Fight! Trump kicks off a war of words with the drug lob­by, propos­ing to peg Medicare prices to over­seas rates

Pres­i­dent Don­ald Trump has just fired an­oth­er shot across the bow of the glob­al bio­phar­ma in­dus­try. And the in­dus­try quick­ly fired back in what promis­es to be a live­ly bat­tle over drug prices.

Bioreg­num Opin­ion Col­umn by John Car­roll

Trump’s HHS pro­posed Thurs­day af­ter­noon to drop the cur­rent way that Medicare cov­ers drugs un­der Part B — cal­cu­lat­ing the av­er­age sales price and adding 6% to the providers who man­age the drug sup­ply — and switch to a new sys­tem that pegs US prices against the much low­er rates that have been es­tab­lished by sin­gle-pay­er sys­tems abroad.

With just days to go ahead of the mid-term elec­tion, Trump pro­posed a pi­lot pro­gram cov­er­ing half of the Part B spend, with the gov­ern­ment mov­ing to an av­er­age bas­ket price cal­cu­lat­ed from sin­gle pay­ers abroad at a 20% dis­count per year over 5 years. 

Trump is out to kill a whole flock of birds with one stone. 

First, he’s ac­cused oth­er coun­tries of free­load­ing on the US, ne­go­ti­at­ing ar­ti­fi­cial­ly low­er drug prices cov­ered by a well-doc­u­ment­ed US pre­mi­um. If man­u­fac­tur­ers are held li­able for their for­eign pric­ing, of­ten set af­ter some hard bar­gain­ing that can in­clude a re­fusal to cov­er it at all, they’d be less like­ly to of­fer a deep dis­count abroad. That could pres­sure oth­er coun­tries to pay more.

Sec­ond, he’s promis­ing to sig­nif­i­cant­ly re­duce heavy Medicare spend­ing, lop­ping bil­lions of dol­lars off of drug costs.

And third he’s mov­ing to a new sys­tem that would be­gin to force com­pa­nies to cut prices af­ter re­peat­ed­ly ac­cus­ing them of “get­ting away with mur­der” on drug prices in the US.

In­stead of a con­tro­ver­sial at­tempt to al­low cheap­er drugs to be im­port­ed in­to the US, Trump is say­ing he wants to keep the drugs and im­port the price. In this in­dus­try, that’s rad­i­cal.

Iron­i­cal­ly, the pro­pos­al that Trump came up with fol­lows a sea change in the in­dus­try’s at­ti­tudes to­ward pric­ing in the US, which con­trols the fate of its prof­itabil­i­ty. Start­ing with Pfiz­er, Trump has forced the ma­jors to at least pause their steady march to high­er prices. For many, the prospect of leav­ing their port­fo­lio prices in place would put tremen­dous pres­sure on their promis­es to in­vestors who con­trol their stock prices. And that would leave many to do some­thing they have nev­er done: ef­fi­cient­ly de­vel­op new block­busters in their R&D groups.

You can al­so ex­pect plen­ty of kick­back from the provider side of the equa­tion, who won’t like the new ven­dor sys­tem that would in­sti­tute a new sys­tem with flat fees for man­ag­ing drug sup­plies. For years physi­cians and the groups who rep­re­sent them slap back at changes that could im­pact their in­come by vow­ing to quit Medicare and leave poor pa­tients on their own.

Faced with a pro­pos­al that could start to shift the US to a new ap­proach dic­tat­ed by the sin­gle-pay­er pric­ing sys­tem — the in­dus­try’s night­mare — PhRMA and BIO came out against the pro­pos­al with all guns blaz­ing.

From PhRMA:

The ad­min­is­tra­tion is im­pos­ing for­eign price con­trols from coun­tries with so­cial­ized health care sys­tems that de­ny their cit­i­zens ac­cess and dis­cour­age in­no­va­tion. These pro­pos­als are to the detri­ment of Amer­i­can pa­tients. The Unit­ed States has a com­pet­i­tive mar­ket­place that con­trols costs and pro­vides pa­tients with ac­cess to in­no­v­a­tive med­i­cines far ear­li­er than in coun­tries with price con­trols, and it’s why we lead the world in drug dis­cov­ery and de­vel­op­ment. Amer­i­cans have ac­cess to can­cer med­i­cines on av­er­age about two years ear­li­er than in de­vel­oped coun­tries like in the Unit­ed King­dom, Ger­many and France.

The pro­posed Medicare Part B mod­el would jeop­ar­dize ac­cess to med­i­cines for se­niors and pa­tients with dis­abil­i­ties liv­ing with dev­as­tat­ing con­di­tions such as can­cer, rheuma­toid arthri­tis and oth­er au­toim­mune dis­eases. The ad­min­is­tra­tion’s pro­pos­al will al­so hin­der pa­tient ac­cess by se­vere­ly al­ter­ing the mar­ket-based Medicare Part B pro­gram by re­duc­ing physi­cian re­im­burse­ment and in­sert­ing mid­dle­men be­tween pa­tients and their physi­cians.

BIO’s Jim Green­wood had this to say:

Con­trary to the pres­i­dent’s re­peat­ed promis­es to end ‘for­eign free-load­ing,’ this pro­pos­al em­braces it and ex­ac­er­bates its harm­ful ef­fects. By adopt­ing for­eign price con­trols on the very small num­ber of in­no­v­a­tive med­i­cines that make it to mar­ket, this pro­pos­al will se­vere­ly chill in­vest­ment in new cures and ther­a­pies for Amer­i­ca’s se­niors.

To make mat­ters worse, the pro­pos­al con­tin­ues a trou­bling trend to­wards un­der­min­ing the Medicare Part B drug pro­gram. This pro­gram sup­ports the sick­est, most vul­ner­a­ble Medicare pa­tients and ac­counts for on­ly a small frac­tion of all Medicare spend­ing.  BIO will strong­ly op­pose short-sight­ed and harm­ful changes to a pro­gram that is so vi­tal to the health and well-be­ing of our se­niors.

In­ter­est­ing­ly, the Trump pro­pos­al isn’t be­ing ad­vanced as a rule-change, just a pro­pos­al for dis­cus­sion aimed at at­tract­ing at­ten­tion to an is­sue that plays well with his base of sup­port­ers. Re­pub­li­can law­mak­ers may not sup­port it, but with their fates in­ter­twined with the sen­si­tive pres­i­dent, crit­i­cism will be mut­ed. 

De­moc­rats on the oth­er hand may well leap at the chance to tack­le drug prices with the pres­i­dent.


Im­age: Pres­i­dent Don­ald Trump speaks at the De­part­ment of Health and Hu­man Ser­vices in Wash­ing­ton, DC, on Oc­to­ber 25, 2018 Nicholas Kamm  AFP

George Scangos (L) and Marianne De Backer

Pi­o­neer­ing biotech icon George Scan­gos hands in his re­tire­ment pa­pers — and this time it’s for re­al

George Scangos, one of the all-time great biotech CEOs, says the time has come to turn over the reins one last time.

The 74-year-old biotech legend spent close to three decades in a CEO post. The first was at Exelixis — which is still heavily focused on a drug Scangos advanced in the clinic. The second “retirement” was at Biogen, where he and his team were credited with a big turnaround with the now fading MS blockbuster Tecfidera. And the third comes at Vir, where he traded in his Big Biotech credentials for a marquee founder’s role back on the West Coast, hammering out a Covid-19 alliance with Hal Barron — then R&D chief at GSK — and breaking new ground on infectious diseases with some high-powered venture players.

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Jeanne Loring, director of the Center for Regenerative Medicine (Credit: Jamie Scott Lytle)

A stem cell pi­o­neer sent an ex­per­i­ment in­to space. Pa­tients are the next fron­tier

Last July, Jeanne Loring stood on a dirt road surrounded by Florida swampland and watched as a nearby SpaceX rocket blasted into the sky. The payload included a very personal belonging: cell clusters mimicking parts of her brain.

For more than two decades, Loring has been at the forefront of a stem cell field that always seems on the brink of becoming the next thing in medicine, but has been slow to lift off.

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FDA re­ports ini­tial 'no sig­nal' for stroke risk with Pfiz­er boost­ers, launch­es con­comi­tant flu shot study

The FDA hasn’t detected any potential safety signals, including for stroke, in people aged 65 years and older who have received Pfizer’s bivalent Covid booster, one senior official told members of the agency’s Vaccines and Related Biological Products Advisory Committee (VRBPAC) on Thursday.

The update comes as the FDA and CDC investigate a “preliminary signal” that may indicate an increased risk of ischemic stroke in older Americans who received Pfizer’s updated shot.

FDA cuts off use for As­traZeneca’s Covid-19 ther­a­py Evusheld

The FDA has stopped use of another drug as a result of the new coronavirus variants. On Thursday, the agency announced that AstraZeneca’s antibody combo Evusheld, which was an important prevention option for many immunocompromised people and others, is no longer authorized.

The FDA said it made its decision based on the fact that Evusheld works on fewer than 10% of circulating variants.

Evusheld was initially given emergency authorization at the end of 2021. However, as Omicron emerged, so did studies that showed Evusheld might not work against the dominant Omicron strain. In October, the FDA warned healthcare providers that Evusheld was useless against the Omicron subvariant BA.4.6. It followed that up with another announcement earlier this month that it did not think Evusheld would work against the latest Omicron subvariant XBB.1.5.

In­vestor 'misalign­men­t' leads to tR­NA biotech's shut­ter­ing

A small biotech looking to carve a lane in the tRNA field has folded, an investor and a co-founder confirmed to Endpoints News.

Similar to Flagship’s Alltrna and other upstarts like Takeda-backed hC Bioscience, the now-shuttered Theonys was attempting to go after transfer RNA, seen as a potential Swiss Army knife in the broader RNA therapeutics space. The idea is that one tRNA drug could be used across a galaxy of disorders and diseases.

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#JPM23: What's re­al­ly dri­ving the cost of health­care and drugs in 2023?

Executive Editor Drew Armstrong spoke with PhRMA CEO Steve Ubl, EmsanaRx CEO Greg Baker and ICER President Steve Pearson about how the debate over drug costs has changed (or not) in the last decade, the shifting payer landscape and why there seems to be so little movement on drug rebates. This transcript has been edited for brevity and clarity.

Drew Armstrong:

So first of all, thank you to everybody for being here and for our panel for being here. Incredibly excited to have this discussion on the cost of healthcare and drugs and what’s driving that. We’re here with Steve Ubl, the head of PhRMA. Thank you so much. Steve Pearson from ICER, and Greg Baker from EmsanaRx. I want to start this conversation with a little bit of a personal reminiscence. So about almost 10 years exactly. I was a reporter back in my previous job and I was covering drug pricing and Gilead had just launched their hepatitis C drug and I was having a conversation with another Steve over at Express Scripts and he made some comments essentially about how they intended to launch a price war over hepatitis C therapies.

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Pa­tient death spurs tri­al halt for Ma­gen­ta Ther­a­peu­tics

Magenta Therapeutics is pausing an early-stage clinical trial after a patient died. The death was deemed to be possibly related to its drug, MGTA-117.

The biotech said the pause of the Phase I/II trial is voluntary and gives it time to review all available data before deciding what to do next. It’s also reported the known information to the FDA.

The dose-escalation trial was designed to test whether MGTA-117, an antibody-drug conjugate, could serve as a more targeted alternative to high-intensity chemotherapy as a conditioning agent for cancer patients who are set to receive a stem cell transplant. It recruited patients with relapsed/refractory acute myeloid leukemia and myelodysplastic syndrome.

In a win for Re­gen­eron, No­var­tis' sy­ringe for AMD drug de­clared 'un­patentable'

Regeneron has won a patent case against Swiss pharma giant Novartis over the delivery system for its eye drug Eylea.

The US Patent Trial and Appeal Board ruled that Novartis’ pre-filled syringe for injecting its eye medication Lucentis was “unpatentable” and handed the victory to Regeneron and its AMD drug Eylea.

In the initial complaint in 2020, Novartis alleged to the US International Trade Commission that certain pre-filled syringes for the intravitreal injection, and ultimately Regeneron’s delivery system for Eylea, were infringing on Novartis’ patent. Regeneron filed a petition to review Novartis’ claims in 2021.

'Tis the sea­son: GSK ad­dress­es win­ter virus surges with celebri­ty and in­flu­encer vac­cine aware­ness cam­paigns

GSK is rounding up the usual suspects this winter — flu, respiratory syncytial and even shingles viruses — for multiple marketing efforts all aimed at encouraging vaccinations.

Mom influencers take center stage in its “Flu is a Family Affair” campaign to reach family decision-makers or “chief health officers.” GSK is asking them in the digital campaign to take care of themselves, and take the family along, when they go to the pharmacy or doctor’s office for a flu vaccine.

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