Lob­by­ing cam­paign killed pro­pos­al to set price lim­its on fu­ture coro­n­avirus drugs, vac­cines — re­port

As Con­gress be­gan draft­ing the emer­gency, $8.3 bil­lion spend­ing bill to com­bat the coro­n­avirus out­break, De­moc­rats sought to wrap a string around some of that fund­ing.

With $3.1 bil­lion go­ing to sup­port phar­ma­ceu­ti­cal com­pa­nies in their R&D ef­forts against the out­break, pro­gres­sive law­mak­ers want­ed to en­sure that any drugs or vac­cines that emerged from those ef­forts would be priced af­ford­ably, Politi­co re­ports. That cam­paign failed.

The bill Con­gress passed Thurs­day and which now awaits a sig­na­ture from Pres­i­dent Trump on­ly re­it­er­ates ex­ist­ing leg­is­la­tion cov­er­ing fed­er­al ac­qui­si­tions. Pro­gres­sives ini­tial­ly cir­cu­lat­ed lan­guage that would have giv­en the De­part­ment of Health and Hu­man Ser­vices the pow­er to strip in­tel­lec­tu­al prop­er­ty from com­pa­nies that priced their drugs too high. Re­pub­li­cans told Politi­co that De­moc­rats al­so pushed to al­low HHS to set prices and lim­it in­creas­es to the rate of in­fla­tion.

In­stead, af­ter a lob­by­ing cam­paign and suc­cess­ful ef­forts by Re­pub­li­cans, the bill goes the oth­er di­rec­tion. It dic­tates that al­though HHS may take steps to as­sure af­ford­abil­i­ty, It “shall not take ac­tions that de­lay the de­vel­op­ment” of a vac­cine or a drug, tak­ing away a key po­ten­tial point of lever­age.

The De­moc­rats’ pro­pos­al comes af­ter years of rhetoric from the left and from the Trump White House on the need to lim­it drug prices to as­sure greater ac­cess, in­clud­ing a re­cent House bill that would give the fed­er­al gov­ern­ment un­prece­dent­ed abil­i­ty to ne­go­ti­ate costs.

The lan­guage De­moc­rats re­port­ed­ly of­fered this past week, though, is not with­out prece­dent. From 1989 to 1995, the NIH had the abil­i­ty to re­quire “rea­son­able prices” on drugs that were built on dis­cov­er­ies fund­ed by the agency. The law was passed in the wake of a dif­fer­ent out­break, the AIDS epi­dem­ic, when the first se­mi-ef­fec­tive drug AZT — large­ly de­vel­oped through fed­er­al grants — was priced by a com­pa­ny at $8,000 to $10,000 a year.

By 1995, though, NIH di­rec­tor Harold Var­mus was help­ing spear­head an ef­fort to re­peal the law, say­ing it had dis­cour­aged pri­vate com­pa­nies from work­ing with the NIH and its sci­en­tists.

Stéphane Ban­cel

Some of the biotechs and phar­ma com­pa­nies lead­ing the re­sponse have an­tic­i­pat­ed crit­i­cism over pric­ing. Mod­er­na CEO Stéphane Ban­cel told Busi­ness In­sid­er this week that “there is no world, I think, where we would con­tem­plate to price this high­er than oth­er res­pi­ra­to­ry virus vac­cines.” Among the most ex­pen­sive res­pi­ra­to­ry vac­cines is one for pneu­mo­nia, priced at $800 for 4 shots. Ban­cel said they were un­like­ly to set a cost that high.

Crit­ics of such pro­pos­als ar­gue they lim­it drug com­pa­nies’ in­cen­tives to re­spond to a cri­sis, de­lay­ing the de­vel­op­ment of po­ten­tial­ly life-sav­ing vac­cines and ther­a­peu­tics.

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