In Congress, committee chairmen are known as the old bulls for a reason: it's unwise to provoke them. So it isn't often that you see one get rolled by his own committee — especially when the chairman in question is the formidable and canny Henry Waxman and the issue in question is one that matters a lot to him. But that was what happened on July 31 as the House Energy and Commerce Committee was putting the final touches on health-reform legislation. Waxman's fellow California Democrat Anna Eshoo offered a last-minute amendment that Waxman opposed. Knowing he would lose, Waxman decided to save face with a quick voice vote. But Eshoo insisted on a roll call, which would put every member on record. Waxman snapped at her, "You promised you wouldn't do that!" The final tally was 47-11 against the chairman. (Read "Understanding the Health-Care Debate: Your Indispensable Guide.")
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Waxman's loss that day was a big victory for drug companies, which have spent more than any other segment of the medical industry to make sure that they come out winners in the effort to overhaul the nation's health-care system. It's understandable the drugmakers would want a roll-call accounting of who their friends and enemies are, considering the size of the investment they are making on Capitol Hill: in the first six months of this year alone, drug and biotech companies and their trade associations spent more than $110 million — that's about $609,000 a day — to influence lawmakers, according to figures compiled by the nonpartisan watchdog group Center for Responsive Politics. The drug industry's legion of registered lobbyists numbers 1,228, or 2.3 for every member of Congress. And its campaign contributions to current members of Waxman's committee have totaled $2.6 million over the past three years. (See 10 players in health-care reform.)
The return on that investment has been considerable, both in the House and in the Senate. "We've done very well," says lobbyist Jim Greenwood, a former Republican Congressman from Pennsylvania who was a member of the Energy and Commerce Committee and now heads the Biotechnology Industry Organization (BIO). "We carried a majority of the Democrats and a majority of the Republicans in each of the committees, and by very clear margins."
Whether the broader public is benefiting from the industry's success is less clear. How Greenwood's group has scored decisive early victories on an obscure but crucial health-care provision is a case study in how interest groups are shaping the contours of health-care reform — and why that's not necessarily good news for consumers.
The Generic Nudge
The question before Waxman's committee last summer was this: How many years of monopoly protection should be afforded to biotechnology drugs, known as biologics, before cheaper alternatives are allowed on the market? These miraculous drugs — which differ from traditional, chemical-based pharmaceuticals because they are derived from living matter — are widely regarded as the future of the pharmaceutical industry and, indeed, of medicine itself. While only 20% of drugs on the market today are biologics, it is expected that, with 633 biotechnology medicines in development last year for more than 100 diseases, half the new drugs approved in 2015 will be. Biologics average more than 20 times the cost of traditional drugs: treating breast cancer with a year's worth of the biologic Herceptin can cost $48,000; Remicade, for rheumatoid arthritis, can cost $20,000 annually. For other, rarer diseases, the price of biologic treatments can be as high as $200,000 a year.As policymakers look for ways to control health-care costs, the price of biologics is drawing more and more scrutiny. The obvious model for bringing in competition is a 1984 law that Waxman wrote with Republican Senator Orrin Hatch. It lowered the regulatory obstacles that prevented generic drugs from making their way to market. At the time, it was expected that fast-tracking the approval of "bioequivalent" drugs would bring down medical costs by $1 billion a year. But with generics now accounting for more than 70% of prescriptions dispensed in the U.S., "the actual savings have exceeded our wildest expectations," Waxman said in a Sept. 18 speech before the Generic Pharmaceutical Association. "In the last decade alone, generic drugs have saved consumers, businesses and state and federal governments $734 billion."(See TIME's health and medicine covers.)
Can a similar approach work with biotechnology drugs, which were not dealt with in the 1984 law because the industry was then in its infancy? A 2008 analysis by former Clinton Administration official Robert Shapiro, who has consulted for both biologics companies and their would-be generic competitors, suggested that generic versions of the top 12 categories of biologics whose patents have expired or will expire soon could save Americans up to $108 billion in the first 10 years and as much as $378 billion over two decades. "It's the low-hanging fruit," says Mark Merritt, head of the Pharmaceutical Care Management Association, the trade organization for prescription-drug-benefit managers. "If you can't get this right on cost control, what can you get right?"
But there's a dilemma: policymakers want to foster cost-saving competition without killing the financial incentives that have put the U.S. biotechnology industry at the vanguard of medical science and without stifling the development of even more drugs that could save lives and eliminate suffering. Finding that equilibrium goes to the question of how long biotech firms should be guaranteed exclusivity, outside the protection of their patents, before copycats can begin using the data they have developed.
Sunday, October 25, 2009
How Drug-Industry Lobbyists Got Their Way on Health Care - TIME
via time.com
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