HHS to Hold Forum on Drug Costs, Access

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By Brian Broderick

Nov. 3 — Citing the “high and growing” cost of drugs, the HHS is holding a forum Nov. 20 in Washington to discuss pharmaceutical innovation, access and affordability.

The event “will bring together consumers, providers, employers, manufacturers, health insurance issuers, representatives from state and federal government, and other stakeholders,” the Department of Health and Human Services said in a Nov. 3 announcement. The department said the goal is to share information and discuss ideas to “increase access to information, drive innovation, strengthen incentives and promote competition.”

In its announcement, the HHS also said specialty medications represent only 1 percent of all prescriptions but, in 2014, these medications resulted in over 31 percent of all drug spending. A 2015 Congressional Research Service report says that although there is no commonly accepted definition of specialty drugs, “insurers and other health care payers generally characterize them as expensive prescription products requiring extra handling or administration (such as injection or infusion) that are used to treat complex diseases including multiple sclerosis, cancer, and hepatitis C.”

Medicare, Medicaid 

An agenda for the HHS event includes such topics as “Purchasing Strategies & Utilization Management Best Practices.” In that part of the forum, panelists will share approaches to innovative purchasing strategies, identify best practices within these models and discuss how the innovations could be implemented in Medicare and Medicaid, the agenda said. In addition, the forum will include a session to “examine the current and future drug classes that contribute to rising health care costs, as well as the impact of innovative and breakthrough therapies in the pipeline on patient care.”

The announcement comes as the pharmaceutical industry is having to defend its pricing of medications. In a recent interview, Ken Frazier, the chief executive of branded drug giant Merck & Co., discussed pricing and other issues. He said the pricing is “an attempt on our part to balance patient access with the kind of return that we need in order for R&D to be sustainable.”

On Nov. 3, a generic drug industry trade group released its findings that the U.S. health-care system saved a record $254 billion dollars in 2014 from generic drugs. The findings are in “Generic Drug Savings in the United States,” compiled by the IMS Institute for Healthcare Informatics on behalf of the Generic Pharmaceutical Association (GPhA).

The report released by the GPhA said nearly 3.8 billion of the total 4.3 billion prescriptions dispensed in the U.S. in 2014 were filled using generic drugs. “This means that generic drugs now account for nearly nine out of every 10 (88%) prescriptions dispensed in the United States. Yet generic prescriptions account for only 28% of total drug spending,” the report said.

Generic drugmakers haven't been immune from scrutiny on pricing. In August, Allergan plc said its Actavis unit received a subpoena from the Justice Department seeking information on the marketing and prices of its generic drugs, becoming the biggest company yet to draw scrutiny in the government's widening antitrust probe of the industry (13 PLIR 1175, 8/14/15).

Congressional Scrutiny 

Meanwhile, several House Democrats, including Rep. Elijah Cummings (D-Md.), formed an Affordable Drug Pricing Task Force. They plan to announce “meaningful action to combat the skyrocketing costs of pharmaceuticals” at a Nov. 4 press conference, according to a statement.

Cummings has worked with Sen. Bernie Sanders (I-Vt.) on drug pricing issues. Recently, Sanders and Cummings asked Turing Pharmaceuticals LLC for information about the dramatic price increase of Daraprim (13 PLIR 1383, 9/25/15). The drug is the only Food and Drug Administration-approved treatment for a life-threatening infection called toxoplasmosis, when used in combination with a sulfonamide and leucovorin.

In September, Cummings and Sanders introduced legislation in the House and Senate (S. 2023 and H.R. 3513) to address skyrocketing increases in prescription drug prices. The proposed Prescription Drug Affordability Act of 2015 would authorize the secretary of health and human services to negotiate drug prices with pharmaceutical companies to bring down costs in the Medicare Part D prescription drug program. It also includes tougher penalties for drug companies that commit fraud and would ban the practice of brand-name drugmakers paying competitors to keep lower-priced generic substitutes off the market (13 PLIR 1294, 9/11/15).

To contact the reporter on this story: Brian Broderick in Washington at bbroderick@bna.com

To contact the editor responsible for this story: Brent Bierman at bbierman@bna.com

Information on the forum is at https://register.mitre.org/hhs_pharmaceutical_forum/. The forum's agenda is at https://register.mitre.org/hhs_pharmaceutical_forum/forum_schedule.html. The Generic Pharmaceutical Association report is at http://www.gphaonline.org/media/wysiwyg/PDF/GPhA_Savings_Report_2015.pdf.