NAFTA Revision, H.R. 1865, and Biologics (Pharma) Switcheroo

Sigh . . .

If the general public has not caught it, there are some of us who watch the political mechanizations by commercial healthcare to improve their lot in Congress. I know the public has not caught this switcheroo in Congress causing them to look good (and boast of it) in removing new drug exclusivity from NAFTA. What we have missed is it was granted in H.R. 1865 instead and for a longer period of time to boot. Read on to see how this was accomplished.

Addressed to Congresswoman Elissa Slotkin:

The Good:

Yes with the revision of NAFTA, Democrats “removed a provision giving the makers of ultra-expensive biologic drugs 10 years of protection from less expensive knockoffs. This is up from 5 years.

Democrats opposed what they called a giveaway to the industry locking in inflated prices by stifling competition. Top examples of the injected drugs made from living cells include medications to fight cancer and immune disorders such as rheumatoid arthritis. This legislation impacted drugs such as Rituxan, Humira, and Enbrel. Humira and Rituxan being two of the more expensive drugs on the market which have incurred pricing increases exceeding twice Medical CPI. From January 2012 to December 2017, Humira experienced price increases of 124%. Rituxan which I use from time to time is right behind Humira in cost.

The Bad:

Recently finished up an article on the prices/costs of healthcare and the resulting increases in Healthcare Insurance and deductibles whether it be Employer, ACA, or Medicare/Medicaid. House Bill H.R. 1865 was passed in the Senate and one of the few to make it through the Senate. It was the 2020  budget bill coming out of the House, altered by the Senate and altered by the House and finally passed by the Senate.

Besides repealing the Cadillac tax and the Medical Device tax which were never implemented and the Healthcare Insurance tax which was implemented; the bill also included (page 1503) a phrase to include “chemically synthesized polypeptides,” medicines such as Novo Nordisk’s Victoza. While it is only for new drugs and not drugs newly deemed to be Biologics such as Humulin and Humira, it is similar to what was removed from the NAFTA bill, is 12 years long for exclusivity, and it is still a huge and similar give away to Pharmaceutical companies the same as what was in the NAFTA revisionary bill.

And The Ugly:

The reasoning for the designation is to give companies a chance to bring new and cheaper bio-similar drugs to market. Ok fine bringing a drug to market, risk adjusted costs can be recouped in 5 years for the most expensive drug such as Humira and Rituxan as detailed by the recent World Healthcare Organization Technical Report on Cancer Drugs. With anywhere from 50% increases to a doubling of prices over a two year period (JAMA Network Open), Pharma does not need legislative incentives through extended exclusivity to be creative and profitable.

References:

Generic Drug Groups See Giveaway to Brand Names in Spending Bill, Bloomberg Law, Alex Ruoff and Jaquie Lee, December 19, 2019

THE HOUSE AMENDMENT TO THE SENATE AMENDMENT TO H.R. 1865, Appropriations Act, 2020, Page 1503, December 16, 2019

TECHNICAL REPORT Pricing of cancer medicines and its impacts, World Health Organization

run75441 (Bill H)

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