Presented by the Partnership for America’s Health Care Future
With help from Susannah Luthi, Brianna Ehley, Darius Tahir, Rachel Roubein, and Joanne Kenen
— FDA is modernizing tech for a wave of new therapies, says Principal Deputy Commissioner Amy Abernethy.
— House lawmakers urge FDA action on Chinese drug importsamid growing dependence on basic ingredients from the country.
— CMS Administrator entertains idea of value-based drug prices, but worries about industry gaming.
Happy Friday and welcome back to Prescription Pulse! Did you see any good health-themed Halloween costumes Thursday? We’d also settle for pictures of your frustrated pets. And as always, send pharma tips and news to Sarah Owermohle (firstname.lastname@example.org or @owermohle)and Sarah Karlin-Smith (email@example.com or @sarahkarlin).
FDA’S ABERNETHY WANTS TO MODERNIZE THE AGENCY’S TECH — AND ITS CBD REGULATION — Amy Abernethy, who became principal deputy commissioner at FDA nine months ago, is digging in on tech goals. Since December, when she spoke with POLITICO after taking the job and preparing to leave electronic records company Flatiron Health, Abernethy has also been named acting chief information officer and has begun an overhaul of FDA’s tech infrastructure.
“When we talked last year around my priorities, I was talking about personalized medicine and real-world evidence and patient data,” she told Sarah Owermohle on the sidelines of the HLTH conference. “When I got to the agency it was like ‘Whoa, wait a second;’ in order to get over there we need to step back and do a couple of things.”
Abernethy became acting CIO “because it became clear that the first thing we needed to do was get our house in order from a technical perspective” to be ready for the wave of real-world data and digital health products on the way, she said. That is where the technology modernization plan announced last month comes in. It’s going to take 12 to 18 months to “really push it forward” but within six months the project should enter its next phase, “which is, if we can get the technology in place, then let’s focus on the data.”
And yes that includes AI. The agency is thinking about the wide variety of technologies, ranging from those that FDA currently oversees, like glucose monitors, to fast-growing fields adjacent to FDA’s jurisdiction, like AI that helps curate data or does patient matching.
And FDA needs to bring its own infrastructure and AI abilities up to speed, Abernethy said. “That first of all allows us to scale and do work faster, but also practically speaking, it means that with those solutions we learn how to think about our regulation of AI products.”
Also: The CBD genie is out, but it isn’t risk-free.An agency update on its plans for regulating CBD is still on track for this fall — but in the meantime, people need to understand the booming product isn’t totally safe, Abernethy said. The country will have to come to grips with how much risk it is willing to tolerate from CBD. In the meantime, FDA will be talking about what kinds of decisions it can make while awaiting definitive information, she said.
FDA is catching up to a booming market. “This was a genie that came way out of the bottle faster than anybody could get their head around,” Abernethy said. CBD “hits across every single kind of product that we regulate” from drugs to dog food and vapes — which makes it that much harder to build a sweeping framework.
Consumers assume it’s a risk-free substance — and that’s a problem. “It’s easy to think we have time, people are going to make good decisions while we are figuring it out,” Abernethy said, but “in the agency there is a lot of urgency. Because people are making a lot of very divergent decisions.”
Among the risks, potential liver damage showed up in clinical trials for the only approved CBD-based drug, epilepsy therapy Epidiolex. But Abernethy said there is evidence that marijuana products including CBD also could impact male fertility. There’s “lots to sort out,” she said.
ICYMI: WHITE HOUSE AIDE SAYS TO ABANDON PELOSI PLAN, MAKE SENATE BILL CHANGES — The White House wants bipartisan buy-in on drug pricing legislation but is willing to sacrifice a key Democratic provision in a Senate Finance Committee plan to firm up Republican support, domestic policy adviser Joe Grogan told POLITICO.
Chairman Chuck Grassley and Sen. Ron Wyden, the panel’s top Democrat, have touted their bill, S. 2543 (116), as the bipartisan answer to drug costs. But Republicans hate a Democrat-led provision to cap Medicare Part D price hikes at inflation; nine lawmakers voted against the measure in committee.
… Grogan cited several concerns with House Speaker Nancy Pelosi’s bill to let the government negotiate the prices of certain drugs: “I admire the ambition, but I don’t know how you’re going to get it through. It might be time to start thinking about [the Senate Finance bill].”
A Pelosi spokesman hit back: “President Trump used to insist that we needed to ‘negotiate like crazy’ to lower prescription drug prices, and House Democrats’ legislation is the only bill that includes negotiation,” said Henry Connelly.
SENATE COMMITTEE APPROVES OVER-THE-COUNTER REVAMP — The Senate HELP Committee on Thursday advanced legislation to boost FDA oversight of the burgeoning over-the-counter drug market as part of a package of eight health bills. S. 2740 (116), is the latest effort from Sens. Johnny Isakson (R-Ga.) and Bob Casey (D-Pa.) to bring the first major changes to federal oversight of the OTC sector in four decades.
The bill would authorize a five-year, multimillion-dollar user fee program at FDA, allowing the agency to hire dozens of new staffers to oversee the industry, which generates about $32 billion in revenues a year.
Burr still resisting the bill. The measure passed by voice vote, though North Carolina Republican Richard Burr, who was not present, asked his vote to be recorded as a no. Burr had put a hold on the legislation in the last session because he opposes expanding FDA’s user fees. The House meanwhile passed it several times, most recently this January.
HOUSE LAWMAKERS URGE ACTION ON CHINA DRUG VULNERABILITY— Democratic and Republican alike expressed concern Wednesday about U.S. vulnerability to a sudden cut-off of supplies of drugs and pharmaceutical ingredients from China, Doug Palmer reports. They also raised questions, at an E&C health subcommittee hearing, about the potential dangers such products pose for Americans.
Basic drug production is increasingly occurring overseas, Janet Woodcock, director of the FDA’s Center for Drug Evaluation and Research, told the panel. Since the 1990s, many drug production facilities have moved off the U.S. mainland, migrating first to Puerto Rico, because of incentives created by Congress, and then to India and China. That “creates a significant risk for national security, not just for our military, but for all our citizens,” Woodcock said.
… While the U.S. only imports about $3 billion in finished pharmaceuticals from China annually, the country plays a much bigger role in producing “active pharmaceutical ingredients,” or APIs, the medicines that go into products. The United States currently has about 28 percent of the world’s production facilities for APIs while China has 13 percent — but that doesn’t reflect the actual volume being produced each place, Woodcock said
“If tensions with China escalate, Beijing could use U.S. dependence for critical drugs as an economic weapon and exploit the health and safety of our armed forces,” said Rep. Anna Eshoo (D-Calif.), the panel’s chair.
… Trade talks could have an impact. President Donald Trump hopes to sign a “phase one” trade agreement with China in coming weeks to resolve some of the concerns that prompted him to impose duties on more than $350 billion worth of Chinese goods, Doug writes. So far, Trump has not imposed tariffs on finished drugs from China — partly because of the administration’s concern about boosting U.S. drug prices.
SENATE CLEARS FUNDING BILL — The Senate cleared a minibus spending bill Thursday, which includes 2020 appropriations for FDA. H.R. 3055 (116), would provide FDA with $3.25 billion in discretionary funding, $185 million above 2019. Including revenue from user fees, total agency funding would be $5.85 billion.
But don’t expect this to get signed into law anytime soon. Lawmakers are currently fighting over how to fund many other parts of the government, including most of HHS. Current government funding lasts through Nov. 21 and another short-term continuing resolution is expected as lawmakers worked to reach agreement on the rest of the appropriations bills. It’s likely the funding fight won’t be resolved until 2020.
SEEMA VERMA’S ONE CONCERN WITH VALUE-BASED PRICING — CMS supports the effort to experiment with paying for drugs based on how effective they are, Administrator Seema Verma said during at panel at the Milken Institute Future of Health Summit. But she warned that it could lead to higher launch prices. “We should be cautious on this.”
“Manufacturers, if they understand that we’re going to give you a discount if the drug didn’t work or you don’t have to pay if the drug didn’t work, then that gets built into the base cost of the drug.”
CMS PROPOSES EXPANSION OF NEXT-GEN SEQUENCING — CMS released a new decision memo proposing to open up reimbursement for genomic testing in new forms of cancer.
In March 2018, the agency decided to reimburse tests for patients with advanced cancer. The new proposal would consider reimbursement for patients with ovarian or breast cancer, plus risk factors for inherited cancers, which can require changed management of the disease, the agency says. It would also cover FDA-approved tests regardless of cancer stage. The agency has opened up a 30-day public comment period.
ANOTHER REASON PATIENT GROUPS MAY BE STEERING CLEAR OF DRUG PRICING — It’s often been noted that many disease and patients groups keep silent about access to medicines and drug pricing — presumably because they rely on drug industry donations.
We spotted another, less talked-about trend this week: patient and disease groups’ investment in drug companies. For example, BrightEdge Ventures is a charitable arm of the American Cancer Society that invests in for-profit companies to advance cancer therapies. Disease and patient groups that are hoping for a handsome return on their funding of drug companies may be less hesitant to support policies that could hurt their stocks and profits.
At a panel discussion POLITICO’s Rachel Roubein attended at the Milken Institute Future of Health Summit this week, Bob Crutchfield, managing director of BrightEdge Ventures, acknowledged that raising money for philanthropic drug discovery can be tricky due to an underlying tension from potential big donors. They want to “do good,” but not necessarily “do good to help others do well” financially, he said.
MCKESSON TELLS INVESTORS TO BUCKLE UP— They may be in for a long, hard haul with thousands of unresolved opioids lawsuits. This week the firm’s CEO Brian Tyler warned that a global settlement could still be a long way off, Susannah Luthi writes.
“The litigation process if necessary will be costly and can take many years to conclude causing a significant and substantial delay to crisis mitigation efforts,” Tyler told investors Wednesday. The firm will continue to defend itself against the “mischaracterization that our company drove the demand for opioids in this country,” he added.
Just last week, McKesson joined three other companies in a $215 million settlement with two Ohio counties — a deal that released them from the bellwether trial that was supposed to take place Oct. 21.
McKesson’s share of the settlement was $82 million. So far, plaintiff communities have withstood pressure from the federal judge presiding over most of the consolidated lawsuits to reach a comprehensive agreement. Tyler said he’s optimistic they’ll reach a deal, but “there are many details and variables that remain open and still need to be addressed.”
MACPAC: NUMBER OF BUPRENORPHINE PRESCRIBERS INCREASED AFTER CARA — A forthcoming MACPAC analysis shows the number of specialists prescribing buprenorphine to treat opioid addiction has increased since enactment of the Comprehensive Addiction and Recovery Act. So has the number of people receiving the medicine, Brianna Ehley reports. The legislation contained a provision expanding buprenorphine prescribing authority to nurse practitioners and physician assistants.
The findings, presented Thursday during a Medicaid and CHIP Payment and Access Commission hearing, showed the number of providers prescribing buprenorphine increased 12.2 percent between July 2017 and June 2018. During that time period, the number of NPs prescribing buprenorphine increased by 78.8 percent and the number of PAs prescribing that drug jumped by 48.8 percent.
UNIVERSAL FLU VACCINE? NOT SO FAST — The Kaiser Family Foundation hosted a group of journalists (including two POLITICOs) in North Carolina to learn about health policy there — with a fascinating bonus visit to the Duke Human Vaccine Institute, which is working on a universal flu vaccine. The scientists at the center, which does research but could also manufacture an experimental vaccine and start Phase 1 clinical trials, explained that a “universal” flu vaccine is still aspirational. A much better, longer-lasting flu vaccine that covers more strains of flu may be within reach, however.
“We will attack this in stages,” said Tony Moody, the principal investigator on the project. A flu vaccine that is “even modestly better” than the current vaccines will have a “big impact” on human health, added Emmanuel Walter, who will help run the trials.
In addition, some of the basic science that the research team is doing could also help companies working on better medications for flu.
Former FDA Commissioner Scott Gottlieb was named to the board of director for Tempus, a precision medicine-focused artificial intelligence company.
FDA released draft guidance for electronic submissions of certain adverse event reports for new drugs being evaluated by FDA.
FDA issued a safety communication on risks of endovascular grafts based on real-world data.
The National Academies published a report on the convergence of infectious and non-communicable diseases, based on a recent public workshop.