PBMs play defense on the Hill

Presented by Kaiser Permanente

With Katherine Ellen Foley, Carmen Paun and Megan R. Wilson

Driving the Day

PBMs BRACE FOR IMPACT — Pharmacy benefit managers, which negotiate rebates on drugs with pharmaceutical companies and decide which medicines insurance plans will cover, are preparing for a congressional bashing, Megan writes.

Lawmakers have become increasingly interested in PBMs, with some on Capitol Hill saying they aren’t transparent enough about how they operate and are incentivized to favor expensive drugs.

Multiple committees in the House and Senate have begun to focus on PBMs — and the Senate Finance Committee wants to have a bipartisan PBM bill by the summer. Yesterday, the Senate HELP Committee announced it would mark up a 91-page bill next week that takes aim at their business practices.

And today, the House Energy and Commerce Health Subcommittee is holding a hearing about transparency and competition in health care that puts a spotlight on industries, including PBMs. Kristin Bass of the industry’s trade association, the Pharmaceutical Care Management Association, is testifying.

PCMA CEO JC Scott told Megan that his group will continue its aggressive campaign to convince lawmakers that PBMs help lower drug costs — countering millions of dollars of lobbying and advertising from big drugmakers.

Scott worries that Congress is having a “knee-jerk reaction” to skepticism of the industry, even though PBMs are already making changes to respond to criticism.

What now? Policymakers on the state and federal levels still feel improvements can be made to the system, and Congress seems intent on moving some sort of PBM-related legislation.

Several lobbyists told Megan that the Senate health panel’s offering could be included in a larger drug-pricing package that Senate Majority Leader Chuck Schumer wants, the overall composition of which is still an open question.

WELCOME TO WEDNESDAY PULSE. If you’ve been stockpiling Claritin-D, Flonase and Kleenex, you’re not alone. This is a beast of an allergy season, and here’s why. Send your best old-school remedies (tea tree oil and steam!), news and tips to [email protected] and [email protected].

TODAY ON OUR PULSE CHECK PODCAST , host Megan Messerly talks with Erin Schumaker about hospitals that want an exemption from an FTC proposal to ban noncompete agreements, saying it would wreak havoc on their finances and harm patients, and what a ban’s potential consequences could mean for patients, doctors and investors.

In Congress

CBO WEIGHS IN ON PROPOSED MEDICAID WORK REQUIREMENTS — Budget forecasters estimate the House Republicans’ proposal to establish new work requirements for Medicaid and expand work requirements for the Supplemental Nutrition Assistance Program and Temporary Assistance for Needy Families programs as part of their plan to raise the debt limit would reduce federal spending by $120 billion between 2023 and 2033.

Here’s the breakdown, according to the Congressional Budget Office:

For Medicaid, the plan would reduce spending by $109 billion. CBO estimates about 1.5 million adults, on average, would ultimately lose federal funding for their Medicaid coverage; of those, roughly 900,000 individuals would stay on state-funded Medicaid programs and 600,000 would become uninsured.

For SNAP, the plan would reduce direct spending by $11 billion. CBO estimates some 275,000 people, on average, would lose benefits each month and another 19,000 would receive smaller monthly benefits under the plan. It would reduce spending by $6 million for TANF.

Around the Agencies

FDA GREENLIGHTS NEW ALS TREATMENT — Biogen said Tuesday that the FDA granted accelerated approval to Qalsody, a spinal injection that treats amyotrophic lateral sclerosis in patients with a specific mutation. The FDA estimates that fewer than 500 people are living with this form of ALS.

Last month, an independent panel of expert advisers to the FDA voted in favor of the drug’s accelerated approval on the grounds that it reduced levels of neurofilament light, a chemical in the blood associated with neurological damage. The experts said a decrease in this protein would likely slow the progression of the disease, which often kills patients within five years of receiving a diagnosis. Biogen is conducting its required Phase III clinical trial to confirm Qalsody’s benefit to patients.

What’s next: Biogen said it would release Qalsody’s cost later this week and it would be priced “within a range comparable to other recently launched ALS treatments.” Relyvrio, an ALS treatment from Amylyx Pharmaceuticals approved last September, costs $158,000 annually.

The company also said Qalsody will be available for health care providers and patients as early as next week.

global health

US MALARIA INITIATIVE TO EXPAND — The President’s Malaria Initiative is set to expand to three additional countries in Africa thanks to a $20 million increase in funding in this year’s fiscal budget, Carmen reports.

The expansion to Burundi, The Gambia and Togo will be the first since 2017 and would bring the total number of countries the initiative supports to 30. Most countries that benefit from the initiative, which has a nearly $800 million budget this year, are in Africa.

The expansion would allow the initiative to continue reducing malaria cases and deaths and close regional gaps, David Walton, the U.S. global malaria coordinator, told Carmen.

The initiative, hosted by the U.S. Agency for International Development and in partnership with the CDC, delivered some 50 million mosquito nets, nearly 95 million rapid diagnostic tests and 80 million malaria medicines in the 2022 fiscal year, according to a report sent to Congress on Tuesday.

Critical context: The World Health Organization estimated that there were 247 million new cases of malaria in 2021, mostly in Africa, which also saw most of the deaths. Most of the nearly 600,000 deaths in Africa in 2021 were in children younger than 5, according to the WHO.

The program also helps countries prepare to roll out a new malaria vaccine, which is expected to start in 2024.

SPEAKING OF VACCINES … More than 25 million kids worldwide missed at least one routine vaccination in 2021, according to WHO — a slide that a new public health campaign is trying to reverse during World Immunization Week this week.

This week, leading global health organizations, including WHO, Gavi and UNICEF, announced “The Big Catch Up,” a global effort to get children up to date on their routine vaccinations. As millions of kids missed their shots during the pandemic, outbreaks of vaccine-preventable diseases, including measles, polio and yellow fever, have become more prevalent and severe.

The campaign will focus on the 20 countries that are home to three-quarters of the children who missed routine vaccinations in 2021, including Afghanistan, Brazil, India, Indonesia, Nigeria and Mexico.

In the States

FLORIDA LAWMAKERS GO AFTER AAP — A GOP-led Florida House panel authorized subpoenas Monday seeking records from two medical organizations that support gender-affirming treatment for minors, POLITICO’s Arek Sarkissian reports.

The state House Committee on Health and Human Services approved subpoenas demanding records from the Florida chapter of the American Academy of Pediatrics and the Florida Psychiatric Society — two organizations that are party to a federal lawsuit seeking to overturn state regulations that ban Medicaid from covering gender-affirming care for minors.

The subpoenas are the committee’s first step toward investigating how medical organizations established the care standards that say surgeries and hormone therapies are safe treatments for gender dysphoria, or the feelings of discomfort or distress some transgender people experience when their bodies don’t align with their gender.

Key context: Earlier this month, the Florida Senate approved a proposed ban on surgeries and prescription treatments for children diagnosed with gender dysphoria. The legislation would also prohibit universities, local governments, the health insurance plans for state workers and providers contracted with the state’s Medicaid managed care program from using public dollars to cover the treatments.

The Florida House hasn’t approved the Senate’s measure.

Names in the News

Narayanan “Nari” Gopala is now chief digital officer for Kaiser Foundation Health Plan and Hospitals at Kaiser Permanente.

Jessica Hatcher is joining Invariant, where she will advise clients on issues from prescription drug prices, price transparency and supply-chain challenges to the regulation of artificial intelligence. Hatcher most previously served as legislative director for Rep. Jake Auchincloss (D-Mass).

AFP reports that British American Tobacco has agreed to pay $600 million to settle charges that it sold cigarette materials to North Korea for years in violation of U.S. sanctions.

The Wall Street Journal reports on a new study that 22 in 25 melatonin gummy brands contained more melatonin than their label disclosed — in one case, nearly 350 percent more.