Trade Deal Would Lengthen Biologics Exclusivity

Congress is currently considering a trade bill that would include 12 years of data exclusivity on biologics. The Trans-Pacific Partnership (TPP) is a priority of the President and would set the terms of trade between the United States and 11 other countries. Opponents of the provision fear that this significant period of exclusivity will make medicines unaffordable in poor nations. The pharmaceutical industry argues that this length of time is necessary to recover investment in biologic discovery and development. Compared to market exclusivity, data exclusivity prevents competitors from even starting to develop a drug. In its budgets, the Obama Administration has proposed cutting biologic exclusivity to seven years, citing a potential of $4.4 billion in Medicare program savings. Senate Majority Leader Mitch McConnell (R-Ky.) has stated that he would like to pass the legislation before the end of this week.

Cassidy, Price Reveal Plans to Repeal and Replace the ACA

Rep. Tom Price (R-Ga.) and Sen. Bill Cassidy (R-La.) are the latest Republicans to offer plans for the repeal and replacement of the Affordable Care Act (ACA) in the time leading up to the Supreme Court’s decision in the King v. Burwell case. House Budget Committee Chairman Tom Price’s plan is based on his Empowering Patients First Act, previously introduced during the 113th Congress. His proposal would permanently repeal the ACA, while providing refundable tax credits for the purchase of health insurance following the elimination of federal subsidies. The credits would be based on the recipient’s age and would take into account whether the recipient has children. Individuals would also be provided with a $1,000 tax credit for the purpose of establishing a health savings account (HSA). The contribution limit of HSAs would be raised to match that of individual retirement arrangements (IRAs). Grants to states would aid in the coverage of those with pre-existing conditions through the establishment of high-risk pools. Individuals would also be allowed to opt out of Medicare, Medicaid, and the VA, and instead use tax credits to purchase private insurance. Under Rep. Price’s bill, small business would be able to purchase insurance across state lines. The plan also includes medical liability reform, changing the burden of proof based on physicians following clinical guidelines. Rep. Price has expressed opposition to proposals from Senate Republican leadership to temporarily extend federals subsidies should the Supreme Court rule against the Administration and invalidate that section of the health care law. Sen. Bill Cassidy plans to introduce the Patient Freedom Act later this month, as a part of a two-part Senate Republican response to the King v. Burwell case. After Republicans settle upon how to temporarily assist the 7.5 million federal marketplace enrollees who could lose their subsidies for purchasing health insurance, Sen. Cassidy’s proposal would allow states to receive tax credits for HSAs if they opt out of ACA mandates. The Court’s ruling is expected in late June. The budget resolution sets a deadline of July 24 for each chamber’s Budget Committee to submit a contingency plan in preparation for the Court’s ruling.

House Democrats Urge Medical Device Tax Repeal

Eighteen House Democrats have sent a letter to Speaker John Boehner (R-Ohio) and Minority Leader Nancy Pelosi (D-Calif.) urging advancement of a bill that repeals the ACA’s medical device tax before Memorial Day. Led by Rep. Scott Peters (D-Calif.), the letter warns that the 2.3 percent tax on manufacturers and importers of medical devices is causing companies to cut their research and development budgets, which “jeopardizes advancements in patient care that have the potential to improve outcomes, lower costs, and offer a better quality of life for millions of patients.” Repeal of the tax would cost $26 billion between 2015 and 2024. H.R. 160, the Protect Medical Innovation Act, currently has 277 bipartisan cosponsors

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