Industry groups weigh in on HHS' drug price blueprint

President Donald Trump
The comment period for the Trump administration's drug pricing blueprint ended Monday. (The White House)

Organizations from across the healthcare industry weighed in on the Trump administration's drug price blueprint in time for a Monday deadline.

In May, the Department of Health and Human Services issued a request for information shortly after President Donald Trump unveiled his administration's "American Patients First" plan to lower drug prices. In the policy blueprint, the White House proposed changes to Medicare drug benefits to lower costs, an increased focus on drug market competition, and a focus on "foreign freeloading," which the president blamed for driving up prices.

The plan received plenty of reactions from across the healthcare spectrum, from patient advocacy groups to the drug industry to pharmacy benefit managers and hospitals.

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Here's a look at the range of feedback submitted on the drug blueprint: 

  • The Community Oncology Alliance warned in a letter to HHS, which was provided to FierceHealthcare, that plans to move certain medications from Medicare Part B into Part D would "increase the roles, leverage and power of third party middlemen." The group added, "Instead, we call for efforts to curb abuses by [pharmacy benefit managers] and to fix the broken 340B drug discount program such that patients in need benefit from 340B savings, not hospitals' bottom lines," the alliance wrote. 

RELATED: House subcommittee debates need for 340B oversight amid host of new bills 

  • PBMs and the 340B program have both been frequent targets of criticism as policymakers and stakeholders debate ways to address the rising costs of drugs. The leading pharmaceutical industry group—the Pharmaceutical Research and Manufacturers of America (PhRMA)—also took aim at PBMs in its comments. PhRMA pushed for what it called a "bold new stance" on drug rebates in its letter to HHS. It suggested that the agency "de-link" the supply chain from list price and push the system toward one where PBMs no longer calculate their fees based on a drug's list price.

    It also said that regulators should ensure that savings from drug rebates are used to lower drug cost sharing for patients.

    "Pharmacy benefit managers and other entities in the supply chain have incentives to favor medicines with high list prices and rebates," PhRMA said. "This hurts patients and increases costs, and we believe it must change."

    PhRMA also said that policymakers should revisit the 340B program and "strengthen" it, as recent research indicates "hospitals are taking advantage" of its discounts.

RELATED: Through spat with PBMs and insurers, pharma deflects drug-price scrutiny 

  • The Pharmaceutical Care Management Association, the largest trade organization for PBMs, wrote in its response to the RFI that rebates must "remain a viable option" for PBMs, as they are "currently the only proven way for PBMs to negotiate lower drug costs." 

    Instead, PCMA said that a focus on policies promoting greater competition in drug markets is more likely to lead to lower costs than eliminating rebates or shaming pharmaceutical companies for list prices. PCMA and PBMs would be "open to any idea that could use a market-based approach to lower drug costs," the group said.

    "Recognizing there have been proposals to change the current rebating system, we have yet to see a viable, market-based proposal that would take as much cost out of brand drug spending as negotiated rebates do today," PCMA said.

RELATED: Trump's drug pricing plan pushes for increased price transparency, greater use of generics 

  • 340B Health, a group that includes more than 1,300 hospitals enrolled in the drug discount program, wrote in its comments (PDF) that 340B is a crucial tool for safety-net providers that treat low-income patients, and significant changes to the program could hinder those providers' abilities to treat patients in need. Plus, 340B hospitals are not responsible for setting list prices for drugs—pharmaceutical companies are, the group wrote. 

    "The notion that the 340B drug discounts are driving prices up is not supported by the facts," 340B Health said. "Under our current regulatory system, the only institutions that set drug prices and raise them are the manufacturers based on what the market will bear." 

    The group said that policymakers should instead implement the long-delayed 340B rule that sets price ceilings and civil penalties to drugmakers that knowingly overcharge hospitals. HHS delayed the rule for the fifth time in June, pushing off its implementation until July 2019. 

RELATED: Hospital groups urge HRSA to implement 340B final rule 

  • The American Hospital Association said in its comments (PDF) to HHS that pharmaceutical companies are "inappropriately" blaming 340B for rising drug prices to divert attention from their own price increases. "This is a blatant attempt to divert attention away from their decisions to set and raise drug prices at higher and higher levels, contributing to double-digit margins," AHA said.

    AHA also warned that changes to the program could harm safety-net hospitals, and echoed 340B Health's call for HHS to enforce the price ceilings rule. 

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