Politics & PDUFA

Jan 01, 2011

Jill Wechsler
Everyone is preparing for a bumpy ride this year in Washington. The conventional wisdom is that President Obama has a year to enact new legislation before the political infighting becomes even more intense leading up to the 2012 presidential election. But the political tensions created by last November's mid-term elections make gridlock more likely. Congressional Republicans will seek to cut the federal deficit by squeezing budgets at government agencies. Pressure to find more resources will intensify federal efforts to levy stiff fines on rule-breaking pharma companies and to impose higher user fees on industry. Challenges to the Obama administration's health reform program will create uncertainties about whether new fees and policies will be implemented as planned, or if manufacturers will have to pay stiffer rebates and taxes without gaining the millions of additional customers promised by a reformed health insurance system.

One certainty is that Republican Congressional leaders will spend considerable time and energy grilling Obama administration officials on reform shortcomings. A Senate Finance Committee hearing during last November's lame duck Congressional session was short and fairly friendly to Donald Berwick, administrator of the Centers for Medicare and Medicaid Services (CMS). But House leaders will not be so gentle in the coming months.

A prime Republican target is the Independent Payment Advisory Board (IPAB). It was established by the Affordable Care Act (ACA) to propose cost-cutting policies for Medicare under procedures that limit Congressional oversight and legal review. But pharmaceutical companies, as well as insurers, providers, and even consumers are leery that IPAB will cut costs arbitrarily and will require seniors to pay more.

Despite these obstacles, a number of reform initiatives are moving forward. CMS is publicizing additional preventive care benefits for seniors, while the IRS has crafted a process to calculate hefty new taxes on pharma companies required by the ACA. FDA is examining a host of policy issues related to developing biosimilars, including standards for product naming and interchangeability and what falls under the definition of "publicly available information." And the governing board for the Patient Centered Outcomes Research Institute (PCORI) held its first meeting last November and plans to assess what research is going on in this field and what information gaps it can fill with early projects that can illuminate PCORI's role.

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