Texas v. United States (An ACA Ruling)

Lanton Law has been both monitoring and advising clients on a controversial case winding through the federal courts called Texas v. United States, which focused on the constitutionality of the Affordable Care Act (ACA). 

On December 18, 2019 the industry witnessed the U.S. Court of Appeals for the 5th Circuit issue its ruling, which found that while the individual mandate is unconstitutional, the federal district court must decide on whether the remaining portion of the ACA could remain intact. The previous federal district court ruled that the ACA’s individual mandate is no longer considered a tax, meaning that Congress does not have a constitutional authority to enforce the individual mandate. Ultimately the district court stated that since the mandate was not a severable provision from the rest of the ACA, the remainder of the ACA was thus unconstitutional.      

In contrast, the U.S. Court of Appeals for the 5th Circuit reasoned:     

“First, there is a live case or controversy because the intervenor-defendant states have standing to appeal and, even if they did not, there remains a live case or controversy between the plaintiffs and the federal defendants. Second, the plaintiffs have Article III standing to bring this challenge to the ACA; the individual mandate injures both the individual plaintiffs, by requiring them to buy insurance that they do not want, and the state plaintiffs, by increasing their costs of complying with the reporting requirements that accompany the individual mandate. Third, the individual mandate is unconstitutional because it can no longer be read as a tax, and there is no other constitutional provision that justifies this exercise of congressional power. Fourth, on the severability question, we remand to the district court to provide additional analysis of the provisions of the ACA as they currently exist.”

 So what happens next?

First the status quo remains for now as the individual mandate has been repealed by Congress. And while it is anticipated that the U.S. Supreme Court will have a say again on this issue in 2020, the defendants in this case comprised of a coalition of Democratic state attorneys general are considering asking the Supreme Court to examine the ACA for a third time since 2012. The question is whether the U.S. Supreme Court would issue any decision before the lower federal courts have completed their review of the case. Whether the Court grants an expedited review is currently unknown. 

If you have additional questions about this issue or you are trying to comprehend how this case will impact you as a stakeholder, contact us by clicking here. 

New Draft Importation Rule Released

A new pilot program that allows states to import from Canada and allow manufacturers to voluntarily import has been announced via a draft rule through HHS and the FDA. 

The program would give states and nonfederal government entities the ability to import from Canada by applying to the FDA. Higher priced drugs such as biologics are not included in the draft rule. Here are some of the main points: 

• The drugs must be approved in Canada. 

• It does not include, controls, biologics or intravenously injected drugs. 

• States can work with wholesalers and pharmacies to create an application.

Canadian officials have already stated that the plan is unlikely to work as Canada is only 2% of the global market versus 44% from the U.S. This means that Canada will not be able to meet demand. 

A separate program that would allow for drug company importation of its own products does not take into account rebates or the best-price rule. The program requires that the drugs go through a separate re-labeling and testing that will have an additional cost. Additional costs may either cancel out any savings or make the drugs more expensive. 

This rule is in response to several states such as Florida who have created legislation in 2019 to allow for the importation of drugs from Canada. 

For more information regarding importation in general click here. 

Here is a link to the proposed rule. 

At Lanton Law we help our clients with business strategy, legal, compliance, as well as regulatory and government affairs issues. We help various entities within the supply chain be prepared for tomorrow by knowing the landscape of today. If you have questions or are looking for innovative ways to realize your organization’s priorities, click here to contact us. 

U.S. Solicitor General Advocates for writ of certiorari to be granted in Rutledge v. PCMA

One case that pharmacy stakeholders have been closely monitoring is  Rutledge v. Pharmaceutical Care Management Association. 

According to the U.S. Supreme Court blog (SCOTUSblog), the issue in this case is “whether the U.S. Court of Appeals for the 8th Circuit erred in holding that Arkansas’ statute regulating pharmacy benefit managers’ drug-reimbursement rates, which is similar to laws enacted by a substantial majority of states, is pre-empted by the Employee Retirement Income Security Act of 1974, in contravention of the Supreme Court’s precedent that ERISA does not pre-empt rate regulation.”   

As part of his response to the Court’s “CVSG” or “Call for the Views of the Solicitor General” to provide a position on an issue such as this, U.S. Solicitor General Noel Francisco on December 4, 2019 submitted his brief recommending that the Court review the Eighth Circuit’s holding that ERISA preempts state laws that regulate PBM-pharmacy reimbursements. The Solicitor General’s position advocates for the overturning of the appeals court decision. The brief can be read here.  Having this letter from Solicitor General can help push the Court into granting cert to hear the merits of this case. 

Lanton Law uses law and government affairs to advocate on behalf of supply chain clients, which includes retail, specialty, LTC pharmacies as well as home infusion providers. All of these providers have ties to PBM business practices via reimbursement. Lanton Law will continue to monitor the developments of Rutledge v. PCMA and will advise our clients accordingly. If you have an issue that we can assist you with such as us being your in house counsel or lobbyist, contact us and we’ll be happy to walk through your options.   

Not knowing what’s in your contracts can stop your business expansion

No matter if you are a hospital, physician, pharmacist, manufacturer, SAAS or Health IT provider, the lifeblood of your business is in your contracts. As an attorney what amazes me time after time is how contracts are often overlooked by businesses.

When I speak with clients, many of them tell me that either they will just sign a contract to get access to something or on the back side, they will simply plan to get out of a contract if they aren’t happy with the party they contracted with. Situations like this are when things get interesting.

For clients contemplating entering into a contract, I usually ask the following: 

• Were you were able to negotiate your priorities into the contract? 

• Are you using standard terms and conditions from prior agreements?

• Are you thinking about how your business may evolve over time? 

On the flip side for clients that plan on exiting a contract I ask:

• Do you know what happens if you plan to get out of the contract? 

• Are there penalties for terminating?

• Are you prohibited from re-entering a certain market?

Many businesses don’t know the answers to these questions. Not knowing your rights before making a decision to either enter or exit a contract can cost your business thousands of dollars. 

Fortunately, there is something you can do about this. Clients have been using Lanton Law to help them understand not only what’s in their contracts, but Lanton Law gives you suggestions on how to negotiate a better deal, while also giving you a risk assessment for clients considering leaving a contractual relationship. Having a contract strategy will definitely save you from making a costly decision. 

Click here to contact Lanton Law now to schedule a contract risk assessment. Taking this small proactive step will not only help protect your interests, but it will allow you to more confidently plan for your future business expansion.

Lanton Law Quoted in New Medscape Article On Biosimilar Insulin

Lanton Law was quoted in a new Medscape article on biosimilar insulin. Click here to read the article

If you are having trouble accessing the link we have included the article for you below:

A new US Food and Drug Administration (FDA) policy may help get novel biosimilar insulins to market more quickly, but it will be no guarantee that the products will be significantly less expensive than branded insulins, say analysts.

The FDA recently issued new draft guidance for insulin biosimilar manufacturers.

The recommendations "may result in a more efficient development program that could ultimately bring biosimilar or interchangeable insulin products to the market more quickly," said Brett P. Giroir, MD, acting FDA commissioner, in a statement by the agency. 

"The availability of approved biosimilar and interchangeable insulin products is expected to increase access and reduce costs of insulin products," he added.

Meanwhile, the Republican leaders of the US House Energy and Commerce Committee have written to the nation's largest insurers to demand that they provide information on their involvement in the rising price of insulin.

The committee wrote to Anthem, Blue Cross Blue Shield, CVS Health, Cigna Corporation, Kaiser Permanente, and UnitedHealth Group seeking transparency on rebate programs with pharmacy benefit managers (PBMs); detailed information on how they design their benefit plans and formularies; how much enrollees in high-deductible plans pay out of pocket for insulin; and whether the insurers offer patient assistance programs to help defray the cost of insulin.

"Unfortunately, even though the average net price that manufacturers are receiving for many insulin products is decreasing and PBMs are working with health plans to help reduce the cost of insulin for health plans, many Americans are facing increased out-of-pocket costs for their insulin at the pharmacy counter," the members of Congress wrote.

"Floodgates Opening": Clearer Path to Market for Biosimilar Insulins 

Analysts and one industry group applauded the FDA draft guidance, stating that it gives a much clearer picture of how products can be developed and approved.

The new guidance — which will be made final once the agency takes public comments into account — has been expected for some time. The FDA issued final guidance on interchangeability of biosimilars in May and held a public hearing specifically on interchangeability of insulin biosimilars not long after.

The Association for Accessible Medicines (AAM) said it was continuing to review the draft guidance but believes it reflects much of the concerns and feedback it gave the agency at the May hearing.

"We find FDA's flexibility on the implementation of statutory interchangeability requirements to be particularly positive," Christine Simmon, AAM senior vice president for policy and executive director of the Biosimilars Council told Medscape Medical News.

"This really was the floodgates opening," said Ron Lanton, III, a Washington, DC-based attorney who studies regulatory policy and has represented primarily small pharmacy chains.

"The United States is not an easy place for doing business when you're talking about biosimilars," he told Medscape Medical News.

The FDA has approved 26 biosimilars, including two insulins which, to date, have been labeled "follow-ons", Basaglar (insulin glargine, Lilly) and Admelog(insulin lispro, Sanofi), as they were brought to market under a different regulatory pathway, but are considered to be copycat or biosimilar versions of the respective branded insulin products.

The guidance "is one step forward for manufacturers" to say, "now that we know what the rules are, we can start to compete," said Lanton.

He believes the draft guidance, if ultimately adopted, will get biosimilars to market faster.

Dave Clissold, a food and drug lawyer with Washington, DC-based Hyman Phelps McNamara, which has represented biosimilar and branded insulin manufactures, also believes the policy will speed up new product development.

Also important, said Clissold, is the FDA's decision that manufacturers won't necessarily have to conduct studies that compare immunogenicity to the reference product.

That goes further than what had been expected but will be welcomed by biosimilar makers, Clissold told Medscape Medical News.

The FDA is communicating that "insulins are special biologics. They're small, they're not very complicated, we know a lot about them. There are all different types of insulins on the market right now, so we've got a ton of clinical experience with these things," he added.

Skipping those comparative studies won't be automatic, he said.

"But there is a path forward" that manufacturers can take to justify why they think they don't need to conduct what are usually costly and long studies, he explained.

Price Still a Question Mark

Clissold continued by noting that the FDA cannot dictate pricing, but ideally, "more competition will drive prices down."

"We've certainly seen that for the big blockbuster generic drugs," he said.

Lanton said that although the agency is attempting to harness competition to lower prices, that's not a given in the US market.

"We really don't know what the pharmacy benefit managers are going to do," he said.

Lanton pointed out the lack of transparency in the rebate scheme between PBMs and drug makers.

"What's going to prevent an innovator from coming in, talking to a PBM, and giving a steeper discount?" he said.

"Even if the price is lower, with the rebate still not being addressed, is that going to have an effect on anything?" Lanton wondered.

CMS Star Ratings: Will Biosimilars Benefit?

This article is in Biosimilar Development: Click here to read the article

In case you can’t access the article, here is the text below.

The Centers for Medicare and Medicaid Services (CMS) star ratings system was created in 2007 for insurance plans operating under both the Medicare Advantage and Part D. This 1 to 5 system (with 5 being the highest rating) is a way for CMS to measure the value of a plan and determine whether to continue to allow it to be part of the program. However, it’s more than just the plan, since the plan’s providers play a key role in how CMS evaluates each plan.

Essentially, the system measures other items as well, such as clinical quality, beneficiary satisfaction, and regulatory compliance, in addition to included providers. Plans are incentivized with financial rewards for improving quality performance and achieving the highest rating. What has been interesting to watch over time is how the star ratings system has become the go to evaluator for anything healthcare. The question is whether this concept could be applied to reduce drug costs, specifically, where biosimilars are concerned. 

We received our answer with the introduction of the Star Ratings for Biosimilars Act, otherwise known as H.R. 4629. This bipartisan bill is sponsored by Congressmen Tonko (D-NY) and Gibbs (R-OH), but to date it hasn’t gotten much support. The bill has a U.S. Senate version sponsored by Senators Cassidy (R-LA) and Menendez (D-NJ). According to Senator Cassidy’s press release, “This bill would incentivize insurers to use lower cost versions of drugs by rating the plan based on usage of biosimilar medications. Using lower cost drugs will lead to positive health outcomes with lower out of pocket costs for patients.” We have also seen similar legislative language in S.2543, known as the Prescription Drug Pricing Reduction Act of 2019.

For years now, we have witnessed several debates on how biosimilars could potentially lower drug costs, and this proposed legislation is another example of the potential promise that biosimilars have in helping policymakers lower drug costs. But will this bill help? Specifically, the proposed legislation calls for determining whether a biosimilar is on the formulary, assesses whether and how utilization management tools are applied with respect to a biosimilar, and assesses the percentage of enrollees prescribed the biosimilar biological product when the reference biological product is also available.

While I applaud any idea that attempts to lower costs and promote patient access, the devil is always in the details. For example, will these proposed metrics of incentivizing plans to use biosimilars work? Will there be competing metrics that plans have that may be better measurements than CMS?

Industry stakeholders like physicians and pharmacists may not like having plans with too much autonomy because unfairness and bias in measuring provider compliance may come into play, as plans and their partner pharmacy benefit managers (PBMs) would likely favor their providers and pharmacies, which could result in different star ratings for some. Will hospitals be amenable to this system when they already have complaints against CMS’ star ratings programs due to hospitals not being able to predict quality improvement metrics for operational efficiency? Physician education on biosimilars will have to be increased as well, since their comfort level with biosimilars will help spawn more utilization by their patients. Lastly, what impact will star ratings on biosimilars have on insurer rebates? At this time, it is too early to tell, since without this clarity it is even hard to quantify if biosimilars are already experiencing formulary disadvantages due to innovators offering larger discounts. One thing is for certain, in order to force monumental change, it may be best to do it via mandate. Forced compliance, in my opinion, will bring out the potential bugs in a system fast.

Ultimately, the other big issue is whether there is enough time to get legislation like this through Congress, along with a presidential signature. It would also help if the bill had more support, through either Congressional members or a push from powerful interested stakeholders. To date, the bill doesn’t have a significant number of cosponsors. It could be that it is December or that lowering drug prices through biosimilars is an idea that is spread throughout too many current Congressional proposed bills.

Theoretically, this seems like a win-win for both parties, but, realistically, we are on the doorstep of campaign season. With the upcoming elections on the state and federal level expected to be explosive, will lawmakers find the will to agree on a bipartisan solution like this before the political rhetoric heats up? We can only hope.  

Lanton Law December 2019 Newsletter Now Available

We are out with our December 2019 newsletter. This edition covers data oversight, a Medicaid white paper and upcoming webinars. Click here to access the December 2019 newsletter.

Additionally, if you are interested in signing up for our newsletter that has trending information on healthcare, technology and fintech, click here to sign up.  

Don’t Ignore the Steady Drumbeat of Drug Importation Part 2

Back in April 2019 we published an article through Specialty Pharmacy Times titled “Don’t Ignore the Steady Drumbeat of Drug Importation?” Click here to read the article

However; we have been noticing lately that there is a lot more chatter on importation, especially from the Administration. It seems as though some state administration officials are moving forward with the idea of providing imported medications for their citizens. Besides the state ideas discussed in the article above, states like Maine, Colorado, Vermont, Michigan, New Hampshire and Florida are all currently debating what an importation program would look like in their states. 

This is all a result of increased discussions initiated by the President who has mentioned the goal of lowering drug prices several times since he took office. The President has been a supporter of importing prescription drugs from Canada, namely following Florida’s importation model that was recently enacted by the state’s legislature.

While there are many solutions to lowering drug prices, importation has been a policy that has supporters on both sides of the aisle. However; there are still questions of safety as well as whether importation will have the cooperation of stakeholders such as drug manufacturers, the supply chain, and the Canadian government.  

While it can be argued that importation may not gain too much momentum with the end of the year quickly approaching and the elections starting to heat up in 2020, we still don’t expect importation to go away. If you are a stakeholder and are interested in learning what either your legal or policy options are contact us at Lanton Law by clicking here.

Lanton Law's Webinar With WellSky Now Available

Our recently recorded webinar with WellSky titled “What home care policies to watch for the rest of 2019” is now available at https://info.wellsky.com/LP-Emerging-SPRX-and-IV-Policies.html Below is a description of the webinar:

Unlike anything we have experienced before, the backend of the legislative calendar year is proving to be louder than ever. While Capitol Hill is embroiled in contentious topics, issues that are more important to home infusion and specialty pharmacy industries are impacted, and slowly working their way through the system. The webinar discussed the following:

DIR and possible policy solutions

• Latest drug price and how these will impact specialty and home infusion stakeholders

• Patient co-payments and biosimilars

• The Home Health Payment Rule

New Lanton Law Webinar on December 4th with the American College of Apothecaries (ACA)

We have a new webinar on December 4, 2019 via the American College of Apothecaries (ACA) on CBD.

Cannabidiol (CBD) products are flooding the market at an alarming rate. Many consumer stakeholders are excited about this new product line, while providers such as pharmacies, natural health food stores, and other retailers are casting a watchful eye; torn between developing market strategies to meet demand while also watching for state and federal regulatory oversight. This webinar will discuss the various aspects of CBD regulations and market trends to give stakeholders a better understanding of the CBD environment for patient and market opportunities.

Register at: https://ce.ppsinc.org/index.cfm?pg=semwebCatalog&panel=showLive&seminarid=10631

What's Next for DIR Policy?

We have a new article in the American College of Apothecaries (ACA) titled “What’s Next for DIR Policy?” We will be having a new white paper on the subject coming out soon. In the meantime, this link will take you to the article in the ACA Fall Magazine 2019. https://acainfo.org/wp-content/uploads/flipbook/22/mobile/index.html#p=9

More Data Oversight on the Horizon

No matter what, technology will always move faster than the law. With this maxim and our ever increasing reliance on convenient information, we have seen technology companies try to bring us what we want to see while also collecting a staggering amount of information on consumers. With regulations scant on personal data, Congress is slowly becoming more active in making policy governing technology. 

In November 2019, Congresswomen Anna G. Eshoo (D-CA) and Zoe Lofgren (D-CA) introduced the Online Privacy Act of 2019 (H.R. 4978). According to the sponsors, the bill proposes to strengthen user rights, places obligations on companies to protect users’ data, establishes a new federal agency to enforce privacy protections, and strengthens enforcement of privacy law violations.  

The sponsors press release discussed the following points which are highlights of the bill: 

• Creating User Rights – The bill grants every American the right to access, correct, or delete their data. It also creates new rights, like the right to impermanence, which lets users decide how long companies can keep their data.

• Placing Clear Obligations on Companies – The bill minimizes the amount of data companies collect, process, disclose, and maintain, and bars companies from using data in discriminatory ways. Additionally, companies must receive consent from users in plain, simple language.

• Establishing a Digital Privacy Agency (DPA) – The bill establishes an independent agency led by a Director that’s appointed by the President and confirmed by the Senate for a five-year term. The DPA will enforce privacy protections and investigate abuses.

• Strengthening Enforcement – The bill empowers state attorneys general to enforce violations of the bill and allows individuals to appoint nonprofits to represent them in private class action lawsuits.

 With so many controversies surrounding the use and rights of consumer data, we fully expect more government oversight into technology. If you are a technology stakeholder and you are interested in learning more about emerging policy or understanding potential risks to your business model contact us for legal or government affairs solutions at Lanton Law.

The Specialty Pharmacist's Role in Educating Patients about Biosimilars and Biologics

Ron Lanton III, Esq. of Lanton Law discusses with Specialty Pharmacy Times the specialty pharmacist's role in educating patients about biosimilars and biologics. https://www.pharmacytimes.com/news/the-specialty-pharmacists-role-in-educating-patients-about-biosimilars-and-biologics

Specialty pharmacies really can help the patient in getting the education out about biologics and biosimilar products in a number of different ways. First of all, the specialty pharmacy is very educated about what products are out on the market, and they’re in close communication with the physician. It’s also going to depend on the formulary and whether or not the pharmacy benefit manager or the carrier is actually going to carry the drug on the particular formulary. So I think if it does, I mean, obviously they don’t know everything about the patient’s formulary but they can find out that information and then see whether or not that’s good for the patient to take, as far as cost and outcomes-wise. So I think that with the specialty pharmacist being positioned in the center of everything, it’s a great position to be in for them to say, ‘Look, this is coming down. This is something I think that can help you, and let’s try and see if we can lower your costs and improve your outcome.’

New Administration Rules Seek Healthcare Cost Transparency

With the release of the Administration’s American Patient’s First Blueprint in May 2018, price transparency was shown to be a centerpiece of the Administration’s governing agenda. Last week, the Administration released two rules, each at different points of the rulemaking process. 

The first is a final rule effective 1/1/21 targeting hospitals that will require them to display their negotiated rate to patients. The second is a proposed rule which according to CMS  “includes two approaches to make health care price information accessible to consumers and other stakeholders, allowing for easy comparison-shopping.” The proposal has a 60 day comment period. At this point in time there is no anticipated effective date.  

Pricing transparency continues to be a re-emerging theme that shows no signs of slowing down. If you need strategic advice or lobbying where price transparency is concerned, contact us at Lanton Strategies. If you need legal advice with regulatory or compliance concerns, contact us at Lanton Law.

New PBM Legislation Advances in Congress

Congresswoman Amy Spanberger (D-VA) has sponsored H.R. 2115 titled “Public Disclosure of Drug Discounts and Real-Time Beneficiary Drug Cost Act.” This is important for healthcare stakeholders, as this proposed legislation requires greater transparency for discounts provided by manufacturers. This bill also proposes to include real-time benefit information as part of a prescription drug plan’s electronic prescription program under Medicare. 

Below are a few of the bill’s highlights: 

“In order to allow the comparison of PBMs’ ability to negotiate rebates, discounts, direct and indirect remuneration fees, administrative fees, and price concessions and the amount of such rebates, discounts, direct and indirect remuneration fees, administrative fees, and price concessions that are passed through to plan sponsors, beginning January 1, 2020, the Secretary shall make available on the Internet website of the Department of Health and Human Services the information with respect to the second preceding calendar year provided to the Secretary on generic dispensing rates (as described in paragraph (1) of subsection (b)) and information provided to the Secretary under paragraphs (2) and (3) of such subsection that, as determined by the Secretary, is with respect to each PBM.”

Not later than January 1, 2021, the program shall implement real-time benefit tools that are capable of integrating with a prescribing health care professional’s electronic prescribing or electronic health record system for the transmission of formulary and benefit information in real time to prescribing health care professionals. With respect to a covered part D drug, such tools shall be capable of transmitting such information specific to an individual enrolled in a prescription drug plan. Such information shall include the following:

(I) A list of any clinically-appropriate alternatives to such drug included in the formulary of such plan.

(II) Cost-sharing information for such drug and such alternatives, including a description of any variance in cost sharing based on the pharmacy dispensing such drug or such alternatives.

(III) Information relating to whether such drug is included in the formulary of such plan and any prior authorization or other utilization management requirements applicable to such drug and such alternatives so included.

Conclusion:

Efforts to advocate for stronger PBM transparency has picked up in the last few years but this legislation which was voted 403-0 is telling. Usually this time of the year has Congress winding down its legislative agenda in preparation for the upcoming election. While I don’t expect to see too much legislation that is politically charged passing by year end, I do foresee either something on drug pricing or PBM transparency; if not both passing before we head into 2020. This Act is currently in the U.S. Senate. 

If you have additional questions about lobbying or need strategic advice on developing state or federal policies, contact Lanton Strategies or our sister company Lanton Law for regulatory compliance and legal issues.

Setting the Record Straight on March-In Rights and Drug Prices

This article appeared in Specialty Pharmacy Times

Following the launch of sofosbuvir (Sovaldi) in 2013, the pharmaceutical industry has been in the crosshairs of the government because of the drug's cost. Many industry stakeholders have been wrestling with difficult questions: How should the fair value of a drug be determined? What should the cost be for better outcomes? How much should a drug cost if it extends life? We have seen some political solutions advanced, such as the International Pricing Index, the Rebate Rule, and others, but no silver bullet to controlling costs has manifested to date.

The political costs of seeing an initiative through have often been harsh. The solution called march-in rights has been discussed frequently, but it has been clouded in confusion. Let’s examine what this policy is and whether it is a feasible solution to controlling prescription drug costs.

March-in rights arose from the Bayh-Dole Act, otherwise known as the Patent and Trademark Law Amendments Act, which was enacted in 1980. The law, found at US Code, Title 35, Part II, Chapter 18, Section 203, addresses intellectual property arising from federal government–funded research.

The law states that if an invention was created with the assistance of federal funds, the agency that provided the funding can require the granting of licenses to responsible applicants. These licenses can be exclusive, nonexclusive, or partially exclusive. If any licensee refuses to abide by reasonable terms for the granted licenses, then the federal agency can empower itself with a license based on specific conditions outlined in the law.

Right now, stakeholder groups are lobbying the National Institutes of Health by arguing that high prescription drug costs are not meeting patient needs, thus satisfying the burdens outlined in the law. Although it sounds as though the federal government can impose price controls on prescriptions, the government has never invoked this type of authority since it legally does not exist within the statute. If this were the case, the industry could possibly witness less innovation, which could inadvertently lead to the devaluation of patents in general.

The Commerce Department’s latest actions may have put the nail in the coffin on exploring the idea of government intervention via price controls. In April 2019, the National Institute of Standards and Technology finalized its green paper that recommends against the government exercising its march-in rights to lower prescription drug costs.1

“The green paper notes that in the intervening decades, interpretation of the Bayh-Dole Act has created confusion over the ‘march-in rights’ and ‘government-use license’ provisions, and that some stakeholders want clarification,” the authors wrote. “March-in rights described under Bayh-Dole allow the government, in certain limited circumstances, to force the party with title to a government-funded intellectual property to grant a license to another entity. To date, the government has never exercised these rights.”

If march-in rights are not the answer to lowering drug prices, then what is? The answer lies with Congress, which alone has the power to amend the Bayh-Dole Act to clarify when government intervention can occur, either by legislation or a regulatory directive. If not through Bayh-Dole, then Congress is the best place to legislation prescription price controls. There are several legislative bills pending on this issue, including the Prescription Drug Pricing Reduction Act, which has gained public momentum in the last few weeks. It will be interesting to see whether there is an emerging policy on price transparency from the states, as several legislatures are exploring solutions to this issue.

I am neutral when it comes to finding the appropriate answer to this issue. I believe that patients should have access to affordable medications. But how do we define affordable and what market-sufficient protocols could convince manufacturers that they should continue to innovate, knowing that they may not recoup their research and development costs?

My neutrality comes from not having an answer. I am for specialty stakeholders being able to operate on a level playing field while servicing their patients. I would advise that whenever there is a gray area, such as march-in rights, we should seek to obtain a long-lasting solution by changing the statute.

Yes, it may take significant time, but going through the courts is not always a guaranteed outcome. Although the short-term work of getting a solution memorialized through legislation is sometimes painstaking, the resulting certainty can last for many years.

Reference
1. NIST releases findings on increasing the innovation impacts of federally funded R&D [news release]. Gaithersburg, MD: National Institute of Standards and Technology; April 24, 2019. www.nist.gov/news-events/news/2019/04/nist-releases-findings-increasing-innovation-impacts-federally-funded-rd.

The Specialty Pharmacist's Role in Educating Patients about Biosimilars and Biologics

Ron Lanton III, Esq., discusses the specialty pharmacist's role in educating patients about biosimilars and biologics on the following link: https://www.pharmacytimes.com/news/the-specialty-pharmacists-role-in-educating-patients-about-biosimilars-and-biologics

Below is the text of the interview.

Specialty pharmacies really can help the patient in getting the education out about biologics and biosimilar products in a number of different ways. First of all, the specialty pharmacy is very educated about what products are out on the market, and they’re in close communication with the physician. It’s also going to depend on the formulary and whether or not the pharmacy benefit manager or the carrier is actually going to carry the drug on the particular formulary. So I think if it does, I mean, obviously they don’t know everything about the patient’s formulary but they can find out that information and then see whether or not that’s good for the patient to take, as far as cost and outcomes-wise. So I think that with the specialty pharmacist being positioned in the center of everything, it’s a great position to be in for them to say, ‘Look, this is coming down. This is something I think that can help you, and let’s try and see if we can lower your costs and improve your outcome.’

The Challenges to Launching Biosimilars

Check out Ron Lanton’s interview with Specialty Pharmacy Times on “The Challenges to Launching Biosimilars” https://www.pharmacytimes.com/news/challenges-to-launching-biosimilars

Below we have provided the text from the interview as well:

Ron Lanton III, Esq.: Well, there are a few challenges to launching biosimilars after approved. One I can think of is litigation. So there’s been constant litigation between the biologic and the biosimilar to make sure that there is some kind of market exclusivity. So that’s the first thing. The second thing is that the biosimilars are actually fighting the patent thicket, so the biologic or innovator product is throwing up a lot of patents to keep the biosimilar off of the market, so you’re having a fight about that. I think education—so physicians, patients, they’re not really knowing too much about biosimilars and what some of these biological products are and kind of use them interchangeably because they don’t know about either/or. So I think a little bit more education is key, and I know that the FDA has been trying to put out a lot of policies recently to get more utilization out of this to drive down the cost of medication.

Is the Insulin Price Reduction Act the Right Answer to High Insulin Prices?

I have a new article in The Centers for Biosimilars titled Is the Insulin Price Reduction Act the Right Answer to High Insulin Prices? You can find the article by clicking on the following link: https://www.centerforbiosimilars.com/contributor/ron-lanton-III-esq/2019/10/is-the-insulin-price-reduction-act-the-right-answer-to-high-insulin-prices

If you cannot access the link above, I have put the text of the article below.

At this point in the legislative calendar, it is time to take a look at what may have a likely shot at passing Congress before the 2020 election season gets underway. With the contentious debate on drug pricing that has occurred during the last several months, insulin pricing is still garnering plenty of attention.

This summer saw the unveiling of bipartisan legislation aimed to deliver a policy solution to rising insulin prices. Titled the Insulin Price Reduction Act, otherwise known as S.2199, the proposed legislation sponsored by Senators Tom Carper, D-Delaware; Jeanne Shaheen, D-New Hampshire; Susan Collins, R-Maine; and Kevin Cramer, R-North Dakota, seeks to hold payers, manufacturers, and pharmacy benefit managers accountable for insulin price increases.

According to Senator Carper’s press release, the bill would create a new insulin pricing model “where the use of rebates would be restricted for any insulin product for which the manufacturer reduces the list price back to a level no higher than the price of the product in 2006. For the most popular insulins, this would result in more than a [75%] decrease in prices compared to what we can expect to see in 2020. These rebate restrictions would apply in Medicare Part D and the private insurance market. Private insurance plans would also be required to waive the deductible for insulin products that met the list price reduction criteria. To keep these rebate exemptions and deductible waivers in future years, the manufacturer would have to limit any list price increase to no more than medical inflation.”

The bill does have support from industry stakeholders. This bill has been endorsed by the JDRF, the American Diabetes Association (ADA) and the Congressional Diabetes Caucus, and the need for insulin access is there. According to the ADA, “Between 2002 and 2013, the average price of insulin nearly tripled. For more than 7.4 million Americans, including all individuals with type 1 diabetes, insulin is a life-sustaining medication for which there is no substitute.”

While having stakeholder support is important, it is not the only factor that determines whether this bill advances. There are several bills in Congress proposing similar solutions to insulin pricing, on top of FDA’s interest in lowering insulin prices via the development of biosimilar and interchangeable insulin products. Not to mention the fact that the US Department of the Treasury has implemented guidance aimed at making chronic medication access easier for beneficiaries with High Deductible Health Plans that include Health Savings Accounts.

While the bill is bipartisan, it would help if more senators from both sides signed on to show broadening support. However, with the looming election season, it remains questionable whether both sides can agree on if the Insulin Price Reduction Act is the right vehicle to lower insulin prices.

Cannabidiol Made Simple

This article appeared in Specialty Pharmacy Times.

Cannabidiol (CBD) has certainly drawn significant attention over the past few months. Marked by the recent passage of the Farm Bill and the FDA’s hearing on CBD at the end of May, the curiosity about and demand for the products have never been stronger. Unfortunately, misinformation on the effects of CBD remains rampant, including details on whether combining CBD with food affects the body’s absorption and conflicting reports on the various differences in state regulation.

This article examines the basis of CBD use in health care along with the recent major regulatory discussions surrounding this emerging trend.

Market Trends
Market projections for CBD have varied widely. A study by cannabis investigators BDS Analytics and Arcview Market Research projected the collective market for CBD sales to exceed $20 billion in the United States by 2024. The study also showed that US retail sales of CBD consumer products in 2018 were between an estimated $600 million and $2 billion. The investigators estimated that CBD products could generate approximately $16 billion in retail sales by 2025.1

What Is CBD?
According to the FDA, “Cannabis is a plant of the Cannabaceae family and contains more than 80 biologically active chemical compounds. The most commonly known compounds are delta-9-tetrahydrocannabinol (THC) and cannabidiol (CBD). Parts of the Cannabis sativa plant have been controlled under the Controlled Substances Act (CSA) since 1970 under the drug class ‘Marihuana’ (commonly referred to as ‘marijuana’) [21 U.S.C. 802(16)].”

The FDA classifies marijuana as a schedule I drug under the CSA because of a high potential for abuse, largely attributable to the psychoactive effects of THC and a lack of agreement on acceptable medical use in the United States.2

CBD Regulation
The passage of the 2018 Farm Bill, also known as the Agriculture Improvement Act of 2018, reauthorized many expenditures from the Agricultural Act of 2014. Enacted on December 20, 2018, the law deemed hemp a legal substance and set the THC threshold of CBD products to 0.3% on a dry weight basis.2

Most important, the law maintains the FDA’s authority to regulate cannabis and its derivatives, as any product claiming therapeutic benefits derived from CBD requires FDA approval for its intended use before going to market. The Farm Bill stated that significant shared state–federal regulatory power over hemp cultivation and production will be instated. State departments of agriculture must consult with their governors and chief law enforcement officers to devise a regulatory plan to submit to the secretary of the US Department of Agriculture (USDA) for approval. Hemp cultivators in states that opt not to devise a program will need to apply for licenses and comply with a federally run program constructed by the USDA.

Before the passage of the Farm Bill, CBD took a major step forward with the FDA approval of Epidiolex. On June 25, 2018, the oral solution was approved for the treatment of seizures associated with 2 rare and severe forms of epilepsy, Lennox-Gastaut syndrome and Dravet syndrome, in patients 2 years and older. This was the first FDA-approved drug containing a purified substance derived from marijuana. It was also the first FDA approval of a drug for the treatment of patients with Dravet syndrome.3

What is happening in state legislatures? Thirty-four states, the District of Columbia, Guam, Puerto Rico, and the US Virgin Islands have approved comprehensive medical marijuana programs, and 12 states allow the use of products containing low THC and high CBD for medical reasons in limited situations or as a legal defense, according to the National Conference of State Legislatures. Furthermore, as of June 5, 2019, 13 states and territories have approved the adult use of cannabis.4

On May 31, 2019, the FDA held a public hearing to gather information from industry stakeholders on the use of CBD in cosmetics, dietary supplements, and food. The FDA made no new regulatory announcements, as the agency recognized that further discussion is needed before it can determine the appropriate regulatory pathway for these products. This point was emphasized by former FDA Commissioner Scott Gottlieb, MD, who outlined the need for a high-level internal agency to explore potential pathways for dietary supplements and/or conventional foods containing CBD to be lawfully marketed. He also emphasized the need to find answers to frequently asked questions to help the public understand how the FDA’s requirements apply to these products, as well as next steps for the FDA.

What Is Next for CBD?
Pharmacy professionals should monitor statements from the FDA in the immediate future to see how it intends to regulate CBD. Further, they can glean regulatory insight by examining warning letters, such as the 3 recent warnings the agency sent to companies making unsubstantiated claims regarding the ability of their products to limit, treat, or cure cancer, neurodegenerative conditions, autoimmune diseases, opioid use disorder, and other serious conditions without sufficient evidence and legally required FDA approval.

The USDA’s Agricultural Marketing Service (AMS) is another place to look for clues to CBD oversight. Earlier this year, the AMS issued a notice to trade over hemp production and cultivation. Cannabis-based stocks such as GW Pharmaceuticals, OrganiGram, Tilray, and the Canopy Growth Corporation could offer further insights into how the FDA will regulate this industry.

However, my closing advice for retailers looking to enter this market is to learn how your hemp products are created, processed, and tested for contaminants, because no uniform standard exists. Lastly, I would advocate for the use of counsel to ensure that the products you wish to sell comply with current FDA regulations and to help you understand the different state regulatory requirements surrounding CBD.

References

1. U.S. CBD market anticipated to reach $20 billion in sales by 2024 [news release]. Boulder, CO: BDS Analytics; May 9, 2019. bdsanalytics.com/u-s-cbd-market-anticipated-to-reach-20-billion-in-sales-by-2024. Accessed June 8, 2019.

2. FDA regulation of cannabis and cannabis-derived products: questions and answers. FDA website. fda.gov/news-events/public-health-focus/fda-regulation-cannabis-and-cannabis-derived-products-questions-and-answers. Updated April 2, 2019. Accessed June 8, 2019.

3. FDA approves first drug comprised of an active ingredient derived from marijuana to treat rare, severe forms of epilepsy [news release]. Silver Springs, MD: FDA. www.fda.gov/news-events/press-announcements/fda-approves-first-drug-comprised-active-ingredient-derived-marijuana-treat-rare-severe-forms. Accessed June 8, 2019.

4. State medical marijuana laws. National Conference of State Legislatures website. ncsl.org/research/health/state-medical-marijuana-laws.aspx. Published June 5, 2019. Accessed June 8, 2019.