Capitol Hill Update
Senators failed to advance (52-47) the GOP’s targeted pandemic relief bill last week Senate Democrats, plus Sen. Rand Paul (R-KY), voted against the motion to proceed for the underlying bill. The package — which included Republican priorities on child care, liability protections, health care, education, and small business — did not meet the 60-vote threshold required to advance the measure for full consideration on the floor. While Congressional Democrats continue to push for a more robust stimulus package to address existing and emerging issues related to the pandemic, Speaker Nancy Pelosi (D-CA) has reiterated her willingness to strike a relief agreement that totals below the $3 trillion outlined in the House-passed HEROES Act. Negotiations between the two sides are expected to continue when the House convenes for votes this week. However, the likelihood of a deal getting struck prior to both the Nov. 3 election and the end of this congressional session remains precarious, as both sides still remain far apart on the overall size and scope of the relief package.
Meanwhile, House lawmakers will convene for legislative business today as Members look to clear their pre-election slate. Headlining floor action for the week ahead is a bill out of the Education and Labor Committee that would establish a “Strength in Diversity” program through the Department of Education. This program would, among other things, award competitive grants for the development or implementation of plans to improve diversity in public schools and publicly funded early education programs. Also on the floor next week, lawmakers will consider: (1) a resolution condemning all forms of anti-Asian sentiment as related to COVID-19; (2) a bill that would amend title VI of the Civil Rights Act of 1964 to restore the right to individual civil actions in cases involving disparate impact; and (3) legislation that would prohibit employment practices that discriminate against job applicants or employees affected by pregnancy, childbirth, or related medical conditions.
President Trump Issues Most Favored Nations Executive Order
Late yesterday, President Donald Trump issued an executive order (EO) to create a “most favored nations” (MFN) pricing system in Medicare. The EO directs the Secretary of Health and Human Services (HHS) to create a demonstration program through which Medicare would pay prices no higher than the lowest price in OECD countries. The HHS Secretary may implement the EO through a combination of rulemaking and a Centers for Medicare and Medicaid Innovation (CMMI) demonstration, and the policy may face a long road to true adoption.
By way of background, in July, President Trump announced four executive orders designed to lower drug prices. Three were released on July 24, while the final one, Lowering Drug Prices by Putting America First, was held pending negotiations between the White House and the pharmaceutical industry to find an alternative arrangement. The new EO rescinded that order, whose text was just released yesterday, and builds upon it by adding drugs in Part D (as well as Part B). The administration started considering an international reference pricing scheme in late 2018, releasing an advance notice of proposed rulemaking (ANPRM) that was never followed by a formal proposed rule.
In a tweet prior to the release of the EO, President Trump said that he “Just signed a new Executive Order to LOWER DRUG PRICES! My Most Favored Nation order will ensure that our Country gets the same low price Big Pharma gives to other countries. The days of global freeriding at America’s expense are over and prices are coming down FAST!” This tweet followed over a month of back-and-forth between the administration and pharmaceutical companies, with the President signing the new order after failing to reach a deal with pharma executives.
Despite the president’s tweets, it is unclear what the ultimate scope of the MFN policy will be. To comply with Medicare statute, the policy will need to be implemented as a demonstration. Current law does not appear to allow the wholesale implementation of such a policy at this stage. Instead, HHS is likely to use waiver authority and rulemaking to create a demonstration. A lot of implementation details remain to be determined. The 2018 ANPRM, if implemented, would have included 50 percent of Medicare Part B spending and would have lasted for five years.
In addition, a possible rulemaking process and implementation could be protracted. Assuming the use of a notice of proposed rulemaking, the rule would be open for comment for 30 to 60 days (the 2018 ANPRM had a 60-day comment period). With 51 days to go until the 2020 presidential election, it is possible that the comment period will not be closed by election day, and rulemaking would likely not be final by the beginning of a second term for President Trump or the inauguration of Democratic candidate Joe Biden. Agencies can issue interim final rules, which go into effect without notice-and-comment; however, such exceptions are limited to agencies having “good cause” and the process being “impracticable, unnecessary, or contrary to the public interest.” In addition, the administration may use CMMI waiver authority to implement the EO, particularly for the Part B demonstration. The legality of the MFN payment scheme is also not known, and litigation could tie up the implementation of MFN for an extended period of time.
Debate Over COVID-19 Vaccine Safety, Efficacy Heats Up
Concerns over the potential safety and efficacy of an accelerated COVID-19 vaccine came to a head last week, with government officials and stakeholders chiming in to ensure politics would not influence the approval of a successful vaccine candidate. Former vice president and Democratic presidential nominee Joe Biden laid out three basic questions the Trump administration will need to answer before releasing a coronavirus vaccine, after warning at an AFL-CIO virtual town hall that Americans should not trust the President’s promise of a vaccine before the November election. He asked that the administration reveal the following before touting a vaccine success: 1) What criteria will be used to ensure that any vaccine meets the scientific standard of safety and efficacy; 2) who will validate that those standards were met; and 3) what is the plan to distribute the vaccine cost-free and safely. President Trump responded to the criticism by calling on his opponent and Democratic vice president pick Kamala Harris to “immediately apologize for the reckless anti-vaccine rhetoric that they’re talking right now.”
A poll published last week by the Kaiser Family Foundation revealed that 40 percent of Americans surveyed believe the Food and Drug Administration (FDA) is paying too much attention to politics, and 62 percent also worried that the FDA will rush to approve a coronavirus vaccine due to political pressure. The poll found that only 42 percent of those polled would get vaccinated if a vaccine was approved and offered for free before the November election.
Eight high-level FDA officials published an op-ed in USA Today on Thursday in an attempt to assure the public that the FDA is an independent agency and confirm that the agency reviewers will be guided by science in their COVID-19 therapy and vaccine decisions. The authors, including Director of the Center for Drug Evaluation and Research Janet Woodcock, stated that “protecting the FDA’s independence is essential if we are to do the best possible job of protecting public health and saving lives.” Additionally, nine pharmaceutical companies developing COVID-19 vaccines issued a joint statement last Tuesday pledging that that the companies will not seek FDA approval for their vaccines until a rigorous phase three clinical trial shows that it is safe and that it works. The companies ensured that they always make the safety and well-being of vaccinated individuals their top priority.
Trump Says He Downplayed Coronavirus to ‘Reduce Panic’
The president faced scrutiny last week after journalist Bob Woodward released recordings of interviews conducted for his new book. The president privately acknowledged in the audio recording that the coronavirus was “more deadly than even your strenuous flus” in early February, despite publicly dismissing concerns about the virus at that time to avoid creating panic. On Wednesday, President Trump acknowledged he downplayed the pandemic, stating that “I don’t want people to be frightened. I don’t want to create panic, as you say, and certainly I’m not going to drive this country or the world into a frenzy.” He added that he wanted to show strength as a nation.
Trump doubled down on his criticism of Woodward on Thursday, tweeting that the journalist had the recordings for months and if the quotes were “so bad or dangerous,” why they weren’t released earlier. The president went on to claim that Woodward hadn’t released them earlier because they were “good and proper answers.” Woodward’s book reportedly also details intelligence briefings Trump received dating back to January, including an episode in which national security adviser Robert O’Brien warned the president that COVID-19 could be the “biggest national security threat” of his presidency. Woodward’s new book, “Rage,” is set to release this week and is based on 18 separate conversations the journalist held with the president.
AstraZeneca Suspends Vaccine Trial Over Patient Illness
AstraZeneca announced last week that the company had paused its vaccine trial after a participant in the phase three trial suffered from neurological symptoms consistent with a rare spinal inflammatory disorder called transverse myelitis. CEO Pascal Soriot revealed in a call with investors that the clinical trial was previously halted briefly in July after another participant experienced neurological symptoms, although the individual was later diagnosed with multiple sclerosis deemed unrelated to the COVID-19 vaccine trial. The company issued a statement last Wednesday noting that AstraZeneca would be guided by a committee of independent experts in determining when to lift the hold on the trial “so that we can continue our work at the earliest opportunity to provide this vaccine broadly, equitably and at no profit during this pandemic.” National Institutes of Health Director Francis Collins assured a Senate panel last Wednesday that the hold is not unprecedented and “certainly” happens in any large-scale trial. CEO Soriot declared that the company is still aiming to complete development of its vaccine, in collaboration with the University of Oxford, by the end of the year despite pausing their phase three trials.
On Saturday, the company said that it had resumed its coronavirus vaccine trial in Britain but that its trials in the United States and other countries were still on hold. The news came the same day that a competitor, Pfizer, said it was expanding the trial of its coronavirus vaccine to 44,000 people — a big increase from its previous goal of 30,000 — in an effort to recruit a more diverse group of participants and potentially cut down the time needed to get results from the trial.
HHS to Allow Pharmacists to Administer COVID-19 Vaccines
The Department of Health and Human Services released guidance last Wednesday outlining that pharmacists will be allowed to administer COVID-19 vaccines to individuals three years or older without a prescription. The HHS authorization, issued under the Public Readiness and Emergency Preparedness Act, preempts state and local laws, and pharmacists will be required to undergo a training program before they are allowed to administer vaccines. Pharmacy interns will also be allowed to administer the COVID-19 vaccines, as long as they are under pharmacist supervision. Assistant Secretary for Health Brett Giroir noted that the guidance will greatly expand access to a COVID-19 vaccine once approved by the administration.