Democrats sign drug price control deal in Bill

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WASHINGTON – House Democrats reached an agreement on Tuesday to add President Biden’s $ 1.85 trillion social safety net plan to a measure to curb the cost of prescription drugs, and agreed to be the government’s first Allow times to negotiate prices for Medicare-covered drugs while on a quick vote on the bill.

The negotiators also pushed for a costly agreement to reinstate a federal deduction, limited in the 2017 tax cuts signed by President Donald J. Trump, for state and local taxes that would benefit people in high-income states like New York and New Jersey.

The prescription drug deal is limited. Negotiations could begin in 2023 on what Oregon Senator Ron Wyden called the most expensive drugs – cancer and rheumatoid arthritis treatments and anticoagulants. Most drugs would have patent exclusivity for nine years before negotiations could begin, and more complex drugs called biologics would be protected for twelve years.

But for the first time, Medicare, the state health insurance program for people 65 and over and for people with disabilities, could step in after these periods, even if pharmaceutical companies purchase patent extensions or otherwise exploit the patent system.

“Prescription drug pricing is a major issue year after year for Americans, including the vast majority of Democrats and Republicans, who want to see a change because they just can’t afford their drugs,” said Senator Chuck Schumer, Democrat of New York and majority leader. “Today we took a big step forward to alleviate this problem.”

California spokeswoman Nancy Pelosi said, “Democrats will have strong drug price negotiations to bring prices down for our seniors and stop big pharma outrageous price hikes beyond inflation.”

Stephen J. Ubl, president and chief executive officer of Pharmaceutical Research and Manufacturers of America, the industry’s premier trading group, criticized the deal.

“While we’re excited about the changes to Medicare that will limit seniors’ self-consumption of prescription drugs, the proposal will allow insurers and middlemen such as pharmacy service managers to reduce the cost of over-the-counter patients,” said Mr. Ubl. “It threatens innovation and makes a broken health system worse.”

The completion of the prescription drugs section could be one of the last big changes to the sweeping climate change and social security bill that Democratic leaders are planning to put to the House of Representatives vote this week. Other issues remained to be resolved, including a plan to deal with methane, a powerful greenhouse gas, and a measure to obtain work permits and protect undocumented immigrants from deportation. The Democrats also want to address a growing backlog in green card applications.

The top Democrats seemed determined to push the polls on Thursday, even without an iron promise from the leaning moderates in the Senate to vote for the final package. Speaking to reporters in Scotland, Mr Biden said that Senate Democratic skeptic Joe Manchin III. from West Virginia, would come over.

“He will vote for it if we have what he expected in this proposal,” Biden said at a press conference before leaving a climate change summit in Glasgow. “I think Joe will be there.”

Passing the social security net and climate bill would free the House of Representatives from also approving a $ 1 trillion infrastructure bill, which the Senate passed in August and gave Mr Biden a long-delayed legislative victory. Schumer said Tuesday he hoped to have the domestic policy plan ready for debate by the week of November 15.

Five moderate and conservative Democrats wrote to Ms. Pelosi on Tuesday warning they would withhold their votes until non-partisan scorers had estimated the full cost of the legislation, telling her to wait to ensure that any proposal of the bill passed the Senate can happen. A copy of the letter reported by Politico was obtained from the New York Times.

“Better to get this right than unnecessarily rushing it just so our constituents can discover the negative effects of our unintended consequences,” wrote lawmakers, including Reps Stephanie Murphy from Florida and Jared Golden from Maine.

But one of the signatories, Oregon Rep. Kurt Schrader, signaled some flexibility, saying he would not stand a full report on the effects of the legislation, which could take weeks.

With Republicans unanimously against the bill, Democrats are pushing it through Congress using an expedited process known as budget balancing, which protects filibuster measures from a filibuster and allows them to make an easy majority decision. But in order to achieve even a narrow majority, they have to secure the support of all 50 of their senators and, with the exception of a few of their members, in the House of Representatives, given their limited scope for control.

Ms. Pelosi told reporters she hoped a final bill would be drawn up as early as Tuesday evening.

The prescription drug compromise was fiercely contested and required Democrats to overcome the onslaught of lobbying from the powerful pharmaceutical industry, which successfully mitigated their original proposal that allowed the government to negotiate prices for a wider universe of drugs. The final agreement includes a $ 2,000 annual personal spending cap for older Americans facing catastrophic health problems, a strict monthly cap of $ 35 on insulin spending, and automatic discounts on drugs that are rising faster than inflation.

But the pharmaceutical industry won its share of concessions. The inflation rebates initially included a “look back” provision that would have assessed discounts on drug prices that skyrocketed as early as 2012. This would have led to one-off charges in the billions for drug manufacturers. And some Democrats wanted Medicare to negotiate prices immediately, with no patent exclusivity periods.

Still, those in favor of the compromise believe the Medicare negotiating powers will be a first step in securing the broader powers that the Democrats have been fighting for decades.

“I don’t think this is just a camel’s nose under the tent,” said Connecticut Democrat Senator Christopher S. Murphy and one of the negotiators. “I think we have the head and part of the body in there too.”

Legislation would require significant price cuts for negotiable drugs starting in 2025. And the rules for restricting the constantly expanding patent protection are the key to reducing costs.

“The problem of evergreen patents, such that tiny changes allow these companies to maintain monopolies for years and years, is wrong,” said Senator Elizabeth Warren, Democrat of Massachusetts. “It is against the basic principle to grant these exclusivity licenses through patents and has been abused by many large pharmaceutical companies and must be discontinued.”

The changes to the Medicare benefit for prescription drugs are likely to have a big impact on consumers even sooner. There is currently no limit to how much patients can spend on their medication, and many Medicare beneficiaries face bills of $ 15,000 or more each year for taking expensive medications. In addition to setting an annual cap on self-spending, the plan would also smooth out spending across the year and eliminate the so-called donut hole when many beneficiaries are responsible for their entire drug bills.

Juliette Cubanski, an assistant director for the Kaiser Family Foundation, said the package would address key issues in the country’s drug pricing system.

If it were to become law, she said, “it would be a pretty significant achievement, especially given the opposition they have received from industry officials who have invested a lot of money to see these guidelines not go into effect.”

Mr Schumer hastened to say that he had received a signature of the deal from Senator Kyrsten Sinema, Democrat of Arizona and another centrist objector of the bill who opposed the House of Representatives much broader proposal for prescription drugs.

Her office then released a statement saying it “welcomes a new agreement on a historic, transformative Medicare drug negotiation plan that will lower the cost of ownership for seniors – to ensure drug prices do not rise faster than inflation – taxpayers save and protect innovations ”. to ensure Arizonans and Americans continue to have access to life-saving drugs and new remedies and therapeutics. “

The state and local tax settlement was still negotiated on Tuesday, but Democrats said they would put a $ 10,000 cap on what is known as the SALT deduction for five years. The suspension would begin with deductions related to property taxes and state and local income taxes, which accrued in 2021 and run through 2025.

It remained unclear whether the deal would apply across the board or be subject to an income cap to prevent the richest Americans from receiving a tax cut.

Senator Bernie Sanders, independent from Vermont and the chairman of the Budget Committee, warned he would oppose the provision unless it was restricted to the middle class.

“At a time of massive income and wealth inequality,” he said in a statement, “the last thing we should do is give more tax breaks to the very rich.”

Margot Sanger-Katz Reporting contributed.


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