HEALTH CARE BRIEFING: Senate Staffs Meet Referee on Drug Pricing

Democrats are hoping to clear a key procedural hurdle today for their legislation to direct the government to demand lower prices from drugmakers and expand Obamacare premium subsidies. Senate Democratic and GOP staffers will argue before the chamber’s parliamentarian on whether parts of the bill could qualify for the budget reconciliation process, which allows some kinds of legislation to pass via a simple major in the Senate.

Sen. Mike Crapo (R-Idaho), the senior Republican on the Senate Finance Committee, said the plan is to “stop them from getting anywhere outside the boundaries” of reconciliation. “We’re looking at the entire bill line by line to find anything that is subject to a Byrd objection,” Crapo said, referring to a process where senators can formally object to a provision that falls outside the budget reconciliation process.

• BGOV OnPoint: Senate Democrats Revive Drug Pricing Bill

The boundaries of reconciliation are complicated, but largely permit only legislation that direct impacts federal spending or revenues. Republicans have in particular eyed drug pricing provisions that cap increases on the cost of medicine for private health insurance plans as possibly not qualifying for reconciliation, according to two sources familiar with discussions.

To extend the savings beyond Medicare, Democrats have sought to apply the pricing caps as much as possible to employer-sponsored and other private insurance plans, rather than only for Medicare plans. The caps on drug price hikes—requiring drugmakers that increase their prices faster than inflation to pay back that excess amount to the federal government—are set to apply broadly and amount to a tax on the pharmaceutical industry.

Crapo insisted there’s a long list of provisions that Republicans will aim to disqualify, but declined to go into details. Senate Finance Chairman Ron Wyden (D-Ore.), whose panel has helped craft the drug-pricing language, said Democrats have specifically written the bill to pass through the reconciliation process. “I feel we’re in a strong position,” he said.

Losing key provisions like the pricing caps would mean the bill won’t go as far in reducing government spending, making it harder for Democrats to attach new spending, Sen. Ben Cardin (D-Md.) said. Democrats want to argue for climate change legislation and extending Obamacare premiums subsidies as long as possible, he said. “The parameters of the bill could change based on the ruling of the parliamentarian and scoring,” Cardin said.

Also Happening on the Hill

Republicans Mull Birth Control Vote Amid Democrats Pressure: House Republicans will be allowed to vote today on a bill (H.R. 8373) to codify access to contraception if they want to as Democrats are poised to use votes against birth control access against the GOP ahead of the midterms. The hands-off approach by House GOP leadership follows a Tuesday vote in which 47 Republicans joined all House Democrats to enshrine same-sex marriage in law (H.R. 8404). Read more from Emily Wilkins.

• Read more in a BGOV Bill Summary by Christina Banoub.
• Meanwhile, in Georgia, a state law barring abortions after a fetal heartbeat is detected can now be enforced, judges on the Eleventh Circuit said, citing the US Supreme Court decision finding no constitutional right to the procedure. The judges vacated a lower court’s injunction on the state’s controversial abortion law prohibiting the procedure around six weeks into pregnancy. Read more from Celine Castronuovo.

House Passes Six-Bill Funding Package: The House passed a six-bill government funding package totaling just over $400 billion—about a fourth of discretionary funds for fiscal 2023—by a 220-207 vote. It includes a provision to block reviews of drugs by Russian pharmaceutical companies. Jack Fitzpatrick has more.

Califf Asks for FDA Money: Food and Drug Administration Commissioner Robert Califf told a panel of Senate appropriators that his agency needs specific funding to continue its response to the ongoing infant formula shortage. Lawmakers pressed Califf about his agency’s response to the crisis, which began after an FDA inspection of an Abbott Nutrition plant in Michigan led to a formula recall.

The FDA moved workers from other areas of the agency to help with the response around the clock, Califf added, “but we can’t sustain that without specific funding.” He noted that the agency has long had issues hiring and retaining staff for its food safety programs. Califf on Tuesday announced an external review of its food safety division, which lawmakers and former officials argued shouldn’t be a priority for the agency, Maeve Sheehey reports.

Pot Decriminalization Bill Set for Senate Introduction Thursday: Senate Democrats are set to introduce a bill Thursday that would federally decriminalize, regulate and impose taxes on cannabis products. Majority Leader Chuck Schumer (D-N.Y.) and Sens. Cory Booker (N.J.) and Wyden, the sponsors, revised the measure, which faces significant obstacles in the chamber, after circulating a draft version last year and receiving feedback from Senate committees. Read more from Jarrell Dillard.

What Else to Know Today

HHS Gets Powers to Coordinate Pandemic Response: The Biden administration is giving new powers to an office within the Health and Human Services Department to take on a more prominent role in responding to public health crises, from pandemics to natural disasters. The Office of the Assistant Secretary for Preparedness and Response will be authorized to “mobilize a coordinated national response more quickly and stably,” Dawn O’Connell, the head of the unit, said in a memo.

The office will be renamed the Administration of Strategic Preparedness and Response and will be reclassified an operating division alongside other major health agencies like the CDC and FDA, according to the memo obtained by Bloomberg News. Read more from Riley Griffin.

Industry Lobbying Figures: The Pharmaceutical Research and Manufacturers of America, the country’s largest drugmaking industry group, spent $6.34 million on lobbying in the second quarter of 2022—down from $6.43 million in the same span in 2021. Its year-to-date spending is $14.4 million, down from last year’s $14.9 million. Last year’s spending came as Democrats were preparing sweeping drug pricing and Medicare negotiation legislation before it stalled in December, Alex Ruoff reports.

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With assistance from Maeve Sheehey

To contact the reporters on this story: Brandon Lee in Washington at blee@bgov.com; Alex Ruoff in Washington at aruoff@bgov.com

To contact the editors responsible for this story: Giuseppe Macri at gmacri@bgov.com; Michaela Ross at mross@bgov.com