PBM Reform is Back on the Front Burner

Sorry for the delay today. But thanks to the nice folks at South Ridge Dentistry for making my morning more pleasant than it might have been.

I feel like I’m compelled to say something about PBM reform, which appears to be (somewhat) back on track after the August recess. There is a consensus House bill circulating that every reporter in DC seems to have seen (but isn’t yet publicly available yet) that’s due to be formally introduced on Friday.

The goal seems to be to get the bill -- part of a larger package of health care transparency measures -- to a floor vote later this month. The reporting suggests that we’re getting a ban on spread pricing and some amped up PBM transparency requirements, but nothing that would tie patient coinsurance and other payments to net prices rather than list.

Caveats abound. Democrats aren’t on board, not that they need to be, largely because of other elements of the bill. And, at the risk of going all Schoolhouse Rock on you, anything the House passes would also need to pass muster with the Senate, which might have different goals.

Of course, there are lots of competing priorities, like the looming government shutdown, that may distract your elected representatives.

I have an old friend who garnered something of a reputation as a DC seer by consistently betting against Congress doing anything, even those issues where there seemed to be consensus.

I’m thinking of him today as I read the coverage.

There is a certain irony in STAT pushing a survey out to 50 biopharma companies, asking them to quantify the impact of the IRA on their decision-making, and then complaining that no one really responded.

The irony comes from the fact that STAT (and others in the media) are part of the reason that companies are gun-shy about talking about the IRA and innovation.

Companies are in a terrible catch-22. If they don’t explain the way that the IRA is causing them to shelve programs or change their development plans, they lose the ability to argue that the IRA will have an deleterious impact on innovation. This is Ed’s point, and it’s well-taken.

But if companies do talk about throttling back on research because of the punitive nature of the IRA, they get absolutely lit up for being heartless profit machines.

The best example of this is also from STAT , which featured a discussion with Genentech’s CEO last month about the gut-wrenching choices that the IRA was forcing on the company.

Here is how STAT characterized Genentech’s decision-making in the face of obvious incentives: “slow-walking … to make more money,” “delay[ing] treatments for cancer patients if it means making more money,” and “slowing down the drug for cancer patients.”

And now Ed is surprised that companies don’t want to walk into that buzzsaw?

I don’t want to pick on Ed, and I’m not claiming that I have the answer here (or even that there is an answer) about how companies should talk about their decisions. I’m only asking for some consideration of the way that this narrative can be weaponized in a way that makes dialogue substantially riskier for companies.

As Ed notes, the IRA is absolutely going to change how companies think about research, development and dealmaking. Pretending otherwise -- or chastising those companies brave enough to offer insight into their thinking -- makes it impossible to have an open and honest discussion about policy implications and muddies our ability to build the kind of system we all want.

• Speaking of the IRA’s impact on innovation, here is a new University of Chicago “policy brief” that makes the case that we’re going to lose 79 small molecule meds over the next two decades because of the IRA. Gilead funded the work. Arguing about specific numbers is for chumps, but it’s worth thinking about the underlying arguments here. If you’re caffeinated and must rush, Fierce has a good summary here.

• I like AstraZeneca CEO Pascal Soriot’s solution to the IRA “pill penalty” problem: don’t start the IRA clock until a medicine receives its first non-orphan approval. The STAT coverage of the idea is pretty delicious, too, because they quote two pharma-skeptical academics who object to the idea for reasons that contradict each other.

• The Association for Accessible Medicines pushed their annual “U.S. Generic & Biosimilar Medicines Savings Report.” It’s worth saving because it has all of the usual stats you need to quantify the generic/biosimilars market. But you might want to pay special attention to the way that PBMs get framed up in the report. My favorite visualization is on page 24.

• I’m never quite sure what to make of Mark Cuban news. The announcement that his company will be distributing a generic version of Spiriva is cool, I guess. But the piece that interests me is the involvement of the COPD Foundation. Curious what the angle of an advocacy group might be here.

• AstraZeneca is out of the IRA-lawsuit game. We’re back down to eight pieces of litigation. For now.

• The argument over how CMS should decide what is and is not “competition” for the purposes of the IRA is a hugely fascinating question (and one that’s going to get hashed out in court), but I’m not sure this STAT First Opinion gets us any closer to an answer.