August 03, 2009 17:33 ET

AMCP Is Disappointed in Health Care Reform Bill Provisions Approved by House Energy and Commerce Committee

Bill Would Eliminate Private Sector's Ability to Negotiate Lower Drug Prices for Medicare Part D; Add 12 Years of Market Exclusivity for Follow-on Biologics

ALEXANDRIA, VA--(Marketwire - August 3, 2009) - The Academy of Managed Care Pharmacy (AMCP) is disappointed at the inclusion of two pharmaceutical-related provisions approved by a House panel overseeing health care reform legislation. At a July 31 markup of H.R. 3200, the House Energy and Commerce Committee passed measures that would direct the government to negotiate drug prices with pharmaceutical manufacturers participating in the Medicare Part D drug benefit, and grant biologics manufacturers 12 years of data exclusivity before competitors could develop follow-on products.

Government studies have shown that these provisions would not result in savings to consumers or the health care system, and could, in fact, increase health care spending by billions of dollars a year.

"We are extremely concerned that the adoption of these amendments represent a step backwards for health care reform, and will not address the needs of patients or the health care system," says Judith Cahill, executive director of AMCP. "We are calling on members of Congress to remove these provisions before final action on the pending health care reform bill is taken up by lawmakers."

AMCP supports the continuation of current statutory requirements that private plan sponsors of the Medicare Part D benefit negotiate with pharmaceutical manufacturers to secure low drug prices. The current structure relies on the concept that drug price concessions are best achieved by Part D sponsors who themselves are motivated by the competitive need to provide the most cost-effective and clinically appropriate drug benefits possible.

Specifically, the new amendment approved by the House panel would repeal the current "noninterference" provision in the Medicare Prescription Drug Improvement and Modernization Act, which prohibits the government from negotiating drug prices. The new amendment retains the current law's prohibition on the establishment of a national formulary.

"The House passed a similar measure in the 'first 100 hours' two years ago that never went anywhere in the Senate," Cahill says. "The nonpartisan Congressional Budget Office has stated that repealing the noninterference provision would have a negligible effect on federal spending, because the federal government would not be able to negotiate significantly lower prices than the prices obtained by private plan sponsors charged with that responsibility."

The Senate Finance Committee, which has jurisdiction over Part D, has yet to introduce its health care reform package.

AMCP also was disappointed by the House Energy and Commerce Committee's passage of an amendment that would give biologics therapies 12 years of market exclusivity, mirroring a provision in a bill passed several weeks ago by the Senate Health, Education Labor and Pensions (HELP) Committee, which shares jurisdiction over health care.

The Academy has endorsed a bill by Henry Waxman (D-Calif.), Chairman of the House Energy and Commerce Committee, which would have granted five years of exclusivity rather than the longer period endorsed by the pharmaceutical and biotechnology industries.

"Even the Federal Trade Commission has come out in favor of the shorter time period," says Cahill. "By giving these firms an additional seven years of data exclusivity, the health care system is leaving billions of dollars on the table."

The two other House panels with jurisdiction -- the Ways and Means Committee and Education and Labor Committee -- passed versions of the bill earlier without these provisions. The House has adjourned for the August recess. When lawmakers return in September, they will need to reconcile differences before the legislation goes to the House floor. A final House bill would still need to be reconciled with any Senate health care reform package.

For more information about AMCP's positions on health care reform legislation, including the future of Medicare Part D, go to Click on the Public Policy & Advocacy tab.

About AMCP:

The Academy of Managed Care Pharmacy (AMCP) is a national professional association of pharmacists and other health care practitioners who serve society by the application of sound medication management principles and strategies to improve health care for all. The Academy's 5,700 members develop and provide a diversified range of clinical, educational and business management services and strategies on behalf of the more than 200 million Americans covered by a managed care pharmacy benefit. More news and information about AMCP can be obtained on its website, at The Academy will observe its 20th anniversary in 2009.

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