HHS nominee calls lowering drug prices one of his ‘top priorities’

Alex Azar II, President Donald J. Trump’s nominee to be the administration's second HHS secretary acknowledged that “all drug prices are too high” and said lowering them would be one of his top priorities if confirmed at a Senate Finance Committee hearing today.

The drug pricing issue has become increasing relevant, with prescription prices rising almost 10% in 2016 from the year before. Egregious examples of price increases such as EpiPen’s 500% price increase since 2007, prices of certain dermatology drugs spiking more than 400% since 2009, and oral cancer drug prices that have risen steadily since 2000 have been noted by medical professionals, researchers and lawmakers.

In his testimony, Azar outlined his strategy at today’s hearing, which included expanding the government’s ability to negotiate drug prices, reversing the incentive on list prices, having what Azar called a “robust” competition for both generic and branded drugs, as well as a “viable and robust” biosimilar market, and review the patent process.

He also claimed that other countries “are not paying their fair share” in developing new medications and that he was generally in favor of transparency on drug pricing with some exceptions.

“Transparency is generally very helpful, but we have to be careful around drug pricing to make sure we don’t do anything that could be anti-competitive and counter-productive to what we are trying to do,” Azar said. “We also have to think about what the benefit and the harm would be to the consumer.”

He added that though his experience, which includes, according to a report in USA Today, about a decade at Eli Lilly, will help him hit the ground running in this area, slowing or reversing the curve on drug prices will require a long-term fix.

“This is such a complex area, the learning curve for any other individual would be so high,” Azar said at one point. “There’s no silver bullet here,” Azar said. “There’s not one action that all of a sudden will fix [high drug prices]. I want to hear ideas from others.”

Lawmakers disagreed how Azar’s former experience in the pharmaceutical industry would help bring that goal to fruition.

“Mr. Azar had a major role over drug prices for every product Lilly marketed in the United States,” Senator Ron Wyden (D-Oregon) said. He went onto point out that prices of Lilly’s arthritis, diabetes and ADHD drugs doubled during Azar’s tenure.

“Some people think that Azar’s work in the pharmaceutical industry as an executive over the past 10 years disqualifies him to serve this position,” Senator Orrin Hatch (R-Utah) said. “That was not the standard some applied to nominees during the previous administration, and it should not apply to this one.”

Azar’s background is unusual, as most former HHS secretaries had backgrounds in politics or academia, rather than the pharmaceutical industry.

Azar, who served as general counsel and deputy secretary at HHS under former president George W. Bush, also faced questions on the opioid epidemic, the solvency of Medicare and Medicaid and the future of the Affordable Care Act. Though he declined to comment on specific administration plans announced thus far as he has not been privy to the discussions behind them, Azar offered his personal thoughts on how he would address these health care issues if confirmed.

Opioid epidemic

Azar said the “scourge” of the opioid epidemic would be brought under control by supporting prevention, regulatory and enforcement efforts. He also said it will take a combination of additional ideas originating outside of Washington, in the communities where the epidemic is especially severe, to find suitable solutions.

“When it comes to prevention and treatment programs, there is not a one-size-fits-all approach, he said. “We need to get out there and see what’s working, not just so we can support them but so that we can replicate them and make them available elsewhere.”

Medicaid

Azar indicated he would work to keep Medicaid as efficient and effective as possible, noting that its focus must be shifted from paying for disease and sickness to paying for health and outcomes.

He was pressed by Senator Bob Casey (D-Pennsylvania) on whether or not the “guarantee” of Medicaid would still be there.

“Whatever we do in Medicaid, we need to make sure it’s doing its job,” Azar said. “For individuals with disabilities... we have to make sure its funded and supported for them.”

Azar also indicated he favors a tailored approach to Medicaid where each state “meets the needs of their citizens,” rather than making across the board, nationwide changes. Block grants to the states were a significant component of GOP efforts at repealing and replacing the Affordable Care Act in 2017. He added that President Trump has stated that the federal budget deficit cannot be filled by cutting Medicare, Medicaid, and other programs.

“I would advise [Trump] to keep his word on that,” Azar said, “but I don’t have the broader context of any discussions [currently] going on.”

Affordable Care Act

“We must make health care more affordable, more available and more tailored to what individuals want and need in their care. We all share a common concern for our Americans who are struggling to achieve access to quality health care,” Azar said. “Even if we do not necessarily agree on how to best address that challenge, under the status quo premiums have been skyrocketing year after year and options have been dwindling. We’ve got to address these challenges... What we have now is not working.”

He also indicated he is in favor of empowering states to run their own health care budgets, as was described in the Graham-Cassidy Bill. He also stated that he is in favor of allowing health insurance to be purchased across state lines.

CHIP

Immediately prior to Azar’s testimony today, lawmakers from both parties agreed to work to a long-term solution for funding the Children’s Health Insurance Program, or CHIP.

There is currently funding for CHIP through March. Lawmakers have 10 days from today to find such a solution.

“I am committed to seeing it reauthorized. It’s one of the most important programs that I’ve worked on,” Hatch said. “The time for short term fixes is over.”

“We all understand that we have to get this [reauthorization of CHIP] done, and get it done quickly,” Wyden added.

Azar said during his remarks that assuming the program is reauthorized, he would take an “open-minded” approach to continuing it, seeking feedback from lawmakers who are more familiar with what works and what does not.

Societies' stances

When Azar's nomination when it was first announced in November, an AMA spokesperson told Healio Family Medicine: “Alex Azar is a capable and proven administrator who has a deep understanding of the HHS portfolio based on his prior work as Deputy Secretary and General Counsel.”

AMA has previously applauded actions by the Trump administration to combat the opioid crisis, including FDA commissioner Scott Gottlieb's "unequivocal endorsement" of Medication Assisted Treatment for opioid use disorder. The Association also said it supported the President’s Commission on Combating Drug Addiction and the Opioid Crisis, which made several recommendations, including updating and supplementing CDC guidelines that are specifically targeted to primary care physicians.

Prior to Azar's nomination, AAFP and ACP had sounded the alarm over rising drug prices. The Academy joined forces with the Campaign for Responsible Rx Pricing to “strike a balance between innovation and affordability in the pharmaceutical industry.” The College issued a position paper that, among other things, called for drug pricing transparency, noting that high drug prices impact patients' health care.

Next steps

Azar’s nomination now goes to the full Senate for confirmation. A date for that vote had not been determined at the time of publication. His confirmation is expected given the Republican majority in the Senate and the lack of any significant controversies arising during the vetting process.

He is being tapped to replace Tom Price, who resigned in September amidst a scandal surrounding his use of private charter airplanes for government business trips. – by Janel Miller

Disclosure: Healio Family Medicine was unable to determine relevant financial disclosures prior to publication.

Alex Azar II, President Donald J. Trump’s nominee to be the administration's second HHS secretary acknowledged that “all drug prices are too high” and said lowering them would be one of his top priorities if confirmed at a Senate Finance Committee hearing today.

The drug pricing issue has become increasing relevant, with prescription prices rising almost 10% in 2016 from the year before. Egregious examples of price increases such as EpiPen’s 500% price increase since 2007, prices of certain dermatology drugs spiking more than 400% since 2009, and oral cancer drug prices that have risen steadily since 2000 have been noted by medical professionals, researchers and lawmakers.

In his testimony, Azar outlined his strategy at today’s hearing, which included expanding the government’s ability to negotiate drug prices, reversing the incentive on list prices, having what Azar called a “robust” competition for both generic and branded drugs, as well as a “viable and robust” biosimilar market, and review the patent process.

He also claimed that other countries “are not paying their fair share” in developing new medications and that he was generally in favor of transparency on drug pricing with some exceptions.

“Transparency is generally very helpful, but we have to be careful around drug pricing to make sure we don’t do anything that could be anti-competitive and counter-productive to what we are trying to do,” Azar said. “We also have to think about what the benefit and the harm would be to the consumer.”

He added that though his experience, which includes, according to a report in USA Today, about a decade at Eli Lilly, will help him hit the ground running in this area, slowing or reversing the curve on drug prices will require a long-term fix.

“This is such a complex area, the learning curve for any other individual would be so high,” Azar said at one point. “There’s no silver bullet here,” Azar said. “There’s not one action that all of a sudden will fix [high drug prices]. I want to hear ideas from others.”

Lawmakers disagreed how Azar’s former experience in the pharmaceutical industry would help bring that goal to fruition.

“Mr. Azar had a major role over drug prices for every product Lilly marketed in the United States,” Senator Ron Wyden (D-Oregon) said. He went onto point out that prices of Lilly’s arthritis, diabetes and ADHD drugs doubled during Azar’s tenure.

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“Some people think that Azar’s work in the pharmaceutical industry as an executive over the past 10 years disqualifies him to serve this position,” Senator Orrin Hatch (R-Utah) said. “That was not the standard some applied to nominees during the previous administration, and it should not apply to this one.”

Azar’s background is unusual, as most former HHS secretaries had backgrounds in politics or academia, rather than the pharmaceutical industry.

Azar, who served as general counsel and deputy secretary at HHS under former president George W. Bush, also faced questions on the opioid epidemic, the solvency of Medicare and Medicaid and the future of the Affordable Care Act. Though he declined to comment on specific administration plans announced thus far as he has not been privy to the discussions behind them, Azar offered his personal thoughts on how he would address these health care issues if confirmed.

Opioid epidemic

Azar said the “scourge” of the opioid epidemic would be brought under control by supporting prevention, regulatory and enforcement efforts. He also said it will take a combination of additional ideas originating outside of Washington, in the communities where the epidemic is especially severe, to find suitable solutions.

“When it comes to prevention and treatment programs, there is not a one-size-fits-all approach, he said. “We need to get out there and see what’s working, not just so we can support them but so that we can replicate them and make them available elsewhere.”

Medicaid

Azar indicated he would work to keep Medicaid as efficient and effective as possible, noting that its focus must be shifted from paying for disease and sickness to paying for health and outcomes.

He was pressed by Senator Bob Casey (D-Pennsylvania) on whether or not the “guarantee” of Medicaid would still be there.

“Whatever we do in Medicaid, we need to make sure it’s doing its job,” Azar said. “For individuals with disabilities... we have to make sure its funded and supported for them.”

Azar also indicated he favors a tailored approach to Medicaid where each state “meets the needs of their citizens,” rather than making across the board, nationwide changes. Block grants to the states were a significant component of GOP efforts at repealing and replacing the Affordable Care Act in 2017. He added that President Trump has stated that the federal budget deficit cannot be filled by cutting Medicare, Medicaid, and other programs.

PAGE BREAK

“I would advise [Trump] to keep his word on that,” Azar said, “but I don’t have the broader context of any discussions [currently] going on.”

Affordable Care Act

“We must make health care more affordable, more available and more tailored to what individuals want and need in their care. We all share a common concern for our Americans who are struggling to achieve access to quality health care,” Azar said. “Even if we do not necessarily agree on how to best address that challenge, under the status quo premiums have been skyrocketing year after year and options have been dwindling. We’ve got to address these challenges... What we have now is not working.”

He also indicated he is in favor of empowering states to run their own health care budgets, as was described in the Graham-Cassidy Bill. He also stated that he is in favor of allowing health insurance to be purchased across state lines.

CHIP

Immediately prior to Azar’s testimony today, lawmakers from both parties agreed to work to a long-term solution for funding the Children’s Health Insurance Program, or CHIP.

There is currently funding for CHIP through March. Lawmakers have 10 days from today to find such a solution.

“I am committed to seeing it reauthorized. It’s one of the most important programs that I’ve worked on,” Hatch said. “The time for short term fixes is over.”

“We all understand that we have to get this [reauthorization of CHIP] done, and get it done quickly,” Wyden added.

Azar said during his remarks that assuming the program is reauthorized, he would take an “open-minded” approach to continuing it, seeking feedback from lawmakers who are more familiar with what works and what does not.

Societies' stances

When Azar's nomination when it was first announced in November, an AMA spokesperson told Healio Family Medicine: “Alex Azar is a capable and proven administrator who has a deep understanding of the HHS portfolio based on his prior work as Deputy Secretary and General Counsel.”

AMA has previously applauded actions by the Trump administration to combat the opioid crisis, including FDA commissioner Scott Gottlieb's "unequivocal endorsement" of Medication Assisted Treatment for opioid use disorder. The Association also said it supported the President’s Commission on Combating Drug Addiction and the Opioid Crisis, which made several recommendations, including updating and supplementing CDC guidelines that are specifically targeted to primary care physicians.

PAGE BREAK

Prior to Azar's nomination, AAFP and ACP had sounded the alarm over rising drug prices. The Academy joined forces with the Campaign for Responsible Rx Pricing to “strike a balance between innovation and affordability in the pharmaceutical industry.” The College issued a position paper that, among other things, called for drug pricing transparency, noting that high drug prices impact patients' health care.

Next steps

Azar’s nomination now goes to the full Senate for confirmation. A date for that vote had not been determined at the time of publication. His confirmation is expected given the Republican majority in the Senate and the lack of any significant controversies arising during the vetting process.

He is being tapped to replace Tom Price, who resigned in September amidst a scandal surrounding his use of private charter airplanes for government business trips. – by Janel Miller

Disclosure: Healio Family Medicine was unable to determine relevant financial disclosures prior to publication.

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