Klobuchar, McCain, Grassley Urge OMB Director Mulvaney to Use Existing Executive Authority to Bring Down Prescription Drug Costs

In a letter to Office of Management and Budget (OMB) Director Mulvaney, Klobuchar, McCain, and Grassley encourage executive or administrative action to reduce the ever-increasing financial burden of prescription drugs for millions of Americans

Klobuchar, McCain, and Grassley have worked together on bipartisan legislation that would address skyrocketing prescription drug prices, including bills to allow for personal importation of medications from Canada and bills that would deter pharmaceutical companies from blocking cheaper generic alternatives from entering the marketplace

WASHINGTON, D.C. – U.S. Senators Amy Klobuchar (D-MN), John McCain (R-AZ), and Chuck Grassley (R-IA) have urged Office of Management (OMB) Director Mick Mulvaney to use existing executive authority to bring down prescription drug costs, including by certifying importation of prescription drugs from Canada. According to media reports, Mulvaney said last week that he has been actively discussing potential executive or administrative solutions with the President to address rising prescription drug costs. Additionally, Health and Human Services Secretary Tom Price has been holding “listening sessions” to discuss possible solutions.

Klobuchar, McCain, and Grassley have also worked together on bipartisan legislation that would address skyrocketing drug prices, including bills to allow for personal importation of medications from Canada, where drug prices are, on average, half the cost they are in the United States, and bills that would deter pharmaceutical companies from blocking generic alternatives from entering the marketplace. In their letter, Klobuchar, McCain, and Grassley detail how the Administration could use executive or administrative action to reduce the ever-increasing financial burden of prescription drugs for millions of Americans.

“According to media reports, you said on Thursday that you have been actively discussing potential executive or administrative solutions with the President to address rising prescription drug costs. Similarly, Secretary Price has been holding ‘listening sessions’ to discuss possible solutions. We write to express our support for such efforts that could provide immediate relief to Americans,” the senators wrote. “Consistent with your comments last week, the Administration has an opportunity to use existing statutory authority to quickly restore competition to the market with the introduction of cheaper, imported alternatives.”

The senators continued, “We urge you to seriously consider this existing statutory authority as well as explore other options for executive action. We also ask that you please provide your recommendations as to what additional authority you would require to protect American consumers. Of course, we would welcome your support of our legislation to bring down the costs of prescription drugs as well.” 

Klobuchar and McCain introduced the Safe and Affordable Drugs from Canada Act to require the Food and Drug Administration to establish a personal importation program that would allow individuals to import a 90-day supply of prescription drugs from an approved Canadian pharmacy. The bipartisan Preserve Access to Affordable Generics Act Klobuchar and Grassley introduced would crack down on anti-competitive “pay-for-delay” deals in which branded companies pay their generic competitors not to compete as part of a patent settlement. These pay-for-delay agreements delay consumer access to generic drugs, which can be as much as 90 percent cheaper than brand-name drugs. The legislation would help make sure consumers have access to the cost saving generics they need by stopping these anti-competitive pay-off agreements that keep more affordable generic equivalents off the market. In addition, Klobuchar and Grassley introduced the Creating and Restoring Equal Access to Equivalent Samples (CREATES) Act with Senators Patrick Leahy (D-VT), Dianne Feinstein (D-CA), and Mike Lee (R-UT). The CREATES Act would combat anticompetitive practices used by some brand-name pharmaceutical and biologic companies to block or delay entry of lower-cost generic drugs in the marketplace. 

The full text of the senators’ letter is below.

Dear Director Mulvaney:

According to media reports, you said on Thursday that you have been actively discussing potential executive or administrative solutions with the President to address rising prescription drug costs. Similarly, Secretary Price has been holding “listening sessions” to discuss possible solutions. We write to express our support for such efforts that could provide immediate relief to Americans. 

We have worked together on bipartisan legislation that would address skyrocketing drug prices, including bills to allow for personal importation of medications from Canada, where drug prices are, on average, half the cost they are in the United States, and bills that would deter pharmaceutical companies from blocking cheaper generic alternatives from entering the marketplace.

While we pursue these legislative options in Congress, we strongly encourage you to take executive or administrative action to reduce the ever-increasing financial burden of prescription drugs for millions of Americans. We have previously outlined ways that the Administration could implement such strategies in a targeted manner that satisfies rigorous safety standards.

Specifically, we wrote to Secretary Price in February urging him to utilize authority the Administration already has under law. Our letter highlighted that Congress enacted legislation in 2003 that would enable importation of less costly medications from abroad. Under this law, the Food and Drug Administration (FDA) can permit pharmacists and wholesale retailers to import prescription drugs from Canada. Additionally, the FDA can issue a waiver to allow individuals to import prescription drugs for personal use. However, this law stipulates that the provisions related to importation do not become effective until the Secretary of Health and Human Services certifies that the implementation of importation would pose no additional risk to the public's health and safety and would result in a significant reduction in the cost of covered products to the American consumer.

Consistent with your comments last week, the Administration has an opportunity to use existing statutory authority to quickly restore competition to the market with the introduction of cheaper, imported alternatives. Under the statute, the Secretary has the authority to issue the certification in a targeted manner to address the current market conditions in a way that readily meets safety standards. The policy can also be expressly limited so that it does not negatively affect innovator companies that invested in the development of the drug.

We urge you to work with Secretary Price to immediately begin considering certifying importation of prescription drugs from Canada in the following circumstances:

1.               The drug is off patent or no longer marketed in the United States by the innovator company that initially developed the drug;

2.              In cases where there are significant and unexplained increases in price;

3.              No direct competitor drug is currently in the market and introduction of a competitor drug will benefit the prices paid by taxpayers and consumers; or

4.              The drug is produced in another country by the name brad manufacturer that initially developed the drug or by a well-known generic manufacturer that commonly sells pharmaceutical products in the United States.

We urge you to seriously consider this existing statutory authority as well as explore other options for executive action. We also ask that you please provide your recommendations as to what additional authority you would require to protect American consumers. Of course, we would welcome your support of our legislation to bring down the costs of prescription drugs as well. 

We look forward to your timely response to this request.

Grassley, Klobuchar, Gardner Introduce Legislation to Help Rural Hospitals Stay Open, Focus on Emergency Room Care, Outpatient Services

WASHINGTON, May 17, 2017 – Sen. Chuck Grassley of Iowa, Sen. Amy Klobuchar of Minnesota and Sen. Cory Gardner of Colorado today re-introduced legislation to help rural hospitals stay open while meeting the needs of rural residents for emergency room care and outpatient services. 

“A car accident or a heart attack is dangerous under the best of circumstances, but it’s a lot more dangerous for someone who’s far away from an emergency room,” Grassley said.  “When a rural hospital closes, its emergency room closes with it. This proposal will fill a pressing need, help keep hospital doors open, and offer hospital services where and when people need them most.”

“Our rural hospitals are essential institutions in communities across Minnesota. They don’t just provide vital health services, they employ thousands of doctors, nurses, pharmacists and other health care workers,” Klobuchar said. “Millions of people depend on keeping these hospitals open. Our bipartisan legislation will help ensure that rural Minnesotans and Americans across the country have access to medical care when and where they need it most.”

“Coloradans living in rural communities should not be denied access to healthcare simply because they do not live in a large metropolitan area,” Gardner said.  “This commonsense, bipartisan legislation provides rural hospitals an option to continue providing emergency services to rural America even if they do not meet Medicare’s criteria for inpatient beds. During an emergency, time is of the essence, and it is critical that we maintain access to life-saving treatment regardless of your zip code.”   

The senators noted that 60 percent of trauma deaths in the United States occur in rural areas, where only 15 percent of the population is represented.  The pace of rural hospital closures is accelerating, and many other hospitals that haven’t closed are struggling to keep their doors open.

Under Medicare, many rural hospitals are designated as Critical Access Hospitals, meaning they have to maintain a certain amount of inpatient beds as well as an emergency room.  Many hospitals struggle to attract enough inpatients to keep their Critical Access Hospital status.  When they close their doors, it often means a community loses its emergency services.  Studies show that proximity to an emergency room often means the difference between life and death.   

The senators’ bipartisan bill, the Rural Emergency Acute Care Hospital (REACH) Act, would create a new Rural Emergency Hospital classification under Medicare.  The hospital would have an emergency room and outpatient services.  It would not have the inpatient beds that many hospitals are struggling to maintain.  For example, a patient in a rural hospital with kidney disease might go to his community hospital for dialysis as an outpatient service.  He would go to a separate major hospital for specialized care such as a kidney operation.  He would go to his community hospital for emergency care for an acute episode, when time is of the essence.

The bill wouldn’t force any new requirements on hospitals.  It simply would offer them a new option. The hospitals would have to maintain some protocols in exchange for removing inpatient services, such as being able to rapidly move a patient to a larger hospital elsewhere that offers more services.

The bill text is available here. 

Kaiser Poll: Majorities of Democrats, Republicans and Independents Support Actions to Lower Drug Costs, Including Allowing Americans to Buy Drugs from Canada

Most Say Importing Canadian Drugs Would Lower Costs Without Affecting Quality, Though Some Have Concerns About Unsafe Drugs and Disincentives for Research and Development

May 01, 2017--When asked about a series of health care priorities facing President Trump and Congress, six in 10 Americans (60%) identify lowering the cost of prescription drugs as a “top priority” for President Trump and Congress – including majorities of Democrats, independents, and Republicans.

The latest Kaiser Health Tracking Survey examines the public’s views on potential policies to address drug costs – and finds majority support for nine different potential actions. 

This includes overwhelming support for allowing the federal government to negotiate with drug companies to get a lower price on medications for people on Medicare (92%), making it easier for generic drugs to come to market (87%), and requiring drug companies to release information to the public on how they set drug prices (86%).

Other proposals with significant majority support include allowing Americans to buy prescription drugs imported from Canada (72%) or from online pharmacies based in Canada (64%).

A majority of Republicans, Democrats, and independents favor eight of the nine specific policies.  The lone exception is encouraging people to buy lower-cost drugs by requiring them to pay a higher share if they choose a similar, higher-cost drug – favored by majorities of Republicans (57%) and independents (60%) but a smaller share of Democrats (40%).

The poll also probes more deeply into the public’s views of how allowing Americans to import drugs from Canada or purchase drugs through online Canadian pharmacies would impact costs, quality and safety.

Most think that each of these policy changes would make medicines more affordable without sacrificing safety or quality (76% say this about imported drugs; 68% say so about online pharmacy sales).

Fewer say either change would expose Americans to unsafe medicines from other countries (35% and 39%, respectively) or lead U.S. drug companies to do less research and development (29% and 33%, respectively).

The findings come from the late April Kaiser Health Tracking Poll, designed and analyzed by public opinion researchers at the Kaiser Family Foundation and conducted from April 17- April 23 among a nationally representative random digit dial telephone sample of 1,171 adults. Interviews were conducted in English and Spanish by landline (421) and cell phone (750). The margin of sampling error is plus or minus 3 percentage points for the full sample. For results based on subgroups, the margin of sampling error may be higher.