Feb 13, 2019

Axios Vitals

Good morning ... The hot Lunar New Year gift in North Korea is ... crystal meth, apparently.

1 big thing: Pharma protections trip up Trump's trade deal

Photo: Chip Somodevilla/Getty Images

Prescription drugs may be the latest snag for President Trump’s proposed NAFTA replacement.

The big picture: Trump's deal, known as USMCA, already faces an uncertain fate in the Democratic-controlled House, as my colleague Jonathan Swan reported earlier this week. And now Democrats are homing in on the deal's protections for biologic drugs, according to the Associated Press.

What they're saying: "This is an outrageous giveaway to Big Pharma," Rep. Rosa DeLauro (D-Conn.) told AP.

  • Rep. Earl Blumenauer (D-Ore.), who chairs the Ways and Means trade subcommittee, said he didn't think the agreement could pass his subcommittee without changes to the biologics provisions.

Details: The U.S. guarantees 12 years of market exclusivity to new biologic drugs, before cheaper quasi-generic competitors known as biosimilars can come to market.

  • The USMCA would require Canada and Mexico to guarantee 10 years of exclusivity for biologics. Both countries offer less than that today.
  • "By including 10 years in a treaty, we are locking ourselves in to a higher level of monopoly protection for drugs that are already taking in billions of dollars a year," Jeffrey Francer, the general counsel for a group representing generics, told AP.

The other side: Generous exclusivity periods are designed to help drugmakers recoup the cost of developing a new drug, including the cost of failed products, and biologics are particularly complex (which is why they are particularly expensive).

The bottom line: The negotiations over USMCA are dynamic and cover a lot of ground. Biologics may not sink the agreement. And the White House is hoping to peel off moderate Democrats, not necessarily the Rosa DeLauros of the world.

  • But for Democrats to be folding one of their strongest issues into this debate can’t be a good sign.
2. Young people hate the health care system more

Young people are a lot less satisfied than older generations with the experience of going to the doctor, according to a new Accenture report.


  • 24% of generation-Z patients said they were dissatisfied or very dissatisfied with the convenience of using the traditional health care system, compared with just 4% of baby boomers.
  • Gen-Z patients were also more dissatisfied than boomers about the ability to ask follow-up questions after an appointment and transparency about which tests would be done.
  • The biggest gaps, though, were in perceptions of the care itself.

Young people were also more likely to choose a provider based on their technological offerings — for example, whether appointments can be made online, or online access to health records.

My thought bubble: There's way too much hype around the idea that some app or whatever is going to turn the health care system upside down.

  • But in terms of the day-to-day patient experience, younger patients do seem to be dragging providers into the online world.
  • And to whatever extent that goes beyond pure convenience and actually promotes changes like better health records or some improved version of telehealth, there's some measurable-but-not-revolutionary chance to make the system work a little bit better.
3. Congress ❤️s Medicare Advantage

Almost 70% of Congress signed onto new letters singing the praises of Medicare Advantage, Axios' Bob Herman notes.

Yes, but: That group only includes 2 of the congressional Democrats running for president: Sen. Amy Klobuchar (D-Minn.) and Rep. Tulsi Gabbard (D-Hawaii).

Between the lines: This is an annual ritual.

  • Medicare proposes new MA payments and policies every January, and the health insurance industry gathers bipartisan signatures of support for the program before the final regulation comes out in April.
  • This's years letters mark the most congressional support Medicare Advantage has ever gotten, and it crosses party lines.

But MA is still facing questions.

  • The federal government recently signaled it wants to audit Medicare Advantage companies and claw back money that was improperly paid to plans.
  • Lawmakers praised praised the plans' out-of-pocket caps and vision benefits — but did not mention tradeoffs and concerns, like narrower networks of doctors and the controversial billing practices that have led to inflated payments.
4. Surging demand for help with surprise bills

Texas has a way to help patients appeal their surprise medical bills. It's not open to everyone. But it's still overwhelmed and unable to keep up with demand.

How it works: Texas operates a mediation program for patients hit with a surprise out-of-network bill, and it has expanded access to the program twice over the past 4 years.

  • The Texas Tribune lays out the details: Once patients file their bill with the state board, any bill collections are paused and insurers and providers have 30 days to work something out.
  • Most cases are resolved there. The others are referred to a formal mediation process.

By the numbers: Demand for the program skyrocketed last year, per the Tribune.

  • Texas received just 43 mediation requests in 2013. Last year, it received more than 4,500 complaints, totaling almost $9 million in hospital charges. Officials are expecting more than 8,000 new requests this year.

That's more than the commission can keep up with, and it's been trying to grow while still managing a workload that's very time-sensitive for patients.

  • "It's somewhat like trying to rebuild the firehouse while you're answering calls to put out fires," Texas insurance commissioner Kent Sullivan said.

Go deeper: Why ending surprise medical bills is harder than it looks

5. Booker tries to shed pro-pharma reputation

Sen. Cory Booker. Photo: Scott Olson/Getty Images

Some of the left's skepticism of Sen. Cory Booker (D-N.J.) stems from his reputation as a friend of pharma, and he's trying to change that reputation as he runs for president.

Why it matters: As Democrats figure out what and who they want in 2020, a whole lot of the process revolves around health care — not just in the potential litmus test of "Medicare for All," but also drug pricing, the Affordable Care Act and how to balance all 3 of those issues.

Booker's pro-pharma reputation has 3 big components: the industry's presence in New Jersey; its contributions to his past campaigns; and his 2017 vote against a non-binding measure to approve of importing drugs from Canada.

Yes, but: He's changed his tune ahead of 2020, STAT notes. Booker has taken a harsher tone toward pharma, even threatening to roll back their patent protections, and said he would stop taking the industry's campaign contributions.

What he's saying: "I live in Newark, a low-income community where people work for pharmaceutical companies," Booker told STAT. "They might be the lab assistant, they might be the secretary, and they value those jobs. And even they know that we can have fair pricing and still have thriving companies. This is not an either-or. And right now we have practices going on that are abusing this nation and constituents of mine."