Jan 10, 2017

Axios Vitals

By Caitlin Owens
Caitlin Owens

Good morning, and welcome back to Vitals. Today, we're looking at a few things besides Obamacare, like drug prices and cybersecurity. But Obamacare repeal is still in the works, and it's not going very well. Our goal will always be to give you the news that deserves your attention, whether that's a few things or a lot.

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Wasn't Obamacare repeal supposed to be the easy part?

Two big signs of Republican unrest Monday night over repealing before a replacement is ready:

  • Five moderate Senate Republicans introduced an amendment pushing back the deadline for repeal legislation by more than a month.
  • The chairman of the conservative House Freedom Caucus said he wanted to wait to see an Obamacare replacement before voting on the budget resolution that starts the repeal process.

That's two mini-revolts coming from opposite ends of the GOP, and they're both wakeup calls for Republican leaders who had hoped to start repeal with a big Senate vote this week. That vote — which was supposed to come late Wednesday night or early Thursday morning — may no longer be an easy victory. And the later vote on a detailed repeal plan could be in serious jeopardy.

In other repeal news: Not to worry
"Not even a little bit. That's going to all work out."— President-elect Trump, earlier Monday, on whether he was worried about the GOP not having a replacement plan ready for Obamacare

For context: Trump is leaning on congressional Republicans to vote on repeal and the replacement at the same time, which GOP leaders don't really want to do. "We'll be talking about it on Wednesday," Trump said — the day he's supposed to have a news conference.

Valeant sells cancer business to Chinese conglomerate

The pharmaceutical company announced late Monday night that it's selling its Dendreon cancer business, which markets a prostate cancer treatment called Provenge, to the Chinese conglomerate Sanpower for $819.9 million. The Wall Street Journal reports that it's all part of a move by Valeant to focus on key franchises and pay down its $30 billion debt. The company was already in political trouble because of its aggressive price hikes.

The bottom line, according to the Journal: "Valeant wasn't a big player in cancer, and Provenge proved a disappointing fit."

One more big sale Monday, announced at the J.P. Morgan Healthcare Conference: Japan's Takeda Pharmaceuticals Inc. is buying the Massachusetts biotech Ariad Pharmaceuticals for $5.2 billion. That will help Takeda diversify its portfolio of hematology drugs, but it will also be a big help to Ariad shareholders, the Boston Globe's Robert Weisman reports.

Grassley's goal on drug prices: Help generics

While you and everyone else have been freaking out about Obamacare, Sen. Chuck Grassley is still thinking about drug prices. Grassley, chairman of the Judiciary Committee and one of the most vocal Republicans on prescription drug prices, tells Caitlin Owens he has three things he'd like to do this year on the issue:

  • Crack down on patented drug companies paying generics to stay off the market
  • Keep brand-name companies from withholding information necessary for generics to come to market
  • Allow the importation of drugs from abroad

The last idea is outside the committee's jurisdiction, not to mention a Democratic favorite, so don't hold your breath. But watch the other two. Grassley has sponsored legislation with Democratic Sen. Amy Klobuchar addressing both of them, and both are in Judiciary's jurisdiction. And watch for Caitlin's full interview with Grassley when Axios launches later this month.

The dirty little secret of Obamacare repeal: Taxes

Grassley, who is also a senior member of the Finance Committee, said he doesn't think there's any way to replace Obamacare without paying for it with taxes. One potential solution, Grassley said, would be to address the taxes in a tax reform package. "If you got tax revision and replacement at the same time in the same package, it's kind of hidden," he said.

Thought bubble: How would that go over with the anti-tax hardliners?

Burwell's advice to Price: Pay attention to cybersecurity

A big and important moment came near the end of Health and Human Services Secretary Sylvia Burwell's speech to the National Press Club on Monday. The topic was Obamacare, but her eyes lit up when the topic turned to cybersecurity. "This is very important, and I would tell my successor that it needs to be prioritized," she said.

It's a newly urgent topic after the highly publicized security breaches at companies like Anthem, Premera Blue Cross and Quest Diagnostics. But Burwell said she's been worried about it for a long time. "People don't want to spend time on it, and they don't want to spend money on it," Burwell said — but they should.

Don't worry, your pacemaker probably won't be hacked

The most eye-opening cybersecurity story of the day didn't involve medical records. It was about Abbott Laboratories' St. Jude Medical, which announced it was releasing cybersecurity updates for its heart devices after the Food and Drug Administration found "vulnerabilities" that could allow people to gain remote access to the devices, per Reuters.

The FDA's main message, echoed by St. Jude in its own release, was that nothing bad has actually happened. And the agency concluded that "the health benefits to patients from continued use of the device outweigh the cybersecurity risks." Still, the potential for bad stuff — including "inappropriate pacing or shocks," according to the FDA — helps explain why St. Jude is pushing out those security updates so quickly.

Caitlin Owens

What we're watching this week: Trump press conference Wednesday, Senate vote on budget resolution that starts the Obamacare repeal process.

Thanks for reading. As always, tips, leaks, and other feedback: david@axios.com.