Axios Vitals

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March 07, 2019

Good morning ... Sad news for $600: The Axios health care team sends its best wishes to this beloved game show host, who announced yesterday that he has pancreatic cancer.

1 big thing: Gottlieb's legacy of faster drug approvals

Data: Evaluate; Chart: Axios Visuals
Data: Evaluate; Chart: Axios Visuals

Outgoing Food and Drug Administration commissioner Scott Gottlieb presided over 2 years of relative leniency toward novel drug therapies, according to an Evaluate analysis.

Why it matters: While this was good for investors and drug companies, the impact on patients isn't yet clear, Axios' Caitlin Owens writes.

Most of these experimental approvals were for cancer drugs, which can get approved quickly when a patient is out of options.

Details: In 2017 and 2018, there were record numbers of accelerated drug approvals based on early signs that the drug was effective, rather than the full approval process.

  • Most of these accelerated approvals were based on information from small clinical trials, without concrete evidence of drugs' effectiveness, Evaluate notes.
  • And most of these approvals have not yet been converted into full approvals based on more rigorous conditions.
  • "Mr. Gottlieb was considered a friendly face by drug developers and investors, a safe pair of hands in an administration rife with unpredictability," the authors of the analysis write.

2. A bipartisan baby step on drug patents

Republican Sen. Susan Collins and a bipartisan group of her colleagues are wading very gently into the debate about drug companies' patent protections, specifically the "thickets" of patents that keep competitors at bay for complex biologic drugs.

Driving the news: Collins introduced a bill yesterday that would ensure that biologics' patents are included on a list the FDA already maintains.

  • Brand-name drugmakers would also have a harder time winning the inevitable lawsuits over any new patents they file after a biosimilar competitor has filed for FDA approval.

Reality check: This is not necessarily a very muscular bill.

  • Drugmakers are already pretty upfront about their patent protections; a different kind of public listing for those patents would not be a disincentive to keep filing them.

Yes, but: Any congressional interest in drug patents — and any tacit agreement that pharma companies game that system — opens a door that the industry's lobbyists are working very hard to keep closed.

Go deeper: Big Pharma's GOP firewall is weakening

3. Pharma companies hate PBMs, but still need them

Pharmaceutical companies put a lot of the blame for high drug prices on pharmacy benefit managers. But big drug companies are also big employers — which means they rely on PBMs to manage their own health care benefits.

Why it matters: PBMs are part of the system, so it's not necessarily surprising that drug companies use them.

  • But it's not clear whether pharma companies are practicing what they preach on the details of PBM contracts and the way savings are distributed.

Between the lines: The 7 pharma executives who testified before the Senate last week spent plenty of time beating up on PBMs. My colleague Bob Herman went back to ask those 7 companies how they handle pharmacy benefits for their own employees.

  • Bristol-Myers Squibb said it uses CVS Caremark. AbbVie and Pfizer declined to answer Axios' questions, but a search of AbbVie's and Pfizer's employee benefits shows they use CVS Caremark for their employees, dependents and retirees.
  • AstraZeneca and Johnson & Johnson both said they hire Express Scripts for their employee drug benefits. Merck and Sanofi declined to answer, but both companies appear to use Express Scripts.

The intrigue: When it comes to public policy, drugmakers argue that PBMs' discounts should be delivered to customers at the pharmacy counter, rather than held back and used to reduce insurance premiums. But it's unclear whether that's how they operate.

  • Bristol-Myers Squibb said that "in lieu of receiving rebates back directly from CVS Caremark," its "employees, eligible dependents and retirees realize lower out-of-pocket amounts."

4. New push for insurance across state lines

Remember when President Trump campaigned on a health care platform of eliminating "the lines around the states?" Well, that particular white whale has reemerged.

The Trump administration posted a 15-page document yesterday asking for public comment on a range of questions related to the interstate sale of health insurance — including questions about using part of the Affordable Care Act to make that change.

How it works: Critics see this as a backdoor way to deregulate insurance. If a patient in New York can buy a lightly regulated policy from Iowa, what good are New York's rules about what plans have to cover and how they have to cover it?

  • There are logistical hurdles: It's pretty hard to set up a network of doctors and hospitals that will work for patients in both Iowa and New York.

Between the lines: The administration already took a bit of a victory lap on this front when it expanded access to association health plans.

  • That wasn't a full-scale deregulation, but it did expand of a type of insurance that can cross state lines — even though, due to the difficulty of creating provider networks, those plans are generally confined to one metro area.

5. Hello, Haven

The new nonprofit health care company founded by Amazon, Berkshire Hathaway and JPMorgan Chase will officially be known as Haven, the companies said Wednesday.

Between the lines: A lot is still unknown about Haven, other than that it will use "data and technology" to try to improve employer health care and that it is "committed to doing this work for the long term," according to a note from Haven CEO Atul Gawande.