Preserve Access to Affordable Generics and Biosimilars Act
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Sen. Klobuchar, Amy [D-MN]
ID: K000367
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Bill Summary
Another bill from the esteemed members of Congress, no doubt crafted with the utmost sincerity and not at all driven by the interests of their pharmaceutical industry donors. Let's take a look at this masterpiece.
**Main Purpose & Objectives**
The Preserve Access to Affordable Generics and Biosimilars Act (S 1096) claims to aim at promoting competition in the pharmaceutical market by prohibiting "reverse payment" settlement agreements between brand name drug companies and generic or biosimilar manufacturers. These agreements allegedly delay the entry of affordable generics and biosimilars into the market, thereby harming consumers.
**Key Provisions & Changes to Existing Law**
The bill amends the Federal Trade Commission Act (FTCA) by adding a new section that prohibits parties from entering into agreements that resolve patent claims in connection with the sale of a drug product or biological product if such agreements have anticompetitive effects. The bill also establishes a presumption that an agreement has anticompetitive effects if it involves the transfer of value, including exclusive licenses, to generic or biosimilar manufacturers.
**Affected Parties & Stakeholders**
The usual suspects are involved here: brand name drug companies, generic and biosimilar manufacturers, consumers, and the Federal Trade Commission (FTC). Pharmaceutical industry lobbyists must be thrilled to see their interests being "protected" by this bill.
**Potential Impact & Implications**
Let's get real for a moment. This bill is not about promoting competition or helping consumers; it's about maintaining the status quo of pharmaceutical industry profits. By prohibiting "reverse payment" agreements, Congress is essentially allowing brand name companies to maintain their monopolies on expensive drugs, while generic and biosimilar manufacturers are left to fight over scraps.
The real impact will be felt by consumers, who will continue to pay exorbitant prices for prescription medications. The FTC will also have its hands tied in enforcing antitrust laws, as the bill's provisions will create a new layer of bureaucratic red tape.
In conclusion, this bill is a masterclass in legislative theater, designed to appease pharmaceutical industry donors while pretending to care about consumers. It's a cynical exercise in regulatory capture, and we should all be outraged by the sheer audacity of it.
Diagnosis: Terminal case of regulatory capture, with symptoms including excessive greed, corruption, and a complete disregard for the public interest. Prognosis: Poor, as this bill will only serve to further entrench the pharmaceutical industry's grip on our healthcare system.
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Sen. Klobuchar, Amy [D-MN]
Congress 119 • 2024 Election Cycle
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Project 2025 Policy Matches
This bill shows semantic similarity to the following sections of the Project 2025 policy document. Higher similarity scores indicate stronger thematic connections.
Introduction
— 306 — Mandate for Leadership: The Conservative Promise programs,104 and they focus on research and promotion of commodities such as beef and eggs. Marketing orders cover research and promotion, but also cover issues such as quality regulations and volume controls. The latter issue, volume controls, is a means to restrict supply, which drives up prices for consumers. Fortunately, there are few active volume controls.105 Marketing orders and checkoff programs are some of the most egregious pro- grams run by the USDA. They are, in effect, a tax—a means to compel speech—and government-blessed cartels. Instead of getting private cooperation, they are tools for industry actors to work with government to force cooperation. The next Administration should: l Reduce the number and scope of marketing orders and checkoff programs. The USDA should reject any new requests for marketing orders and checkoff programs to the extent authorized by law and eliminate existing programs when possible. While the programs work differently, there are often petition processes and other ways that make it difficult for affected parties to get rid of the marketing orders and checkoff programs,106 and the USDA itself may not even be required to honor requests to terminate a program.107 The USDA should make the process easier. Further, the USDA should reject any effort to bring back volume controls to limit supplies of commodities. l Work with Congress to eliminate marketing orders and checkoff programs. These programs should be eliminated, and if industry actors want to collaborate, they should do so through private means, not using the government to compel cooperation. l Promote legislation that would require regular votes. There should be regular voting for parties subject to checkoff programs and marketing orders. For example, the voting should occur at least every five years, to determine whether a marketing order or checkoff program should continue. The USDA should be required to honor the results of such a vote. Through regular voting, parties can demonstrate their support for a marketing order or checkoff program and ensure that those administering them will be held accountable. Focus on Trade Policy, Not Trade Promotion. The USDA’s Foreign Agri- cultural Service (FAS) covers numerous issues, including “trade policy,” which is a reference to removing trade barriers, among other things, to ensure an envi- ronment conducive to trade.108 It also covers trade promotion.109 This includes programs like the Market Access Program110 that subsidizes trade associations, — 307 — Department of Agriculture businesses, and other private entities to market and promote their products overseas. FAS should play a proactive and leading role to help open upmarkets for American farmers and ranchers. There are numerous barriers, such as sani- tary and phytosanitary measures, blocking American agricultural products from gaining access to foreign markets.111 However, FAS should not help businesses and industries promote their exports, something these businesses and industries can and should do on their own. The next Administration should: l Push legislation to repeal export promotion programs. The USDA should work with Congress to repeal market development programs like the Market Access Program and similar programs. Remove Obstacles for Agricultural Biotechnology. Innovation is critical to agricultural production and the ability to meet future food needs. The next Admin- istration should embrace innovation and technology, not hinder its use—especially because of scare tactics that ignore sound science. One of the key innovations in agriculture is genetic engineering. According to the USDA, “[C]urrently, over 90 percent of U.S. corn, upland cotton, and soybeans are produced using GE [genet- ically engineered] varieties.”112 Despite the importance of agricultural biotechnology, in 2016, Congress passed a federal mandate to label genetically engineered food.113 This legislation was argu- ably just a means to try to provide a negative connotation to GE food. There are other challenges as well for agricultural biotechnology. For example, Mexico plans to ban the importation of U.S. genetically modified yellow corn.114 The next Administration should: l Counter scare tactics and remove obstacles. The USDA should strongly counter scare tactics regarding agricultural biotechnology and adopt policies to remove unnecessary barriers to approvals and the adoption of biotechnology. l Repeal the federal labeling mandate. The USDA should work with Congress to repeal the federal labeling law, while maintaining federal preemption, and stress that voluntary labeling is allowed. l Use all tools available to remove improper trade barriers against agricultural biotechnology. The USDA should work closely with the Office of the United States Trade Representative to remove improper barriers imposed by other countries to block U.S. agricultural goods.
Introduction
— 456 — Mandate for Leadership: The Conservative Promise abortion providers and whether better prenatal physical, mental, and social care improves infant outcomes and decreases abortion rates, especially among those who are most vulnerable. The Ensuring Accurate and Complete Abortion Data Reporting Act of 20239 would amend title XIX of the Social Security Act and Public Health Service Act to improve the CDC’s abortion reporting mechanisms by requiring states, as a condition of federal Medicaid payments for family planning services, to report streamlined variables in a timely manner. The CDC should immediately end its collection of data on gender identity, which legitimizes the unscientific notion that men can become women (and vice versa) and encourages the phenomenon of ever-multiplying subjective identities. FOOD AND DRUG ADMINISTRATION (FDA) The FDA’s mission includes ensuring the safety and efficacy of drugs, biological products, and medical devices. Federal Laws That Shield Big Pharma from Competition. Because generics generally cost far less than brand-name drugs, consumers begin to save money as soon as a generic product comes on the market. The vast majority are very afford- able with 93 percent of generic products costing $20 or less. Savings would be even higher under proposals that prevent brand-name man- ufacturers from slowing down or impeding the entrance of generic products into the marketplace. Specifically, the FDA should prohibit pharmaceutical companies from purposely sitting on their legally available right to be the first to sell generic versions of their drugs. Additionally, Congress should create legal remedies for generic companies to obtain samples of brand-name products for their generic development efforts and should prohibit meritless “citizen petitions” submitted by manufacturers to delay approval of a generic competitor.10 Approval Process for Laboratory-Developed or Modified Medical Tests. Learning from the failed early COVID-19 testing experience, Congress and the FDA should focus on reforming laws and regulations governing medical tests, especially with respect to laboratory-developed tests. Commercial tests are developed with the intention of being widely marketed, distributed, and used, while laboratory-developed tests are created with the intention of being used solely within one laboratory. A test developed by a lab in accordance with the protocols developed by another lab (non-commercial sharing) currently constitutes a “new” laboratory-developed test because the lab in which it will be used is different from the initial developing lab. To encourage interlab- oratory collaboration and discourage duplicative test creation (and associated regulatory and logistical burdens), the FDA should introduce mechanisms through which laboratory-developed tests can easily be shared with other laboratories with- out the current regulatory burdens.11 — 457 — Department of Health and Human Services The “laboratory-developed tests” category currently encompasses a range of possible tests, many of which would be characterized more appropriately as “lab- oratory-modified tests” because they are not truly novel tests but rather modified versions of existing tests. To avoid stifling innovation and access to medical care, the applicable statutes and regulations should be revised to facilitate greater access to such modified tests.12 Finally, the FDA has long held that it has regulatory authority over such tests, while others have argued that they should be considered clinical services regulated by the Centers for Medicare and Medicaid Services (CMS). The FDA currently has regulatory authority over in vitro diagnostics, and under the Clinical Lab- oratory Improvement Amendments (CLIA),13 the CMS ensures that labs meet analytical validity standards for test methods. Congress, the FDA, and the CMS need to clarify and disentangle overlapping authorities over tests to eliminate regulatory confusion.14 Drug Shortages. The very thin profit margins and the regulatory burdens associated with generic drug manufacturing discourage inventory and capacity investments by manufacturers and contribute to drug shortages. HHS and the FDA should encourage more dependable generic drug manufacturing. The FDA should expand its current pass/fail approach to drug facility inspec- tions into a graded system that recognizes manufacturers that exceed minimum standards by investing in improving production reliability. The FDA should also add facility codes to drug packaging and construct a searchable database that cross-references product codes and facility codes. That would enable wholesalers and pharmacy benefit managers to identify and preference drugs manufactured at more reliable facilities, thus encouraging generic drug manufacturers to compete on reliability as well as on price. For its part, HHS should exempt multi-source generic drugs from requirements to pay rebates to Medicaid and other federally funded health programs, as those provisions penalize new investments in expanding manufacturing capacity when supply is unable to meet demand.15 Additionally, FDA and NIH should promote efficacy trials of new applications for generic drugs, which might include NIH fund- ing such trials or conducting its own. Abortion Pills. Abortion pills pose the single greatest threat to unborn chil- dren in a post-Roe world. The rate of chemical abortion in the U.S. has increased by more than 150 percent in the past decade; more than half of annual abortions in the U.S. are chemical rather than surgical. The abortion pill regimen is typically a two-part process. The first pill, mifepris- tone, causes the death of the unborn child by cutting off the hormone progesterone, which is required to sustain a pregnancy. The second pill, misoprostol, causes con- tractions to induce a delivery of the dead child and uterine contents, usually into a toilet at home. The abortion-pill regimen is currently approved for up to 70 days
Introduction
— 465 — Department of Health and Human Services 1. Make Medicare Advantage the default enrollment option. 2. Give beneficiaries direct control of how they spend Medicare dollars. 3. Remove burdensome policies that micromanage MA plans. 4. Replace the complex formula-based payment model with a competitive bidding model. 5. Reconfigure the current risk adjustment model. 6. Remove restrictions on key benefits and services, including those related to prescription drugs, hospice care, and medical savings account plans.26 Legacy Medicare Reform. Legislation reforming legacy (non-MA) Medicare should: l Base payments on the health status of the patient or intensity of the service rather than where the patient happens to receive that service. l Replace the bureaucrat-driven fee-for-service system with value- based payments to empower patients to find the care that best serves their needs. l Codify price transparency regulations. l Restructure 340B drug subsidies27 toward beneficiaries rather than hospitals. l Repeal harmful health policies enacted under the Obama and Biden Administrations such as the Medicare Shared Savings Program28 and Inflation Reduction Act.29 Medicare Part D Reform. The Inflation Reduction Act (IRA) created a drug price negotiation program in Medicare that replaced the existing private-sector negotiations in Part D with government price controls for prescription drugs. These government price controls will limit access to medications and reduce patient access to new medication. This “negotiation” program should be repealed, and reforms in Part D that will have meaningful impact for seniors should be pursued. Other reforms should include eliminating the coverage gap in Part D, reducing the government share in — 466 — Mandate for Leadership: The Conservative Promise the catastrophic tier, and requiring manufacturers to bear a larger share. Until the IRA is repealed, an Administration that is required to implement it must do so in a way that is prudent with its authority, minimizing the harmful effects of the law’s policies and avoiding even worse unintended consequences.30 Medicaid. Over the past 45 years, Medicaid and the health safety net have evolved into a cumbersome, complicated, and unaffordable burden on nearly every state. The program is failing some of the most vulnerable patients; is a prime target for waste, fraud, and abuse; and is consuming more of state and federal budgets. The dramatic increase in Medicaid expenditures is due in large part to the ACA (Obamacare), which mandates that states must expand their Medicaid eligibility standards to include all individuals at or below 138 percent of the federal poverty level (FPL), and the public health emergency, which has prohibited states from performing basic eligibility reviews. The overlap of available benefits among the various health agencies has led to a complex, confusing system that is nearly impossible to navigate—even for recipients. Recipients are often faced with a “welfare cliff” of benefit losses as they earn above a certain amount, which is contrary to the fundamental purpose of empowering individuals to achieve economic independence. Benefits increasingly involve nonmedical services such as air conditioning and housing, many of which are already handled by departments other than HHS. Improper payments within Medicaid are higher than those of any other federal program. These payments are evidence of the inappropriateness of Medicaid’s expansion, which, stemming largely from public health emergency maintenance of effort (MOE) requirements and the Affordable Care Act, has crowded out the primary targets of these programs: those who are most in need. True health care reform cannot be accomplished in a bureaucratic silo or only through Medicaid and health safety net programs. Reform of the tax code is also essential to genuine, effective reform of our health care system. All components of the health care system should be part of the reform efforts, and it is imperative that the system be modified to assist states with their current programs. Therefore, the next Administration should: l Reform financing. Allow states to have a more flexible, accountable, predictable, transparent, and efficient financing mechanism to deliver medical services. This system should include a more balanced or blended match rate, block grants, aggregate caps, or per capita caps. Any financial system should be designed to encourage and incentivize innovation and the efficient delivery of health care services. Federal and state financial participation in the Medicaid program should be rational, predictable, and reasonable. It should also incentivize states to save money and improve the quality of health care.
Showing 3 of 5 policy matches
About These Correlations
Policy matches are calculated using semantic similarity between bill summaries and Project 2025 policy text. A score of 60% or higher indicates meaningful thematic overlap. This does not imply direct causation or intent, but highlights areas where legislation aligns with Project 2025 policy objectives.