Liberals fight their own party over drug prices

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Top Democrats have struggled with progressives for much of the year over drug pricing. “People have not been included,” said Rep. Mark Pocan (left). | Chip Somodevilla/Getty Images

House Democratic leaders are facing deep skepticism from their progressive wing over a plan empowering the government to limit prices for some expensive prescription drugs – a rift that could hurt the party on an issue that has also been embraced by President Donald Trump.

Liberal lawmakers and like-minded advocacy groups say the preliminary drug pricing plan pitched by House Speaker Nancy Pelosi is far too timid a response to spiraling U.S. drug costs, and could fail to leverage the government’s massive purchasing power in demanding cheaper medicines.

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Democratic leaders have focused on a concept that grants federal officials new authority to negotiate prices for a select group of drugs and quickly rein in the nation’s priciest medicines, possibly formingthe basis of a broader bipartisan drug pricing deal. But progressives want far more expansive changes, pushing to give the government sweeping power to set prices across the board – and punish pharmaceutical companies that fail to fall in line.

The tensions are delaying House Democrats’ bid to make good on a chief campaign promise, frustrating lawmakers eager for progress on the health care issue. And it’s unfolding in the shadow of a bigger intraparty fight over single-payer health care, or “Medicare for All,” that’s playing out in Congress and on the 2020 presidential campaign trail.

The drug pricing effort now risks stretching into the fall, leaving Democrats with a narrow window for securing a major win before the 2020 race swamps Washington.

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“People have not been included,” said Rep. Mark Pocan (D-Wis.), a co-chair of the Congressional Progressive Caucus. “There has been no process up to now.”

Top Democrats have struggled with progressives for much of the year over drug pricing, trying to overcome suspicions that leadership will ultimately stop short of a crackdown on the influential drug industry.

House progressives early this year roundly rejected using a third party to set prices for drugs through binding arbitration, blasting the idea broached by leadership as opaque and overly cautious.

A revised plan outlined in recent weeks by Pelosi hasn’t fared much better. It seeks to assuage liberals by empowering the Government Accountability Office to decide drug prices rather than an outside entity, and requires HHS to negotiate the price of at least 25 medicines per year. The resulting prices would then be applied to the entire U.S. market.

But leading progressives remain wary, and vented this week that much of the rank-and-file remains in the dark on where Pelosi’s office is headed.

Rep. Pramila Jayapal (D-Wash.), the other co-chair of the Progressive Caucus, told POLITICO on Tuesday that she has a list of questions for Democratic leadership staff about their drug pricing workdemanding details after the latest plan raised “lots of concerns” about whether it would make a significant dent in the prices Americans pay for their prescription drugs.

Pocan voiced concerns to House Democratic Caucus Chairman Hakeem Jeffries (D-N.Y.) during a closed-door session later in the day about going public with any proposal before the caucus has a chance to weigh in.

“We just want to make sure that everyone is brought on board,” Pocan said after the session, which was billed as a drug pricing roundtable aimed at new members. “What I’m really afraid of is we set the whole cause back and we wind up having nothing done.”

A Jeffries spokesperson called the meeting – which included several advocacy groups – an effort to introduce interested lawmakers to key players working on drug price issues, not a discussion about a single legislative proposal.

Leaders stress they’ve yet to finalize any drug price plan and are still refining concepts that will be more ambitious and far-reaching than critics suggest. On Tuesday, Energy and Commerce Committee Chairman Frank Pallone (D-N.J.) told reporters the caucus will have plenty of time to publicly weigh a range of plans.

“We’ll have a hearing on many different proposals,” he said. “There isn’t one party position at this point.”

Still, the closely guarded and drawn-out process – which has included discussions between top Pelosi health aide Wendell Primus and the White House – has frustrated progressive Democrats who fret that six months into their House majority, there’s been little measurable progress and even less communication about the centerpiece of the party’s drug price pledge.

“If there’s to be good collaboration, there needs to be more openness,” said Ways and Means health subcommittee chair Lloyd Doggett (D-Texas), who is pushing his own sweeping drug price reforms. “We talk about transparency in drug pricing. We need a little transparency on the process.”

It wasn’t supposed to be this complicated. House Democratic leaders had once planned to unveil a plan as early as February.

But questions about the scope of the government’s rolehave since fractured the caucus. Progressive Democrats are throwing their weight behind Doggett’s proposal permitting the government to strip drug makers of their patent protections if they refuse to negotiate prices in good faith.

Moderate Democrats view the approach as too blunt of an instrument to threaten a complex industry that, for all its flaws, still develops life-saving medicines.

Democratic leaders’ search for a middle ground is based on a belief they can still unite the party and potentially garner support from President Donald Trump, who has long pledged to dramatically cut drug prices.

The most recent outline would mandate that HHS try negotiating an acceptable price for at least 25 drugs a year with their manufacturers, based on pricing and development information collected from the companies, sources familiar with the proposal said. GAO would oversee a “dispute resolution” process and set the final price if HHS and the companies fail to reach an agreement.

Companies that refuse tosubmit to the process would get hit with a 50 percent excise tax on the prior-year sales of each drug in question. And medicines not subject to negotiation would face penalties if their manufacturers hike prices above a certain threshold – an effort to prevent drug makers from jacking up prices elsewhere.

Key details have yet to be fleshed out, most notably which drugs would qualify for negotiation. That’s an element that skeptics say is crucial, especially amid concerns the plan would target only a select set of drugs.

“It doesn’t seem aggressive enough to me,” Budget Committee Chairman John Yarmuth (D-Ky.) said of the outline, questioning whether it would drive broad price reductions. “I worry about not catching some of the real abuses.”

Leadership allies and some advocacy groups have urged patience, chalking up the delays to caution over possibly jeopardizing a potential major political and policy victory.

They argued that the proposal outlined by Pelosi could serve as the foundation for a hard-hitting bill that first targets the highest-cost drugs like insulin and some cancer therapiesand imposes sweeping restrictions on the broader industry.

“Congress should focus on price negotiations on key drugs for the same reason that bank robbers rob banks: Because that’s where all the money is,” said Ben Wakana, executive director for Patients for Affordable Drugs. “It is really a handful of two dozen drugs that are driving the majority of the spending in Medicare.”

Even some progressives allow that there are reasons for optimism. Pocan praised the suggestion that negotiated prices would apply across the entire market even as he dismissed other elements of the plan as “horrendous”; others calledPelosi’s latestoutline a decent first step.

“It’s a good start,” said Rep. Mark DeSaulnier (D-Calif.). “We should be being more aggressive.”

But the secrecy surrounding leadership’s work has put the liberal bloc on edge.

More than one Democrat in recent weeks has compared the drug price process to Republicans’ desperate bid to shield their Obamacare repeal bill from public view – and members of their own party – back in 2017. Several others lamented that they’ve learned more about leadership’s efforts from press reports than top Democrats themselves.

And Pocan on Tuesday emphasized that Democrats won the House in part on promises of major drug pricing action -and thatthe party needs to take the time to ensure it follows through with an ambitious, unified proposal.

“If we don’t address this in a big and bold way, a lot of us should go home and start knitting,” he said, adding thathe hopes Democratic leaders won’t try to jam the rest of the caucus on such a high-stakes issue. “To me, if the conversation ends in two weeks, we got screwed.”

CLARIFICATION: A previous version of this article left it unclear that Rep. Jayapal has a list of questions for leadership staff about their drug pricing work, but has not yet sent them.

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