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Executive Summary

DINGELL DONE WITH DIVERSION; WAXMAN PANEL WILL consider legislative action during the second session of the 99th Congress. A report on drug diversion is currently being drafted by Rep. Dingell's (D-Mich.) House Commerce/Oversight Subcmte. and reportedly could be ready by early spring. The subcmte. report is expected to include legislative as well as administrative recommendations. A ban of reimported pharmaceuticals and modifications of drug sampling practices and differential pricing policies for nonprofit institutions have been mentioned as candidates for legislation by pharmacy-related assns. that testified before the cmte. last year ("The Pink Sheet" Dec. 9, p. 3). The Commerce/Health Subcmte. will determine whether to hold hearings, although it is likely that Chairman Waxman (D-Calif.) will be partial to pursuing any legislative recommendations made by the Dingell subcmte. Waxman reportedly met with Sen. Hatch (R-Utah) on Jan. 30 to discuss their respective legislative agenda. Hatch will push his bill to permit the export of unapproved drugs on the Senate floor, and Waxman has said he will hold hearings on export legislation. The congressman additionally is pursuing a measure to require designations of FDA approval on the labeling of agency-approved Rx drugs and a bill to mandate Senate confirmation of FDA commissioner appointees. The diversion issue, export legislation, and product liability are among the legislative concerns of the Pharmaceutical Mfrs. Assn. PMA VP-Govt. Affairs Geoffrey Littlehale told a Jan. 27 press briefing that a Senate cmte. staff-drafted bill, circulated in December, contains "several provisions that were designed to accommodate the interests of the pharmaceutical industry." Littlehale said that there may be hearings on the bill in late February or early March. On the impact of Gramm-Rudman-Hollings on FDA, PMA President Gerald Mossinghoff predicted the budget cuts could have a "very devastating effect" on the agency's recent acceleration of approvals. Mossinghoff said the $18 mil. reduction from Gramm-Rudman could be "devastating": "because (1) it's a lot of money and a high percentage of FDA's resources, [and] (2) those cuts have to be absorbed in a lot less than a fiscal year -- if they take effect in March, you're dealing with half a fiscal year, so all of the effects are multiplied at least by two in order to get savings." Mossinghoff suggested that FDA might have been hit harder by Gramm-Rudman than other public health agencies. "If that is the case," Mossinghoff said, "we are going to try to make our case that that's not a wise cut." He noted that PMA will stress FDA's relative cost-benefit advantage. "What FDA does, for example in the approval of new drugs, is a value-added type thing," Mossinghoff said. "For a small expenditure of money, there is an enormous amount of economic and health benefits that flow from the expeditious review and approval of new drugs."

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