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DEMOCRATIC SENATE GAINS WILL PRESSURE WHITE HOUSE, PHARMACEUTICAL INDUSTRY TOWARD QUICK RESOLUTIONS OF EXPORT/VACCINE BILL, DRUG DIVERSION LEGISLATION

Executive Summary

The Democratic victory in regaining majority control of the Senate after the Nov. 4 elections will place pressure on the White House and the pharmaceutical industry to find quick solutions to two pieces of health-related legislation: The omnibus health care bill, which contains drug export and vaccine injury compensation provisions and must be signed by President Reagan on or before Nov. 15 to be enacted, and The drug diversion bill, which would restrict the distribution of samples by drug company detail forces. By signing the omnibus health care package, President Reagan would eliminate any concern that Congress next year will pass similar legislation that not only contains provisions for a more expensive federal compensation program but also deletes drug export provisions, which the Administration supports. The Justice Department has opposed presidential signature of the omnibus health care bill on the grounds that it would establish too costly a federal vaccine injury compensation program. However, a Democrat-controlled Senate, working with Rep. Waxman (D-Calif.) in the House, could yield a version of the legislation next year that the Administration would find even less acceptable. Proponents of the omnibus legislation claim they have isolated the Justice Department as the sole opponent to enactment of the bill. Reportedly, Office of Management & Budget Director Miller, Treasury Secretary Regan, and White House Chief of Staff Baker now support presidential signature. At an Oct. 28 press conference to rally support to enact the export/vaccine legislation, Sen. Hatch (R-Utah) maintained that if the bill must be reconsidered in the 100th Congress, it will not be "much different" from S 1744. The senator contended that a pocket veto would serve only to delay enactment of the compromise bill until "the middle or late part of next year." Hatch's point was that federal vaccine injury compensation provisions, to which the Justice Department objected, are not likely to be deleted or modified; however, a Democratic Congress might expand those provisions. The Nov. 4 elections have adversely affected two key Republican sponsors of the drug export/vaccine compensation bill in the Senate: Sen. Hawkins (R-Fla.), who was defeated by former Florida Gov. Robert Graham, and Hatch, who will relinquish his chairmanship of the Labor & Human Resources Committee. Had the Republicans retained control of the Senate, Hatch reportedly would have stepped down from the committee chair to head the Judiciary Committee. Sen. Quayle (R-Ind.) was the next Republican in line for the Labor & Human Resources Committee chairmanship. However, Sen. Thurmond (R-S.C.) is now expected to remain the ranking Republican on the Judiciary Committee, and Hatch is expected to become ranking minority member of Labor & Human Resources. Rep. Dingell's drug diversion bill failed to pass the 99th Congress but is sure to reappear next year. The measure died because unanimous consent was required to move the bill in the final days of the legislative session, and the Pharmaceutical Manufacturers Association objected to a provision establishing corporate penalties for drug sample abuses. Dingell (D-Mich.) currently is preparing to hold hearings to examine the abuse of drug samples by manufacturers' detail personnel. To head off the potential adverse publicity such hearings are likely to generate, the industry is scrambling to negotiate a new bill with Dingell. One possibility is a compromise which was reached last spring between Dingell and former Rep. Broyhill (R-N.C.) and was supported by Burroughs-Wellcome, Marion, and Merck. That version, which permitted manufacturers to distribute physician samples only by mail or other direct courier but not by detailers, was rejected by PMA. Ironically, working with a Democrat-controlled Senate for an entire legislative session, Dingell could move a more restrictive bill through Congress. For example, a version which was proposed but never formally introduced, bans physician samples. Dingell's House Energy & Commerce Committee will get at least three new faces on the Democratic side of the aisle and one on the Republican. Reps. Mikulski (Md.), Shelby (Ala.), and Wirth (Colo.) all successfully ran for the Senate, leaving three Democratic seats vacant. On the other side, the minority party will have to replace freshman Rep. Fred Eckert (N.Y.), who was defeated in his first re-election bid by Louise Slaughter. The margin was approximately 3,000 out of more than 163,000 votes in New York's 30th district. Another bill sure to resurface next year would require Senate confirmation of the FDA commissioner. The Senate shift should have little effect on the measure's chances for passage, which are good. However, the Democratic majority could make it easier to enact a stronger version of the legislation, such as the measure which was introduced by Sen. Gore (D-Tenn.) and passed the Senate on the final day of the 99th Congress. The legislation is intended to make FDA more independent from Administration control and more responsive to Congress. Sponsored by Waxman in the House and Gore in the Senate, the bill was introduced after it was reported that the Office of Management & Budget actively reviews FDA's nominees for advisory committee appointments and the agency's scientific decisionmaking involving issues such as color additives, sulfites, and Reye's syndrome warnings for aspirin. One bill the Democratic majority is likely to affect significantly is product liability legislation. In the 99th Congress, Senate Commerce Committee Chairman Danforth (R-Mo.) and Consumer Subcommittee Chairman Kasten (R-Wis.) initially attempted to address substantive tort law reform but ended with a bill that predominantly consisted of procedural reforms. Sen. Hollings (S.C.), who was the ranking Democrat on the Committee and is said to be interested in the chairmanship, consistently expressed a negative view toward tort reform. Hollings was re-elected Nov. 4 to his fourth Senate term. The Danforth bill (S 2760) reached the Senate floor in September. It was pulled from consideration in the interest of conserving time, after opponents indicated they would filibuster the bill; however, an 84-13 procedural vote indicated broad Senate support for the bill ("The Pink Sheet" Sept. 29, T&G-6). Consequently, Hollings might hold hearings on the issue, but any legislation brought before a Hollings committee is expected to be much narrower in scope. Provisions that interested parties seem able to agree on for federal legislation include the following: FDA approval as a defense against punitive damages, inadmissability of subsequent remedial measures as evidence of fault, limited modifications of the doctrine of joint and several liability, a unified mechanism for alternative dispute resolution, establishment of a statute of limitations, elimination of the collateral source rule, and penalties for filing frivolous lawsuits. Kasten was one of two Republicans on the committee who were vocal during the legislative progress of S 2760 and were up for re-election. He won, but Sen. Gorton (Wash.) did not fare as well. Gorton, who was more moderate than Kasten in his approach and often voted with the Democrats, was defeated by Brock Adams, formerly a congressman and transportation secretary during the Carter Administration. Among other Commerce Committee members, Sens. Long (D-La.) and Goldwater retired, and Sens. Ford (D-Ky.) and Inouye (D-Hawaii) were re-elected.
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