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Executive Summary

DRUG LEGISLATIVE ACTIVITY WILL CENTER LARGELY IN SENATE Labor & Human Resources Committee during the 101st Congress. Chairman Kennedy (D-Mass.) is reportedly planning hearings on the Orphan Drug Act and the high cost to patients for drugs like human growth hormone and AZT. Kennedy and the committee's Ranking Minority Member Hatch (Utah) will also be spearheading efforts toward FDA "revitalization." Plans are likely to include broader hearings to review the FD&C Act. In addition to seeking increased funding for centralized facilities and more personnel, such hearings could examine the drug approval process, particularly for drugs for AIDS and other life-threatening diseases. The Senate committee will be taking the lead on many drug-related proposals, which in the past have been subject of greater activity in the House. This year Rep. Waxman's (D-Calif.) Health Subcommittee will spend less time on drug issues while focusing on other areas, such as food labeling. Another primary item on Waxman's agenda will be medical device amendments. The California Democrat, however, will continue to monitor such drug issues as pricing, advertising, and implementation of the Catastrophic Care and the animal drug laws passed last year. The orphan drug issue is an example. In the 100th Congress, Waxman held hearings and markups on legislation he sponsored to amend the Orphan Drug Law. His primary interest was the market exclusivity benefit which he wanted to be shared by more than one company in certain instances. FDA and the National Organization for Rare Diseases testified in favor of an amendment that would permit subsequent orphan drug developers to share a prime developer's exclusivity if the later products had reached a certain stage (for example, Phase III clinicals or NDA submission) by the time the first product was approved. FDA Commissioner Young referred to these situations as "inadvertant, coincidental" orphan drug development. As recently as a matter of weeks ago, the HHS National Commission on Orphan Diseases was considering a recommendation for shared exclusivity. However, none of these groups now endorses the concept of shared exclusivity, citing fears that it may discourage orphan drug development. Consequently, finding there is no readily apparent "legislative fix" for the high prices and other concerns associated with market exclusivity, Waxman is simply monitoring the situation. Greater demand for amendments may surface after approval of erythropoietin, another orphan drug with a potentially large market. Kennedy's interest, on the other hand, is growing. His constituents now include drug research firms who are locked out of the human growth hormone market by the Orphan Drug Act's exclusivity provisions. The heavy concentration of the biotech industry in Massachusetts, along with a new committee staff, have changed Kennedy's profile since the late 1970s, the last time he held hearings involving the drug industry.

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