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AIDS DRUG BLOCK GRANTS FUNDED AT $30 MIL

Executive Summary

AIDS DRUG BLOCK GRANTS FUNDED AT $30 MIL. for fiscal 1990 under the House/Senate compromise HHS appropriations bill. House and Senate wrapped up a conference on the measure Oct. 5. The full House endorsed the compromise Oct. 11 by a 364-56 vote; Senate floor action is yet to be scheduled. The grants will be administered by the HHS Health Resources and Services Administration. "The conferees have provided $30 mil. for the AIDS drug reimbursement program," the report notes. "The conferees direct the [HHS] secretary to permit the states to make available to eligible individuals therapeutics determined to prolong life or prevent the serious deterioration of health arising from AIDS or HIV infection." The earlier Senate version of the bill had provided $30 mil., while the House bill contained no funding for the AIDS grants. Sen. Kennedy (D-Mass.) has been a strong supporter of the program. The grants have primarily been used in the past for subsidizing the cost of Burroughs Wellcome's Retrovir (AZT). However, HRSA specifically notified state programs in the past that funds would also be available for Lyphomed's aerosolized pentamidine, Nebupent, and alpha interferon marketed by Schering-Plough and Hoffmann-La Roche ("The Pink Sheet" Feb. 27, T&G-3). Supplemental appropriations may be necessary to keep the program operating, the report points out, due at least in part to the price of Burroughs Wellcome's Retrovir (AZT). Maintaining that the price of AZT is still too high, even with the recent, second 20% price cut, the conferees urge Burroughs Wellcome to consider further action to make the drug more accessible to low-income patients. The report states: "The conferees remain concerned about the price of AZT. Even with the recent price reduction by the manufacturer of the drug, AZT remains prohibitively expensive for most AIDS patients. While the conferees are providing additional funds for the AIDS drug reimbursement program, the conferees strongly urge the manufacturer of AZT to take further steps to make the drug more widely accessible to low-income patients." The federal program began in 1988 to give states funds to provide drugs to low-income AIDS patients. Initially it was envisioned as a one-time effort to give states time to set up their own funding mechanisms, but the program was extended twice during 1989 ("The Pink Sheet" April 10, T&G-4). Total 1989 funding was $20 mil. -- including $15 mil. reprogrammed from other HHS activities and $5 mil. provided by Burroughs Wellcome. Burroughs Wellcome announced its 20% reduction in the price of AZT on Sept. 18. That same day, Rep. Waxman (D-Calif.) met with company officials, seeking answers to a series of questions related to the costs and the price of the drug ("The Pink Sheet" Sept. 25, T&G-5). Waxman is considering hearings on the issue.
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