Pink Sheet is part of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC’s registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

This copy is for your personal, non-commercial use. For high-quality copies or electronic reprints for distribution to colleagues or customers, please call +44 (0) 20 3377 3183

Printed By



Executive Summary

Sen. Nancy Kassebaum's ascension to ranking minority member of the Senate Labor & Human Resources Committee is one of the important changes in the congressional health establishment that will color the workings of the 103rd Congress. Kassebaum (R-Kan.) replaces Sen. Orrin Hatch (R-Utah), who is likely to remain on the committee but is relinquishing his ranking position in order to become the top Republican on the Judiciary Committee. Sen. Strom Thurmond (R-S.C.) vacated the ranking post on Judiciary to head the minority members on the Armed Services Committee. Kassebaum assumes the new post with two unfulfilled legislative initiatives in the pharmaceutical field from the previous session: orphan drug amendments and a pediatric study/exclusivity bill. In the last Congress, the Kansas Republican cosponsored with Sen. Howard Metzenbaum (D-Ohio) S 2060, legislation that would end market exclusivity of orphan drug products after their sales exceed $200 mil. Hatch, her predecessor, forcefully opposed the legislation. Kassebaum introduced S 3337 on Oct. 5, shortly before Congress adjourned, to solicit comment on the proposal in preparation for introduction early next year. The bill aims to encourage clinical studies that would yield information about the use of prescription drugs in pediatric populations; the proposed incentive is six months of market exclusivity for manufacturers that sponsor such trials ("The Pink Sheet" Oct. 19, p. 5). On the larger health care financing issues, the Kansas Republican also is likely to reintroduce her "Basicare Health Access and Cost Control Act" in the 103rd Congress. The bill, which she introduced as S 2346 on March 12, is designed to expand access to the uninsured while constraining costs. It would establish a national commission to develop a minimum package of benefits that health insurers would be required to offer. Financing and administration of the benefits would be left to the private sector under the bill, but denial of coverage and raising of premiums based on pre-existing illness would be prohibited. Costs would be controlled by capping annual premium increases. If Hatch remains on the Labor committee, he will continue to be a valuable ally of the pharmaceutical industry, although he will lose the services of an extensive staff to handle the various issues. Hatch has been the primary spokesman for and defender of the pharmaceutical industry for a dozen years. He also has often forged alliances with liberal Democrats like Chairman Edward Kennedy (D-Mass.) and House Energy & Commerce/Health Subcommittee Chairman Henry Waxman (D-Calif.). On the other hand, the Utah Republican is eyeing a seat on the Senate Appropriations Committee, and it is uncertain whether he will leave the Labor Committee or the Finance Committee to take it. Hatch probably will relinquish his new seat on Finance because senators generally cannot sit on more than one of the top committees, which include Finance and Appropriations. Kassebaum's staff will be headed by Susan Hattan, who was minority staff director of the Labor & Human Resources/Education, Arts & Humanities Subcommittee. Hattan helped Kassebaum develop both the orphan drug and pediatric study bills. Previously an aide to Sen. Bob Dole, (R-Kan.), Hattan is a summa cum laude graduate of Washburn University (1973) and has an MA from American University. The Kansas Republican's cosponsorship of the orphan drug legislation with Metzenbaum, who has long been a critic of pharmaceutical company marketing and pricing, could bode ill for the industry, particularly without the automatic veto threat from a Republican White House. In addition, it remains to be seen whether Kassebaum will be as forceful as Hatch was as the minority opposition. For example, Hatch managed to delay committee passage of the orphan drug bill at a markup in which the Democrats had the votes to pass the bill ("The Pink Sheet" July 6, T&G-6). Hatch also was able to cajole industry into making concessions when necessary, as he did during negotiations on the 1984 ANDA/patent law and the 1986 drug export and vaccine compensation acts. More recently, he chastised the industry publicly for failing to restrain price increases on their off-patent products. Labor & Human Resources Committee Chairman Kennedy will be involved with health care reform legislation as his first priority. The Massachusetts Democrat was a cosponsor of the Democratic leadership's HealthAmerica bill introduced in the previous Congress. The committee chairman also is being watched for his continued interest in the pharmaceutical industry's promotional practices with a focus on symposia. Two Labor & Human Resources Committee members were up for re- election and won: Democratic Sens. Christopher Dodd (Conn.) and Barbara Mikulski (Md.). Another Democrat, Brock Adams (Wash.), retired. Two House committees that deal with prominence in health issues, Energy & Commerce and Ways & Means, each may have lost 13 members from the 102nd Congress. Four, possibly five, Energy & Commerce Committee members lost their election races on Nov. 3. They are Reps. Gerry Sikorski (D- Minn.), Peter Kostmayer (D-Pa.) and Clyde Holloway (R-La.), who were members of the Health Subcommittee, and Reps. Tom McMillen (D-Md.), and Don Ritter (R-Pa.). In addition, Rep. Richard Lehman (D-Calif.) was in danger of losing his seat in a close race in which absentee ballots were still being counted after the election. In addition, the committee lost seven members before election day. Reps. Norman Lent (N.Y.), the committee's ranking Republican, James Scheuer (D-N.Y.), a Health Subcommittee member, Dennis Eckart (D-Ohio), an Oversight Subcommittee member, Claude Harris (D-Ala.) and Matthew Rinaldo (R-N.J.) retired. Also, Rep. William Dannemeyer (R-Calif.), a member of the Health and Oversight Subcommittees, left the House in an unsuccessful bid for a Senate seat, and Health Subcommittee member Terry Bruce (D-Ill.) failed to be renominated. The significant committee losses appear to be on the Republican side of the aisle, where four of the top five ranking members -- Lent, Rinaldo, Dannemeyer and Ritter -- will not be returning. Health Subcommittee Chairman Waxman, who won re-election, is said to be planning at least one hearing on drug pricing early in the 103rd Congress, if not sooner. The focus will be results of study by the General Accounting Office of prescription drug prices in the U.S. as compared to foreign countries. GAO already has issued one report that concluded prices for the same products average 32% higher in the U.S. than in Canada. A second study will compare U.S. prices with those in Europe. The hearings will probably be designed to support components of health care reform legislation aimed at pharmaceutical price controls. Waxman has a vocal ally in the Senate on this issue in Sen. Pryor (D-Ark.). Pryor, in turn, has received expressions of support from Governor Clinton during the campaign. Announcing release of the GAO report, Waxman said "it is time for the control prescription drug prices." At a hearing on Medicaid rebates, he suggested that companies raise prices in certain U.S. market segments when prices in other segments are constrained because the industry compensates for price setting by "most other countries," and the solution is "to protect all of our purchasers of drugs in this country" ("The Pink Sheet" Oct. 26, p. 3). At a 1986 hearing on the initial price of Burroughs-Wellcome's Retrovir (AZT, or zidovudine), Waxman warned that the industry might have to accept controls just as physicians and hospitals accepted DRGs. Two other Energy & Commerce Committee members, Reps. Ron Wyden (D-Ore.) and Jim Cooper (D-Tenn.), were re-elected and can be expected to continue their efforts on health issues. In 1990, they cosponsored the House Medicaid rebate law. Wyden also may introduce legislation to require enhanced reporting to FDA of adverse reactions to prescription and OTC drugs. In the Ways & Means Committee, Rep. Tom Downey (D-N.Y.) was the only member who lost in the general election, although another 12 members will not be returning. They include five Health Subcommittee members: Rep. Marty Russo (D-Ill.) was defeated in his primary contest, Reps. Brian Donnelly (D-Mass.) and Raymond McGrath (R-N.Y.) retired, and Reps. Jim Moody (D-Wis.) and Rod Chandler (R-Wash.) unsuccessfully ran for the Senate. The remaining seven full committee members who will not be returning in the 103rd Congress include Rep. Guy Vander Jagt (R-Mich.), second-ranking Republican, and Rep. Beryl Anthony (D-Ark.), who like Russo lost their primary races. Reps. Ed Jenkins (D-Ga.), Frank Guarini (D-N.J.), Don Pease (D-Ohio) and Richard Schulze (R- Pa.), like McGrath and Donnelly, retired. In addition, Rep. Byron Dorgan (D-N.D.) was elected to the Senate. Health Subcommittee Chairman Pete Stark (D-Calif.) has been developing comprehensive health care reform legislation with House Majority Leader Richard Gephardt (D-Mo.). Their health bill probably will involve the single-payer approach. Stark favors the expansion of Medicare coverage to the general population. House Select Committee on Aging Chairman Edward Roybal (D- Calif.), who held hearings on drug prices in the 1980s, retired. Another Aging Committee member, Rep. Mary Rose Oakar (D-Ohio), was defeated. She had been involved in women's health issues like breast implants and OTC drug safety. In the Senate, five Finance Committee members were up for re- election were winners. They are Ranking Minority Member Bob Packwood (Ore.), Bob Dole (R-Kan.), Thomas Daschle (D-S.D.) and Charles Grassley (R-Iowa), who are Medicare Subcommittee members, and John Breaux (D-La.). Sen. Steve Symms (R-Idaho) retired. In the Senate HHS Appropriations Subcommittee, Ranking Republican Arlen Specter (R-Pa.) and Sens. Ernest Hollings (D- S.C.), Daniel Inouye (D-Hawaii), Dale Bumpers (D-Ark.) and Harry Reid (D-Nev.) all appeared to win re-election. Sens. Adams, Kent Conrad (D-N.D.) and Warren Rudman (R-N.H.) retired. In the Agriculture Appropriations Subcommittee, Adams and Conrad retired, while Specter, Don Nickles (R-Okla.) and Christopher (Kit) Bond (R-Mo.) were re-elected. Sen. Wyche Fowler (D-Ga.) failed to win a majority in a three-way race, and will face his Republican opponent, Paul Coverdell, in a runoff. Bumpers, a member of the full Appropriations Committee, was re-elected. He cosponsored a bill to provide capital gains tax breaks for long-term seed capital investments in startup biotechnology companies. The measure was passed by Congress as part of a tax bill, HR 11, and vetoed by President Bush on Nov. 4. In addition, Sen. Robert Kasten, Jr., (R-Wis.) failed to win re-election. Kasten, who lost to Democratic challenger Russell Feingold, championed product liability legislation as a member of the Commerce Committee since he joined the Senate in 1980, but the effort never progressed beyond the Senate floor. Governmental Affairs Committee Chairman John Glenn (D-Ohio) narrowly won a fourth term in the Senate. His committee has investigated interference in FDA regulatory decisionmaking by the Office of Management & Budget and by Vice President Quayle's Council on Competitiveness. In the House Government Operations Committee, the death of Intergovernmental Relations Subcommittee Chairman Ted Weiss (D- N.Y.) could have a profound impact on the future of the panel's investigations. It remains to be seen whether the new chair will be willing, able and bold enough to continue such involved scrutiny of FDA's scientific and regulatory judgments. Those mentioned to date as possible successors to Weiss include Reps. Donald Payne (D-N.J.), Patsy Mink (D-Hawaii), Rosa DeLauro (D- Conn.) and Bob Wise (D-W.Va.).

You may also be interested in...

Part D Discount Liability Coming Into Focus: CMS Releases Drug Cost Data

Newly released Medicare Part D data sheds light on the sales hit that branded pharmaceutical manufacturers will face when the coverage gap discount program gets under way in 2011

FDA Skin Infections Guidance Spurs Debate On Endpoint Relevance

FDA appears headed for a showdown with clinicians and the pharmaceutical industry over the proposed new clinical trial endpoints for acute bacterial skin and skin structure infections, the guidance's approach for justifying a non-inferiority margin and proposed changes in the types of patients that should be enrolled in trials

Shire Hopes To Sow Future Deals With $50M Venture Fund

Specialty drug maker Shire has quietly begun scouting deals with a brand-new $50 million venture fund, the latest of several in-house investment arms to launch with their parent company's pipelines, not profits, as the measure of their worth




Ask The Analyst

Please Note: You can also Click below Link for Ask the Analyst
Ask The Analyst

Your question has been successfully sent to the email address below and we will get back as soon as possible. my@email.address.

All fields are required.

Please make sure all fields are completed.

Please make sure you have filled out all fields

Please make sure you have filled out all fields

Please enter a valid e-mail address

Please enter a valid Phone Number

Ask your question to our analysts