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Executive Summary

The Pharmaceutical Manufacturers Association does not expect Congress to adopt price controls for prescription drugs as part of health care reform legislation, PMA President Gerald Mossinghoff maintained at a Jan. 13 press briefing on 1993 drug approvals. Mossinghoff predicted that neither the incoming Clinton Administration nor Congress would enact health care reform legislation that would place restrictions on pharmaceutical prices. The PMA president said he, senior staff and Chairman Paul Freiman (Syntex) "have met with [Clinton Transition Team's Health Policy Director Judith] Feder and [health policy outreach official Christopher] Jennings on this issue." Feder and the transition team's health legislation official Stuart Altman both have suggested that health care reform may have to include spending limits. "We're aware of their concerns," Mossinghoff said, and "we're discussing it with them." While acknowledging that "no definitive decisions have been made," the PMA official said he was "optimistic" that the industry still enjoys "the kind of support we got last year," when Sen. Pryor's (D-Ark.) S 2000 was "overwhelmingly defeated." He maintained that Congress continues to have "a major aversion to price controls on our industry." Mossinghoff also noted that "several of our major companies have announced" plans to limit price increases to the inflation rate and that the Producer Price Index "is down pretty drastically from a couple of years ago" (for PPI results from 1992, see preceding story). Furthermore, Mossinghoff said, "there's a keen recognition of the importance of" prescription drugs as a "tool to hold down health care costs." There is, he asserted, "a widespread recognition even among our critics that the day they start enacting policies that cause a decrease in the rate of [drug price] increases is not going to be a good day for health care cost containment generally." PMA Senior VP-Science & Technology John Beary predicted that FDA's user fee program should help improve the speed with which the agency approves new biologics. Industry user fee payments will provide about $330 mil. in new resources and for both drug and biologic reviews "will enable [FDA] to hire about 300 reviewers," Beary said. Consequently, PMA is "quite hopeful" that average biologic review times will be lower in future years. Beary said "the burgeoning biotech industry" has dramatically increased the workload of FDA's Center for Biologics Evaluation and Research. One effect of the growth in CBER's workload is that FDA took an average of 29.9 months to review the 26 new drug compounds it approved in 1992 but 35.3 months to approve the six biologics it cleared for marketing ("The Pink Sheet" Jan. 11, p. 9 and p. 11). Institution of the user fee program is a priority for 1993. Noting that user fees cannot be collected until they are authorized by a supplemental appropriations act, Mossinghoff said the Clinton transition team, the industry and three key legislators -- Sen. Kennedy (D-Mass.) and Reps. Dingell (D-Mich.) and Waxman (D-Calif.) -- "are pushing" to include provisions permitting collection of user fees "in the very first supplemental appropriations bill" sent to Congress. "There is no reason to believe that" Congress will not move the required legislation, Mossinghoff said, adding that he hopes Congress will begin consideration "perhaps even by the end of March or early April." Beary said CBER reorganization may also help speed biologic review times. PMA is "optimistic" that center Director Kathryn Zoon will focus on reducing average review time for biological products, he said.

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