Amgen Working With Sen. Kennedy On Medicare Rx Benefit Bill

Amgen is working with the ranking Democrat on the Senate Health Committee, Sen. Kennedy (D-Mass.), to develop a Medicare prescription drug benefit bill.

Sen. Baucus (D-Mont.) told AARP's legislative meeting Feb. 14 in Washington D.C. that "Sen. Kennedy is talking to drug companies about a prescription drug bill. Amgen is one of the main pharmaceuticals."

Baucus, the ranking Democrat on the Finance Committee, indicated that the proposed bill would build on Kennedy's 1999 bill.

The approach being discussed by Kennedy would offer a "very significant" drug benefit through competing pharmacy benefit management companies overseen by an entity outside of the Health Care Financing Administration.

Moving control outside HCFA responds to one of the drug industry complaints with the 1999 Kennedy bill, which called for the PBMs to contract with HCFA and follow HCFA rules for quality and financial standards

Baucus noted that Amgen is working with other companies on the new Kennedy bill. Genzyme is also said to be participating in the effort.

Genzyme is located in Cambridge, Mass. Kennedy is an attractive sponsor for Amgen and Genzyme because of his long Senate tenure in health issues and because of the strong Massachusetts biotech constituency. Kennedy has also been supportive of stop-loss limits on patient expenditures which is a key point to biotech companies.

Kennedy is likely to seek a Republican co-sponsor from the Finance Committee, which is planning to begin Medicare hearings in March (¹ (Also see "Medicare Rx Bill: Senate Finance Chair Grassley Sets August Deadline" - Pink Sheet, 19 Feb, 2001.)). Sen. Specter (R-Penn.) is understood to be interested in the bill.

Although not a Finance Committee member, Specter chairs the Veterans' Affairs Committee as well as the Appropriations/HHS Subcommittee. The biotech industry has had close ties to Specter, who also has a large constituency of traditional drug companies in Pennsylvania.

The separate initiative by Amgen presumably reflects the status of the company as one of the most successful current providers of drugs to Medicare programs, especially its Epogen drug covered under the dialysis program. It has been a key objective for BIO, representing companies like Amgen, to make sure that a new Medicare program does not "interfere" with existing Medicare drug payment schedules.