Washington Healthcare Update

November 23, 2020

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This week in Washington: Congress gets organized for next Congress; House passes health care bills; COVID-19 vaccine is the talk of the town.





Final Regulations/Guidance



House Passes 10 Health Care Bills

On Nov. 17, the House passed 10 health care-related bills that include legislation to support new research into health disparities, improvements to food and drug labeling, and a new $10 million grant program for trauma centers that intervene in cyclical violence. The legislation also provides $1.5 billion annually in grants to states and tribal organizations to support substance use disorder (SUD) treatment and prevention, as well as new tools and authorities to prevent the illegal distribution of controlled substances. All of the bills were passed by voice vote and now must be considered by the Senate. 

The House passed the following bills:

  • H.R. 4499, the NIMHD Research Endowment Revitalization Act of 2020, authorizes the National Institute on Minority Health and Health Disparities to facilitate research on minority health disparities through research endowments at current or former centers of excellence.
  • H.R. 5668, the Making Objective Drug Evidence Revisions for New Labeling Act of 2020 or the MODERN Labeling Act of 2020, allows the Food and Drug Administration (FDA) to require modifications of outdated labeling for certain generic drugs to ensure labels have complete and accurate information. The bill would require FDA to report any actions taken under this new authority to update labeling for covered drugs, including the number of drugs, description of the changes and the rationale, as well as any FDA recommendations to modify the program.
  • H.R. 4712, the Fairness in Orphan Drug Exclusivity Act, closes a loophole in the Orphan Drug Act by requiring drug manufacturers seeking orphan drug designations under the rarely used cost recovery pathway to demonstrate the absence of any reasonable expectation of the costs they incur in developing and making those drugs available in the U.S. for such disease or condition. The legislation requires FDA and the manufacturer to take into account the sales of all of the manufacturer’s drugs developed under the same orphan drug designation.
  • H.R. 2466, the State Opioid Response Grant Authorization Act of 2020, authorizes the Substance Abuse and Mental Health Services Administration (SAMHSA) State Opioid Response Grants program to align with the grant authority provided through the 21st Century Cures Act. The bill also authorizes support for state actions to address stimulant use.
  • H.R. 2281, the Easy Medication Access and Treatment for Opioid Addiction Act or the Easy MAT for Opioid Addiction Act, would require the Drug Enforcement Administration (DEA) to allow a practitioner to dispense up to a three-day supply of medication-assisted treatment. This practice is intended to relieve potential acute withdrawal symptoms while the individual awaits longer-term treatment.
  • H.R. 2117, the Food Allergy Safety, Treatment, Education, and Research Act of 2020 or the FASTER Act of 2020, would require the Centers for Disease Control and Prevention (CDC) to expand the collection of information related to the prevalence of food allergies for specific allergens and to include that information in reports to Congress. The bill would also amend the Federal Food, Drug, and Cosmetic Act (FFDCA) to include sesame as a major allergen and allow FDA, through regulation, to add other food ingredients as major allergens based on the prevalence and severity of allergic reactions to the food ingredient. Additionally, the bill would require FDA to include patient experience data on treatments for patients with food allergies in its reports on patient experience data.
  • H.R. 5855, the Bipartisan Solution to Cyclical Violence Act of 2020, would create a grant program at the Department of Health and Human Services (HHS) to support trauma centers with violence intervention and violence prevention programs. Program support would be provided to conduct research to reduce the incidence of re-injury and re-incarceration caused by intentional violent trauma.
  • H.R. 3878, the Block, Report, And Suspend Suspicious Shipments Act of 2020, creates additional requirements for drug manufacturers and distributors who discover a suspicious order for controlled substances. In addition to reporting a suspicious order of controlled substances to DEA, a manufacturer or distributor must also exercise due diligence, decline to fill the order or series of orders, notify DEA of each suspicious order or series of orders and the indicators that led to the belief that filling such orders would be a violation. These requirements would become effective one year following enactment.
  • H.R. 4806, the Debarment Enforcement of Bad Actor Registrants Act of 2020 or the DEBAR Act of 2020, would amend the Controlled Substances Act to allow the Attorney General to prohibit any registrant from manufacturing, distributing or dispensing a controlled substance or a list I chemical if that registrant meets or has met any of the conditions for suspension or revocation of registration, or has a history of prior suspension or revocations.
  • H.R. 4812, the Ensuring Compliance Against Drug Diversion Act of 2019, terminates the controlled substance registration of any registrant if the registrant dies, ceases legal existence, discontinues business or professional practice or surrenders registration. A registrant who ceases legal existence or discontinues business is required to notify DEA. Registrants must receive written consent from DEA in order to assign or transfer a registration. Registrants are also required to return certain documentation if a registrant’s work is discontinued.


Wyden Presses UnitedHealth for Details on Mental Health Coverage Shortfalls

On Nov. 19, Senate Finance Committee Ranking Member Ron Wyden (D-OR) sent a letter to health insurance company UnitedHealth requesting it disclose details about its behavioral health business, which has been subject to ongoing class action litigation for improperly denying coverage for mental health and substance use disorder (SUD) care. Sen. Wyden requested more information on factors that are driving revenue and profit growth for UnitedHealth in its behavioral health business. The letter also asks for more information about allegations that UnitedHealth directed at least one customer to Medicaid rather than covering the care itself, and whether such practices are widespread at the company. Additionally, the letter seeks details about subsidiaries, affiliates and contractors that UnitedHealth may use to administer behavioral health care coverage for third-party health plans.

Find the letter here.


FDA Grants EUA to Baricitinib-Remdesivir Combo for COVID-19

On Nov. 19, the Food and Drug Administration (FDA) granted emergency use authorization (EUA) to Eli Lilly’s anti-inflammatory drug baricitinib to be used in combination with Gilead’s antiviral remdesivir for treatment of COVID-19. The combination will be used for hospitalized adult and pediatric patients who require supplemental oxygen, mechanical ventilation or extracorporeal membrane oxygenation. The EUA for baricitinib is the first EUA of a drug that acts on the inflammation pathway.

FDA: Pfizer, Moderna COVID Vaccines to File for EUA

On Nov. 18, Pfizer and BioNTech announced a plan to submit an emergency use authorization (EUA) application to the U.S. Food and Drug Administration (FDA) within days. The vaccine developed jointly by Pfizer and the German firm BioNTech, BNT162b2, has demonstrated 95 percent efficacy and participants experienced few serious adverse events within a median two months after completing the two-dose vaccination sequence. The two-month mark was set by FDA as the required safety milestone in its September 2020 guidance for sponsors seeking EUAs for their COVID-19 vaccines. Moderna also announced it will soon file for an EUA for its investigational COVID-19 vaccine, which demonstrated 94.5 percent efficacy in an early analysis of trial data. According to Moderna, the EUA will be driven by the final safety and efficacy data.

FDA: First Full At-Home COVID-19 Test to Be Followed by Similar EUAs

On Nov. 18, the Food and Drug Administration (FDA) issued its first emergency use authorization (EUA) for a rapid COVID-19 diagnostic that can be performed entirely at home and hopes to approve similar tests in the upcoming weeks. The newly authorized test, developed by Lucira Health, uses self-collected nasal swabs to collect samples that are then placed in a test unit. The results can be read as soon as 11 minutes after performing the test, but no longer than 30 minutes from the test unit’s light-up display. The test is available under a prescription only for patients 14 and older and the company anticipates it will cost around $50. The test is expected to be available through health care providers nationally by early spring 2021.

Find more information here.

FDA Will Publicize EUA Data, Information as GAO Calls for Transparency

On Nov. 17, the Food and Drug Administration (FDA) announced it will publicly post its reviews of data and information supporting emergency use authorization (EUA) decisions for drugs and biologics, including vaccines, as part of its COVID-19 response. The announcement was made just before the Government Accountability Office (GAO) issued a report calling for FDA to be more transparent about its EUA reviews and decisions.

FDA Removes Language on Declining to Review LDT EUAs from Website

On Nov. 17, the Food and Drug Administration (FDA) updated its online testing FAQs to reflect the Department of Health and Human Services’ (HHS) directive that FDA review emergency use authorization (EUA) applications voluntarily submitted for COVID-19 laboratory-developed tests (LDT). FDA told labs in October it would no longer conduct the reviews following HHS’s August pronouncement that FDA lacked jurisdiction over LDTs. FDA now states that it prioritizes EUA requests based on several factors, including public health need, the extent to which the product would serve a significant unmet medical need and the availability of information concerning the likelihood that the product is safe and effective. The FAQs also now say that FDA has brought in additional staff to double the number of teams working on reviewing EUA submissions.

OMB Reviewing Final 340B Administrative Dispute Resolution Process

On Nov. 17, the Office of Management and Budget started reviewing a final rule on the establishment of a process for 340B administrative dispute resolution. The proposed version of the rule was issued by the Obama administration back in 2016 and was withdrawn by the Trump administration in August 2017.

Find more info here.

Special Fraud Alert from OIG Raises Concerns with Speaker Programs

On Nov. 16, the Department of Health and Human Services (HHS) Office of Inspector General released a Special Fraud Alert on the potential fraud and abuse risks of speaker programs hosted by pharmaceutical companies and medical device manufacturers. The alert notes that companies should evaluate their speaker programs in light of this new guidance and determine whether adjustments should be made, with specific focus on existing guardrails, requirements and justifications for determining the need for speakers, speaker selection, remuneration of speakers and attendees and the degree to which such programs are conducive to education.

Find more information here.

Final Regulations/Guidance

CMS Issues Most Favored Nation Model for Medicare Part B Drugs and Biologicals Interim Final Rule with Comment Period

On Nov. 20, the Centers for Medicare & Medicaid Services (CMS) announced a new payment model, the Most Favored Nation (MFN), and issued corresponding interim final rule with comment period. The new model follows President Trump’s recent executive order on Lowering Drug Prices by Putting America First (Sept. 13, 2020). The MFN Model will test paying Part B drugs at comparable amounts to the lowest adjusted price paid by any country in the Organisation for Economic Co-operation and Development (OECD) that has a gross domestic product (GDP) per capita that is at least 60 percent of the U.S. GDP per capita. The model will also test a redesign of the percentage add-on payment structure under Medicare Part B to remove incentives for use of higher-cost drugs through a flat per-dose add-on payment, and will include a financial hardship exemption for MFN participants. The mandatory MFN Model will operate for seven years, from Jan. 1, 2021 to Dec. 31, 2027.

Find the interim final rule here.

CMS Issues Final Rule on Anti-Kickback/Rebates Physician Self-Referral Regulations

On November 20, the Centers for Medicare and Medicaid Services (CMS) finalized changes to the physician self-referral regulations, also known as the Stark Anti-kickback regulations. The Physician Self-Referral law, generally prohibits a physician from sending a patient for many types of services to a provider that the physician either owns, is employed by, or otherwise receives payment from, regardless of what that payment is for. 

The rule finalizes many of the proposed policies from the notice of proposed rulemaking issued in October 2019, including:

  • Finalizing new, permanent exceptions for value-based arrangements to that will permit physicians and other health care providers to design and enter into value-based arrangements without fear that activities to coordinate and improve the quality of care for patients and lower costs would violate the physician self-referral law.
  • Finalizing additional guidance on key requirements of the exceptions to the physician self-referral law to make it easier for physicians and other health care providers to make sure they comply with the law.
  • Finalizing protection for non-abusive, beneficial arrangements that apply regardless of whether the parties operate in a fee-for-service or value-based payment system – such as donations of cybersecurity technology that safeguard the integrity of the health care ecosystem.
  • Reducing administrative burdens that drive up costs by taking money previously spent on administrative compliance and redirecting it to patient care.

Find the final rule here, to be published on the Federal Register on Dec. 2, 2020.

CMS Finalizes Rule for Organ Procurement Organizations’ (OPO) Conditions for Coverage for Medicare and Medicaid

On Nov. 20, the Centers for Medicare and Medicaid Services finalized a rule that makes changes to the donate rate measure, transplantation rate measure as well as performance benchmarks in organ procurement. In addition, it sets up a 12-month review period during the organ procurement organizations’ (OPO) four-year recertification cycle. At the end of each cycle, each OPO will be assigned a tier ranking based on its performance. Those that are at the bottom of three tiers will be decertified. Those in the middle will have to compete to keep their donation service area and will not automatically be recertified. Those at the top of the tier will be automatically recertified.  The new measures go in place August 2022.

Find the final rule here.

FDA Issues 34 New and Revised Product-Specific Guidances

On Nov. 18, the Food and Drug Administration (FDA) issued its latest quarterly release of product-specific guidances meant to promote the development of generic drugs, with 13 new and 21 revised draft guidances, bringing the total number of such guidances to 1,974 total. The guidances are intended to foster generic competition by clarifying FDA’s expectations for the studies required to demonstrate that a generic drug is equivalent to a reference-listed drug. So far this year, FDA has issued or revised more than 180 product-specific guidances.

Among the new and revised guidances are 11 for complex products, such as metered dose inhalers or aerosol foams, two of which FDA says were developed based on Generic Drug User Fee Amendments-funded research. FDA points out that 24 of the guidances are for products with no approved generic competition.

Find the list of guidances here

FDA: Updated Recommendations for Investigational COVID-19 Convalescent Plasma

On Nov. 16, the Food and Drug Administration (FDA) issued a new guidance to provide recommendations to health care providers and investigators on the use of COVID-19 convalescent plasma under the emergency use authorization (EUA) or investigational convalescent plasma as an investigational new drug (IND) during the pandemic. The guidance also provides recommendations to blood establishments on collection. The guidance describes FDA’s interim compliance and enforcement policy regarding the IND requirements for the use of investigational convalescent plasma to facilitate the availability of convalescent plasma to treat hospitalized patients with COVID-19. The guidance supersedes the guidance of the same title issued in April 2020 and updated in May and September 2020.

Find the final guidance here.

HHS Uses Artificial Intelligence to Review 185,000 Pages of Regulations, Proposes Final Changes

On Nov. 17, the Department of Health and Human Services (HHS) released a final rule to clean up 185,000 pages of regulatory code by removing outdated regulations, correcting nearly 100 citations, axing erroneous language and fixing misspellings and typographical errors. HHS used artificial intelligence and natural language processing to discover the inconsistencies. The rule amends HHS regulations to make miscellaneous corrections, including correcting references to other regulations, misspellings and other typographical errors, and goes into effect on Dec. 16, 2020.

Find the final rule here.


Find a comprehensive look at “Courts and Healthcare Policy in 2020” here.


GAO: Defense Production Act – Opportunities Exist to Increase Transparency and Identify Future Actions to Mitigate Medical Supply Chain Issues

On Nov. 19, the Government Accountability Office (GAO) released a report suggesting the Department of Health and Human Services’s (HHS) improved use of the Defense Production Act, which allows federal agencies to require companies to prioritize government contracts for medical supplies in addressing COVID-19. Federal agencies initially used the authority to address early medical supply shortages for ventilators and N95 respirators and eventually for other critical supplies like masks and testing supplies during the pandemic. The Department of Health and Human Services (HHS) is leading an effort to address U.S. medical supply chain issues related to the pandemic, but has not clarified its plans. GAO recommended that HHS identify how it will use the act to increase U.S. production of critical medical supplies and reduce reliance on foreign sources.

Find the recommendations here, and the full report here.

GAO: Comparative Effectiveness Research – Patient-Centered Outcomes Research Institute and HHS Continue Activities and Plan New Efforts

On Nov. 18, the Government Accountability Office (GAO) released a report on the Patient-Centered Outcomes Research Institute, which funds research to compare available treatment options for various diseases and conditions. The federally funded, nonprofit corporation and the Department of Health and Human Services are also required to share the findings of the research.

According to the report, the institute met its goal of getting its research cited in more news and online sources. HHS took steps to assess its effectiveness in sharing findings and getting them implemented. Both plan to comprehensively evaluate their efforts in the future.

Find the full report here.

GAO: COVID-19 – Federal Efforts Accelerate Vaccine and Therapeutic Development, But More Transparency Needed on Emergency Use Authorizations

On Nov. 17, the Government Accountability Office (GAO) released a report on the transparency of accelerated efforts to develop vaccines and therapeutics for COVID-19 through Operation Warp Speed. The Food and Drug Administration (FDA) has so far issued four emergency use authorizations (EUAs) that temporarily allow use of unapproved therapeutics. With a goal to ensure public trust, GAO recommended the FDA should better communicate the findings of its safety and effectiveness reviews.

Find the recommendations here, and the full report here.

If you have any questions, contact the following individuals atMcGuireWoods Consulting:

Stephanie Kennan, Senior Vice President
Mariam Eatedali, Research Associate

Founded in 1998,McGuireWoods Consulting LLC(MWC) is a full-service public affairs firm offering infrastructure andeconomic development, strategic communications & grassroots, and governmentrelations services. McGuireWoods Consulting is a subsidiary of theMcGuireWoods LLPlaw firm and has been named in The National Law Journal’s special annualreport, “The Influence 50,” for the past several years. In the most recentreport, McGuireWoods Consulting was ranked 15th of the 1,900 governmentrelations firms in Washington, D.C.

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