Print BCTV: Waxman's Legacy -- Henry Waxman on retirement, pharma, drug access, patent exclusivity

Waxman's Legacy

Transcript of BioCentury This Week TV Episode 182



Representative Henry A. Waxman (D-CA)




President Obama

Orrin Hatch (R-UT)

John D. Dingell, Jr. (D-CO)

Frank Pallone (D-NJ)


National Institutes of Health

Food & Drug Administration



Steve Usdin, Senior Editor




NARRATOR: Connecting patients, scientists, innovators, and policymakers to the future of medicine. BioCentury This Week.


STEVE USDIN: For the last 40 years, California's Henry Waxman has shaped American healthcare legislation, co-writing laws creating the generic drug industry and unleashing treatments for hundreds of rare diseases. He's retiring from Congress this year. Today, we'll hear his point of view.


NARRATOR: Biotechnology is a complex world of passionate opinions and strong personalities. Point of View is a special BioCentury series probing the thinking and experiences that have shaped some of biotech's most controversial and influential individuals.


NARRATOR: For 40 years, Representative Henry Waxman has sculpted the landscape of American healthcare. The California Democrat partnered with Republican Orrin Hatch on legislation creating the generic drug industry. Waxman championed the Orphan Drug Act, unleashing treatments for hundreds of rare diseases. He pushed the Ryan White Act through the House, helping millions of Americans access lifesaving AIDS drugs. Waxman opened new doors for the drug industry while fighting to reduce its profits, including a losing battle to limit monopolies on expensive biologic therapies.


HENRY WAXMAN: If you'd raise your right hand --


NARRATOR: Tenacious and theatrical, Waxman staged the enduring image of tobacco CEOs swearing to tell the truth. Regulated industry patient and consumer advocates will remember Waxman's legacy differently. He says his guiding principle has been public health.


STEVE USDIN: Representative Waxman, thanks for taking the time to join me today. I want to start by asking you, you were involved in creating the generic drug industry in the Ryan White Act that is providing HIV medicines for millions of Americans, the Orphan Drug Act, the Affordable Care Act. Is there unfinished business in healthcare policy and legislation? What's the next Henry Waxman or John Dingell have to do?


HENRY WAXMAN: I chose to concentrate my legislative efforts in the healthcare area because I was so convinced that this is a place where government has to be involved. Government must be involved in doing the biomedical research. The drug companies can't afford to do that and they benefit from it, and then they translate the early research into applications that save lives or prevent diseases. Government has to be involved to be sure that people have access to healthcare services. And then there's a public health dimension where government is, I think, absolutely essential.


We've accomplished a lot in this area, but there's still more to do. The Affordable Care Act is going to evolve over time. I don't know exactly the course it will take, but at least we've got in place a system where every American citizen will be able to get health insurance coverage. They can't be denied it because of preexisting conditions. They can get some assistance financially if they otherwise couldn't afford it, and we're trying to put in place ways to hold down healthcare costs.


So far, we're succeeding in that regard by trying to move the healthcare system from one where we're just paying for quantity, and now we'll pay for quality. We don't know what, in the public health arena, we may be facing tomorrow, but there are still things we need to do. I worry about the fact that antibiotics are not as effective as they have been in the past.


So there are a lot of things to work on, and government needs to be there. Others in the Congress will have to take on this responsibility as I leave and as Congressman John Dingell leaves at the end of this year. But Frank Pallone is the Chairman of the Health Subcommittee, and there are others in the Congress who care about this issue and will, I'm sure, emerge to show leadership.


STEVE USDIN: One of your signature piece of legislation was creating the generic drug industry, and a lot of your work has been battling the innovative drug companies and trying to help create access for generic drugs. Do you think that the country has the balance right now between innovative drugs and access through generic drugs, or does more work have to be done in that area?


HENRY WAXMAN: Well, I think the balance we tried to set in place was a good one, but there's always somebody trying to tip that balance for their economic gain. From the public interest point of view, what we want to achieve is the full incentives for investment in new breakthrough drugs. At the same time, we want to get competitive generic drugs on the market so that people can afford these new breakthroughs.


Right now, most people get their drugs through the generic side, but some of the most expensive lifesaving drugs are at the brand level, and they are very, very expensive, and so a lot of people just cannot afford to get those drugs. So it's a balance we have to continually watch as we look at the original act and anticipate some of the problems that have come up. We're always trying to change it.


It's hard when somebody likes the status quo because the status quo is easier to maintain than to change legislation, but I think we always have to worry that if we don't get this balance right, there will be those who will be calling for a drug formulary that would be paid for by the healthcare system without any distinction between the incentives for development of the drugs. And on the other side, we may have the highest priced drugs in the world and our people won't be able to afford them.


STEVE USDIN: One of the things that some people said is an unintended consequence of Hatch-Waxman, which allows generic drug companies to challenge an innovator pill after about four or five years, and then you've got the Affordable Care Act, which gives 12 years of exclusivity for biologics, is that it creates an incentive for companies to create these much, much more expensive biologics versus pills. Is that something that concerns you?


HENRY WAXMAN: I didn't like the provision that was added on the pharmaceutical biologic area as part of the Affordable Care Act. It really wasn't part of that law, but it was a vehicle, and so it was attached. That bill was attached to it. I think 12 years is an excessive period of time to give a monopoly control, which means the highest possible prices for drugs. The Hatch-Waxman Act only had a five-year period, and I don't think there's a justification for that longer period.


The President and many of us would like to see it shortened, and there's always that tension that goes on. What is the right balance? I think the balance is too much in favor of the monopoly control over medicines, and not enough to get the competitive side of it so we can get better prices for medicines.


STEVE USDIN: I want to ask you when we come back right after a break about what might be done or what you think realistically might happen in Congress about that period of exclusivity. We'll be right back with Representative Henry Waxman.


HENRY WAXMAN: One of the most important debates in modern politics is the role of government. I think government can be a tremendous instrument for good, and I've seen it help Americans in countless ways.


NARRATOR: You're watching BioCentury This Week.




STEVE USDIN: We're back with Representative Henry Waxman.


So you were saying that you don't think that the period of exclusivity that biologics have now is justified. You think it's too long. Is there any prospect that Congress would actually be able to have the political will and muscle to be able to change that?


HENRY WAXMAN: Well, Congress has the ability to change the law, as we look at it and see what the impact will be. We have accomplished a pathway for a generic to be approved for these biologic drugs.


It's a little different than the traditional medicines, where all they had to do is show they're doing the exact same drug and then it came out as a generic alternative. But we knew it was really the same drug.


I think that the Congress will continue to look at this issue. I don't think we can afford to pay monopoly prices for some of these drugs. The payors are the public, the taxpayers, the pharmaceutical managers for the insurance companies. And for individuals have to pay for their own drugs.


And I think we could price people out of the market, and then we have lifesaving pharmaceuticals that aren't going to save anybody's life, if they can't possibly get access to it.


STEVE USDIN: I want to shift and ask you about something else. Over the years, in the past, you've been extremely critical of the FDA. In 2007, you basically said that politics was driving FDA decision making.


You haven't made those kind of statements in recent years, and I'm wondering, is it because you think that the FDA has changed or they just get a pass because it's a Democratic administration?


HENRY WAXMAN: I think the FDA is doing what it's supposed to do, relying on the science. But when the FDA -- when I made that statement -- refused to allow a day-after pill to prevent pregnancy, and they were stopped from approving a drug, based on the science that it was safe and effective, because of the politics of those who don't want any abortions or what they would define as abortions, I thought that was political and was inappropriate for the FDA.


STEVE USDIN: So was it political when President Obama said that he thought that there should be restrictions, age restrictions, on access to the Plan B? And then later, the Court, a court, overturned it. But the Obama administration did try to put those restrictions in place.


HENRY WAXMAN: I think that was political, as well. And I was critical of that position. Because I didn't see that that was the role for the FDA, unless it was a question of safety or efficacy, to start defining who can have access to some of these drugs, based on whether they thought it was appropriate for a teenage woman to be able to stop a pregnancy.


STEVE USDIN: And another thing, you've been very active about regulation of advertising of pharmaceuticals. I'm wondering, do you think that Congress needs to step in now and do anything about the promotion of drugs, using social media, on the internet, and so on?


HENRY WAXMAN: I think that in this country, we have gone down the path of allowing advertising.


STEVE USDIN: Which is something that no other country allows.


HENRY WAXMAN: No other country allows it. It's somewhat disturbing, because these are not drugs that the individual patients who would use the drugs would buy they're drugs that they have to go to their physician to prescribe.


And they're putting the physicians in a situation where they feel that unless they're going to go along and write a prescription for a drug that their patient wants, they may lose that patient.


And we've seen advertising be very, very successful in getting people to use drugs. Sometimes, there side effects on drugs. You would hope the physician would intercede and not prescribe a drug. But too often, they just give in.


And I think that we probably have a wider use of drugs that are inappropriate for a lot of people in this country than we do in other countries. And that disturbs me.


But I think a lot of the court cases, and looking at this as a First Amendment right, I distinguish in my own mind -- although I think I'm in the minority on this -- between the First Amendment, which allows free political speech, free ideas being expressed, to commercial speech, which is advertising.


For example, I would have prohibited outright -- even today -- any advertising of tobacco. Tobacco is legal, only because it's already established a market. If it were just being introduced for the first time, we would say, no, no, we don't need this product. It's harmful. When you use as intended, it kills.


But it's a legal product. And yet, I don't see why we should allow them to advertise and take a deduction, tax deduction, as a business expense, for their advertisements.


But I think that my point of view is not the prevailing one. I do see a role for limiting advertisement for drugs in a widespread way. If the FDA believes that they've approved a drug without knowing the full extent of side effects that might occur, because the patient population used for the trial does not reflect the large patient population that would be using the drug.


And we found out a couple instances -- I can't recall the specifics of it at this moment -- where a drug was approved. The FDA pushed hard to get these drugs out as quickly as possible.


They may be doing the aftermarket surveillance. But if there's a tremendous advertising campaign, large numbers of people can start taking the drug. And then we see that there's a dangerous side effect that we didn't know about.


So FDA should have the power to say, we think this drug has a potential to do some harm. Let's limit the advertising for a certain period of time and not let the full-fledged billion dollar campaign push that particular product.


STEVE USDIN: We're going to be right back with Representative Waxman to talk about this and other issues.


HENRY WAXMAN: It is unfair and wasteful to develop new products that sick people can't afford. It is pointless to get easy access to products that don't help. This is a balancing act that I know well. I've been working on it for almost 20 years now.




NARRATOR: Now, back to BioCentury This Week.


STEVE USDIN: We're back with Representative Henry Waxman. Representative Waxman, from one of the things that you've proposed over the years and the Obama administration has supported, is requiring that drug companies give rebates for the so-called dual eligibles. These are patients who are on Medicare but are also eligible for Medicaid. Why do you propose that, and do you think that it's likely to become law?


HENRY WAXMAN: Before we had a Part D on Medicare, which is a prescription drug coverage, people who were dual eligible because they were also on Medicaid got drugs, but we insisted that the pharmaceutical companies give the government the best price, the lowest price, they'd give to any other purchaser of the drug for this population. Well, when the Medicare Part D program was adopted, suddenly the Republicans who were in charge shifted those people who were getting the drugs at a lower price because of the rebates to a Medicare price, which raised the amount of money that the drug companies got for the very same drug off of the very same population, giving them a huge windfall. There was no justification for it, just the drug companies wanted more money and the Republicans in charge wanted to give it to them.


I think we could look to say that those who are dual eligibles, on Medicaid and Medicare, ought to have those drugs at the same price we paid for those drugs at a previous time. That would save $140 billion over a 10 year period. That's a huge amount of money. There's no reason that that $140 billion windfall should go to the drug companies when we're struggling with a deficit and high cost for the Medicare, Medicaid programs.


STEVE USDIN: How likely do you think that is to happen? It's something that you've proposed in the past, the Obama administration has included in their budgets in the past, and it hasn't really gone anywhere. Do you think it will ultimately be passed?


HENRY WAXMAN: I think it makes a lot of sense because when we're under pressure to hold down costs, we get ideas like saying we'll restrict the drugs that people can get under Part D. Well, if they need a specific drug, there's a very good argument they should get that drug. The proposal I'm suggesting doesn't affect the patient access to drugs. People get it, it helps us hold down the costs, and I think it's perfectly justified than taking drugs away from people or making people have to pay a lot more for their drugs.


STEVE USDIN: So with that one and with another thing that you've pushed over the years, which is the idea that the administration should be able to negotiate drug prices on Part D, the drug companies push back and say, well if you do that, then that's going to reduce the amount of money that's available for innovation and the public won't get new drugs in the future that they need. What would be your response to that?


HENRY WAXMAN: I think that argument's overdone when they say they've got to have more money to do research because they use more money for advertising and promotion of drugs than they do on actual research. But I think that we ought to make sure that the payers for drugs, the government particularly, is getting the best price.


And I was astonished when the Republicans put in Part D that there was a prohibition on the government getting a better price for the drugs when we are bringing in millions of people as customers for the drug companies under Medicare, and then saying the government couldn't get a better price for a large volume of people. In fact, the government was being prohibited from trying to negotiate a better price. Buyers should be able to negotiate, and if they buy more drugs, they should have more leverage over it. The government spends an enormous amount of money for pharmaceuticals, and I think we ought to be able to go in there and negotiate it so that the public benefits, especially the taxpayers.


STEVE USDIN: Representative Waxman, you were involved in successfully doubling the NIH budget in the 1990s. Since then, the budgets have been flat in real terms, and actually, they've gone down about 20% if you figure inflation into it. What would it take to get the kind of political will that would be needed to get NIH's budget at least back up in terms minus inflation to where it was in the 1990s?


HENRY WAXMAN: It's very shortsighted for us to allow that budget to decline in value because you can't have researchers stay with their profession if we're going to give them funds one year and take it away the next. I think we need steady, clear funding that will increase at least at the rate of inflation for the biomedical research. There's such strong, overwhelming, bipartisan support for it. People understand this is so important. The crown jewel of government is to do something like biomedical research.


We've got to stop the mindlessness by which we had a program called sequestration, just lop off sums of money in certain appropriated programs without recognizing that some programs need more money and some programs don't even have to be there at all. We could save the money by eliminating them or cutting back on them. But one place we shouldn't cut back is on the research that will give us the ability to prevent, control, and cure diseases for the future.


STEVE USDIN: You said there's bipartisan support for it but it's not happening. What has to happen or what could happen to create that support for it that would allow the Congress to support the NIH and level it out to where it was in the past?


HENRY WAXMAN: Whether philosophically you believe in a greater role for government or a smaller role for government, if we don't continue biomedical research, we are making a serious mistake, and we've got to get that message across to all of our legislators. Whatever their philosophical points of view might be, as a practical, realistic matter for the future of this country, we need a national defense and we need to fund biomedical research, and there are certain minimal things that government must do because it otherwise, won't get done, like investing in the education of our children so that we can compete economically. So our future depends on some of these investments. Research into science is one of the best investments we make, not just to find new products for the future, but so that we can improve our economy.


STEVE USDIN: Well, thanks. We're going to be right back with more with Representative Henry Waxman.


NARRATOR: Every month, BioCentury This Week will feature Profiles in Innovation, a special segment highlighting the stories of innovators whose work is improving lives and transforming the world of healthcare.




STEVE USDIN: We're back with representative Henry Waxman. Representative Waxman, these proposals about negotiating Part D prices, the rebates on the dual eligibles, why do you think that those things haven't happened? The Democrats in Congress have supported them, the administration supports them. What's preventing that from happening?


HENRY WAXMAN: I think it hasn't happened because of the power of the pharmaceutical industry. Pharma is a very persuasive group because they're very powerful, they have many, many lobbyists, they give a lot of campaign contributions, and they have what on the appearance looks like a sympathetic story to tell. They always threaten that we won't have the new breakthroughs that we're desperate for unless we let them have more money, even though they don't use more money for research, they use more money for profits and for promoting these drugs. But nevertheless, they're powerful with Republicans and Democrats, and so it gets hard to ever change things when they are standing against it.


They were helpful to the administration in supporting the Affordable Care Act, the Obamacare law. A lot of Republicans weren't happy about it, but they were out there because they saw the huge financial benefit to them of all these new people who would get insurance coverage to pay for healthcare, including pharmaceuticals. I thought they did what was in their self-interest, and it turned out in that case, it was in the public interest, but their primary goal is to protect their own special interest.


STEVE USDIN: So you've been successful in the past in trying to align the interests of the drug industry and public health. The Orphan Drug Act is a good example of that. Do you think that there are opportunities in the future to do that, to extend the approach in the Orphan Drug Act, for example, to try to get incentives for creating drugs for public health needs like Alzheimer's and diabetes and things like that?


HENRY WAXMAN: The only clear way to get legislation adopted -- and sometimes it takes a very long time to get bills through, even bills that seem like common sense and should be easy, but they all take time because you have to reconcile different, competing interests and try to bring groups together so they can all see their self-interest in getting something passed. That happened with the Orphan Drug Act, it happened in a lot of other legislation, and that's always the difficulty, but sometimes, you can't reconcile these issues as easily as you'd like.


But in the future, we need the pharmaceutical industry, both the brand name, research intensive parts of it, as well as the generic drug side of it, for a lot of important public health benefits. We need to figure out cures for diseases that are costing us a huge amount of money, like Alzheimer's, or other diseases that we're seeing more, like antibiotics that aren't working. We need to give incentives to the companies to do more to develop these products and to make them affordable.


STEVE USDIN: Thank you, Representative Waxman. Have a thought about today's show? You can join the conversation on Twitter using the hashtag BioCenturyTV. I'm Steve Usdin. I'll see you next week.