Washington Editor

WASHINGTON - With an eye toward the new and vastly reconfigured Congress, Jim Greenwood, president and CEO of the Biotechnology Industry Organization (BIO), soon expects to pay a visit to Sen. Edward Kennedy (D-Mass.).

The senior Bay State legislator is likely to be the next chairman of the Senate's Health, Education, Labor and Pensions Committee, one of a couple of congressional committees that oversee the FDA and the laws that govern its activities. In addition, he's active on a range of health care fronts of importance to drugmakers and their lobbyists here, all of whom fear that the new leadership could spur downward pressure on prices and overhaul the drug-approval process, both of which could cause a chilling effect on investment.

"With respect to FDA legislation, it is going to be a very busy year next year," said John Manthei, a lawyer with Latham & Watkins LLP who previously worked on Capitol Hill. Pointing to three laws that sunset next October, including the Prescription Drug User Fee Act, he labeled this a "rare situation with must-dos."

Like Kennedy, whom Manthei said is "well positioned" to effect change, several other veteran but freshly empowered Democrats will have quite a bit of sway with this industry going forward, given the number of potential policy moves they can make in the 100th Congress. Rep. John Dingell (D-Mich.) is likely to lead the House Energy and Commerce Committee, and Rep. Henry Waxman (D-Calif.) probably will be the House Government Reform Committee's next leader. It's also expected that Waxman will head the Energy and Commerce Committee's subcommittee on health.

Manthei said both "have the FDA squarely within their crosshairs," although he said the Democrats' ability to make sweeping changes would prove difficult given the thin margins between the parties in both chambers, President Bush and his administrative appointees. "Party discipline is going to be very tough," he said.

Nevertheless, Greenwood, who diplomatically referred to "some new and improved opportunities" that the new Democratic majorities would provide the industry, also pointed to "some increased challenges."

With regard to the latter, negotiations to reauthorize PDUFA are likely to include more congressional input than before. Many people believe the law's renewal won't be clean, as it was four years ago, but instead will serve as a vehicle for multiple changes to the FDA, including the redirection of user fees for more than drug reviews.

Greenwood conceded that Kennedy and Dingell, whom he labeled "old hands" on PDUFA matters, will dictate such discussions from positions of more power than in the past, when they generally accepted legislation negotiated between the FDA and the industry.

Manthei indicated that changes to the Food, Drug and Cosmetic Act, such as those inherent in PDUFA, would drive other reforms, and Greenwood said he wouldn't be surprised so see amendments to the coming iteration related to drug safety, reimportation and biogenerics.

"We'll have our hands full," he added, noting that the trade association's top priority is to remain active with congressional members in the PDUFA reauthorization process.

Greenwood cautioned against slowing drug development in the name of safety, as well as knee-jerk market withdrawals for the same reason. Instead, he called data mining through post-approval surveillance "the most productive and comprehensive way to achieve safety."

Variety Of Issues On Agenda

Reimportation proponents already scored a victory this year, with language from Sen. David Vitter (R-La.) included in a homeland security bill to permit 90-day drug supplies from Canada. Greenwood said he'd expect this Democratic Congress "to go considerably farther in that regard," which BIO is fighting by stressing the negative consequences that reimportation of lower-priced drugs could have on innovation.

The same argument underlies opposition to biogenerics, for which Waxman recently introduced legislation to create a regulatory approval pathway at the FDA. Greenwood, who uses models to demonstrate the differences in complexity between biologicals and small molecules when discussing the issue with congressional members, indicated that those lawmakers should "follow the science." Underscoring his point, he emphasized that "the policy has to be conducive to investment."

The reimportation and biogeneric issues relate to pricing, and the industry clearly is recoiling at the prospects of Democrats driving down drug costs. Such efforts, Greenwood cautioned, would retard investment and stifle innovation as a result. "If you want to go down the European pathway," he said, describing a policy for squeezing more and more health care benefits from the lowest possible expenditures, "then we'll never see the real promise of this technology develop."

Also on the laundry list of drug pricing-related rhetoric is a legislative undertaking championed by future House Speaker Nancy Pelosi (D-Calif.) to offer a government-administered drug benefit to Medicare Part D beneficiaries, which would repeal the Medicare non-interference provision and allow the government to directly negotiate prices. Critics have labeled that an effort to institute price controls, but she said she would take up this cause in the first 100 hours of this reshaped Congress.

Expressing BIO's disagreement, Greenwood said Part D's existing framework in which private insurers negotiate prices with drugmakers has worked, given the program's broad adoption and support, as well as lower-than-expected premiums being paid by beneficiaries. "We don't think it's broken," he said, "and we don't think it needs to be fixed."

Greenwood said BIO also expects to "vigorously" resist Democrat-led efforts to roll back pandemic flu- and biodefense-related liability protections given to drugmakers, which puts the burden on plaintiffs to prove wrongful misconduct. Companies working to develop and market such products "cannot afford" to do so, he said, "if they stand a grave risk of being eviscerated by trial lawyers."

Among benefits of new leadership to the industry, Greenwood expects members to quickly reintroduce this summer's vetoed embryonic stem-cell legislation, the soon-to-be-renamed DeGette-Castle bill. While he predicted passage by a wider margin in both chambers than before, he expects another veto.

Neither he nor Manthei expects the new congress to impede Andrew von Eschenbach's confirmation as FDA commissioner, and Greenwood said the Senate could take up the vote before the end of the year.

In terms of appropriations, he anticipates new leadership "would be sympathetic to our interests" in securing significantly better funding for the FDA and the National Institutes of Health. He also expects Democrats to support efforts to secure construction funding for cellulosic ethanol plants, given the party's soft spot for sustainable energy and environmental issues.