Washington Editor

WASHINGTON - The midterm elections are a day away, and the biotech industry could be facing some changes in rhetoric, at the very least.

That's because many political observers expect Republicans to lose control of the House of Representatives, and possibly the Senate too, leaving Democrats to fill leadership positions in one or both chambers. In either case, a different voice would have the opportunity to chart new courses and transform the climate, at least to some degree.

A leadership change provides Democrats "a bully pulpit" to shape agendas and public discussions by moving certain health issues to the front burner, explained Michael Werner, the president of The Werner Group, a Washington-based life sciences consulting firm. Given the Bush administration's ongoing foreign policy focus, Democrats would have "room to run" on domestic matters such as health care policy, he told BioWorld Today, and that could spell tough days ahead for drugmakers.

Though Werner believes that getting legislation passed would remain "very unlikely," because of the probability of a fairly evenly split House and Senate, as well as the hurdle President Bush represents, he cautioned that the industry "is going to find itself playing defense" in the face of unpopular legislative proposals and a more negative health policy dialogue.

Nancy Myers, the president of Catalyst Healthcare Consulting in McLean, Va., said a switch in either or both chambers would portend "a much greater focus on policies that have been in place for the last couple of years" under the Republican-controlled Congress. But she sees the potential for sweeping differences ahead, telling BioWorld Today that "Democrats may try to change some fundamental policies fairly significantly."

In the House, Democrats need to win 15 seats to take control, and they need six seats to take command of the Senate. If they take both chambers, Myers said they could push through legislation that the president would have difficulty vetoing, and if they control only the House, conference negotiations would take on a different tone and a Republican-led Senate could be pressured to make significant concessions, depending on the mood of the public on certain matters.

After the election dust settles, a number of issues that matter to the industry could be impacted by a change atop one or both chambers.

Pricing Weighs On Reimbursement, Access

Drug pricing represents the most wide-reaching concern to be addressed by new leadership, which could affect reimbursement and access, and Myers predicted "more scrutiny" with Democrats in charge. Already there are suggestions among Democrats to offer a government-administered drug benefit to Medicare Part D beneficiaries, essentially through efforts to repeal the Medicare non-interference clause.

That would allow the government to directly negotiate prices, and current House Minority Leader Nancy Pelosi (D-Calif.) has been vocal about her desire to tackle that matter in the first 100 hours of a reshaped Congress.

Critics contend that this would lead to de facto price controls, and Werner cautioned that government-negotiated "artificial pressure" on drug prices could have a near-term impact on investment in biotech and pharmaceutical companies, as well. But he predicted that "Democrats will try to push that," and "the industry will try to fight it."

Along the same lines, there could be "more noise" and hearings on biogenerics, Werner added, though in his opinion it would be a "tall order" to quickly amend the Public Health Service Act, as recently proposed legislation would do. That's because "the jury is still out" on whether such products would lower consumer costs, he said, and there remain outstanding safety issues. Still, Werner indicated that Democrats could use legislation as a "threat" to prod the FDA into broadening its guidelines.

Also related to drug pricing is reimportation, a nonpartisan issue, Myers said, but something that would be looked at "in a new light" under different congressional leadership. She cautioned that drugmakers could very well find themselves portrayed negatively as a result of drug pricing criticism, despite recent image improvements made through "significant steps" to improve access for the poor and research advances in orphan and other difficult diseases.

Those who might work to curb drug costs include Reps. Henry Waxman (D-Calif.), John Dingell (D-Mich.) and Pete Stark (D-Calif.), all of whom could become chairmen of relevant committees. All have experience on the issues, and "they will make life difficult for the industry," Werner said, later adding that they would "use their leadership role to try to adjust the agenda" by holding hearings, publishing reports and conducting investigations to raise the profile of certain issues, even if legal changes aren't the final outcome.

That same leadership group likely would dial up the drug safety dialogue, Myers said, even though she noted that it's not necessarily a partisan issue. But the scope and degree of safety-related changes at the FDA does differ between the two parties, with "a likelihood that significant pressure" would come if Democrats take control of one or both chambers, she said, to take back some command of the agency from the Bush administration.

Myers added that ongoing negotiations to reauthorize the Prescription Drug User Fee Act could take a turn with Democrats in charge, "having the user fees go for a broader scope of things."

But Werner said that the political dynamic around PDUFA would make it difficult for Democrats to wholly amend the way the FDA evaluates drugs, though he conceded that "it's certainly more likely that Congress will play a bigger role or try to legislate changes to the review and approval process" with them in control.

Stem Cell Debate Always There

In addition, efforts to increase federal funding for embryonic stem cells could heat up again if Democrats take control of one or both chambers, though overriding a presidential veto still is a significant obstacle.

Nevertheless, Werner predicted that Democratic leadership would "make this a big issue" early on to push for a vote "and potentially put more pressure" on President Bush, who vetoed bipartisan legislation earlier this year that would have increased the number of embryonic stem cells available for federal research grants.

In terms of election rhetoric leading up to the vote, stem cell research has proved to be the only biotech issue "that moves the needle" in some campaigns, Werner said, noting that it "resonates with voters."

It's certainly a prominent theme in the senate races in Maryland and Missouri, as well as the gubernatorial election in Wisconsin, and pro stem cell stances are aiding candidates in each of these races, Werner said.

"I think these elections really are very meaningful," Myers concluded, "despite the fact that it's not a presidential election year."