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HEALTH CARE BRIEFING: Generics-Makers Prep for Exclusivity Fight

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HEALTH CARE BRIEFING: Ginsburg’s Death Casts Doubt on Obamacare

 

The generic drug industry is gearing up for a busy year with lawmakers mulling changes to the pharmaceutical supply chain and how medicines are priced.

The Covid-19 pandemic sparked fears among U.S. regulators and lawmakers around drug shortages and U.S. reliance on foreign medicine producers, particularly for the ingredients crucial to generic drugs.

“A large part of the conversation, particularly in early 2020, was whether we are too reliant on one part of the world for manufacturing,” Erik Komendant, vice president of federal affairs for the Association for Accessible Medicines, said. The group is the lead lobbying organization for Teva Pharmaceutical Industries, Novartis’s Sandoz, and other generic drugmakers. “Those concerns didn’t pan out because of our members.”

Generics-makers will make the case this year for capping what seniors pay for drugs under Medicare, and they will take on the growing price of branded medicine, industry observers say. They’re also defending against a push to change the 180 days of exclusivity granted to some new generics. Generics have been targeted by lawmakers worried about companies abusing exclusivity rules and availability of medicines if global supply chains are disrupted.

A bipartisan duo in the House introduced a bill in the 116th Congress that seeks to limit “parking” on a generic drug application—when a company blocks competition. Drug firms can get 180 days of exclusivity on a drug if they’re the first to file an application with the Food and Drug Administration. That bill was part of a bicameral deal on surprise billing and health-care cost legislation, but wasn’t included in a year-end spending deal with the rest of the measure.

AAM has been increasing its lobbying tab over the past four years, although it and individual drugmakers still spend far less than branded companies and their lobbying organization, the Pharmaceutical Research and Manufacturers of America. AAM spent nearly $4 million in 2020, up from $3.5 million in 2017, but less than the $4.75 million paid in 2019, according to federal lobbying disclosures.

Two of the largest generics companies, Teva and Viatris, spent $2.1 million and $2.3 million respectively in 2020. Teva’s spending was down slightly from 2019, while Mylan, which merged with another company to become Viatris in 2020, paid $4 million on lobbying through 2019.

PhRMA had a down year in 2020, spending $25.5 million on lobbying, federal disclosures say. Among big brand companies, Amgen boosted its spending to $11.1 million, from $8.5 million in 2019, while Pfizer‘s outlays of $10.9 million were little changed last year from the previous year. Read more from Alex Ruoff.

Lobbying Thrived in 2020 Bolstered by Virus Aid Advocacy: The coronavirus pandemic was a boon for Washington lobbying firms, many of which posted record-high revenue in 2020. Lobbying executives predict that trend will continue this year with a whirl of activity by a new administration and Congress. Akin Gump Strauss Hauer & Feld, the No. 1 firm by revenue, took in $49.6 million in lobbying fees last year, $7 million more than in 2019, marking the strongest revenue the firm’s lobbying shop has ever had. Brian Pomper, the co-head of the firm’s public law and policy practice, expects the work to continue with President Joe Biden trying to push an ambitious agenda through a closely divided Congress. Read more from Megan R. Wilson.

Happening on the Hill

Biden to Push Congress on Stimulus: President Joe Biden will escalate appeals for Congress to back his top priority, $1.9 trillion in pandemic relief, seeking to overcome Republican opposition to the plan as he enters his first full week in office. Biden’s top economic adviser, Brian Deese, spent more than an hour yesterday discussing the proposal with a bipartisan group of lawmakers. Some asked the White House to further justify what would be the second-largest emergency spending measure in U.S. history and expressed interest in a much narrower bill focused on accelerating coronavirus vaccine distribution, according to Sen. Angus King (I-Maine) and people familiar with the matter.

Deese and other officials provided details and context in response to the senators’ questions, according to an administration official. Senior White House aides plan to keep talking with lawmakers in both parties this week to hear their concerns but also press for urgent action, the official said. Read more from Jordan Fabian.

Biden Health Picks Stuck With Power-Sharing in Flux: The Senate Health, Education, Labor, and Pensions Committee is stuck in a holding pattern until Senate leaders are able to reach a power-sharing agreement, potentially pushing back a confirmation hearing for Biden’s pick to lead the Health and Human Services Department. Committees aren’t formally adding any new members or chairs until the agreement is struck, leaving the Senate HELP Committee without a ranking member and delaying the committee’s work in scheduling hearings for Xavier Becerra, according to two Democratic Senate aides, Alex Ruoff reports.

House E&C Organizational Meeting: The House Energy and Commerce Committee has scheduled a formal organizational meeting for the committee Thursday. The committee will adopt the committee rules and formally announce its subcommittees’ leaders and members.

Eshoo, Katko, Klobuchar to Talk Tech Policy: Rep. Anna Eshoo (D-Calif.), chairwoman of the House Energy and Commerce Health Subcommittee, will discuss Covid-19 disinformation online tomorrow at the annual State of the Net internet policy conference.

The Coronavirus Pandemic

U.S. Won’t Relax Travel Restrictions: Biden will continue to restrict travel to the U.S. from the U.K., Ireland and 26 countries in Europe, and will extend the ban to South Africa, to slow transmission of Covid-19, said a White House official familiar with the plan. The latest ban would prevent most non-U.S. citizens from entry if they have recently been in South Africa, where a new strain of the virus has been identified. It’s unclear how long the restrictions will continue.

The Trump administration on Jan. 18, two days before Biden’s inauguration, announced a plan to wind down restrictions on travelers from a number of countries starting Jan. 26, when arrivals to the U.S. would need to have tested negative for the virus.

Starting today, all passengers arriving in the U.S., including citizens, will also be required to get a viral test for the coronavirus within three days of their departure, and to provide written documentation of a negative result. The CDC, in an order issued yesterday, eliminated an option for airlines or other aircraft operators with flights from countries that lack testing capacity for Covid-19 to apply for two-week waivers from the order. Read more from Jordan Fabian.

U.S. to Boost Surveillance of Virus Variant: The U.S. government, including the Pentagon, is boosting surveillance of coronavirus variants to monitor their effect on Covid-19 vaccines and therapeutics, the new Centers for Disease Control and Prevention director said. “We are now scaling up both our surveillance of these and our study of these,” Rochelle Walensky told “Fox News Sunday.” The agency is working with others, including the Defense Department and the Food and Drug Administration, to monitor the variants, she said. Read more from Craig Torres and Tony Czuczka.

  • As the U.K. coronavirus variant spreads across the country, the U.S. has reached another milestone in the year-long struggle against the coronavirus, as total infections exceeded 25 million—or roughly 8% of the population—Johns Hopkins University data show. Brian Wingfield has more.
  • The U.K.’s health minister warned that coronavirus vaccines may be less effective against new variants of the disease, and that stricter border controls are justified. Read more from Joe Mayes.
  • The U.K.’s new strain of coronavirus may be more deadly than first thought, Prime Minister Boris Johnson said Friday, as he warned again that the country faces a long wait before it can emerge from lockdown. Speaking at a news conference in London, the premier said new evidence had led the government to revise its initial view that the variant was more contagious but not more dangerous. It may be 30% more deadly than the original strain – or more, a government GFN found. Read more from Joe Mayes and Tim Ross.
  • Why the Mutated Coronavirus Variants Are So Worrisome: QuickTake

Shot Scarcity Weighs on Hopes for Biden’s Global Push: With a new president in the White House, the U.S. is re-engaging with the rest of the world to combat Covid-19. But for now, the Biden administration may hold back the one thing poorer nations desperately need: vaccines. One day after Biden’s inauguration last week, his chief medical adviser, Anthony Fauci, pledged support for the World Health Organization, including participation in the Covax program to deploy vaccines globally. Even with the U.S. playing a major role, tough challenges remain in the effort to aid low- and middle-income nations.

The U.S. has long been the WHO’s leading partner in combating diseases, including smallpox, polio, and Ebola. And the superpower could still have a big impact in the bid to slow Covid-19 and tackle other threats after former President Donald Trump’s pullback. Lawrence Gostin, a global health law professor at Georgetown University, said he believes it’s imperative for rich nations to share vaccines before it’s too late. But doing so, he said, creates a challenge as the virus continues to spread in the U.S. James Paton and John Lauerman have more.

  • The U.S. is close to administering vaccinations at a pace of a million shots a day, suggesting that the Biden administration’s 100-million-doses-in-100-days goal might be a modest aspiration. As of Thursday, 940,000 doses a day were administered on average over a seven-day period, data from the Bloomberg Vaccine Tracker show. The most recent two days topped a million doses. Biden’s goal, essentially, is to not backslide. Read more from Tom Randall and Drew Armstrong.
  • Pfizer-BioNTech will supply up to 40 million doses of their vaccine to Covax. Shipments will launch in the first quarter and continue through 2021, the partner companies said. The deal follows pacts with AstraZeneca, whose shot is approved in the U.K., and other drugmakers such as Johnson & Johnson. Naomi Kresge and Corrine Gretler have more.

Birx Says Trump Presented Charts She Never Made: Deborah Birx, who recently ended her stint with Donald Trump’s coronavirus task force, said misinformation abounded in his White House and that the former president had presented “parallel” information about the pandemic. “I saw the president presenting graphs that I never made. So I know that someone — someone out there or someone inside — was creating a parallel set of data and graphics that were shown to the president,” Birx said in a lengthy interview on CBS’s “Face the Nation” that aired yesterday. “I know what I sent up, and I know what was in his hands was different from that,” she said. Read more from Yueqi Yang.

More Headlines:

What Else to Know

Late Trump-Era Health Rules Raise Legal Questions: The Biden administration could delay or rewrite three major health-care rules issued in the last weeks of the Trump administration after their effective dates were found unlawful by a federal watchdog agency. Two of the new rules provide broad exceptions to the Stark Law and Anti-Kickback Statute, which police fraud in the health-care industry. The third restructures how drugmakers pay pharmacy middlemen such that the rebates can’t fluctuate based on the price of a drug.

The Government Accountability Office found all three rules violate the Congressional Review Act, which requires that major rules take effect 60 days after they’re published in the Federal Register or after Congress receives them, whichever comes later. Those findings may “serve as a defect” for the Biden administration to issue new effective dates, said James Segroves, a partner at Reed Smith. Read more from Tony Pugh.

Pandemic Spurs Calls for At-Home Pain Care Boost: The Biden administration is seeing calls for a new Medicare experiment to offer in-home symptom management, pain relief and other services to non-hospice patients with serious chronic illnesses. Currently, this type of palliative care, which targets patient comfort and improved quality-of-life, is only available in traditional Medicare via the hospice benefit for patients with under six months left to live. Read more from Tony Pugh.

More Headlines:

To contact the reporters on this story: Brandon Lee in Washington at blee@bgov.com; Alex Ruoff in Washington at aruoff@bgov.com

To contact the editors responsible for this story: Zachary Sherwood at zsherwood@bgov.com; Giuseppe Macri at gmacri@bgov.com; Michaela Ross at mross@bgov.com

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Vermont Health Connect had 10 data breaches last winter

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Vermont Health Connect had 10 data breaches last winter
Vermont Health Connect has set up a special enrollment period in response to the coronavirus outbreak. VHC photo

In mid-December, a Vermont Health Connect user was logging in when the names of two strangers popped up in the newly created account.

The individual, who was trying to sign up for health insurance, deleted the information that had suddenly appeared.

“It was super unsettling to think that someone is filing in my account with my information,” the person, whose name is redacted in records, wrote in a complaint to the Department of Vermont Health Access. “Just seems like the whole thing needs a big overhaul.”

It was one of 10 instances between November and February when Vermont Health Connect users reported logging to find someone else’s information on their account.

The data breaches included names of other applicants and, in some cases, their children’s names, birth dates, citizenship information, annual income, health care plans, and once, the last four digits of a Social Security number, according to nearly 900 pages of public records obtained by VTDigger. On Dec. 22, the department’s staff shut down the site to try to diagnose the problem.

While officials say the glitches have been resolved, it’s the most recent mishap for a system that has historically been plagued by security and technical issues. The breaches could be even more widespread: Administrators of Vermont Health Connect can’t tell if other, similar breaches went unreported.

“We don’t know what we don’t know,” said Jon Rajewski, a managing director at the cybersecurity response company Stroz Friedberg. Regardless of whether there are legal ramifications for the incidents, they should be taken “very seriously,” he said.

“If my data was being stored on a website that was personal, — maybe it contains names or my Social Security number, like my status of insurance… — I would expect that website to secure it and keep it safe,” he said.

“I wouldn’t want someone else to access my personal information.”

Andrea De La Bruere, executive director of the Agency of Human Services, called the data breaches “unfortunate.” But she downplayed the severity of the issues. Between November and December, 75,000 people visited the Vermont Health Connect website for a total of 330,000 page views, she said. The 10 incidents? “It’s a very uncommon thing to have happen,” she said.

De La Bruere said the issue was fixed on Feb. 17, and users had reported no similar problems since. The information that was shared was not protected health information, she added, and the breaches didn’t violate the Health Insurance Portability and Accountability Act, or HIPAA.

“No matter what the law says technically, whether it’s HIPAA-related or just one’s personal information, it’s really concerning,” said Health Care Advocate Mike Fisher.

The timing of the issue is less than ideal, he added. Thousands of Vermonters will be logging into Vermont Health Connect in the coming weeks to take advantage of discounts granted by the American Rescue Plan. “It’s super important that people can access the system, and that it’s safe and secure,” Fisher said.

A ‘major issue

The issues first arose on Nov, 12, when at least two Vermonters logged in and found information about another user, according to records obtained by VTDigger.

Department of Vermont Health Access workers flagged it as a “major issue” for their boss, Kristine Fortier, a business application support specialist for the department.

Similar incidents also occurred on Nov. 17 and 18, and later on multiple days in December.

Department of Vermont Health Access staff members appeared alarmed at the issues, and IT staff escalated the tickets to “URGENT.”

“YIKES,” wrote a staff member Brittney Richardson. While the people affected were notified, the data breaches were never made public.

State workers pressed OptumInsights, a national health care tech company that hosts and manages Vermont Health Connect, for answers. The state has contracted with the company since 2014. It has paid about $11 million a year for the past four years for maintenance and operations, with more added in “discretionary funds.”

Optum appeared unable to figure out the glitch. “It is hard to find root cause of issue,” wrote Yogi Singh, service delivery manager for Optum on Dec. 10. Optum representatives referred comments on the issues to the state.

By Dec. 14, Grant Steffens, IT manager for the department, raised the alarm. “I’m concerned on the growing number of these reports,” he wrote in an email to Optum.

The company halted the creation of new accounts on Dec, 14, and shut down the site entirely on Dec, 22 to install a temporary fix. “It’s a very complex interplay of many many pieces of software on the back end,” said Darin Prail, agency director of digital services. The complexity made it challenging to identify the problem, and to fix it without introducing any new issues, he said.

In spite of the fixes, a caller reported a similar incident on Jan. 13.

On Feb. 8, a mother logged in to find that she could see her daughter’s information. When she logged into her daughter’s account, the insurance information had been replaced by her own.

“Very weird,” the mother wrote in an emailed complaint.

Optum completed a permanent fix on Feb. 17, according to Prail. Vermont Health Connect has not had a problem since, he said.

Prail said the state had reported the issues to the Centers for Medicaid and Medicare Services as required, and had undergone a regular audit in February that had no findings. The state “persistently pressured Optum to determine the root cause and correct the issue expeditiously but at the same time, cautiously, so as to not introduce additional issues/problems,” he wrote in an email to VTDigger.

“We take reported issues like this very seriously,” he said.

A history of glitches

The state’s health exchange has been replete with problems, including significant security issues and privacy violations, since it was built in 2012 at a cost of $200 million.

The state fired its first contractor, CGI Technology Systems, in 2014. A subcontractor, Exeter, went out of business in 2015. Optum took over for CGI, and continued to provide maintenance and tech support for the system.

Don Turner
Don Turner, right, then the House minority leader, speaks in 2016 about the need to fix the state’s glitch-ridden Vermont Health Connect website. With him are Phil Scott, left, then the lieutenant governor, and Sen. Joe Benning. Photo by Erin Mansfield/VTDigger

In 2018, when Vermont Health Connect was less than 6 years old, a report dubbed the exchange outdated and “obsolete.”

Officials reported similar privacy breaches in 2013, when Vermonters saw other people’s information.

An auditor’s report in 2016 found a slew of cybersecurity flaws, and officials raised concerns again during a  2018 email breach.

It wasn’t the first time that Vermont Health Connect users had been able to view other people’s personal information. Three times since October 2019, individuals had logged in to see another individual’s insurance documents. Prail attributed those incidents to human error, not to system glitch; a staff member uploaded documents to the wrong site, he said.

In spite of the issues, Prail said he and other state officials have been happy with Optum. After years of technical challenges with Vermont Health Connect, “Optum has really picked up the ball and improved it and been running it pretty well,” he said.

Glitches are inevitable, he added, and Optum has addressed them quickly. “They took a really difficult-to-manage site and made it work pretty well,” he said. “Optum is generally quite responsive to any issues we have.”

“I find any privacy breach to be concerning,” said Scott Carbee, chief information security officer for the state. He noted that the state uses “hundreds of software systems.” “While the scope of the breaches can be mitigated, true prevention is a difficult task,” he wrote in an email to VTDigger.

Optum spokesperson Gwen Moore Holliday referred comments to the state, but said the company was “honored” to work with Vermont Health Connect “to support the health care needs of Vermont residents.”

Prail said the Agency of Human Services had no plans to halt its contract with the company. “I don’t have a complaint about Optum,” he said. “They took a really difficult-to-manage site and made it work pretty well.”

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Health Care

Tags: data breaches, Optum, Vermont Health Connect

Katie Jickling

About Katie

Katie Jickling covers health care for VTDigger. She previously reported on Burlington city politics for Seven Days. She has freelanced and interned for half a dozen news organizations, including Vermont Public Radio, the Valley News, Northern Woodlands, Eating Well magazine and the Herald of Randolph. She is a graduate of Hamilton College and a native of Brookfield.