Killed by the house commerce subcommittee on health with representatives from the pharmaceutical industry and policy stakeholders. This is three hours. [inaudible conversations] [inaudible conversations] we will come to order. The committee will come to order and the chair will recognize himself for an opening statement. Todays hearing is focus on the critical topic of finding longterm solutions to prevent future drug shortages of key drugs for patients. For months, Cancer Patients including pediatric Cancer Patients, have had to scramble to find the drugs recommended or use alternatives because of instability in the markets and supply chains. In 2022 alone there were over, there were 301 drugs enacted shortages according to the university of utah. For over a decade professions and a medical and Regulatory Community has sounded the alarm on the underlying economic causes of drug shortages. Unforeseen circumstances like a tornado hitting a pharmaceutical warehouse in North Carolina, or a manufacturing facility in india shutting down due to public quality concerns get a supply chain out of whack and potentially the shortage of what i regard. To ensure we are prepared to respond appropriate to these issues we must encourage strong investment to ensure that there are multiple means to develop, store and distribute drugs. Thats why the Energy Commerce committee is continuing extensive work to identify the drivers of why cause of the supply chain can be unstable and leaked to the shortages weve seen over the last decade. It is congress alone we an oversight hearing, artest will shortages at a hearing. The chair did a request for proposals all leading to the hearing today on potential solution to spend numerous federal agencies and players. Through this work a keeping a merge comes the economics of the generic drug market specifically Sterile Injectable Drugs must be reformed. If you want a more stable pipeline of drugs including sustained investment in domestic manufacturing. Earlier this year the New York Times wrote an article diving into the complex supply chain for generic drugs that quote there is a high cost to low prices unquote. From there the article dives into the frailty of supply chains operate at low cost with these lowcost oftentimes being driven by artificially deflated price of from Government Programs like certain medicare and medicaid policies. Even commissioner kayla agrees economics are the main driver witchy publication before this committee during a previous hearing. Thats why today will be considering a discussion draft from chair rodgers that aims to improve the systematic market failures of our truck supply chain. This discussion draft includes proposals to reinformed reimbursement rates for lowcost drugs and include new ideas to ensure that fda is a properly prioritizing using greater discretion to get more lowcost generics to the markets sooner. It also is important to note that this is only a discussion draft, and i sort expected to be a healthy discussion among all members today on this draft and other proposals to address the issue of supply chains and shortages. We are also continue actively solicit Stakeholder Feedback given the complexities of the supply chain. It is my hope, nonetheless, that after weve had our robust discussion that we will be able to find commonsense Bipartisan Solutions to shore up our generic drug market. Doing so will keep americas healthy and protect our National Security by making us less dependent on address relations for medical needs in the event of future unforeseen natural disasters. I look forward to the discussion today and our continued work to advance longterm policies designed to address this critical issue. Thank you and i yield back. The chair now recognizes the gentlelady from california the right member of the subcommittee, Ranking Member eshoo for five minutes on opening statement. Thank you, mr. Chairman, and good morning, colleagues. And witnesses. Today is an important day. After months of pleading by the democratic members of the subcommittee, we are finally having a legislative hearing on drug shortages in our country. In july, cancer drug shortages delivered get punched the patients unsure if their survival odds will be undercut. The fda repor over half of the y impactful. Longterm structural factors caused drug shortages including high concentration among manufacturers swings in consumer demand, complex Manufacturing Processes mismatch pricing. Today we will discuss i proposals that attempt to address this crisis. First, my drug origin Transparency Act addresses manufacturer concentration by providing the fda with the information they had repeatedly said they need to identify where critical drugs and active pharmaceutical ingredients are made to prevent shortages. Second, the bipartisan drug shortage prevention act by representative jacobs of california requires manufacturers to inform the fda if there is a sustained increase in demand for a drug or ingredient. Next, the ensuring access to lifesaving drugs by representative slot can of michigan at and the patient s to urgent use pharmacy compounding act like representative Morgan Griffith of virginia attempt to mitigate shortages by allowing drugs to be safely used after the Expiration Date or through pharmacy compounding. Pilot were considering chairwoman rodgers longawaited proposal to stop drug shortages act. The subcommittee delayed action on the drug shortage crisis during the spring and summer with the promise of legislation that comprehensively addresses the issue. But i believe this proposal mostly studies a problem with more reports. Where the proposal is actionable policy, i think its a grab bag of talking points. It weakens the 340b program and chips away at the Inflation Reduction Act by excluding certain manufacturers from the inflation rebate. The proposed inflation rebate policy is understands the market failure that caused drug shortages. Many of the chemotherapy shortages were caused by manufacturers choosing to drop their prices in it and sustainable attempt to gain market share. So ill get forward to working with my colleagues to ensure that any final package to address drug shortages contains policies like my pediatric cancer drug supply act of 2023, which i will introduce in the coming days. This bill establishes a program at hhs to create a longterm contract for the manufacturing of essential pediatric cancer drugs to ensure there is a consistent sixmonth supply available. I i look forward to finding a bipartisan weight to create a pool crack a proposal that thoroughly addresses the threat that drug shortages posed to our nation and its patients. And with that, mr. Chairman, ideal expert the gentlelady yields back. The chair to recognizes the chair of the full Committee Chair rodgers for five minutes for her opening statement. Good morning, everyone. Good morning and colleagues. Thank you, everyone for being here to address Bipartisan Solutions to a longterm decades long challenge around drug shortage there weve all heard the heartbreaking stories about children and others that are struggling to get the medication that they need as a result of drug shortages. I visited Providence Sacred Heart Medical Center including pediatric oncology in their Childrens Hospital over the August Reagan heard firsthand how shortages resulting a difficult decision to conserve and prioritize supply, reevaluate treatment plans for some patients and identify alternative therapeutics when possible. The task before us today is to examine the drug supply chain and try to better understand the root causes of drug shortages so our Healthcare Providers and the patients that rely on them are not having to change recommended treatment due to a lack of supply. I appreciate the witnesses from across the drug supply chain being here today to help us better understand the problem and provide feedback on the proposed solutions, in the new ideas the committee should consider. Over the last year energy and commerce has committed itself to examining drug shortages that hit a ten year high earlier this year. May 11 of this year the oversight and investigations subcommittee held a hearing were a panel of expert witnesses testified to the underlying market failures that make it harder for patients and Healthcare Providers to get essential medicine. In june of this year i issued a request for information alongside senator crapo two additional stakeholders regarding drug shortages. The robust comments we received highlighted the complex challenges facing lowcost generic drugs, which make up more than 90 of the drugs dispensed in this country. Stakeholders submitted comments regarding the consequences of consolidation in the drug supply chain and how belowmarket federal reimbursements for such drugs can make it difficult, a difficult market even worse, leading to a lack of investment in manufacturing and supply chain. Less than a month later i released a discussion draft to try to put specific Solutions Forward to address these broad concerns. Our goal today is to pursue multifaceted and longterm solution that address the root causes of the shortages. Again where hearing from people from across the supply chain to examine this issue. According to fda commissioner caliph, quote, the economics of this are not favorable were fixing the problem the way it is currently working. This committee has a chance improve the economics for these drugs, potential for something more on showing and making sure patients have access to the drugs that they need. The challenge is how to appropriately target the incentives and relief from existing government price controls. I hope there will be a robust discussion on a best to do that. The discussion draft focuses primarily on generic sterile and injectable drugs for a serious disease or condition in getting these drugs out from under mandatory 340b rebates and deflation penalties. We require cms to launch a a l that test market base pricing policy for these drugs in medicare as well. A discussion draft also look into how we can bring transparency to current contracting practices through new 340b guidance and disclosure reporting for Group Purchasing organizations. Fda plays a role as provisions in the discussion draft and of the bills noticed today indicate. However, i do not believe fda authorities would solve these issues, and in some cases i think fda may play a role in worsening a shortage through unclear communication. Im also concerned fda may not look domestically for production before turning outside the u. S. During a drug shortage. I look forward to a robust, constructive dialogue about the policies noted today and a potential unintended consequences, any additional ideas, and im hopeful we can Work Together in this committee to come together on a number of discrete proposals to tackle and turn the tide against these drug shortages. Its clear that each shortage is unique and is not one solution that will address all issues. Thank you. I yield back. Thank you. The chair yields back and the chair will recognize the regimen of the full committee, mr. Pallone for five minutes for Opening Statements for thank you, mr. Chairman. I am pleased that after months of refusing to work with democrats to address the drug shortage crisis, the republican majority has finally called a hearing to discuss legislative proposals to address this serious ongoing problem for patients. Democrats put forward three of the bills notice for discussion in hearing today or in consideration of the all hazardous for curtis act, or pahpa. We want to meet of the act because experts including doctors providing care on the front line told us drug shortages are an ongoing emergency for the patients and a threat to National Security. They also told us the democratic bills could up help address e crisis patients are facing i i providing to authorities to the fda. Unfortunately republicans refused to work with us to include these policies in the pop up reauthorization and instead have pursued republican only built that slashed Health Preparedness funding and a difficulty passing the house before pahpa expires at the end of this month. After nation was unprepared of worst pandemic in a century, its inexcusable that republicans have failed to learn the lessons of covid19 and have refused to properly invest in public Health Preparedness. This family is putting american lives at risk, and then just after gaveling out of session for the august recess, republicans finally put forward ideas to address drug shortages. Unfortunately many of the proposal in the republican discussion draft that actually be two more drug shortages and increased profits for the pharmaceutical industry while raising costs for consumers. I opposed many of the policies in the republican discussion draft because i simply do not believe they will help in the drug shortage crisis. In fact, i think it will make it worse. Thats not the approach democrats want to take. Over the last month weve been highlighting our efforts to expand the middle class including by making drugs more affordable under the Inflation Reduction Act. For the first on the Inflation Reduction Act allows medicare to negotiate the prices of drugs for seniors get is a 2 2000 2000 cap on outofpocket cost for drugs in Medicare Part d and prevent huge price increases by requiring Drug Companies to pay a rebate back to the government as the rays drug prices faster than the rate of inflation. Every republican vote against lowering drug prices, and now theyre trying to eat away at the Consumer Protections that democrats created. The republican discussion draft would about some Drug Companies to raise prices on consumers faster than the rate of inflation without paying a penalty to medicare or medicaid. I am deeply concerned this proposal could unintentionally provide an incentive for Drug Companies to keep drugs in shortage or near shortage longer periods of time in order to raise drug prices on the american people. While its true Market Conditions affect manufacturing and supply issues, two major causes of the drug shortage crisis, the republican proposal to simply allow drug copies to raise prices is not the answer to the problem. In stark contrast to some of the misguided policies in the republican discussion draft, the democratic bills before us today our common sense and take significant steps to better secure our supply chain pier we should know where our drugs and the critical ingredients are being made so when a drug shortage or other supply interruption happens, fda and manufactures can react properly. Ranking member eshoo legislation the drug origin Transparency Act would require Drug Companies to report the sources of active pharmaceutical ingredients to fda and include the source of api on a drug label. We should be ensuring fda knows the earliest possible time when a surge in demand for drug is likely to cause a shortage, and that is exactly what the bipartisan bill introduced by representative jacobs and meals will do, and we should make sure were not needlessly throwing away safe and effective drugs that could be used past the shelflife date. The ensuring access to lifesaving drugs act will help address that by requiring manufacturers to report the fda on the longest possible shelflife of the drug. Im interested in more from our panel and am hopeful that we can find a bipartisan path forward on these drug shortage policies as patients and providers are facing life altering consequences if we dont do more to address this critical problem. With that, mr. Chairman, i yield back. Thank you. The gentleman yields back that we will now move to witnesses opening save us. I will introduce each witness and they will call on your individual. Ill introduce the witnesses as a panel at the first before us is Michael Ganio consumed correct the pharmacy practice and called for the American Society of Pharmacy Professionals. Mr. Todd ebert presidency of Healthcare Supply Chain association. Mr. Chip davis president and ceo of Healthcare Distribution Alliance. Doctor melissa barber, postdoctoral fellow at the yale school of medicine, yale law school, ngo collaboration for regulatory rigor integrity and transparency. Mr. Allen koegel, Senior Vice President of Public Policy civica, and dr. David gaugh, interim president and ceo the association for accessible medicines. As each of you will have five minutes for your opening statement. I think you come some have testified before but you will have a yellow light and you get close to the end of the formers and a yellow light and then when the red light we would ask you to wrap up if you havent finished to get to final thoughts and they will get to questions and will have some discussion and talk. We appreciate it and first i will recognize dr. Ganio for five minutes for your opening statement. Thank you, chair guthrie, Ranking Member eshoo and distinguish member