Alston & Bird Health Care Week in Review, May 21, 2021

Below is Alston & Bird’s Health Care Week in Review, which provides a synopsis of the latest news in healthcare regulations, notices, and guidance; federal legislation and congressional committee action; reports, studies, and analyses; and other health policy news.

Week in Review Highlight of the Week:

This week, the Senate Finance Committee discussed making permanent COVID-19 flexibilities, including those related to telehealth. See the hearing and other news below.

I.Regulations, Notices & Guidance 

• On May 19, 2021, the Food and Drug Administration (FDA) issued draft guidance entitled, Feasibility Clinical Studies for Certain Medical Devices Intended to Therapeutically Improve Glycemic Control in Patients with Type 2 Diabetes Mellitus. The draft guidance provides recommendations for feasibility and early feasibility clinical studies for certain medical devices intended to therapeutically improve glycemic control in patients with Type 2 Diabetes Mellitus. These medical devices are intended to therapeutically reduce glycated hemoglobin in Type 2 Diabetes Mellitus patients independent of medication (e.g., insulin) delivery. The draft guidance is not final nor is it in effect at this time.
• On May 21, 2021, the FDA issued draft guidance entitled, Adjusting for Covariates in Randomized Clinical Trials for Drugs and Biological Products. The draft guidance, when finalized, will represent the current thinking of FDA on adjusting for covariates in randomized clinical trials for drugs and biologic. The guidance revises the draft guidance “Adjusting for Covariates in Randomized Clinical Trials for Drugs and Biologics with Continuous Outcomes” that published April 25, 2019. This revision provides more detailed recommendations for the use of linear models for covariate adjustment and also includes recommendations for covariate adjustment using nonlinear models.

Event Notices

• May 28, 2021: The Department of Health and Human Services (HHS) announced a public meeting entitled, Meeting of the COVID-19 Health Equity Task Force. The purpose of this meeting is to consider interim recommendations specific to discrimination and xenophobia
• June 9, 2021: FDA announced a public workshop entitled, Model Informed Drug Development Approaches for Immunogenicity Assessments. The purpose of this public workshop is to discuss the best practices and future directions of quantitative methods for predicting immunogenicity of biological products.
• June 16-17, 2021: HHS announced a public meeting entitled, Meeting of the National Vaccine Advisory Committee (NVAC). During this meeting, NVAC will hear presentations on vaccine safety, communication activities for COVID-19 vaccines, and immunization equity.
• June 23, 2021: FDA announced a public workshop entitled, Fiscal Year 2021 Generic Drug Science and Research Initiatives Workshop. The purpose of the public workshop is to provide an overview of the status of science and research initiatives for generic drugs and an opportunity for public input on these initiatives.
• June 24, 2021: CMS announced a public meeting regarding new and reconsidered clinical diagnostic laboratory test codes for the Clinical Laboratory Fee Schedule for calendar year (CY) 2022. This notice announces a public meeting to receive comments and recommendations (including data on which recommendations are based) on the appropriate basis for establishing payment amounts for new or substantially revised Healthcare Common Procedure Coding System codes being considered for Medicare payment under the Clinical Laboratory Fee Schedule (CLFS) for CY 2022. This meeting also provides a forum for those who submitted certain reconsideration requests regarding final determinations made last year on new test codes and for the public to provide comment on the requests.
• June 29-30, 2021: HHS announced a public meeting entitled, Meeting of the Presidential Advisory Council on Combating Antibiotic-Resistant Bacteria. This meeting will be dedicated to the council’s deliberation and vote on two reports to transmit to the HHS Secretary, the first from the Disparities in Antibiotics Access and Use Working Group, and the second from the Working Group on Antimicrobial Resistance (AMR) in Inter-Professional Education. The remainder of the two-day public meeting will include an update on the status of the antibiotic development pipeline and an open council discussion on provocative questions in AMR (no recommendations will be made), in addition to presentations from subject matter experts on Operationalizing One Health and the Environmental Dimensions of AMR.
• July 28-29, 2021: CMS announced a public meeting entitled, Meeting of the Medicare Advisory Panel on Clinical Diagnostic Laboratory Tests. The purpose of the Panel is to advise the HHS Secretary and CMS Administrator on issues related to clinical diagnostic laboratory tests.

II. Congressional Hearings

U.S. Senate

• On May 18, 2021, the Senate Finance Committee held a hearing entitled, Funding and Financing Options to Bolster American Infrastructure. Witnesses present included: Joseph Kile, Ph.D., Director of Microeconomic Analysis, Congressional Budget Office; Victoria Sheehan, President, American Association of State Highway Transportation Officials; Heather Buch, Subcommittee Chair, Transportation Steering Committee, National Association of Counties; and Shirley Bloomfield, Chief Executive Office, NTCA – The Rural Broadband Association.
• ON May 19, 2021, the Senate Finance Committee held a hearing entitled, COVID-19 Health Care Flexibilities: Perspectives, Experiences, and Lessons. Witnesses present included: Jessica Farb, Director, Health Care, United States Government Accountability Office; Kisha Davis, M.D., MPH, Member, Commission on Federal and State Policy, American Academy of Family Physicians; Linda DeCherrie, M.D., Clinical Director, Mount Sinai at Home and Professor, Geriatrics and Palliative Medicine, Icahn School of Medicine at Mount Sinai; Narayana Murali, M.D., Executive Director and Board Member of America’s Physician Groups, Marshfield Clinic; and Robert Berenson, M.D., Institute Fellow, Urban Institute.
• On May 19, 2021, the Senate Judiciary Subcommittee on Competition Policy, Antitrust, and Consumer Rights held a hearing entitled, Antitrust Applied: Hospital Consolidation Concerns and Solutions. Witnesses present included: Professor Martin Gaynor, E.J. Barone University Professor of Economics and Public Policy, Carnegie Mellon University; Ms. Beth McCracken, Pittsburgh, PA; Michael Cannon, Cirector of Health Policy Studies, Cato Institute; Dr. Rodney Hochman, President, Chair of the American Hospital Association; Ahmer Qadeer, Director of Strategic Initiatives, Services Employees International Union; Dr. Brian Miller, Assistant Professor of Medicine, John Hopkins School of Medicine.
• On May 19, 2021, the Senate committee on Homeland Security & Governmental Affairs held a hearing entitled, COVID-19 Part II: Evaluating the Medical Supply Chain and Pandemic Response Gaps. Witnesses present included: Shereef Elnahal, M.D., President and Chief Executive Officer, University Hospital; Robert Handfield, Ph.D., Professor, Poole College of Management, North Carolina State University; Stephen Schondelmeyer, Professor, College of Pharmacy, Co-Principal Investigator, Resilient Drug Supply Project, University of Minnesota; and Kimberly Glas, President and Chief Executive Officer, National Council of Textile Organizations.
• On May 20, 2021, the Senate Committee on Health, Education, Labor, and Pensions held a hearing entitled, A Dire Shortage on Leveraging the Tax Code for Infrastructure Investment. Witnesses present included: David Skorton, MD, President and Chief Executive Officer, Association of American Medical Colleges; Leon McDougle, MD, MPH, President, National Medical Association; Shelley Spires, Chief Executive Officer, Albany Area Primary Health Care; and James Herbert, Ph.D., President, University of New England.

U.S. House of Representatives

• On May 19, 2021, the House Ways and Means Committee held a hearing entitled, Leveraging the tax Code for Infrastructure Investment. Witnesses present included: Khalil Shahyd, Senior Policy Advisor, National Resource Defense Council; Michael Novogradac, Managing Partner, Novogradac; Rachael Eubanks, Treasurer, State of Michigan; Stephen Lewis, Governor, Gila River Indian Community; and Adrian Moore, Vice President of Policy, Reason Foundation.

III. Reports, Studies & Analyses

• On May 17, 2021, the Department of Health and Human Services Office of Inspector General (HHS OIG) issued a report entitled, Comparison of Average Sales Prices and Average Manufacturer Prices: Results for the Fourth Quarter of 2020. By law, OIG must notify the HHS Secretary if the average sales price (ASP) for a particular drug exceeds the drug’s average manufacturer price (AMP) by five percent of more. If that threshold is met, the Secretary may disregard the drug’s ASP when setting the reimbursement amount and substitute the payment amount with the lesser of either the widely available market price or 103 percent of the AMP. In the fourth quarter of 2020, OIG found that some drug codes met CMS’s price substitution criteria, however, the drug codes were identified as being in short supply.

IV. Other Health Policy News

• On May 17, 2021, the HHS agency charged with administering the 340B Drug Pricing Program sent letters to six pharmaceutical manufacturers stating that the manufacturers’ policies restricting 340B pricing in contract pharmacy settings have resulted in overcharges and are in direct violation of the 340B statute. HRSA’s announcement states that the 340B Ceiling Price and Civil Monetary Penalties (CMP) final rule (82 Fed. Reg. 1210, 1230 (Jan. 5, 2017)) provides for penalties of $5000 for each instance of overcharging where a 340B-participating manufacturer knowingly and intentionally charges a covered entity more than the ceiling price for a covered outpatient drug. The letters state that “continued failure to provide the 340B price to covered entities utilizing contract pharmacies” may result in CMPs as described in the CMP final rule, in addition to repayments owed to covered entities, and requests a status update on compliance with the letter by June 1.

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