Lawmakers Send Biopharma Mixed Signals

The post-mortem on the 2022 General Assembly session as it relates to the state’s biopharma sector is that Connecticut needs to work on its marketing.

In the end, legislators and policymakers often do the “right thing,” but they create a lot of public relations damage along the way.

This session, the centerpiece of this counterproductive strategy was SB 13, which contained two provisions anathema to biopharma and harmful to patients and consumers.

It would have instituted price controls on drugs and constructed a complex regulatory scheme to import drugs from Canada.

The price control provisions would have caused drug shortages and dramatically slowed the introduction of new medicines.

The bill might not have killed innovation outright, but it would have severely hobbled what has been an incredibly successful biopharma research and development machine—COVID-19 vaccines and antiviral treatments are Exhibit A.

‘Political Mechanism’

It was difficult, if not impossible, to find a legislator or policymaker who believed the drug importation provisions of SB 13 would work in the real world.

The regulatory contraption the legislation would have established was, as most supporters agreed, mainly a political mechanism to signal support for the idea of lower drug prices. 

Drugs would flow from Canada only with a myriad of federal actions and approvals and after most of the actors in the supply chain guaranteed the safety and efficacy of the imported drugs.

The Canadian government was opposed to the bill and Canadian pharmacies were highly unlikely to go far out on a legal liability limb to guarantee drug safety and efficacy.

No actual, working Canadian drug importation program was ever a real possibility.

As a practical matter no actual, working Canadian drug importation program was ever a real possibility.

SB 13 was in play, with a significant probability of passage, throughout the 12 weeks of the 2022 session.

Toward the end, the price control provisions were stripped from the bill, and arrangements made to link Canadian importation to other less controversial bills (in a parliamentary strategy to improve the odds of passage), but SB 13 didn’t make it over the finish line.

This was a good thing for the industry and, more importantly, for patients and consumers.

But a great deal of reputation damage occurred. It’s a simple proposition: if you want to attract the good jobs and labs of biopharma—if you want new cures and treatments to be developed and manufactured in Connecticut—why would you stubbornly pursue policies that are both ineffective and loathed by biopharma?

Surgical Smoke, Bariatric Surgery

SB 89 requires surgical facilities to develop and implement policies to prevent human exposure to surgical smoke.

The bill ultimately became part of HB 5500. The date for development and implementation of surgical smoke policies is now set at Jan. 1, 2024.

The date for development and implementation of surgical smoke policies is now Jan. 1, 2024.

SB 282 provided medical assistance for bariatric surgery and prescription drug treatment of obesity to Medicaid and Husky B participants.

The bill passed unanimously out of the Human Services Committee and passed unanimously in the Senate.

Unfortunately, due to some interparty wrangling, it remained uncalled in the House.

A Psychedelic Future Is Closer

HB 5396 establishes a pilot program to study the use of two psychedelic drugs, psilocybin and MDMA, for the treatment of certain mental health conditions and ready Connecticut’s statutory provisions related to these drugs (when anticipated changes in the federal classifications occur), was not passed outright, but many of its provisions were placed in budget bills HB 5506 and SB 9. 

As the original bill found its way into the budget, provisions to fund the pilot program with two installments of $1.5 million were deleted.

Significant departmental resources will be made available for the psychedelics pilot program.

The psychedelics program is now to be funded by the Department of Mental Health and Addiction Services “within available appropriations.”

The program will be administered by a Connecticut medical school as determined by DMHAS.

The loss of explicit funding is unfortunate, but it appears some significant departmental resources will be made available for the pilot program and be a catalyst for research and development in this promising and quickly evolving field.

R&D Tax Credit Study, Data Privacy

SB 351, which calls for the Department of Economic and Community Development to study extending R&D tax credits to pass-throughs, became part of the state budget revisions bill.

Another bill, HB 5488, which actually extended R&D tax credits to pass-throughs died in the Finance, Revenue, and Bonding Committee earlier in the session.

HB 5260, which established a rare disease council, became part of HB 5500. The date for appointments to be made is now Oct. 31, 2023.

Another bill that actually extended R&D tax credits to pass-throughs died earlier in the session.

SB 6 requires companies to disclose when they collect data on consumers and allow consumers to opt out of the sale or sharing of such data.

Companies can continue to collect data used solely for product improvement (and not shared with third parties).

Healthcare Benchmarking, Opioids

HB 5042 requires the Office of Health Strategy to develop state healthcare cost growth benchmarks and facilitate adherence to these targets. The bill was folded into the budget.

SB 357 revises (“fixes”) 2021 legislation in light of IRS commentary. It specifies that certain cost-sharing requirements apply to high deductible health plans.

The bill became part of SB 9, the governor’s budget recommendations.

The aid-in-dying bill was tabled for this year.

HB 5430 permits wider distribution of opioid antagonists and passed in the final hours of the 2022 session.

SB 88 which would have allowed competent, terminally ill adults to obtain “aid-in-dying” medication, had much support but was referred by the Senate to the Judiciary Committee for review.

A motion at the Judiciary Committee to bring the bill before the General Assembly was unsuccessful and the bill was tabled for this year.

No Action

When the gavel came down at midnight, no action was taken on the following bills:

SB 188 required brand name drug companies to provide samples of their drugs at wholesale cost to their competitors, generic drug makers. This is the third year in a row that this bill has failed to come before the General Assembly for a vote.

SB 331 included a provision to prohibit health carriers from requiring the use of step therapy for drugs prescribed to treat behavioral health conditions.

SB 355 required that 340B covered entities receive the same drug cost reimbursement rates as non 340B entities and required drug manufacturers to comply with federal 340B pricing when selling to 340B entities.

SB 410 required the Connecticut Department of Insurance to analyze Pharmacy Benefit Managers’ distribution of prescription drug practices regarding spread pricing, manufacturers’ rebates, transparency and accountability and submit a report to the General Assembly by Jan. 1, 2023.

HB 5275 prohibited health carriers from requiring the use of step therapy for drugs prescribed to treat behavioral health conditions.

HB 5386 capped the cost of coinsurance, copayment, deductible or other out-of-pocket expense at $25 for epinephrine cartridge injectors.

HB 5503 allowed business operating losses incurred after Jan. 1, 2023 to be deductible over 40 income years.

---

Paul Pescatello is the executive director of CBIA’s Bioscience Growth Council and chair of We Work for Health Connecticut. Follow him on Twitter @CTBio.