Wednesday, June 10, 2015

qotd: Two days away from a perilous blow to health care justice

The Hill
June 10, 2015
GOP to hold trade vote Friday
By Scott Wong

The House will vote Friday on giving President Obama fast-track trade
authority, which would allow him to send a major trade deal with 11
other Pacific Rim nations to Congress for an up-or-down vote.

As part of the agreement, Republicans agreed to scrap the Medicare
sequester offset, which Democrats objected to.


June 10, 2015
Trans-Pacific Partnership Agreement
Transparency Chapter Annex on Transparency and Procedural Fairness for
Pharmaceutical Products and Medical Devices


This is the secret December 2014 draft (with country negotiating
positions) of an annex to the Trans- Pacific Partnership Agreement (TPP)
"Transparency Chapter". The TPP is an attempt to create a transnational
treaty regime encompassing 40 per cent of global GDP and one-third of
world trade.

The draft Annex places requirements and restrictions on national
healthcare access programs in how they allocate public subsidies for
medicines and medical devices.



The Parties are committed to facilitating high-quality healthcare and
continued improvements in public health for their nationals including
patients and the public. In pursuing these objectives, the Parties
acknowledge the importance of the following principles:

(a) the importance of protecting and promoting public health and the
important role played by pharmaceutical products and medical devices2 in
delivering high quality health care;
(b) the importance of research and development, including associated
innovation, related to pharmaceutical products and medical devices;

(b) the importance of research and development, including associated
innovation, related to pharmaceutical products and medical devices;

(c) the need to promote timely and affordable access to pharmaceutical
products and medical devices, through transparent, [xx oppose:
impartial,] expeditious, and accountable procedures, without prejudice
to a Party's right to apply appropriate standards of quality, safety,
and efficacy; and

(d) the need to recognize the value of pharmaceutical products and
medical devices through the operation of competitive markets or by
adopting or maintaining procedures that appropriately value the
objectively demonstrated therapeutic significance of a pharmaceutical
product or medical device.


To the extent that a Party's national health care authorities operate or
maintain procedures for listing new pharmaceutical products or medical
devices for reimbursement purposes, or setting the amount of such
reimbursement, under national health care programs operated by the
national health care authorities,34 the Party shall:

(b) disclose procedural rules, [xx propose; xx considering:
methodologies, principles, and [xx oppose; xx propose: where relevant,]
guidelines used to assess such proposals6;

(e) provide applicants with [xx propose: detailed] written information
[xx propose: sufficient to comprehend] [xx oppose: regarding] the basis
for recommendations or determinations regarding the listing of new
pharmaceutical products or medical devices for reimbursement by national
healthcare authorities;

(f) make available [xx propose: xx considering: an independent] review
process [xx propose; xx oppose:8] that may be invoked at the request of
an applicant directly affected by such a recommendation or determination
by a Party's national healthcare authorities not to list a
pharmaceutical or medical device for reimbursement [xx propose: xx
considering: or as an alternative, an internal review process, such as
by the same expert or group of experts that made the recommendation or
determination, provided that such a review process includes, at a
minimum, a substantive reconsideration of the application and may be
invoked at the request of an applicant directly affected by such
recommendation or determination]9; and

(g) provide written information to the public regarding such
recommendations or determinations, while protecting information
considered to be confidential under the Party's law.


1. To facilitate dialogue and mutual understanding of issues relating to
this Annex, each Party shall give sympathetic consideration to [xx
propose: and shall afford adequate opportunity for consultation
regarding] a written request by another Party [xx oppose: to consult] on
any matter related to this Annex.


national health care authority means, with respect to a Party listed in
the schedule to this Annex, the relevant entity or entities specified
therein, and with respect to any other Party, an entity that is part of
or has been established by a Party's central level of government to
operate a national health care program;

national health care program means a health care program in which a
national health care authority makes the [xx propose: determinations or
recommendations] [xx oppose: decisions] regarding the listing of
pharmaceutical products or medical devices for reimbursement, or
regarding the setting the amount of such reimbursement.

PARAGRAPH X.7: Disputes

The dispute settlement procedures provided for in Chapter BBB (Dispute
Settlement) shall not apply to this Annex.


Further to the definition of national healthcare authorities in
Paragraph X.6, national healthcare authorities shall mean:

(c) [xx propose: For the United States: The Centers for Medicare &
Medicaid Services (CMS), with respect to CMS's role in making Medicare
national coverage determinations;]

WikiLeaks press release


June 10, 2015
MEMO: Three Burning Questions about the Leaked TPP Transparency Annex
and Its Implications for U.S. Health Care
Contact: Peter Maybarduk

Today, WikiLeaks published the draft Trans-Pacific Partnership (TPP)
"Annex on Transparency and Procedural Fairness for Pharmaceutical
Products and Medical Devices." This Annex sets rules that TPP country
health authorities would be required to follow regarding pharmaceutical
and medical device procurement and reimbursement. The draft is dated
December 17, 2014. An earlier version leaked in 2011. Unlike that
document, the new leak expressly names the Centers for Medicare &
Medicaid Services (CMS) as covered by the text, "with respect to CMS's
role in making Medicare national coverage determinations." Under the
TPP, then, these determinations would be subject to a series of
procedural rules and principles, the precise meaning of which are not
clear and perhaps not knowable.

Pharmaceutical companies could attempt to exploit the general language
of the annex to mount challenges to Medicare and health programs in many
TPP negotiating countries. The Annex would constrain future policy
reforms, including the ability of the U.S. government to curb rising and
unsustainable drug prices.

What guarantees are there that the TPP's requirements would not override
existing procedures for Medicare?

The Office of the United States Trade Representative (USTR) claims that
Medicare today is fully compliant with the proposed provisions of the
TPP. Yet the ambiguous language of the TPP leaves our domestic
healthcare policies vulnerable to attack by drug and device
manufacturers. For example:

* Could companies use the Annex to compel Medicare to cover expensive
products without a corresponding benefit to public health? Medicare
reimbursement is limited to products that are "reasonable and necessary"
for treatment. But the TPP "recognize[s] the value" of pharmaceutical
products or medical devices through the "operation of competitive
markets" or their "objectively demonstrated therapeutic significance,"
regardless of whether there are effective, affordable alternatives.

* The TPP also requires countries to "make available a review process"
for healthcare reimbursement decisions. Medicare national coverage
determinations allow for appeals, but only in a limited set of
circumstances.2 Might this conditional appeal process be construed as
insufficient, if companies argue the TPP grants them an unconditioned
right to review?

* Similarly, the TPP mandates that parties provide opportunities for
applicants to comment on reimbursement considerations "at relevant
points in the decision-making process." Though Medicare national
coverage determinations allow for comments in certain stages of the
process, these determinations may be vulnerable to legal challenge
depending on the construction of "relevant points."

Would the TPP constrain pharmaceutical reform efforts in the U.S.?
In addition to its application to Medicare Part A and B, the Annex would
apply to any future efforts related to national coverage determinations
by the CMS, including potential Medicare Part D reforms.

In response to soaring drug costs, advocates have increasingly called on
the government to enable the Secretary of Health and Human Services to
negotiate the price of prescription drugs on behalf of Medicare
beneficiaries. Vital to this reform would be the establishment of a
national formulary, which would provide the government with substantial
leverage to obtain discounts.

The development of such a national formulary would be subject to the
requirements of the TPP. These procedural requirements would pose
significant administrative costs, enshrine greater pharmaceutical
company influence in government reimbursement decision-making and reduce
the capability of the government to negotiate lower prices.


Comment by Don McCanne

The Senate has already approved fast-track trade authority, and the
House will vote on it in just two days. If it passes, it will allow
President Obama to send Congress the Trans-Pacific Partnership trade
agreement (TPP) for an up-or-down vote, with no amendments allowed.

There are many issues with forcing blanket approval of this trade
agreement, but one that should be of great concern to advocates of
health care justice is the extraordinary power granted to the
pharmaceutical and medical device industries to control markets and
prices at home and abroad.

WikiLeaks has released a working copy of the TPP Transparency chapter
for "procedural fairness" for pharmaceutical products and medical
devices. Simply reading the "Principles" reveals that the fairness
sought is for the pharmaceutical and medical device industries to be
able to use "procedural fairness" to control markets and prices,
threatening affordability of their products for patients and for
national health systems.

Just one phrase of their principles, "by adopting or maintaining
procedures that appropriately value the objectively demonstrated
therapeutic significance of a pharmaceutical product or medical device,"
repeats the rhetoric that is being used by the industry now when they
say that it is not their costs that should determine prices but rather
it is the value of the benefit received. A recent campaign used this
reasoning to justify egregious pricing for hepatitis C drugs since they
would prevent expensive liver transplants and premature death. The
industry contends that they are entitled to capture the dollar value of
extended, higher quality lives and the value of potential future medical
care that was aborted by their products.

If for no other reason, everyone in the United States should be
concerned that our own Medicare program is potentially threatened by the
processes in the TPP.

The vote is scheduled for Friday, June 12 - just two days away. We need
to "fast track" ending TPP fast-track authorization. Contact members of
the House of Representatives immediately.

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