Washington Editor

WASHINGTON - A prescription drug plan friendly to the industry could end up on the House floor before the July 4th holiday.

But what's going to happen in the Senate is anyone's guess at this point.

As stated by Washington insiders earlier this year, lawmakers on both sides of the aisle are expecting to work overtime to resolve the prescription drug issue in order to win the senior voting block before the mid-term elections.

So far, the House is moving along with a Republican plan for Medicare beneficiaries that would be administered by the private sector - insurance companies or private health plans - and would not impose any price controls on prescription drugs.

While the Washington-based Biotechnology Industry Organization (BIO) has not endorsed the GOP plan, Sharon Cohen, BIO's vice president for government relations, told BioWorld Today that it does contain some provisions supported by the industry, such as market-based reimbursement. Also, the GOP plan does not encompass any rules that would hamper innovation or research and development.

The plan would cost $350 billion over 10 years, and is expected to provide senior citizens with a 60 percent to 85 percent savings on prescription drugs. Except for low-income seniors, other elderly persons would be required to pay a $35 monthly premium plus a $250 deductible. The proposed out-of-pocket cap is $3,800 per year per person.

An analysis of the GOP plan released by the Department of Health and Human Services said Medicare beneficiaries and disabled Americans would see their out-of-pocket drug expenses drop by an estimated 70 percent if the plan is approved.

By contrast, the House Democrats wanted the government to administer its 10-year, $800 billion plan that included a $2,000 out-of-pocket cap and premium payments based on income.

In a 22-to-16 vote, the House Ways and Means Committee Wednesday approved its version of the GOP plan, and the House Energy and Commerce Committee is expected to complete its own version by the weekend. Both plans will be folded into one by the Committee on Rules before going to a floor vote next week.

There are a few sticky points though. Patrick Ronan, BIO's director of health policy, said: "There have been discussions about many amendments that might be offered that are sometimes just intended to poke a finger in the eye of the industry. We've heard discussions about numerous price control measures. Whether it's through re-importation or reference pricing or other things that deal with Hatch/Waxman reform or generic biologics, we could run down a list of amendments that we have concern over." (The Hatch/Waxman Act created the generic drug industry.)

That's the House, but in the Senate, Cohen said the industry doesn't expect discussions to begin until sometime in July.

Both Cohen and Ronan said a few Senate plans have been floated recently, but nothing stands out except a "tri-partisan" proposal being written by sens. Orrin Hatch (R-Utah), Jim Jeffords (I-Vt.) and John Breaux (D-La.).

"We're still waiting to see details on that, but the $64,000 question is what will the Senate do this year," Ronan said. "We don't have a timeline, but it is our understanding that committees of jurisdiction are interested in getting to work on this, and Sen. [Tom] Daschle [D-S.D.] has sent signals that he would like to move a prescription drug bill to the Senate floor this year. We are hopeful that the Senate can actually do something this year."