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Jan 2, 2012

Congress Will Have to Deal with Much More than Just Elections in 2012

At the forefront of discussions will be deficit reduction, which could significantly impact life science funding.

Congress Will Have to Deal with Much More than Just Elections in 2012

During 2012, the Senate is expected to join the House of Representatives in reauthorizing the Pandemic and All-Hazards Preparedness Act (PAHPA) through FY 2018.

  • 2012 will be a busy one for Congress even when it comes to governing the life sciences industry. Arguably last year’s most important policy and legislative framework was set within the past month, as Congress approved relatively flat fiscal year 2012 budgets for the agencies involved in life sciences. NIH ended up with a 1% increase, to $30.6 billion.

    This year Congress will have to shape the budget for FY 2013, which, however, is more uncertain than usual. Typically during election years, Congress either goes for increased spending where possible, or if that isn’t an option, punts the issue until after November.

    Under the Budget Control Act, however, Congress must approve cutting at least $1.2 trillion over 10 years from future federal spending. It they do not succeed in doing this, there will be automatic across-the-board cuts for FY 2013 of 7.8% for nondefense agencies, resulting in a $39 billion savings, and 10% for defense expenditures, resulting in savings of $55 billion.

  • Budget

    A 12-person “supercommittee” of Senators and representatives created to figure out a deficit-cutting plan, officially known as the Joint Select Committee on Deficit Reduction, failed to meet a November 23 deadline. However, members of that committee are expected to resume talks; if no agreement is reached this year, the automatic cuts are to take effect on January 1, 2013.

    “We thought FY 2012 was difficult, but we probably haven’t seen anything yet,” Jon Retzlaff, managing director of science policy and government affairs for the American Association for Cancer Research (AACR), told GEN. “We are cognizant that this is a difficult time, and we are in a challenging fiscal time. And policy makers must choose priorities and must have a balanced approach. The fear is that in this environment where they are just looking to squeeze government programs, you can’t cut the deficit on the backs of the domestic appropriations pool. It’s going to require a broad look at entitlements and our tax structure.”

    “We think,” Retzlaff added, “when there is that overview look, that something like biomedical science, something like cancer research, will come to the forefront in terms of what really needs to be supported through sustainable annual increases in funding. But it’s going to take the entire biomedical research community to come together, to just talk about the exciting opportunities here, and how we can’t let them wither on the vine.”

    One of those opportunities is NIH’s plan to consolidate programs from 20 institutes, three centers, the National Library of Medicine, and the director’s office into the new National Center for Advancing Translational Science (NCATS). NIH director Francis S. Collins, M.D., Ph.D., prevailed in securing Congressional approval to establish NCATS. He failed, however, to get the level of first-year funding that he wanted.

    NCATS will begin operation with about $576.5 million in funds previously scattered among other centers within NIH. It is also nearly 18% less than the roughly $700 million sought by Dr. Collins when he first reported plans for this center earlier this year.

  • Defense

    During 2012, the Senate is expected to join the House of Representatives in reauthorizing the Pandemic and All-Hazards Preparedness Act (PAHPA) through FY 2018, retaining with some changes the array of federal biodefense programs created in the years after 9/11. A House bill to that effect (HR 2405) sailed through that chamber on a simple voice vote, while the Senate version of that measure (S.1855) has been placed on the Senate Legislative Calendar.

  • Orphan Diseases

    Patient advocates are hopeful that Congress will pass legislation to advance rare disease drug development. One such bill, the Creating Hope Act (S.606 and HR 3059) would enable drug developers to receive priority review vouchers that could be sold or transferred more than once. The Creating Hope Act has attracted 104 co-sponsors in the House and nine in the Senate.

    On December 20, Rep. Cliff Stearns (R-FL) introduced another measure, the Unlocking Lifesaving Treatments for Rare-Diseases Act (ULTRA). The bill (HR 3737) would allow FDA to grant fast-track approval using a surrogate endpoint that would not require clinical treatment data or other historical clinical data as a prerequisite if such data were not available.

    “This change, small in focus, is the right step forward to opening the door to treatment of the forgotten and devastating disorders that are too rare for investors to care about and too difficult (with respect to biology) for typical drug development,” Emil Kakkis, M.D., Ph.D, president of the EveryLife Foundation, wrote in a blog entry on the foundation’s website. The foundation has met with lawmakers in recent weeks seeking support for ULTRA.

  • Helping Small Businesses

    In January Congress is to receive a report by US Patent and Trademark Office (USPTO) director David Kappos in consultation with the Commerce Department and Small Business Administration with recommendations for helping smaller businesses in and outside the life sciences gain international patent protection. The report is required under the Leahy-Smith America Invents Act, the patent system overhaul enacted by President Barack Obama in September.

  • PDUFA

    Congress is also expected to take up the fifth authorization of the Prescription Drug User Fee Act (PDUFA V) soon after FDA issues final recommendations, which is expected January 15 and covers fiscal years 2013–2017. PDUFA IV expires at the end of September.

    PDUFA V is expected to require more communication between the FDA and drug developers seeking approval. PDUFA V was hammered out earlier this year by FDA and the two groups that represent drug developers, the Biotechnology Industry Organization (BIO) and the Pharmaceutical Research and Manufacturers of America (PhRMA).

    Washington can expect to hear, and hear often, from industry as it shapes legislation and policy during this upcoming election year. What’s not as obvious, however, is how much of what gets said by biopharma companies and institutions and their leaders will be reflected in the laws and regulations that officials roll out in 2012. The answer to that question will help determine what role, if any, industry ultimately plays in the races unfolding for one-third of the Senate, every seat in the House, and of course, the White House.


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