Panel

High drug prices driven by profits, House panel report finds

Enormous drug company profits are the primary driver of soaring prescription drug prices in America, according to a damning investigation that Democrats on the House Oversight Committee began releasing Wednesday.



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The first two reports in the investigation focus on Celgene and Bristol Myers Squibb’s Revlimid cancer treatment, which saw its price hiked 23 times since 2005, and Teva’s multiple sclerosis drug Copaxone, which went up in price 27 times since 2007.

Those costs have little to do with research and development or industry efforts to help people afford medication, as drug companies often claim, according to the probe.

“It’s true, many of these pharmaceutical industries have come up with lifesaving and pain-relieving medications, but they’re killing us with the prices they charge,” said Rep. Peter Welch (D-Vt.) as the hearings began Wednesday. He added that “uninhibited pricing power has transformed America’s pain into pharma’s profit.”

The top Republican on the committee, Rep. James Comer of Kentucky, called the investigation a partisan attack. “These hearings seem designed simply to vilify and publicly shame pharmaceutical company executives,” Comer said.

Much of the drug industry’s profits come at the expense of taxpayers and the Medicare program, are used to pay generous executive bonuses and are guarded by aggressive lobbying and efforts to block competition, regulation or systemic change in the United States while the rest of the world pays less, the reports say.

“The drug companies are bringing in tens of billions of dollars in revenues, making astronomical profits, and rewarding their executives with lavish compensation packages — all without any apparent limit on what they can charge,” committee chair Rep. Carolyn Maloney (D-N.Y.) wrote in a letter attached to the first two staff reports.

Rep. Elijah Cummings (D-Md.), the former committee chairperson who died last October,

Hillicon Valley: House panel says Intelligence Community not equipped to address Chinese threats

Welcome to Hillicon Valley, The Hill’s newsletter detailing all you need to know about the tech and cyber news from Capitol Hill to Silicon Valley. If you don’t already, be sure to sign up for our newsletter with this LINK.



a person sitting at a table in front of a sign: Hillicon Valley: House panel says Intelligence Community not equipped to address Chinese threats | House approves bill to send cyber resources to state, local governments


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Hillicon Valley: House panel says Intelligence Community not equipped to address Chinese threats | House approves bill to send cyber resources to state, local governments

Welcome! Follow our cyber reporter, Maggie Miller (@magmill95), and tech reporter, Chris Mills Rodrigo (@chrisismills), for more coverage.

THE IC GETS A LESS THAN STELLAR REVIEW: A House committee warned Wednesday that the U.S. intelligence community is not equipped to handle evolving threats from China in the fields of technology and politics.

The House Intelligence Committee detailed its findings in an unclassified summary of a report, approved for release by the panel by voice vote, that delves into the intelligence community’s (IC) capabilities to respond to Chinese threats.

“The United States’ intelligence community has not sufficiently adapted to a changing geopolitical and technological environment increasingly shaped by a rising China and the growing importance of interlocking non-military transnational threats, such as global health, economic security, and climate change,” the committee wrote in its summary.

“Absent a significant realignment of resources, the U.S. government and intelligence community will fail to achieve the outcomes required to enable continued U.S. competition with China on the global stage for decades to come, and to protect the U.S. health and security,” the committee added.

The report said the IC places “insufficient emphasis and focus” on “soft threats,” such as viral pandemics and climate change, and that if the IC did not modernize systems to increase focus on machine learning and artificial intelligence, national security could be undermined.

On the technological front, “China’s continued advancements in cyber

House panel says US intelligence community not equipped to address evolving Chinese threats

A House committee warned Wednesday that the U.S. intelligence community is not equipped to handle evolving threats from China in the fields of technology and politics.

The House Intelligence Committee detailed its findings in an unclassified summary of a report, approved for release by the panel by voice vote, that delves into the intelligence community’s (IC) capabilities to respond to Chinese threats.

“The United States’ intelligence community has not sufficiently adapted to a changing geopolitical and technological environment increasingly shaped by a rising China and the growing importance of interlocking non-military transnational threats, such as global health, economic security, and climate change,” the committee wrote in its summary.

“Absent a significant realignment of resources, the U.S. government and intelligence community will fail to achieve the outcomes required to enable continued U.S. competition with China on the global stage for decades to come, and to protect the U.S. health and security,” the committee added.

The report said the IC places “insufficient emphasis and focus” on “soft threats,” such as viral pandemics and climate change, and that if the IC did not modernize systems to increase focus on machine learning and artificial intelligence, national security could be undermined. 

On the technological front, “China’s continued advancements in cyber and space-based systems also introduce the likelihood of entirely new domains of conflict in the event of a contingency,” which could serve to “extend the battlefield to our political discourse, mobile devices, and the very infrastructure that modern digital communication and communities rely upon,” the lawmakers wrote.

Committee Chairman Adam SchiffAdam Bennett SchiffTrump official releases unverified Russian intel on Clinton previously rejected by Senate panel Schiff subpoenas Homeland Security, charges ‘unlawful obstruction’ Schiff to subpoena top DHS official, alleges whistleblower deposition is being stonewalled MORE (D-Calif.) acknowledged the shortcomings laid bare by the report, 

House panel says drugmakers inflated prices to boost profits and reap bonuses

The Democrat-led reports come just weeks before Election Day, and amid efforts by President Donald Trump to show progress on slashing drug costs, one of his 2016 campaign promises.

Neither company immediately responded to requests for comment.

Highlights: Celgene raised the price of cancer medicine Revlimid 22 times since it launched in 2005, more than tripling its price. Those hikes were not necessarily linked with rising costs or innovation: In 2014, for instance, former CEO Mark Alles ordered an emergency price increase so Celgene could meet its quarterly revenue targets.

“I have to consider every legitimate opportunity available to us to improve our Q1 performance,” Alles wrote in an email. He appears before the committee Wednesday along with Bristol CEO Giovanni Caforio.

Bristol continued with another increase after buying Celgene last year. Revlimid now costs more than $16,000 a month.

The panel’s report also details tactics that Teva Pharmaceuticals used to ward off competition, such as introducing new formulations of multiple sclerosis medicine Copaxone and contracting with payers to limit generic substitutions for the blockbuster medicine.

Teva has raised Copaxone’s price 27 times since its launch in 1997, inflating its cost from $10,000 then to nearly $70,000 today. Bonuses for Teva workers soared as well — the committee reports that “lower level employees were aware of the direct link between their compensation and Copaxone’s price and revenue.”

Teva CEO Kåre Schultz testifies for the pharmaceutical company on Sept. 30.

The panel said that other costs, such as rebates that drugmakers pay to pharmacy benefit managers, do not account for the consistently rising drug prices. Manufacturers typically point to these rebates — used to ensure products’ places on insurer formularies — to justify price hikes because a chunk of the cost goes to those payer discounts.

Heart of the pricing debate:

House panel approves FAA reform bill after Boeing 737 MAX crashes

WASHINGTON (Reuters) – A U.S. House of Representatives committee on Wednesday unanimously approved bipartisan legislation to reform the Federal Aviation Administration’s aircraft certification process after two fatal Boeing 737 MAX crashes that killed 346 people.

Representative Peter DeFazio, who chairs the Committee on Transportation and Infrastructure, said the House would vote on the sweeping reform measure later this year.

The Boeing Co BA.N 737 MAX has been grounded since March 2019. Among other reforms, the bill requires that an expert panel evaluate Boeing’s safety culture and recommend improvements.

“Those crashes were the inevitable culmination of stunning acts and omissions within Boeing and the (FAA),” DeFazio said at a hearing.

He said the FAA had failed to properly ensure the safety of the 737 MAX, and called aircraft certification “a broken system that broke the public’s trust.”

Boeing and the FAA have declined to comment on the legislation.

The bill would require American aircraft manufacturers to adopt safety management systems and complete system safety assessments for significant design changes, ensure that risk calculations are based on realistic assumptions of pilot response time, and share risk assessments with the FAA.

A report released last week by House Transportation committee Democrats found that the 737 MAX crashes were the “horrific culmination” of failures by Boeing and the FAA and called for urgent reforms.

The House bill would extend airline whistleblower protections to U.S. manufacturing employees, require FAA approval of new workers who are performing delegated certification tasks for the agency, and impose civil penalties on those who interfere with the performance of FAA-authorized duties.

FAA Administrator Steve Dickson is conducting an evaluation flight at the controls of a 737 MAX in Seattle, a key milestone as the U.S. planemaker works to win approval for the aircraft to resume flights.

Reporting by David Shepardson;