American Society of Hematology

New Senate Drug Shortage Bill Focuses on Economic Incentives

Published on: April 26, 2012

Senator Orrin Hatch (R-UT), Ranking Member of the Senate Committee on Finance, released draft drug shortage legislation, ThePatient Access to Drugs in Shortage Act intended to provide economic incentives for drugs defined within the critical drug shortage parameters. Senator Hatch's proposal is in addition to legislation the Senate Health, Education, Labor & Pensions Committee has been developing.

To provide market stability and more incentives to manufacturer to produce low-cost drugs, Senator Hatch proposes to exclude some medications from the 340B drug discount and Medicaid rebate programs and base reimbursement for these drugs on Wholesale Acquisition Cost instead of Average Sales Price.  

ASH submitted comments to Senator Hatch commending him for recognizing the importance of providing economic incentives, but raised several questions about his proposal and recommended that further study is needed to understand how these provisions would impact the drug shortage problem. Specifically, ASH questioned how changing the Average Sales Price (ASP), a method of Medicare reimbursement to physicians, will effectively provide economic incentives to drug manufacturers. ASH also recommended that Senator Hatch consider an option modeled on the Orphan Drug Program to incentivize manufacturers' production of specific low cost critical drugs.

Legislation concerning drug shortages, including Senator Hatch's proposal, is expected to be considered in the Senate in May.

Read more information about the status of hematologic drug shortages, ASH advocacy efforts, and resources for physicians dealing with shortages. If you have any additional questions and/or concerns about any hematologic drug shortages, please contact ASH Government Relations Manager, Stephanie Kaplan at 202-776-0544 or skaplan@hematology.org.

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