Looking ahead to 2021: Impacts of the U.S. election for the life sciences and health care industry - Life Sciences and Health Care Horizons
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Looking ahead to 2021: Impacts of the U.S. election for the life sciences and health care industry Life Sciences and Health Care Horizons
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Introductions
Speakers
Alice Valder Curran Elizabeth (Beth) Halpern
Partner Partner
Health Law Health Law
David Horowitz Kelly Ann Shaw
Partner Partner
Pharmaceutical and Biotechnology International Trade and Investment
Regulatory, Administrative and Public Law
Ivan Zapien
Partner
Government Relations and
Public Affairs
Election results, transition, and Biden’s first 100 days
Election results
• President-elect Biden and
Vice President-elect Harris
• Highest overall voter turnout in
history
• Rebuilt the blue wall/flipped two red
states
• Republican’s 50-48 majority in the
Senate hangs in the balance -- Georgia
• House Speaker Nancy Pelosi clings to
slim 221-209 majority
Transition and lame duck
• Refusal to cooperate with President-elect
Joe Biden’s transition team
• Biden team prepared for this possibility
• Early appointments focused on
Competency and Diversity
• COVID-19 spike
• The Lame Duck period in Congress
– COVID-19 relief package
– Government funding
Hogan Lovells | 9
Biden’s first 100 days
• Taking office in less than ideal circumstance
– Transition
– Divided government
– House
– Senate
• Cabinet confirmations
• Executive orders
– Paris climate
– WHO
– Muslim ban
Hogan Lovells | 10Biden’s first 100 days
• COVID-19 response and legislation
• Domestic priorities
– Economy, COVID-19, ACA, education,
environment, criminal justice, immigrations
reform
• International priorities
– Restore relationships
– Lead on climate
Hogan Lovells | 11Legislating with a divided government
• Politics will take center
stage – Senate and
House midterms
• COVID-19 relief
• Immigration reform
• Infrastructure
• Health care – drug
pricing
• Taxes
• Justice reform
Hogan Lovells | 12Health care
Health care: Biden administration priorities
1. COVID-19
2. Protect and expand access to affordable, quality health care
– Protect the ACA and expand into “Bidencare”
– Reduce drug prices
Hogan Lovells | 14COVID-19
• Priority status illustrated by early action to name Task Force members
• 7-prong plan:
– Ensure access to testing
– Ramp up production of personal protective equipment
– Provide clear, consistent public health guidance
– Plan for distribution of vaccines and therapeutics
– Protect high-risk Americans
– Rebuild and expand defenses against pandemic threats
– Implement mask mandates through state and local government orders
• Funding will require agreement with Congress; other steps can be implemented
through regulation or Executive Orders
Hogan Lovells | 15Protect and expand access to quality, affordable health care
• Protect the ACA: Supreme Court arguments November 10, 2020, indicated that the Court might not
strike down the entire law if it finds the individual mandate to be unconstitutional without a tax
penalty
• Expand the ACA into Bidencare:
– Expand existing ACA individual market health insurance exchange subsidies
– Establish new public insurance option to offer on the exchange
– Automatically enroll low-income individuals in premium-free coverage through the exchange
– Lower Medicare eligibility age from 65 years old to 60 years old
• The future of Biden’s proposals will depend on Senate; even if the Democrats gain a bare majority
with the two Georgia seats and the Vice President casting tie-breaking votes, it may be difficult to
enact significant reforms
• Some Trump Administration actions can be reversed through Executive Orders and regulation, such
as putting more resources into promoting enrollment
Hogan Lovells | 16Protect and expand access to quality, affordable health care
• Biden’s drug pricing proposals:
– Repeal law banning Medicare from negotiating drug prices directly
– Create independent board to set “reasonable” prices based on average price in other countries for new
drugs and biologics without competition
– Limit price increases for branded, biotech, and “abusively priced” generic drugs to the rate of inflation
– Allow consumers to buy prescription drugs from other countries via importation, as long as HHS
certifies those drugs as safe
– Encourage accelerated development of generic drugs to increase competition
– End “surprise billing,” reduce market concentration of healthcare providers, and partner with the
healthcare workforce to deploy innovative system designs to improve outcomes and lower costs
• Expect continued public pressure, emphasis from White House and House, potential
for continued resistance from Senate leadership
Hogan Lovells | 17Fate of Trump administration regulations
• Outgoing presidents of the opposite party to the incoming president will issue an Executive Order to place
a hold on unfinalized regulations, delaying effective date of rules not yet taken effect, pending review
– Any proposed rules could be amended and reissued or withdrawn.
– The order is generally to put on hold any rule that is finalized but not yet effective so it can be reassessed
• Currently pending proposed rules include
– Medicare Coverage of Innovative Technologies and Codification of the Reasonable and Necessary Standard
– International Pricing Model for Part B Drugs
– Removal of Safe Harbor Protections for Rebates to Plans or PBMs Involving Pharmaceuticals and Creation of New Safe Harbor
Protections
– Durable Medical Equipment proposed rule
– Enabling More Medicaid Value-Based Payment Arrangements (and Other Medicaid Drug Pricing Changes)
– 10-year Review and Sunset of Regulations
• Trump Administration might seek to release final rules at least 60 days prior to Inauguration Day to
ensure they take effect and make harder to reverse
Hogan Lovells | 18FDA impacts
FDA: Biden administration preview
• COVID-19
• Restoring public trust
• New commissioner
• Drug importation
• Enforcement
Hogan Lovells | 20COVID-19
• Emergency Use Authorizations (EUAs)
– The shift has already occurred
• Operation Warp Speed (OWS)
– More continuity than change
• Lab-Developed Tests (LDTs)
– FDA may resume its prior requirements for
EUAs
– Expect rulemaking and/or legislation
Hogan Lovells | 21Restoring public trust in FDA
• Top priority for FDA and other public health agencies
• More direct communications from scientists and public health experts
• Avoiding even the appearance of political interference
• Renewed efforts to obtain greater independence
Hogan Lovells | 22New commissioner
• Dr. Stephen Hahn will not be asked to stay on
• Amy Abernethy, Principal Deputy Commissioner, may serve as Acting Commissioner
• Scott Gottlieb? David Kessler? Joshua Sharfstein? Others?
Dr. Stephen Hahn Amy Abernethy
Hogan Lovells | 23Drug importation
• Biden Administration will inherit the drug importation final rule
• The rule will not serve as a meaningful pathway to lower prescription drug costs
• Rule and statute severely constrain drug importation
• FDA has long opposed drug importation based on concerns about safety and
counterfeits
• Legislation?
• Other alternatives to address to drug pricing issues
Hogan Lovells | 24Enforcement
• Backlog of inspections and enforcement candidates
• Expect a major uptick in FDA enforcement after inspections resume
• How will FDA prioritize?
Hogan Lovells | 25International Trade
Biden administration priorities
• Work closely with allies
• Domestic-focused agenda
• No trade negotiations during the first
year
• Priority issues: labor and environment
• Industrial policies (including Buy
American)
• Key players to watch
Hogan Lovells | 27Potential short-term trade actions
• Tariffs, tariffs, and more tariffs
– EU
– Vietnam
– Steel
– De minimis exemption
• Buy American EO implementation
• Additional actions on China
• Forced labor
Hogan Lovells | 28The $500 billion question: China?
Answer: China will remain a strategic
competitor
• Longevity of Phase 1.0
• Prospects for Phases 2, 3
• National security measures
• Increasing role of Congress
Hogan Lovells | 29The rest of the world
• Enforcement under existing FTAs
• UK-US trade agreement
• UK-Kenya trade agreement
• (CP)TPP – Will the U.S. rejoin?
• Future of the World Trade Organization
• G7/G20 and other multilateral forums
Hogan Lovells | 30Contact us
Speakers
Alice Valder Curran Elizabeth (Beth) Halpern
Partner Partner
Health Law Health Law
alice.valder.curran@hoganlovells.com elizabeth.halpern@hoganlovells.com
David Horowitz Kelly Ann Shaw
Partner Partner
Pharmaceutical and Biotechnology Regulatory, International Trade and Investment
Administrative and Public Law kelly.ann.shaw@hoganlovells.com
david.horowitz@hoganlovells.com
Ivan Zapien
Partner
Government Relations and
Public Affairs
ivan.zapien@hoganlovells.comwww.hoganlovells.com
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