Amgen, the largest biotechnology firm in the world, scored a huge back-room deal that went largely unnoticed by the media. Lawmakers added a paragraph into the “fiscal cliff” bill that gives a class of pharmaceuticals a break on Medicare price restraints.
Although the bill does not mention any companies by name, the most prominent drug affected by the restraint is Sensipar, the ultra-costly Amgen drug used to treat kidney dialysis patients. The provision will let Amgen sell Sensipar for another two years without government price controls. So welcome was the news that Amgen’s CEO quickly relayed it to investment analysts.
The deal is projected to cost taxpayers upwards of $500 million, explaining why Amgen, and it squad of 74 lobbyists Washington capital, argued aggressively for the delay. Supporters, primarily leaders of the Senate Finance Committee, said it was necessary to give regulators time to prepare for the price change. Critics, however, were shocked when they discovered the measure in the final bill and quickly pointed out that Amgen has already had a two-year delay.
Amgen has deep financial and political ties to lawmakers like Senate Minority Leader Mitch McConnell, Republican of Kentucky, and Senators Max Baucus, Democrat of Montana, and Orrin G. Hatch, Republican of Utah, who hold heavy sway over Medicare payment policy as the leaders of the Finance Committee.
Read full story: Fiscal Footnote: Big Senate Gift to Drug Maker