H.R.2542 - Old Drugs, New Cures Act (119th Congress)
Summary
H.R.2542, the "Old Drugs, New Cures Act," aims to amend Titles XVIII and XIX of the Social Security Act. The bill focuses on modifying how manufacturer rebates are calculated for certain drugs under Medicare and Medicaid. Specifically, it addresses 'priority research drugs' and seeks to exclude them from being treated as line extensions of existing drugs for rebate calculation purposes.
Expected Effects
The bill would create a process for designating certain older drugs being researched for new indications as 'priority research drugs.' These drugs, if designated, would be excluded from the definition of 'line extensions' when calculating manufacturer rebates under Medicare and Medicaid. This could potentially incentivize pharmaceutical companies to invest in research for new uses of existing drugs.
Potential Benefits
- May incentivize research into new uses for older drugs, potentially leading to new treatments for diseases with unmet medical needs.
- Could improve access to treatments for conditions with high prevalence among beneficiaries of federal healthcare programs.
- May reduce costs for patients if new uses are found for existing, potentially cheaper, drugs.
- Could encourage pharmaceutical companies to focus on repurposing existing drugs, potentially a more efficient research pathway.
- The bill aims to streamline the process for drug manufacturers to get existing drugs approved for new uses.
Most Benefited Areas:
Potential Disadvantages
- May increase costs to taxpayers if manufacturers are able to avoid paying rebates on drugs designated as 'priority research drugs'.
- The criteria for designating a drug as a 'priority research drug' may be too broad or too narrow, leading to unintended consequences.
- Pharmaceutical companies may manipulate the system to get drugs designated as 'priority research drugs' even if the new indication is not truly innovative or beneficial.
- The bill could create a disincentive for the development of entirely new drugs if repurposing older drugs becomes more financially attractive.
- The 60-day timeline for the Secretary to designate a drug as a priority research drug may not be sufficient for a thorough review.
Constitutional Alignment
The bill appears to align with the general welfare clause of the Constitution (Preamble), as it aims to improve healthcare access and potentially lower drug costs. Congress has the power to legislate on matters related to Medicare and Medicaid under the Necessary and Proper Clause (Article I, Section 8) to execute its enumerated powers to provide for the general welfare. However, the specific details of the implementation and potential impact on government spending would need further scrutiny to ensure full alignment with constitutional principles of fiscal responsibility.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).