Legislature(2017 - 2018)HOUSE FINANCE 519
05/03/2017 01:30 PM House FINANCE
Note: the audio ![]()
and video ![]()
recordings are distinct records and are obtained from different sources. As such there may be key differences between the two. The audio recordings are captured by our records offices as the official record of the meeting and will have more accurate timestamps. Use the icons to switch between them.
| Audio | Topic |
|---|---|
| Start | |
| Presentations: the Economy and Fiscal Policy Overview | |
| SB32 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| + | SB 32 | TELECONFERENCED | |
| + | TELECONFERENCED |
SENATE BILL NO. 32
"An Act relating to biological products; relating to
the practice of pharmacy; relating to the Board of
Pharmacy; and providing for an effective date."
4:01:01 PM
SENATOR SHELLEY HUGHES, SPONSOR, asked for direction on the
bill presentation.
Co-Chair Foster answered that a brief overview would
suffice.
Senator Hughes complied. She explained that the bill would
update statutes to allow pharmacists to substitute a new
category of medicines called interchangeable biologic
products. The medicines were life-changing for people with
debilitating diseases and could make the difference between
being bed-ridden or up and functional. The drugs were not
the same as generics. She detailed that a biologic is made
from a living cell and is a complicated molecular
structure. Whereas, a generic drug copies a recipe. She
furthered that a biosimilar or interchangeable biologic was
trying to replicate a complex cell and the items would not
be identical. The bill maintained the physician's control -
if the doctor did not want a substitution they could write
"dispense as written (DAW)." If the doctor wanted to know
whether an interchangeable was available, they could ask
the pharmacist to call if it was available. A pharmacist
could do the substitution if it was not written on the
script pad, but they would be required to communicate the
substitution to the physician. The bill also required the
pharmacist to receive the patient's consent prior to making
a substitution.
Representative Wilson asked if the bill pertained to
compound prescriptions.
Senator Hughes replied in the negative. She stated there
were entrepreneurs, small companies, and large
pharmaceutical companies who were currently working to make
more affordable biologic products as biosimilars and to
raise them to the standard where there would be no
different clinical reaction for the patient. She relayed
that 33 states had passed similar legislation and 7 others
had pending legislation. The states had done analysis and
had determined there should be some savings to Medicaid
budgets because biologics were expensive. Interchangeable
biosimilars should help the budget. She did not want to
make a claim about what the savings may be, but some states
had done so. She continued that the Centers for Medicare
and Medicaid Services (CMS) believed interchangeable
biosimilars should bring down the cost for Medicaid.
Representative Wilson referred to the fiscal note that
included the following language: "in addition this bill
requires the Board of Pharmacy to post and maintain a link
to the U.S. Food and Drug Administration's list of
currently approved interchangeable biological products on
the board's website." She asked if the board already had to
post medications and how much the bill would cost
pharmacies.
4:06:49 PM
Senator Hughes answered that pharmacists could choose
whether to carry interchangeable biological products. Most
pharmacists had automated systems to contact physicians.
She did not know whether there was a current link to post
medications. She thought it was a simple thing. She
believed the fiscal note was related to the requirement for
the board to send something out by mail to pharmacists
around the state. She thought the legislature may want to
consider why the information was not being sent
electronically.
Representative Wilson explained that her question was not
related to the fiscal note because the state did not
normally care about the cost for the private sector - it
only cared about the cost to the state. She asked for
follow up on whether there would be a cost to pharmacies or
whether it was something the pharmacies already did. She
asked about the fiscal note and the legal costs to amend
the regulation and printing and postage in the first year.
She noted the funding source was receipt services. She
asked if all business licenses would pay. She wondered why
it was a receipt service "for this area." She reasoned
bill's goal was to make things easier for Alaskans. She
wondered if the Board of Pharmacy would be solely
responsible for paying or whether all corporate licensing
would pay a portion for the writing of regulations.
Senator Hughes replied that she would follow up. She
reiterated that pharmacists could choose whether to carry
interchangeable biological products. She specified that not
all pharmacists would carry the products that were highly
specialized. She deferred to the department for further
detail.
JANEY HOVENDEN, DIRECTOR, DIVISION OF CORPORATIONS,
BUSINESS AND PROFESSIONAL LICENSING, DEPARTMENT OF
COMMERCE, COMMUNITY AND ECONOMIC DEVELOPMENT, answered that
they were receipt supported services and the pharmacy
program would pay through licensing fees. She could not
imagine the cost impacting every licensee. It was a nominal
one-time cost to do the regulation project.
4:09:44 PM
Representative Wilson asked if pharmacists had asked for
the bill. She surmised it appeared to be an improvement
over what could be given to Alaskans. She was trying to
determine why the fiscal note would not come out of general
funds versus being charged back to the pharmacist. She
stated the situation was unique - typically items were more
closely related to the board when they were paid for by the
board. She observed that the bill was different because it
was trying to do something positive for Alaskans by making
medication more affordable and did not necessarily fall
under the board's responsibility.
Ms. Hovenden replied that the changes would impact the
statutes of the pharmacy program; the Board of Pharmacy
members would help design the regulations to implement the
legislation.
Representative Kawasaki asked for verification that a
biosimilar was not identical to another product. He asked
for the difference between a biosimilar and an
interchangeable.
Senator Hughes answered that a generic is a duplicate of a
medicine made of various chemicals and ingredients - there
was no requirement to communicate between the pharmacist
and the doctor. A complicated biologic called a biosimilar
was made from living cells (e.g. Insulin and Humira).
Companies were trying to develop a product that would have
the same clinical impact. The companies were using the same
basic thing, but because they were using living cells the
product would never be 100 percent identical. The
interchangeable biosimilar or interchangeable biologic
product was the gold standard of the biosimilar. She
detailed that the FDA would test and approve the product as
interchangeable because if administered to a patient, the
patient would have to have the same clinical results
whether they were taking the original biologic, were
alternating between the original biologic and the
interchangeable, or were only taking the interchangeable.
There would be no difference in the clinical results. She
continued that biosimilars would not all fit within the
interchangeable category. She clarified that the doctor
would have to specify on a script when a biosimilar was not
categorized as interchangeable. It was a new category that
would be somewhat like a generic, but not identical (it
would be clinically similar, but the genetic makeup would
be different).
Representative Kawasaki shared that he took fish oil for
cholesterol for triglycerides. He detailed that
prescription fish oils were ten times the price of non-
prescription fish oils. He asked if a fish oil was
considered biosimilar.
DR. THOMAS FELIX, DIRECTOR, MEDICAL RESEARCH, AMGEN INC.
(via teleconference), communicated that he had worked with
the coalition of organizations to present coalition
language included in the bill. He replied that a fish oil
was not considered a biosimilar product. A biosimilar was
something that took a very specific regulatory pathway for
approval by the FDA to try to create and reference an
existing biologic. A fish oil was not as closely regulated
as a biologic and another fish oil from a different
manufacturer would not be considered a biosimilar. It was
necessary to take the 351(k) pathway to be considered a
biosimilar.
Representative Kawasaki asked if fish oil would be
considered a biosimilar product if it was regulated as
other specific drugs.
Mr. Felix believed the question was whether fish oil would
be considered a biologic because it was derived from living
tissues. He relayed that it could be considered a biologic
in a very technical definition, but for regulatory purposes
it was not considered like or governed like biologics would
be. However, in a technical term, because it was derived
from living tissues or living cells, it was possible to say
that it was a derivative of a biologic entity.
Representative Kawasaki asked for verification that the
point was for a biosimilar to mimic the exact same thing
that an interchangeable would do.
Mr. Felix replied it was important to understand why a new
industry had been built around the development of
biosimilars. He explained that biologic drugs had been on
the market for over 40-plus years and intellectual
properties around long-existing biologics were coming off
patent. He furthered that biosimilars or versions of the
older products coming off patent were intended to create
competition to lower healthcare costs and the analog was
generics. Biosimilars were coming to the market to do what
generics have done, but with a different scientific
framework and expectation financially.
Representative Kawasaki relayed that the bill packet
included a letter of opposition from the Board of Pharmacy.
He thought the board may support a bill like the one under
consideration. He asked for comment.
Senator Hughes answered that there were some pharmacists in
support of the bill. She explained that pharmacists would
prefer having the ability to substitute [drugs] without
making the communication. Physicians would probably prefer
total control and that substitutions could not be made. She
detailed that because of the ability for physicians to
specify "dispense as written" they ultimately had full
control. She furthered that the change the bill would
implement would be best for the patient in terms of
affordability. The extra step was communication - something
pharmacists did not have to do with generics. Her
understanding was that the pharmacies - the number would be
relatively low because there were a limited number of
individuals with applicable diseases - would probably have
the automated system set up, meaning it would not be
burdensome. She relayed that the State Medical Association,
Alaska State Hospital and Nursing Home Association
(ASHNHA), the Alaska Commission on Aging, and the Alaska
Cancer Action Network were all in support of the
legislation.
Senator Hughes corrected her earlier example of biosimilar
drugs and clarified she had been referring to the drug
Humira for rheumatoid arthritis. She shared an example of a
Vietnam veteran from Wasilla named Cajun Bob. She detailed
he had been featured in Life or Time Magazine in the 1960s.
He had been bed-ridden, and the use of a biologic drug had
given him a new lease on life. She stressed the importance
of the drugs for Alaskans with debilitating diseases. She
discussed that sometimes the effectiveness of a medication
wore off for an individual, making it necessary to switch
to a new medicine. The goal was to ensure individuals would
have immediate access to all options.
4:20:15 PM
Representative Kawasaki referred to a letter of opposition
from the Alaska Rheumatology Alliance in the packet. He
added that members' packets were very comprehensive with
letters of support.
Senator Hughes replied that her office had worked with the
group and it had been helpful for them to learn that they
could specify to dispense as written and maintain control.
Representative Kawasaki provided a scenario of the receipt
of a prescription. He thought in the past he had been asked
by the pharmacist whether he wanted the cheaper generic
prescription. He asked how it would work with a biosimilar.
Senator Hughes answered that the physician would prescribe
the biologic. When the patient went to the pharmacy to pick
up the prescription the pharmacist would notice there was
an interchangeable and would ask the patient if they wanted
the interchangeable. She noted that the interchangeable was
the FDA approved gold standard. If the patient selected the
interchangeable, the pharmacist would be required to inform
the physician within three business days that the
substitution had been made. She stated that with most
pharmacies the information would be instantaneously
communicated as the medicine was processed and provided to
the patient.
BUDDY WHITT, STAFF, SENATOR SHELLEY HUGHES, referred to an
earlier question by Representative Wilson and wanted to
ensure he understood the question. He noted she had been
speaking about links to the FDA's list. He thought he had
heard her ask if the pharmacist had to post links. He
clarified that the Board of Pharmacy had to post the link
to the FDA website with a list of all the interchangeable
biological products approved by the FDA. The bill did not
require individual pharmacists to provide the information.
4:22:42 PM
Representative Ortiz asked how long the term biosimilar had
existed.
Senator Hughes deferred the question to Dr. Felix.
Mr. Felix responded that the term biosimilar had existed
since the early 2000s when Europe had been first
considering development and existence of a pathway forward
for biosimilars. The issue had arisen because their
intellectual properties were expiring [audio
indecipherable].
Representative Ortiz surmised that the movement towards
biosimilars was based on similar motivations of movement
towards generics, which had probably taken place in the
1970s or 1980s. He believed the motivation was about trying
to provide medications that were equally as effective at a
lower price.
Senator Hughes replied in the affirmative. The intent was
to increase access and affordability.
Representative Ortiz referred to a letter of opposition
from the Board of Pharmacy dated March 6, 2017. He asked
for verification that the group was still in opposition to
the bill.
Senator Hughes replied that the board had not submitted a
letter of support, but individual pharmacists and a
national pharmacy association had vocalized support for the
bill. The individuals understood the importance of access
to the medicines. She stated that the Board of Pharmacy
retained its position.
4:25:12 PM
Representative Guttenberg believed the biosimilars were a
good thing. He referred to letter from the Board of
Pharmacy. He believed one of the problems was related to
who was paying the bill and who had the burden of
fulfilling the legislative requirements for reporting by
doctors and pharmacies. He thought the issue of payment may
mean large-scale pharmacies would be supportive, but smal1-
scale pharmacists may feel burdened. He referred to the
last few lines of the letter - the board believed the bill
would create an unintended barrier to access. The letter
also stated there were currently no available
interchangeable biosimilar medications on the market. The
board did not see the need for legislation regarding
biosimilars, but wanted the legislation to follow the BPCI
Act of 2009 [Biologics Price Competition and Innovation
Act] and its intent of increasing access to medication. He
asked if any changes had happened in the bill regarding
some of the board's position on the bill. He did not know
what the BPCI Act was. He asked for detail about the act
and about the bill's conflict with the act.
Senator Hughes deferred the question to Dr. Felix.
Mr. Felix replied that the BPCI Act allowed the FDA to
create regulatory pathways for approval for biosimilars and
interchangeable biologic products. The act had been passed
in March 2010 as part of the Affordable Care Act (ACA); it
was one of the few portions of the ACA with bipartisan
support. He believed the most important recent development
was that, at the beginning of the year, the
interchangeability designation finally had a draft guidance
released by the FDA. The guidance provided transparency to
the community in terms of what was required to obtain
interchangeability. He spoke to the importance of
understanding that for companies that were not developing
biosimilars or interchangeables, the area had previously
not been clear. However, for developers of biosimilars or
interchangeables, the FDA had been transparent in terms of
providing direction for the development of clinical trials
and data requirements. There had been companies that had
completed clinical trials that may satisfy the requirements
for an interchangeability designation. Additionally,
companies had announced starting clinical trials to pursue
an interchangeability designation. He stated that sometimes
there was a description that the only reason the
legislation was needed was to ensure the facilitation of
interchangeability and that substitutions could be made by
pharmacists. In general, the community was not aware of
what biosimilars were as compared to generics. He shared
that five biosimilars had been approved to date [audio
indecipherable]. He noted they were awaiting an approval of
an interchangeable in the future. People typically thought
of biosimilars as generics - most generics were
substitutable - but biosimilars were not substitutable.
Another reason to pass legislation was to clearly
communicate how to use the products when they were approved
under different designations.
Co-Chair Foster passed the gavel to Vice-Chair Gara.
Vice-Chair Gara remarked that some of Dr. Felix's testimony
had been difficult to hear.
Mr. Felix apologized and reiterated his previous remarks.
He restated his previous testimony related to the creation
of the BPCI Act and draft guidance released by the FDA in
January on the path to obtaining the interchangeability
designation. He explained that were companies that had
completed trials to try to achieve an interchangeability
designation. When they would be approved was currently
unknown. Companies had also announced they would be
interchangeability trials to pursue the designation. He
underscored the importance of the legislation because it
would facilitate substitution of an interchangeable by a
pharmacist.
4:32:18 PM
Mr. Felix reiterated that the legislation clearly
communicated how to use biosimilars and interchangeables
when they were approved under different designations. The
five biosimilars approved to date were only biosimilars and
did not have the FDA designation that would allow
substitution by a pharmacist. He explained that the
products were very different than how generics were viewed.
If the community was uneducated and began to think of
biosimilars as approved and immediately used their closest
analog, which was generic approval, the community may think
the biosimilars were substitutable unless clear terms of
use were in place. He stated that every aspect of
healthcare was trying to increase communication between
members of the healthcare team. The bill would allow
transparency for a prescriber to know what was ultimately
dispensed to the patient for the prescriber to be on top of
their care. If there was any change in a patient's response
to a medication the prescriber would know exactly what
medication the patient was on.
Representative Guttenberg spoke to who was paying the bill.
He observed that Dr. Felix had not stated whether any of
the products were approved by the FDA. He referred to Dr.
Felix's testimony about clarity and transparency. He
wondered why the decision would not be handled in the
doctor's office instead of at the pharmacy. He continued
that patients were often in a hurry at the pharmacy and
were amenable to whatever was given to them. Alternatively,
he thought it made sense to have the physician tell
patients what they would receive. He referred to Dr.
Felix's earlier testimony that many practitioners and
people were not up on the issue. He thought the doctor's
office was the best place to do prescribing. He continued
that the doctor could specify for a pharmacist to only
prescribe a prescription as written.
Mr. Felix answered that biologics were distributed through
either a medical benefit (administered by a healthcare
professional) or were self-administered (pharmacy benefit).
The legislation pertained to biologics that were self-
administered. The medications would not be dispensed in a
physician's office. Often the pharmacist would be the first
to become aware, especially when an interchangeable was
approved in the marketplace. He explained that medical
benefit biologics were typically administered by a
healthcare professional in a clinic, hospital, or office
setting. Whereas self-administered biologics meant a
patient self-injected the medication. The physician or
their delegate would not be directly administering the
product to the patient. The method of facilitation of
substitution by a pharmacist had worked well for generics
and had worked to lower cost and facilitate access.
4:38:02 PM
Senator Hughes referenced Representative Guttenberg's
comments about the letter from the Board of Pharmacy. She
agreed there were not any [interchangeables] on the market;
the products were in the testing phases. There had been a
projection that the products could be out within a month to
a year. The primary issue was that they did not want to
wait an extra year to provide the products (if they became
available) to Alaskans suffering from diseases such as
lupus, multiple sclerosis, and rheumatoid arthritis. She
reiterated her earlier testimony that pharmacists did not
have to carry the products. She relayed that if the
communication requirement was not included, it would be bad
for patients - patients wanted the substitution listed in
their medical records; doctors needed the information
because they were not 100 percent identical like a generic.
Representative Wilson asked who had requested the bill.
Senator Hughes replied it had been a combination of patient
groups and companies developing the products. The companies
were spending millions on product development; if statutes
were not set up, patients would not have access to the
products. The individuals suffering, who had tried a
biologic, wanted continued access.
Representative Wilson stated it had been her understanding
that a pharmacist would have to call the physician prior to
giving the product to a patient; however, that was not the
case. She summarized that there was discussion between the
pharmacist and the patient, the patient made the
determination, and the doctor may not know what happened
for three days. She was uncomfortable with that process.
She referred to a letter in members' packets from a
physician specifying their practice would be in harm's way
because they were not notified right away. She requested to
hear from the Board of Pharmacy at a future hearing. She
remarked that the bill would charge pharmacists and they
had not asked for it. She asked for additional information
at a future hearing.
Senator Hughes reiterated that the State Medical
Association supported the bill. She explained that a
physician could retain control by specifying a prescription
was to be dispensed as written. She added that the products
were FDA approved and clinical results would be no
different than the original reference product.
Representative Wilson understood, but she surmised it could
constitute a significant medical change. She wanted to be
very careful. She surmised there could be a change from
what the physician wanted. She wanted to ensure all parties
were involved, not only groups or outside entities.
4:42:45 PM
Mr. Whitt pointed to Section 4 of the bill that specified a
pharmacist who substituted a biologic in compliance with
the section did not incur any greater liability than would
be incurred in filling the original prescription. The
section also specified the dispense as written provision.
Representative Wilson noted that her concern was with
Section 5 related to the three-day timeframe a pharmacist
had to communicate a prescription to a physician. She was
concerned about the liability to the physician. She was
certain that if a person had side effects it would be the
physician who was accountable. She stated that prescribing
was a physician's duty. She was concerned that the Board of
Pharmacy would have to pay for something it was not in
favor of. She had not understood earlier that the pharmacy
would be telling a physician what prescription was
dispensed without obtaining approval from the physician.
Senator Hughes noted that the process for medication to be
approved by the FDA was incredibly rigorous. She furthered
that if a medication was categorized as interchangeable,
there was a high assurance level, which was the reason for
the State Medical Association's support of the bill.
Representative Wilson clarified her concern was that
pharmacists were not doctors. She stated that a patient
could receive a doctor prescription, but then go to a
pharmacy and get something that was slightly different. She
was concerned that the doctor would not know for up to
three days what prescription had been dispensed. She spoke
to the liability to the physician. She believed the bill
would allow a medical decision to be made by the pharmacist
and patient. She had initially believed the doctor would
know about the prescription before it had been dispensed.
Senator Hughes answered that the types of pharmacies that
would be handling the expensive medication would more than
likely have instantaneous notification to the physician.
She reasoned that the FDA's rigorous process had been
trusted with great success and savings.
SB 32 was HEARD and HELD in committee for further
consideration.
Co-Chair Foster addressed the schedule for the following
day.
| Document Name | Date/Time | Subjects |
|---|---|---|
| SB032 Opposing Document-Opposition Letters 04.17.17.pdf |
HFIN 5/3/2017 1:30:00 PM |
SB 32 |
| SB032 Sectional Analysis ver J 04.17.17.pdf |
HFIN 5/3/2017 1:30:00 PM |
SB 32 |
| SB032 Sponsor Statement 04.17.17.pdf |
HFIN 5/3/2017 1:30:00 PM |
SB 32 |
| SB032 Supporting Documents-Support Letters 04.17.17.pdf |
HFIN 5/3/2017 1:30:00 PM |
SB 32 |
| SB32_Support_050317.pdf |
HFIN 5/3/2017 1:30:00 PM |
SB 32 |
| HFIN Crum ATA.pdf |
HFIN 5/3/2017 1:30:00 PM |