HHS Nominee Azar Questioned About Vow to Lower Drug Prices

Disclosures

November 29, 2017

Alex Azar II, President Donald Trump's nominee for secretary of the Department of Health and Human Services (HHS), said at a Senate hearing today that his first priority in the job would be lowering drug prices.

His vow was a point of contention for Senate Democrats, who hold the expharmaceutical executive responsible for helping to jack up those prices, and question whether he will stand up for ordinary Americans and not his old industry.

Azar worked at Eli Lilly from 2007 through 2016, the last 5 years as president of its US affiliate. During that time, Eli Lilly increased the price of its insulin drug Humalog by 345%, according to the consumer watchdog group Public Citizen. Eli Lilly and other insulin makers have been hit with state investigations and a class-action lawsuit filed by patients with diabetes who claim that unaffordable prices endanger their health.

Alex Azar, President Donald Trump's nominee to become head of the HHS, testifies during a Senate committee confirmation hearing on Capitol Hill on Wednesday, Nov. 29, 2017. (Source: Carolyn Kaster/AP)

At a hearing of the Senate Committee on Health, Education, Labor and Pensions (HELP), Sen. Tammy Baldwin (D-WI) asked Azar what he would tell one of her constituents who is paying more than $1000 a month for insulin about the Lilly price increases.

"It's the system," replied Azar, who explained repeatedly in the hearing that although pharmaceutical companies bear some of the responsibility for rising prices, drug wholesalers, pharmacies, pharmacy benefit managers, and even government also are culpable. "Everyone owns a piece of this."

Azar also maintained that he would not be an advocate for pharmaceutical companies as HHS secretary. "My commitment is to the American people, not to anywhere I have worked in the past," he said.

While Azar had a tough going with Senate Democrats over drug prices, Republicans on the HELP committee saw his experience in the pharmaceutical industry as a plus, together with his past service in HHS. He served as the department's general counsel from 2001 to 2005 and as its deputy secretary from 2005 to 2007 during the George W. Bush administration. Azar also clerked for the late Supreme Court Justice Antonin Scalia.

"Your broad experience is an obvious asset in leading HHS," said Sen. Lamar Alexander (R-TN), who chairs the HELP committee. "You should need no on-the-job training."

Azar discussed ways to lower drug prices, which Trump promised to do when he ran for president. Increasing competition is one solution. "More drugs on the market will bring down costs," he said. He would open the market to more generic drugs by preventing manufacturers of brand-name drugs from extending patent protection through legal ruses. Azar said that during his time as HHS general counsel, he helped end one particular abuse of patent law that saved consumers $34 billion in drug costs over 10 years.

He sounded less amenable to a cost-control strategy suggested by Sen. Rand Paul (R-KY) ― allowing prescription drugs made in the United States that are then exported to places such as Europe and Canada to be reimported at lower, foreign-market prices.

"You've taken a position against reimportation," Paul told Azar.

"I've stated a position against unsafe reimportation," Azar replied.

"So the drugs in the European Union are unsafe?" exclaimed Paul. "You...sit there and say that the European Union has unsafe drugs. It's just frankly not true. It's a canard.

"You need to convince us who are skeptical that you'll fix [the price problem] and not be beholden to Big Pharma."

No White House Sabotage of the ACA, Nominee Says

Azar ran a gauntlet of questions about his commitment to implement the ACA, which he has characterized as "fundamentally broken."

"If I am confirmed as secretary, my job is to faithfully implement the programs as passed by Congress whatever they are," Azar told the committee. But when asked if he would support repealing the ACA's individual mandate to obtain insurance coverage as part of a GOP tax plan, Azar replied, "What I do not support is for 6.7 million Americans to pay $3 billion in penalties to not buy something they don't want to buy through a mandate upon them."

Azar also doubled down on a past assertion that the ACA is "failing completely on its own terms" in the face of Democrat senators accusing the Trump administration of undermining the law. During the hearing, they ticked off examples of what they called sabotage — shortening the 2018 enrollment period for ACA exchange plans from 3 months to 6 weeks, cutting the advertising and outreach budget for enrollment, and no longer reimbursing insurers for lowering out-of-pocket expenses for most individuals covered by ACA exchange plans, as they are required to do.

Sen. Bob Casey Jr (D-PA) asked Azar if he would oppose such efforts if he is confirmed by the Senate.

"I would disagree that there is any effort to sabotage the program," Azar replied. "People want to make the program work."

Today's hearing was considered a political courtesy to the HELP committee, which exercises considerable oversight of federal healthcare programs but does not vote on nominations for HHS secretary. That job belongs to the Senate Finance Committee, which has not yet scheduled its confirmation hearing on Azar.

Follow Robert Lowes on Twitter @LowesRobert

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