HHS nominee Alex Azar outlines priorities: lower drug prices, improve Medicare outcomes

The former Eli Lilly CEO also told the Senate Finance Committee affordability and the opioid epidemic round out his top four priorities.
By Susan Morse
04:17 PM
HHS nominee Alex Azar

Democratic members of the Senate Finance Committee on Tuesday grilled Health and Human Services Secretary nominee Alex Azar about hikes in drug prices while he was CEO of the pharmaceutical company Eli Lilly.

Azar addressed the drug pricing issue during his opening statement, before being questioned.

“First, drug prices are too high,” Azar said, listing four priorities should he become the next secretary of Health and Human Services.

[Also: Michigan law requires providers check state's PDMP before prescribing opioids]

His priorities are addressing the high drug prices while allowing for innovation, making healthcare more affordable and available, harnessing the power of Medicare to shift from paying for sickness to paying for outcomes, and the opioid epidemic.

Azar, 50, is President Donald Trump’s pick to become the second HHS secretary in less than a year. Former secretary Tom Price resigned in September over the controversy of using private jets for business travel.

Azar is the former CEO of Eli Lilly, from 2012 to 2017. He also served as chairman of the U.S. drug pricing committee.

[Also: Hearing for HHS nominee Azar dominated by drug pricing issue]

He was former HHS secretary from 2005-2007 and worked at HHS for about six years, where he helped to implement Medicare Part D. 

Once the Senate Finance Committee finishes its evaluation, Azar’s nomination moves to the full Senate.

Senate Finance Chairman Orrin Hatch of Utah, who has announced his retirement after serving for 40 years in the Senate, said opponents have said Azar’s work in pharmaceutical industry should disqualify him.

[Also: OCR revamps HIPAA guidance in wake of opioid crisis, 21st Century Cures rules]

This has not the standard for other nominees who have worked in the private sector, Hatch said.

“We’re not talking about anything unethical,” Hatch said of Azar’s work in the industry.

Ranking member Democrat Ron Wyden and other members of the committee thanked Hatch for his service with Wyden telling the chairman, “You’ve always been a gentlemen,” and “40 years a boxer. That’s real endurance.”

Wyden had staff hold up charts showing drug prices doubling under Azar’s tenure.

“The same Donald Trump who said price hiking drug companies were getting away with murder, has nominated a drug executive with a history of raising drug prices,” Wyden said.

The osteoporosis drug Forteo increased in price from $1,000 to $2,700 for five years under Azar’s tenure, Wyden said. Revenue for the drug increased 58 percent in 2016, he said.

Bringing down the cost of drugs is complex, Azar said. It will take a change in the current system. 

“There’s no silver bullet,” he said. “Not one action that fixes this.”

There must be incentives to bring down list prices, he said. 

“All drug prices are too high in this country,” he said. “This is what is so bizarre about how the system is organized. During the same period, the net realized price for the company stayed flat.” 

Senator Debbie Stabenow of Michigan asked Azar if he supported having the federal government negotiate prescription drug prices.

Azar said it should be looked at but added, “For the government to negotiate, we would need a national formulary. I don’t believe we want to go there and restrict patient access.”

Azar also was asked about Medicaid. 

“I share a commitment to the Medicaid program, it’s a vital safety net. If confirmed my goal would be to make that program as efficient … as possible.”

During the hearing, Hatch said there is a bipartisan agreement to fund the Children’s Health Insurance Program, CHIP.

CHIP funding needs to be extended by Jan. 19.

“We have a bipartisan agreement reported out of committee,” Hatch said. 

Twitter: @SusanJMorse
Email the writer: susan.morse@himssmedia.com

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Macon Community Hospital Lafayette Tennessee RCM

Macon Community Hospital in Lafayette, Tennessee. (Credit: Macon Community Hospital)

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