 I'm James Mulan, welcome to this episode of Talk of the Town. I am joined today by our state senator, Cindy Friedman. Always a joy to have. Join us here in the studio. Thanks so much for coming in. We really do appreciate it. Thank you. It's nice to be here, as always. As always. I wanted to, you know, I ask you in, because usually we are speaking quarterly, writing legislative updates about the many pies that you have your fingers in up at the state house. And we will get to one of those again shortly, undoubtedly. But I was struck about a month ago, there was a press release from your office, about the passage of the PACT Act. And PACT P-A-C-T is the Pharmaceutical Access Costs and Transparency Act. And that came, basically it passed the Senate in early February. And I really wanted to take the opportunity, because I know from talking to you from the day that you started as our official state senator, how important this work and this subject matter is to you. And I want to take a deep dive. So I appreciate your taking the time to do so and agreeing to do so. So let me start by asking, just to give people a sense of why are we going to be talking about this for the next half hour? What is so necessary and important about the passage of this particular piece of legislation? So I think if you look at what we try and do as a commonwealth in terms of healthcare, it's focused on affordability, accessibility, and quality. We have, over the past 10 years, in fact it's been 10 years, we've put a certain structure in place to help us measure that and also to set a benchmark, especially around the cost. We have lots of other benchmarks for quality, but cost and accessibility is something that we really focus with a lot of measurement. We cover insurers who are the payers, we cover hospitals. So we cover a certain delivery of services. What we don't cover and what we haven't looked at is pharmaceuticals. And pharmaceuticals are right now one of the fastest growing industries and costs to residents. In fact, I just was recently reading a survey that I think was within the past six or seven months that found that nine out of ten people in the commonwealth are worried about being able to afford their drugs. Ninety percent. Ninety percent. Nine out of ten. And this has actually been validated by a number of studies. So while we've really focused on our insurers and while we focused on our hospitals and doctors, we have not paid attention to the pharmaceutical industry, which is big and powerful and important and a big, it's a lot to take on. Yeah. And I just want to say that you were saying right now this is a rapidly growing kind of source of cost escalation, but as far as I know, I mean, I've just been feeling for my entire adult life, like the pharmaceutical industry and pharmaceuticals in general, prescription drugs are kind of runaway costs in general. So trying to get your hands around that and do something about it, again, a daunting task, but nonetheless, clear measurable progress here, I think, right? Yeah. If this bill passes, which you kind of, as usual, you're one step ahead of me, because that is my next question, in fact. What happened on February 10th is that the Senate passed this legislation. There is another chamber over there. Yes, there is. At the state house. Which we ignore at our own peril. Right, exactly. So what happens next? Not only procedurally what happens next, but what's your sense of how things will go? So what happens now is that this bill is sitting in houseways and means that's been sent over to them, and they can take it up. They can take it up exactly how it is. They could rewrite it and have their own version and take that up, meaning bring it to the floor. They could put this one out there and with lots of amendments and amend it. And then, if that were to happen, they would pass a version. I'm sure it won't be the same exact version as ours. And then we would have to, what's called, conference it. So three people from the Senate would sit down with three people from the house and they would negotiate the final bill. I know you've been one of those three people from the Senate at various points in the past. Yes, I have. And probably will be, again, when it comes to reconciling this, I assume? Yeah, I mean, I would certainly be part of it. And so, again, if you don't mind, because I get to ask you these kinds of questions and you give me straight answers a lot of the time, what's your sense? Are you optimistic? Are you pessimistic somewhere in between? I think I'm somewhere in between. I have in the past had conversations with House leadership that acknowledges some of the problems that we have. It's always an interesting exercise when we talk about pharmaceuticals in this state because we are such a pharmaceutical state. Biotech is a huge part of our economy and I think people are always reluctant to take some of these on because of possible consequences. Yeah, and let's acknowledge, I mean, the pharmaceutical industry, as you say, is gigantic and very well insulated in a lot of ways. And so, and this state, however progressive we are, however much we care to reduce the costs for all of us, especially those who can least afford it, et cetera, we also are dependent on this kind of. Right. And they do good things. They make, you know, they make vaccines. That's right. You know? They do a lot of, you know, there is a lot of really amazing work done and there's a lot of stuff that is questionable. So let's talk about that because in the press release that you put out, you had, you, you know, obviously the bill covers a lot of ground and has a lot of content to it. You chose a few provisions to highlight from that bill and I just wanted to kind of dig into a few of those. The first one, I'm just going to read from the press release, not completely, but for the first one, it says that the most notably the PACT Act would permanently cap a consumer's out of pocket costs for insulin at $25 per 30 day supply. So nobody would have to pay more than $25 in a month for insulin. What struck me, and of course there are awful lot of folks with diabetes out there, but what struck me is that there's a specific drug that you're kind of saying, planting a flag down. Tell us why. Well, first and foremost, you cannot live for any period of time without insulin. Insulin to somebody who has diabetes is like water to us. There's just no question. So there's no discretion. There's no discretion. You don't get to decide. You can't like exercise or change your diet. Or it is a chronic illness that you are absolutely dependent. Your body is not making something that is necessary for it to continue. So that's number one. Number two is it was a drug that was, I believe, discovered in 1922. It was given to a hospital for $1 for the sole purpose of making sure that everybody could get it. Since 1922, the cost of insulin has gone beyond what any of us would imagine. We were just reading something today. My comms director, Stephen, gave it to me that there is a woman, there was a conversation about, I think it was in Commonwealth. She's paying $700 for a three-month supply of insulin, $700 for a drug that is basically not changed. So it felt like an absolute prime drug to take on. Now, having said that, there's some other drugs that are very close behind, EpiPens, inhalers, things that we think are also very, very important. All the chronic illness drugs, right? And we want to tackle them. This bill, we did the insulin and we also have done some other things, which is to allow our Health Policy Commission, which oversees the costs of health care. We've now, this bill gives them the authority to look at medications that are essential. Also an inhaler is an essential drug, EpiPens are essential, right? To look at those drugs along with brand new drugs that have a high cost, so either the brand new drug has got a high cost of over, I think it's $25,000 a year, or essential drugs that have gone up a certain percentage. And if those drugs would now be ripe for them to take a look at, to actually look into what is the true cost of the drug and the value of the drug. And if they find that that is out of line with what a pharmaceutical company is charging, they would then have the ability to sit down with that pharmaceutical company and work to bring that cost down. So what I hear you saying then is that for these categories of drugs, either essential or ones that are expensive, expensive to manufacture, then of course expensive to pay for, that you basically want to have an opportunity to go to that T impact, right? The transparency at the very least to be able to say, why is that? Show us. And then let's talk about it. How did you get that cost? What is that cost contained here? And yeah, that's exactly what the, you know, and what we find is that there are drugs out there that are extremely expensive. And when you do an independent review of them, you find out that that's why they're expensive. They're expensive because they were incredibly expensive to make, because they have such a profound effect on the health of a group of people. And so the cost is warranted, right? I think somebody, if you look at some of the research, there are something like, and I don't even want to tell you the number, but it's hundreds of drugs that are on formularies, which are the lists that insurers keep of what drugs they pay for and what drugs they don't. They're on formularies that have not proven to be effective for anything. And yet they're dispensed, people pay for them, and there's no information or evidence that says they have value. Yeah. And we've already noted pharmaceutical companies, big and small, biotech companies, huge for our economy here in Massachusetts. But also that narrative, what you were just saying, you want to be able to basically, this legislation pushes us towards being able to say, okay, your narrative is consistently that, wow, the cost of discovery, the cost of just doing all of this stuff up front that we, the pharmaceutical company bears, we now have to, it's only right that we have a chance to make that back. I've heard that argument hundreds of times, I'm sure everybody has. And what you're saying, I think, here is, okay, show me, how'd you get to it? And if that's the case, okay, we agree. We're on a good show. We might find out how often that's the case or not. So on the issue of transparency, I just wanted, because you just covered the second of the five provisions that you had laid out, I wanted to go to the third, which deals basically, it says that it directs the state to collect a range of information around drug costs from pharmaceutical manufacturers and from pharmacy benefit managers or PBMs, basically allowing both policymakers, folks in the government and consumers, because we could then see this, to better understand the role that both of these play in driving prescription drug costs. So can you explain for us as succinctly as possible, what is the role, I think people understand and we've talked about, okay, the manufacturers, they're making the stuff. What about these pharmacy benefit managers? What is their role? So a pharmacy benefit manager should be thought about like a middleman. They negotiate, this is very high level, they negotiate on behalf of the insurers with the pharmaceutical companies and the pharmacies, right, they also interact with the pharmacies to get the best value for the insurers, okay, right, their job, their job is to negotiate because it's, as we've said, it's hugely complicated, there's enormous amount of information and over time insurers have sort of carved out this, the pharmacy benefit is what it is and the pharmaceutical, the PBMs are responsible for that. Now, the PBMs are things like CVS, silver scripts, express scripts, those are things we all have heard about, those are the benefit managers. They also negotiate rebates. The problem is, is that A, they have absolutely no regulatory authority that they have to answer to, so they are not licensed, they do not need to be licensed and B, we have no idea, no idea of what's behind the curtain. We know that pharmacy costs are going up, we know that these companies do incredibly well, we don't know how those negotiations affect the premiums or the costs that we pay, we know nothing about that and so what this bill is doing is it saying PBMs, number one you have to be licensed and number two you have to be part of our cost trends hearings and the cost trend hearing is where we actually look at and determine whether our benchmarks for healthcare costs increase are being met and right now pharmaceuticals, companies don't have to be part of that and PBMs don't have to be part of it, insurers are, hospitals are and so we need to bring them into this process to get to truly understand what our healthcare costs are. Right, because they are prime players, you've already outlined and to not know that about a prime player in this whole scenario just doesn't make any sense. And they are becoming, they're going from being PBMs to becoming kind of providers, you can go to a CVS minute clinic, Walgreens getting into the primary care business, all of these entities are kind of merging in a way that we should be very, very cognizant of and there's lots of money to be made. Amen. So moving on, we've got just two more things I want to talk about. One is that it says that the PACDAC will establish a trust fund to provide financial assistance for prescription drugs that treat chronic illness. Now again, you talked about drugs that treat chronic illness a little earlier, clearly these are absolutely societally, these are absolutely essential drugs for all of us because you know it could happen, it could befall any of us that we are dependent on these. So what do you mean by providing financial assistance to whom will that assistance go and where's that money going to come from for the trust fund? So there's a, okay, so first off the WHO and the CDC places like that, organizations like that, they have a list of what are essential drugs and the definition of what an essential drug is. And there are numbers of drugs that are across the board, they're used by so many people like blood pressure, right, is a really good one, like lots of people are on blood pressure medication. So what this would say is that if you meet a certain financial level and it really is for the people that are not poor enough to be on mass health and not wealthy enough to be able to actually be able to afford their medication, that that set of people would have access to chronic care drugs that they need at low cost. In fact, the health connector, Massachusetts, which is our version of the public option, has just announced that there will not be co-pays and deductibles for certain chronic illness drugs. And that's amazing. And everybody should look at the health connector, everybody should go and check that out because they are really incredible and there's some good plans there. But anyway, the purpose of this is to provide some way while we figure this out for people to be able to have access to those drugs and that's what the trust fund would do. Now part of that money is going to be state funded and we will push for that and part of that money will come from fines that are levied on pharmaceutical and PBMs, companies who do not engage in providing us information that we are requesting. Okay, so I see both the enforcement of the requirements that they do so and the funding of this trust fund comes from the same, at least in part from the same source, which will be, how do you enforce those things? You find the companies if they don't do what you have mandated that they do. And you know, is it enough? Would I like to do more? Absolutely. But the way that I look at it and the way the world works is you have to be taking significant steps, but you will never get the whole thing at one time. So we think these are significant steps. We should go forth and be happy and actually get this done and then we're going to start all over again and go to the next step. Right, and I think that that's super important of course, always to remind our viewers that the work that you do, it never ends at a particular point. Even when your hands are raised in triumph over some recent legislation or something like that, it's not perfect and there's going to be more to be done from there, of course. Okay, I just have one last thing to ask you about, which is that it also says here that the act will ensure the consumers pay the lowest available cost for a prescription drug at the pharmacy counter. What does that lowest available cost mean? So what that simply means is that when you go to the pharmacy counter to get a drug, you have a benefit and you have a copay or you have it out of pocket. And you also have the cost of the drug without those things. This requires that you be told what the lowest price of is and that that is offered to you. So it's shocking to know, but in there are a number of cases, not just a few, that your copay is greater than the actual cost of the drug. Is that right? And that is something that we feel should be addressed. Well, let's just make sure people understand that very well. You're saying it is not rare. In fact, it can happen with some regularity that people will pay a copay for a prescription drug and that copay exceeds the cost of the drug. Now it gets very complicated, right, because we all have these deductibles. And so the question is, well, if I don't pay that, if I don't pay the copay, for instance, or the out of pocket, but I pay for the lower price, what happens? And so we in this bill have said you don't get to be charged more because you're not meeting your deductible. Great, great. Well, all of this sounds good and you cautioned us right from the outset that this has passed one of the two chambers and it's likely to be in a different form by the time it gets to be law, which we hope it will be. But I really appreciate you taking the time to again kind of go nicely into the weeds on this. We only have a couple of minutes left, but let me ask you, I said at the outset, this is important to you. It's also clear from the way that you've just spoken about it. This is important to you. What has your role been up to this point? How much is your own imprint on this legislation, do you feel? And then what's your role going forward? Obviously, the House will do what they're going to do and then there will be further steps to take. So just tell us a little bit about what you've done for this so far and what you expect to be doing in the future. So in 2019, I sponsored a bill that was written by my team and I, we worked on this together with input from many, many, many stakeholders over many months. And we put together this bill, the first version of the PACT Act. This session and part of what happened is COVID came right. So this session. Thought we were going to have a whole conversation without mentioning that word, didn't you? No, no, no, sorry, go ahead. Delta crime, thank you. We, we re, we resubmitted it and we updated it. So I am the sponsor of this bill. My team, my incredible team wrote this and so, and then we ushered it forward. I'm also the chair of healthcare financing for the Senate. So that gives me some opportunity to have bills I care about. Not always, not always, but you know. So that is what the role that I've had. Going forward, I work with my co-chair on the house to talk to him about what are the issues of moving this bill and how can we do that. If they do move it and there, there is a house version, then I would think that as the chair of healthcare financing, I would probably be, you know, the conference committee. Right, as we mentioned before, probably. And I, you know, I would, and I, nothing is ever guaranteed, but that would be my role. So I think again, I just wanted to clarify I wasn't that sure myself, although I did have the sense. This is basically the work of you and your team. Right, this is, yeah. And it's the work of my team, and it's my work. And it's also work that has gone through numbers of iterations to try and get as many people to the table and as many people comfortable as we think, you know. So this represents what I believe is important and will help move it along. It doesn't totally reflect what I, Cindy Friedman, would like to see. Absolutely, sausage everywhere. Right, sausage everywhere, and that's the way it works, yeah. Obviously, so, but again, great to spend this time with you, to talk about something, again, near and dear to your heart, but also what you literally have drafted, again, with lots of input. And we will be very interested to see how things move from here. We'll be talking to you about it further. But for today, we are out of time. Thanks, again, this has been really, really good. I appreciate it very much. Well, I do too, and I really appreciate the opportunity to actually talk about the content. Yeah, I agree, I think so. Let's do it again. Yes, absolutely. Of course, she is Cindy Friedman, our state senator, and I am James Milan. This has been Talk of the Town. We've been talking about the PACT Act and let us hope that we are talking about the final legislation at some point in the not too distant future. For Talk of the Town and for Cindy Friedman, we appreciate her time, we appreciate yours. I'm James Milan. Thanks for joining us.