[Senate Hearing 109-210]
[From the U.S. Government Publishing Office]
S. Hrg. 109-210
ROUNDTABLE DISCUSSION: PREPARING A NATIONAL BIODEFENSE: S. 975
=======================================================================
HEARING
BEFORE THE
SUBCOMMITTEE ON BIOTERRORISM AND PUBLIC
HEALTH PREPAREDNESS
OF THE
COMMITTEE ON HEALTH, EDUCATION,
LABOR, AND PENSIONS
UNITED STATES SENATE
ONE HUNDRED NINTH CONGRESS
FIRST SESSION
ON
EXAMINING S. 975, TO PROVIDE INCENTIVES TO INCREASE RESEARCH BY PRIVATE
SECTOR ENTITIES TO DEVELOP MEDICAL COUNTERMEASURES TO PREVENT, DETECT,
IDENTIFY, CONTAIN, AND TREAT ILLNESSES, INCLUDING THOSE ASSOCIATED WITH
BIOLOGICAL, CHEMICAL, NUCLEAR, OR RADIOLOGICAL WEAPONS ATTACK OR AN
INFECTIOUS DISEASE OUTBREAK
__________
JULY 21, 2005
__________
Printed for the use of the Committee on Health, Education, Labor, and
Pensions
U.S. GOVERNMENT PRINTING OFFICE
22-683 WASHINGTON : 2005
_____________________________________________________________________________
For Sale by the Superintendent of Documents, U.S. Government Printing Office
Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; (202) 512�091800
Fax: (202) 512�092250 Mail: Stop SSOP, Washington, DC 20402�090001
COMMITTEE ON HEALTH, EDUCATION, LABOR, AND PENSIONS
MICHAEL B. ENZI, Wyoming, Chairman
JUDD GREGG, New Hampshire EDWARD M. KENNEDY, Massachusetts
BILL FRIST, Tennessee CHRISTOPHER J. DODD, Connecticut
LAMAR ALEXANDER, Tennessee TOM HARKIN, Iowa
RICHARD BURR, North Carolina BARBARA A. MIKULSKI, Maryland
JOHNNY ISAKSON, Georgia JAMES M. JEFFORDS (I), Vermont
MIKE DeWINE, Ohio JEFF BINGAMAN, New Mexico
JOHN ENSIGN, Nevada PATTY MURRAY, Washington
ORRIN G. HATCH, Utah JACK REED, Rhode Island
JEFF SESSIONS, Alabama HILLARY RODHAM CLINTON, New York
PAT ROBERTS, Kansas
Katherine Brunett McGuire, Staff Director
J. Michael Myers, Minority Staff Director and Chief Counsel
______
Subcommittee on Bioterrorism and Public Health Preparedness
RICHARD BURR, North Carolina, Chairman
JUDD GREGG, New Hampshire EDWARD M. KENNEDY, Massachusetts
BILL FRIST, Tennessee CHRISTOPHER J. DODD, Connecticut
LAMAR ALEXANDER, Tennessee TOM HARKIN, Iowa
MIKE DeWine, Ohio BARBARA A. MIKULSKI, Maryland
JOHN ENSIGN, Nevada JEFF BINGAMAN, New Mexico
ORRIN G. HATCH, Utah PATTY MURRAY, Washington
PAT ROBERTS, Kansas JACK REED, Rhode Island
MICHAEL B. ENZI, Wyoming (ex
officio)
Robert Kadlec, Staff Director
David C. Bowen, Minority Staff Director
(ii)
C O N T E N T S
__________
STATEMENTS
Thursday, July 21, 2005
Page
Burr, Richard, Chairman, Subcommittee on Bioterrorism and Public
Health Preparedness, opening statement......................... 1
Lieberman, Joseph I., a U.S. Senator from the State of
Connecticut.................................................... 2
Hatch, Hon. Orrin G., a U.S. Senator from the State of Utah,
opening statement.............................................. 5
Schumer, Hon. Charles E., a U.S. Senator from the State of New
York........................................................... 9
ADDITIONAL INFORMATION
Statements, articles, publications, letters, etc.:
Kennedy, Hon. Edward M., a U.S. Senator from the State of
Massachusetts, prepared statement.......................... 19
(iii)
ROUNDTABLE DISCUSSION: PREPARING A NATIONAL BIODEFENSE: S. 975
----------
THURSDAY, JULY 21, 2005
U.S. Senate,
Subcommittee on Bioterrorism and Public Health
Preparedness, Committee on Health, Education, Labor, and
Pensions,
Washington, DC.
The subcommittee met, pursuant to notice, at 10:09 a.m., in
room 430, Dirksen Senate Office Building, Senator Burr,
chairman of the subcommittee, presiding.
Present: Senators Burr, Hatch, Lieberman, and Schumer.
Opening Statement of Senator Burr
Senator Burr. This hearing will come to order. Senator
Lieberman, welcome.
Senator Lieberman. Thank you.
Senator Burr. We also welcome Senators Hatch and Schumer.
At this time I would ask unanimous consent that all
members' statements be included in the record, as well as the
full statements of today's witnesses be included in the record,
and without objection, so ordered.
Again, I would like to thank you and our colleagues,
Senator Lieberman, for being here.
This is the second formal Roundtable that we have had, and
I am hopeful that we are growing close to the end of a very
long process, but one that was needed greatly.
As we begin to examine all the aspects of S. 975, we
certainly have the ability to tap the talents and the knowledge
of two people who have been extremely engaged in the process,
Senator Hatch and Senator Lieberman. For scheduling reasons,
Senator Gregg is unable to join us today, but as we stated when
we started this process, we had been charged by Senator Enzi to
look at all the pieces of legislation that had been introduced
as it related specifically to BioShield, to try to figure out
what we collectively have learned over the past several years,
and to try to make sure that we incorporated all the great
ideas that existed not just on the Hill but around the country.
I can tell you that we have exhausted every opportunity to
reach out in a public venue, in a private venue, to individuals
that we thought had something to contribute. I truly believe
that at the end of this process we will have left no stone
unturned to try to learn something that possibly we did not
know. I am convinced that as we go through the final pieces,
and that is, trying to assemble a piece of legislation, the
same individuals will be included in that process. This is not
one that will be written in the dark of night or in a closed
room. It is one that will be written based upon the input of
experts, and as we move along that process, I believe that we
will have a bill that addresses the concerns that are expressed
in S. 975, the concerns that are expressed by people on the
front line, the concerns that every American has about their
security and the threat that is out there.
With that, I want to thank Chairman Enzi and Senator
Kennedy. Without their cooperation we would not have been able
to go through this process, and they have been extremely
helpful. Both are unable to be with us today.
For us to move to the next step, it is absolutely vital
that we get the insight from you, Senator Lieberman and Senator
Hatch, as it relates to the specific pieces of S. 975 that you
have focused on and feel passionate about, so that we
understand exactly the reasons these things may be assembled or
worded in the way that they are.
I know that you said that you would yield to Senator Hatch
first because your schedule accommodated. Since he is not here,
if we can, we will go ahead with you and we will work out
whatever we need to with Orrin when he comes.
STATEMENT OF JOSEPH I. LIEBERMAN, A U.S. SENATOR FROM THE STATE
OF CONNECTICUT
Senator Lieberman. Thanks very much, Chairman Burr, and
thanks for inviting Senator Hatch and me to testify about some
of the key features of S. 975, which he and Senator Brownback
and I have introduced, but thanks really more specifically for
the sense of urgent leadership you bring to this matter which
is urgent; and the question which is how do we best and most
quickly protect our people from the bioterrorist threat and
from the naturally occurring threat of infectious diseases?
This is no casual matter. You know, you are new here, and I
greatly appreciate that you have focused on this and that you
have done it with the support of Senator Enzi and Senator
Kennedy because, believe me, if there was ever an occasion for
bipartisan cooperation, this is it, because we are talking
about truly the national defense, national security, national
well-being of our people.
I do want to say that my own feeling is that the best way
to combat the threat of bioterrorism is to utilize one of
America's greatest strengths, which is our innovational and
entrepreneurial talent. The BioShield law that was enacted last
year takes the first step, but unfortunately, my conclusion is,
without additional reforms, companies are not likely to risk
their own capital to fund the necessary research, leaving us
with a Government funding model that will be expensive, and I
am afraid will not produce the results we need.
The concepts in our legislation, S. 975, including tax,
intellectual property and liability reforms, we are confident
will give us important additional tools to enlist the industry
in this vital research. Let me try to briefly elaborate.
BioShield II calls on this innovational spirit that I have
talked about. We need to get companies and investors to commit
their resources to this effort, and since intentional,
maliciously infected infectious disease and naturally occurring
infectious disease may have equally devastating effects, the
incentives that we are proposing are extended to
countermeasures to nature's threats as well. And I include by
example pandemic flu, SARS, malaria, and ebola virus.
Just as we in the United States seek to protect ourselves
from new infectious disease threats, clearly, less developed
nations are trying to eliminate scourges that have restricted
their social and economic development for too long now, and
BioShield II seeks to inspire innovation on behalf of neglected
markets worldwide.
I am glad to see Senator Hatch here. If you have a minute,
I will just say a few more words about our bill, and then yield
to my very distinguished colleague.
BioShield II proposes that through the mechanism of a
contract for a new product with the Department of HHS,
companies receive a menu of tax incentives, some for small and
others for medium and large companies. BioShield II, again,
through this contract method, provides a menu of intellectual
property incentives and options that may be appropriate
motivators for start-up midstream or successful enterprises to
take on these high-risk assignments.
And finally, through the HHS contract, companies may
partake, under our legislation, of a selection of liability
protections as incentives to the companies to get them
involved. We also provide grants to assist small companies with
promising technologies that need support while undergoing
regulatory approval of a product, and we address public health
preparedness in the case of a national medical emergency by
consolidating authority at DHS.
Mr. Chairman, the intellectual property provisions that I
mentioned above seem to be drawing the most interest, and
frankly, the most fire, so I would like to briefly address this
concern.
One option we have here, which is to try again urgently to
draw the enormous capabilities of our biotech and
pharmaceutical industry into providing countermeasures for both
maliciously imposed bioterrorist infectious attacks and
naturally occurring ones, is to enact what we are calling a
patent bonus that a company could apply to a patent in its
portfolio in exchange for achieving the goal we have set, which
is to protect us from these terrible threats.
Obviously, we should not burden consumers with higher
prices for patented products any longer than necessary, but in
this legislation, we are raising the question of whether it is
necessary to enact the bonus in order to establish a viable
biodefense industry. The fact is that the established
pharmaceutical companies have a proven record of success in
running clinical trials and gaining regulatory approval for
their products, which I believe are the safest and most
effective in the world. I understand--and opponents of this
provision of our measure have said there might be some increase
in the cost of prescription drugs if a patent were extended for
some period of time--but I think we have to understand exactly
what we are proposing and the trade-off that we are suggesting.
If we need a particular drug, a countermeasure to protect
ourselves against a bioterror attack or to cure AIDS, or
another deadly pathogen, then this cost should be weighed
against the devastating cost if we fail to secure and develop
needed medical countermeasures.
Let me give the argument for how this might work in the
world we know today. AIDS is costing America $18 billion a year
to treat, to identify, all the consequences of it. In fact, the
United States is now spending $5 billion additional dollars a
year in aid to foreign countries to treat their citizens
suffering from AIDS. To state this as a balance, would that be
a fair investment for a cure or vaccine that would render that
annual expenditure entirely unnecessary? In other words, if in
fact the patent bonus results in some prescription drugs
costing a little more than they otherwise would for some period
of time, you have got to weigh that against the billions of
dollars and incalculable benefits from saving people from the
pain of AIDS or other illnesses we would cure. Imagine how much
suffering would be ended, as well as lives and money saved.
You have to ask, what is it worth to generate a platform
technology that would promptly generate vaccines against
emerging viruses? What would we spend for new resistance-free
antibiotics or truly effective antiviral medications? Each of
these discoveries I think shares something in common. They are
not products industry seems to be willing to develop right now
because their profit is not assured, there is not a clear
market, and the cost of product liability or market failure are
too high. These companies are not fulfilling the requirements
of their shareholders as they see it by participating in these
programs to the extent we need them to in today's economic
environment.
I want to finally stress this. Under S. 975, BioShield II,
these patent extensions, either for newly developed drugs or
for existing patents in a company's portfolio, are selectively
available only for a limited time, up to 2 years at the
discretion of the Secretary of DHHS, and administered at his
discretion, and they are not automatic, which is to say they
are not awarded unless the patent holder delivers to
countermeasure. At some point the Secretary of DHS will say,
OK, what you are working on with regard to a countermeasure for
a bioterrorist, an anthrax attack or AIDS or the ebola virus or
any number of other threats we face, pandemic flu, it looks
good enough that we are going to agree that if it works, we
will give you this patent extension for 6 months or 3 months,
or maybe if it is big enough, 2 years. But you only get the
patent bonus if the countermeasure, an effective countermeasure
is delivered. Those incentives do not apply to existing
entities or patents purchased from any other company after the
contract is enforced.
I am going to yield to my colleagues, but I wanted to
directly deal with what clearly seems to be the most
controversial part of the proposal Senators Hatch, Brownback,
and I have made.
Again, Senator Burr, you are a new Senator, but I think you
have the potential to make an enormous contribution on a matter
of the most urgent national interest. I thank you for your
leadership and I look forward to working with you. And with
your permission, I would yield to Senator Hatch.
Senator Burr. Absolutely. Welcome, Senator.
Opening Statement of Senator Hatch
Senator Hatch. Thank you, Senator Burr. I just joined
Senator Lieberman in praising you and commending you for taking
the lead in this area because you have been very determined,
and I think have really been moving forth in ways that are very
much appreciated by me and by Senator Lieberman and others as
well. Now, I appreciate also Chairman Enzi's dedication to
developing the best legislation possible in the area of public
health preparedness.
My longstanding concern in this area of bioterrorism has
been manifested in this longstanding partnership with Senator
Lieberman. We cosponsored bills in the last three Congresses,
including our current BioShield II bill, S. 975. So I would
also like to take time to acknowledge the contributions of our
new third primary partner in this endeavor, Senator Brownback.
As you know, I really appreciate working with Senator
Lieberman. He is just a terrific Senator and a person who
really takes these matters very seriously, and I am grateful to
him, and others as well.
I appreciate my good friend, Senator Schumer over there. He
picks on me all the time, but other than that--[Laughter.]
Senator Lieberman. Senator Hatch, he is going to do it
again today.
Senator Hatch. Is that right?
Senator Lieberman. Yes. He is going to pick on both of us.
Senator Schumer. Could the committee pass out Kleenex to
everybody, please? [Laughter.]
Senator Hatch. As you know, I have a difficult time
defending myself.
Senator Schumer. Oh, yes, I see that.
Senator Hatch. I love Chuck, but he is a pain in the neck
sometimes.
Senator Schumer. And by the way, that is an improvement on
what he said a few years ago. [Laughter.]
Senator Hatch. They have been resurrecting that, much to my
chagrin, because it was all done in good sport, and you were a
very good sport about it, in spite of the dumb questions.
[Laughter.] I could not resist. I apologize.
Recently I have been heartened to the call to action so
eloquently stated in a major address at Harvard by Senate
Majority Leader Frist. Now is the time to couple words with
action.
Warning of the threat is critical, but we must take
tangible steps to mitigate this great and growing danger while
we can. Both Senator Lieberman and I have long recognized that
the only sure way for the Senate to pass comprehensive,
meaningful bioterrorism legislation is for the Majority Leader
to call upon all of the relevant committees of jurisdiction to
report legislation by a certain date.
While we applaud the efforts past and present of the HELP
Committee, especially the efforts of Senators Gregg, Enzi,
Frist, Burr, Lieberman, Brownback, and I think that we need the
active involvement of the Finance, Judiciary, Homeland Security
and Agriculture Committees, among the others that have
jurisdiction of matters we include in our bill, S. 975. I think
this is also the case with the Gregg bill, S. 3. In fact, we
just passed the renewal of the PATRIOT Act out of the Judiciary
Committee before I came up here.
I have taken note of, and have been disappointed to see,
that by and large the private sector pharmaceutical industry
has largely voted with their feet or at least their
pocketbooks, and chosen not fully to involve themselves in the
search for medical countermeasures to bioterror agents and
emerging infectious diseases. The potential product liability
exposure alone creates a powerful disincentive to private
sector involvement in this field. It is no accident that the
American vaccine industry has nearly vanished in the wake of
enormous product liability concerns, and likely fueled by
sometimes overzealous and outright greedy trial lawyers.
I am also disappointed to sense an air of complacency among
too many on the Hill and in the administration because the
status quo is simply unacceptable. The hard truth is that in
the summer of 2000, the Defense Science Board found that we had
only one of the 57 diagnostics, drugs and vaccines most needed
to respond to a bioterror attack. We now have only 2 of the 57
countermeasures, and this list does not include medicines for
genetically engineered or otherwise exotic bioterror agents.
This is not only unacceptable, it is potentially very dangerous
and deadly.
Unfortunately, it appears it may well take another
terrorist threat similar to the anthrax attacks that many
people in this room experienced, or a direct threat from an
illness like SARS or avian flu before sweeping reforms are
adopted by Congress. I think that is pathetic. The Lieberman-
Hatch-Brownback BioShield II legislation, S. 975, was developed
and refined with input from literally dozens and dozens of
experts over a long period of time. It has been criticized by
some as being too broad, too sweeping, and too generous in its
incentives. Those critics, in my view, are misguided. This is
not a threat we can hope to abate by nibbling around the edges.
BioShield I should have taught us that. We have seen what
little result we got from a change in a single area. To move
from a position of apathy and unpreparedness to a positive or a
posture of strength and vigilance will require more than a
minor change here or there. That is why S. 975 contains 29
titles and 360 pages.
It is a comprehensive and aggressive strategy of incentives
for the development of effective bioterrorism and infectious
disease medical countermeasures, as well as addressing other
critical issues like command and control, protection of our
food and water supplies, and workforce issues.
To those who focus upon and decry certain features of the
intellectual property incentive, such as the wild card patent
extension, I ask you, how much would you be willing to pay for
preventive measures for a threat of agents like the ebola
virus?
Furthermore, the cost of these proposed incentives is
trivial compared to the cost of bioterror attack or infectious
disease outbreak. Moreover, the research that will be done by
companies seeking to earn some of these incentives will likely
drive all medical research forward and give rise to many
ancillary medical benefits for Americans.
I do not believe that it is possible to understate that a
crisis is looming, or crises are looming. Although Secretary
Leavitt at Health and Human Services, and Secretary Chertoff at
Homeland Security are working tirelessly to improve our
readiness, their hands are tied by many of the problems which
are addressed in S. 975, that it is not only intentional
threats with which we must concern ourselves. Naturally
occurring and emerging disease may prove even more dangerous.
People are already suffering terribly from dreadful diseases
such as AIDS, tuberculosis, antibiotic resistant organisms and
hepatitis. These diseases kill millions each year, and with
diseases like SARS and the avian flu, there is evidence that
things will only get worse unless we take steps to stop them.
We need to establish biodefense, infectious disease and
vaccine industries that can develop new diagnostics and
therapeutics as threats evolve. We must develop the
capabilities to quickly respond to new threats, and to do that,
we must remove obstacles to this research.
We also need to broaden the responsibility for developing
these countermeasures beyond the Government by increasing
private sector incentives. That is where many of the best and
brightest work to develop new drugs. We should let industry do
what it does best, and that is innovate. And we should make
sure that appropriate rewards exist for those who succeed.
Both S. 975 and S. 3 propose bold and innovative incentives
to create a viable market for these medical countermeasures.
These bills shift the cost and risk of development of these
countermeasures to the biotech and pharmaceutical sector in
exchange for substantial and appropriate rewards if and only if
these companies successfully develop the countermeasures we
need to defend ourselves against an attack or outbreak.
Companies will be rewarded for success. This is not a
Government subsidy for ongoing research. BioShield II is
premised on the notion that we should use the biopharma
industry to our national advantage.
It is true that our bill contains aggressive R&D tax
provisions, strong liability protections, and several IP
incentives, but we will not be able to fill the medicine chest
with the 57-plus required countermeasures on the cheap.
Biopharma industry representatives have repeatedly stated that
only if we enact all of the proposed incentives in S. 975,
without dilution, do we have the best chance that industry will
venture into this area.
We are in the enviable position of being able to learn from
the experiences of Canada and China. They paid an
extraordinarily high price for their experiences, but they have
hopefully learned from their pain. We must not look on in a
disinterested fashion and argue that it could never happen to
us. Complacency in this area has fatal results. Developing
medicines for these emerging pathogens is perhaps the most
important step we as Members of Congress can take to protect
our citizens. This is as fundamental to our Nation's security
as are our law enforcement personnel, metal detectors at
airports and a strong well-equipped military. The magnitude of
the threat justifies aggressive and innovative incentives.
And I have mentioned that the spinoffs that can come from
it are absolutely startling. When we did that little, wee, tiny
orphan drug bill, with a cost of $14 or $15 million, it gave
incentives to develop orphan drugs for population groups that
are less than 200,000 people. At that time I think there were
one or two orphan drugs available and nobody was trying to find
answers to these people's difficulties.
Because we did that little bill, gave minimum of
incentives, put some prestige in cooperation under that bill,
now we have upwards of 300 orphan drugs being developed; and
they found by developing the orphan drugs for the benefit of
population groups of 200,000 or less, that they have had
spinoffs that have turned out to be multibillion dollar
spinoffs. And, frankly, they have had research that has gone
far beyond because of the incentives we provided in a very
modest bill.
BioShield II, S. 975 also seeks to build and maintain a
national public health infrastructure to meet future health-
related threats, be they conventional weapons like the bombs in
the London transit system, biological threats like the anthrax
attacks, or emerging diseases like ebola. One key issue is
command and control. To be blunt, today, no one is clearly in
command of our public health or medical systems in the event of
an attack or outbreak, and that issue has to be resolved.
Our bill, S. 975, also focuses on the need to protect our
Nation's food and water supply from bioterror and infectious
disease threats. My home State of Utah is a rural State, and I
appreciate the importance that agriculture plays for both the
physical and economic health of this Nation. People often think
of biological threats as something more for city dwellers to
fear, but people in the country are no better off, particularly
if the threat does not strike initially at humans. Hoof and
mouth disease, to name just one disease, could devastate
ranchers and families and farms. Many of the medical conditions
we worry about can affect animals as well as humans. Any
student of history knows that medieval chronicles of plague
outbreaks often describe the disease's devastating effects on
the animal as well as the human population.
Over half of the infectious disease pathogens we fear
today, including avian flu, SARS, ebola, Marburg, malaria,
Chagas, schistosomiasis, hantavirus and Lyme disease, West Nile
virus, affect both humans and animals.
For this reason we must prepare ourselves for threats to
our agriculture as well as to our people.
I know that to some it is disturbing that I am talking
about the literal destruction of civilization when I describe
these threats, but in fact, I am. There is a reason that
pestilence is generally considered to be one of the four
Horsemen of the Apocalypse, because disease can cause massive
terror and destabilize entire nations.
We have been given an opportunity to prepare ourselves to
ensure that our Nation and our citizens are as well-positioned
as possible to face any medical threats, but this window of
opportunity, in my opinion, is closing. Time is slipping away,
and I join with my colleagues in urging you to move forward and
as quickly and boldly as we can. The stakes are truly that
high.
There are a hundred reasons why S. 975 can be criticized as
going too far, but the day after the next bioterrorist attack
of natural disease outbreak, I bet there will be 535 Members of
Congress who will be thinking and saying that we did not go
fast or far enough, and I do not want to have to reach that
position.
Let me just close again by thanking you personally, Senator
Burr. I agree with Senator Lieberman, you are relatively new in
the Senate, but you are a serious, reflective, intelligent man
who has grabbed this ball, and has spent the hours and hours of
time, you and your staff, trying to understand this issue,
trying to push it forward. And I, just for one, want to pay my
tribute to you and tell you how much I personally appreciate
you as a leader in this area. I think you are doing a terrific
job, and I just want you to know that all of us who are really
concerned about this are wishing for your success, and we
intend to help you to have success in this area. I just want to
express my gratitude to you, and gratitude to my two staffers.
And again, I apologize to my dear friend, Senator Schumer
for taking this long, and also Senator Lieberman, but usually
it is Schumer who takes too long.
Senator Schumer. You started off on a pretty good track,
Orrin. [Laughter.]
Senator Burr. Senator, I thank you for your comments. I
think it is safe to say that I share the urgency that both you
and Senator Lieberman, as well as others, have on this issue,
and the wonderful thing is that we did not start at ground zero
in the process because of really the spade work that has been
done by both of you and others--Senator Gregg, the interest
that Senator Schumer has had in this, Senator Frist has
contributed greatly.
Senator Hatch. Mr. Chairman, will you forgive me for having
to leave? I have got U.S. Supreme Court-itis on my plate today.
Senator Burr. As long as we can keep Senator Schumer here
and leave you out there without him, we are in good shape.
[Laughter.]
Senator Hatch. Keep him here as long as you can and ask
plenty of questions.
Senator Lieberman. I do want to reassure Senator Hatch that
there are countermeasures to U.S. Supreme Court-itis.
[Laughter.]
Senator Burr. With that, Senator Schumer.
Senator Schumer. Why don't you say that into the
microphone? [Laughter.]
Senator Hatch. Schumer is the best.
Senator Schumer. Now, don't say--no, no, no. [Laughter.]
Sometimes, Orrin, I think--and this is an ultimate
compliment from me. Sometimes I think you have a little
Brooklyn in you. [Laughter.]
Senator Lieberman. We promise not to mention that in Utah.
STATEMENT OF CHARLES E. SCHUMER, A U.S. SENATOR FROM THE STATE
OF NEW YORK
Senator Schumer. Thank you, Mr. Chairman, and I appreciate
the opportunity. I will try to be brief here, particularly
because Orrin had such a full statement that covered everything
several times.
Anyway, I want to thank both Senator Hatch and Senator
Lieberman for bringing their ideas to the table, and I could
not agree more with the problem and the need to move quickly.
That is extremely important. We are not doing enough. We must.
And the efforts of Senator Hatch, Senator Lieberman, yourself,
and many others who have been involved are terrific.
But the need to move quickly and strongly does not mean
that you let everything go. It does not mean that anything that
puts the name BioShield on it is good. And I am worried that
the proposal here will be regarded, should it pass, or could be
regarded as a boondoggle that helped the pharmaceutical
industry more than it helped BioShield and more than it helped
protect us from bioterrorism. And I hope that things can be
crafted so that the efforts we put into encouraging
pharmaceutical companies to get involved in this issue are
first directed at real efforts, not at things they would be
doing already; and, second, that the amount of compensation we
give them is consummate with the amount of effort they are
putting in. And that is the problem with this bill.
And, finally, at a time when drug prices are a huge issue,
who are we making pay for this? Purchasers of drug prices. It
is not the Government. If you went to an economist, they would
say, okay, you believe in BioShield and you need to help the
pharmaceutical industry with economic incentives, the
Government should pay for it. But we are going to choose
particular citizens who desperately need a particular drug to
subsidize it. Now, that may be the scheme, but if you are going
to do that, you ought to be very careful.
So let me just get briefly to the problems I have. The
first and most egregious problem is the wild card patent
extension. It is a reward available to drug companies which may
be as many as 8 years away from completing work on a
countermeasure, and it allows companies to extend one patent
for up to 2 years. The patent does not have to be related to
the countermeasure. My good friend, Orrin Hatch, mentioned
orphan drugs. Those are great. The money that was paid went
into the drug itself. They weren't to unrelated incentives. But
this is any drug the company can make, they can choose it. And
then, the amount of compensation they would get is totally
unrelated to the countermeasure.
So Merck, for instance, earned $4.5 billion on Zocor. Merck
could get a 2-year patent extension worth $9 billion, which
could be in compensation for a countermeasure that might be in
the tens of millions of dollars. Who would make such a deal?
Who would give Merck a 2,000-percent return?
Now, the answer is the Secretary of HHS has the discretion.
Well, smell the coffee, my colleagues. The Secretary of HHS has
not been a very good guardian of keeping drug prices low. Just
look at the prescription drug bill that was passed. Joe and I
voted against it. You were not here, Senator Burr. But it had a
$200 billion giveaway. In fact, to help the pharmaceutical
industries, the prescription drug bill that the President
proposed became such a pallid compromise that no one is happy
with it. Why are we going to repeat that? And it was the
Secretary of HHS who was fully supporting it.
So I do not have much faith in giving unmitigated
discretion to the Secretary of HHS. Smart legislation would put
limits, would not let Merck choose Zocor for a countermeasure
that might only cost tens of millions of dollars and may never
come to pass.
My colleague from Connecticut, my good friend--I love him,
I revere him--he said we do not give them the extension for any
longer than necessary? That is not true. We give it for
whatever the Secretary of HHS wants to. And I for one do not
have much faith that that will work out. The pharmaceutical
industry, when they work against HHS, seems to always get their
way. So that is number one.
The second provision goes to something--and where I come
from on this, Senator Burr, is along with Senator Gregg,
Senator McCain, and Senator Kennedy, we authored the Generic
Drug Act, the New Generic Drug Act that passed a couple of
years ago and that has kept the price of generics low. So I
care a lot about generic drugs. And the second provision allows
companies to get years and years of patent time restored far
beyond Hatch-Waxman. And, again, the way the countermeasures
are defined in this bill, these patent extensions could be
granted to blockbuster drugs already on the market, like
antidepressants or drugs for stomach disorders.
Take Prevacid. This is a drug to treat ulcers, which could
easily be a side effect of treatment with a countermeasure or
of people's panic during time of attack. If the company made a
slight tweak and got the drug approved as a countermeasure
under the definition of this bill, which could fit, they could
get 6 more years of patent protection worth $20 billion.
Now, if for whatever political reason somebody wanted to
help out the maker of Prevacid, we would allow them to do so.
And paid for by whom? Not by the Senate, you know, the
taxpayers as a whole, but by just the users of Prevacid. Why is
that fair? I know we do not want to pay any more. That is the
problem here. Nobody wants to spend more money on this, so
let's find another route. But when the drug people, the people
who use these drugs find out that they are being taken
advantage of to pay for a benefit for the whole society, they
are not going to feel too good about it.
What is worse about these patent extensions is because
companies can get their entire patent restored after spending
years after developing the drug, it actually removes any
incentive to bring the drug to market quickly.
Finally, S. 975 includes a provision that would waive the
rights of the Government to spur further production of
countermeasures in time of crisis. The waiver of the marching
rights takes away the ability of the Government to intervene in
easily foreseeable situations where a sudden surge in demand
for a countermeasure overwhelms the ability of the company
holding the patent. In other words, in this one, again, just--I
mean, it seems that the pharmaceutical industry has almost
written large parts of this bill. We want to give them money in
the first part as an incentive to produce a much needed drug
because we need the much needed drug. But when it is against
their interests to produce the much needed drug, like it was
with Cipro a few years ago, then we say we cannot do it.
So it seems somehow in the pantheon of interests here we
have it a little backwards. Instead of the need to get drugs
out to market quickly when people need them, we take the needs
of the pharmaceutical industry first.
So if there are times of national emergency, we cannot let
a patent stand in the way of saving American lives. We have to
give recompense, no question about it. But we have to do that.
So I think that these provisions are inappropriate for
multiple reasons. Without saying anything negative about the
need to do something here and about the idea of helping
companies, encouraging companies to do it, just make the
incentive proportionate to the reward that the society gets. Do
not just leave it completely wide open. The reward is
disproportionate to the investment put in, very possibly,
depending on HHS and what they approve. A drug company that
spends tens of millions or hundreds of millions of dollars
developing a countermeasure which will already be compensated
when the Government purchases the product could receive a
multibillion-dollar windfall at the expense of the drug
consumer.
Second, they undermine existing patent law, which protects
the rights of consumers to affordable pharmaceuticals. We know
how much generic drugs save Americans, save the Government in
Medicare and Medicaid. It accounts for 50 percent of the
country's prescriptions, 10 percent of the cost. Senator Hatch
with Henry Waxman 20 years ago did a lot to protect the
intellectual property of pharmaceutical companies, and I agree
with that. They have to be rewarded. But, again, the reward
should be proportionate. It is a balancing test, and the
balancing test in this bill is out of whack.
And, after all, as I mentioned earlier, it is not even
clear that rewarding brand new products--that we are rewarding
the brand new products that address the most dire threats. The
definition of countermeasure could refer to many drugs that are
already on the market. Again, you say, well, HHS will not do
it. They have done other things that are even more egregious.
Countermeasures are not only drugs that treat the direct effect
of terror attacks; they can refer to drugs that treat secondary
consequences of the attacks. So if a new vaccine produces a new
negative side effect, I am all for providing appropriate
incentives to ensure we have a drug to treat that side effect.
But the language here is not drafted narrowly. As it is, we
could end up shelling out money for migraine and antidepressant
medications that are already on the market.
So, Mr. Chairman, I propose we keep the thrust of
BioShield, but that the patent-extending provisions be removed
and be replaced with improved procurement procedures, coupled
perhaps with some limited liability protections. I strongly
believe we can bring companies to the table without needing to
throw in unrelated windfalls whose costs cannot be predicted
and that restrict the access of the American people to
affordable prescription drugs.
The President proposed cutting funding to bioterrorism
preparedness grants. We cannot afford to spend billions of
dollars that may never, ever lead to the availability of drugs
needed to fight bioterrorism when we have not even spent the
millions it would take to make sure the existing
countermeasures can be delivered effectively. And I look
forward to working with you--I am on the Finance and Judiciary
Committees, which have some say over different parts of this,
but your committee and all the others--to bring an effective
bill that does not open the door for all kinds, as I said, of
disproportionate reward and even boondoggles.
Senator Burr. Senator Schumer, thank you very much. I feel
compelled to give Senator Lieberman a rebuttal, but for the
sake of time, if we can, I understand we are targeted to go to
the floor with a vote, an up-or-down vote on Judge Dorr at
about 10:50, 10:55. It will not be a cloture vote. My hope is
that we could spend 15 minutes with some questions and answers
if your time accommodates.
Senator Schumer. I apologize, Mr. Chairman. I have some
guests here in the back. I have to go see them. They have been
waiting.
Senator Burr. If Senator Lieberman has got the time, I
would like to do that.
Senator Lieberman. I do.
Senator Burr. Senator Schumer, I know that we have not had
an active line of communication with your staff, but if you
would so accommodate us as we move into these final stages.
Senator Schumer. I would love that.
Senator Burr. As I said prior to your appearance, we have
not been given a good task, but we have been given an important
task, and that is to try to assemble a bill that addresses all
the concerns that we have. And those concerns are not limited
just to the health concerns of an attack. It is the concerns
that you have and others have about how we word it and what we
extend.
I will assure you that we will go through every scenario,
explore every option. At the end of the day, whether I am
trying to sell Joe on something that we have got in the final
product or whether I am trying to sell you on something that
you swore should not be there, ultimately I have got the
responsibility to convince you. In the overall scheme of
things, this was the only thing that we could do to accomplish
the end goal. And I think that is the degree of detail we have
gone into from a standpoint of looking at all of these issues
that come up.
Senator Schumer. Thank you.
Senator Lieberman. Mr. Chairman, if I can very briefly
before Senator Schumer has to leave, I think it is very
important that you try to engage us all in this. Look, I don't
think any one of us disagrees with this fact. The current
BioShield I is not working. And the normal market mechanisms
are not working to bring about the countermeasures we need to
deal with bioterrorism or infectious diseases. So we have got
to enter the market to create new incentives. That is what this
bill would do.
I take heart from the fact that Senator Schumer said he
believes that there ought to be some liability protections.
That is important. The other important part--I think there are
three critical parts of S. 975: one is liability; the other is
the tax incentives for companies to get involved; and we think
the third is patent extension. And, obviously, we disagree but,
look, the bottom line here is urgent threats require urgent
solutions. And this is an urgent threat that keeps all of us
awake at night. And I am just trying to figure out how do we
create an adequate incentive to the biopharma industry to get
them to put their considerable talent to work to come up with
countermeasures. And one idea is to extend the patents that
they have only if there is proof that the company has come up
with a countermeasure that works. And what is the consequence?
Some people will pay what they are paying now, not more--the
patent will be extended. They will pay what they are paying now
for whatever the drug is--Zocor, Prevacid, you know, Lipitor or
whatever. They will pay what they are paying now for an
additional period of time as determined by the Secretary of
HHS.
I really urge my friend from New York, maybe there is a way
we can work together on some of the language involved here if
you are concerned about it--and I hear you--the latitude that
we are giving the Secretary of HHS is of concern. We could
create clearer lines so that this is a possible incentive to
give.
Senator Schumer. I have not said that I am against all
patent--using the patent system. It may not be my preferred
way, but I am willing to have give and take. But at least there
have got to be some guards that you do not do $10 million maybe
of needed investment for $1 billion of reward.
Senator Lieberman. Senator Burr, blessed are the
legislative mediators. [Laughter.]
Senator Burr. Senator, you partially answered my first
question, and that was the three areas that you talked about:
liability, intellectual property through patent extension, and
tax credits, which you highlight in your bill.
I understand you would not have them all in there if you
didn't think it was a package that was needed.
Senator Lieberman. Right.
Senator Burr. But could you prioritize those three things
for us from a standpoint of your understanding of their
importance to accomplish that.
Senator Lieberman. That is harder for me. As you know, we
have got an enormous number of incentives--I believe it is 29--
of different kinds. So I have tried to prioritize by going to
these three. And they affect firms of different sizes. I think
the patent extension will probably be much more attractive and
hopefully engage the big pharmaceutical companies. I think the
tax incentives--we have an R&D limited partnership incentive, a
special capital gains rate, and a new market credit for R&D
partnership pass-throughs to investors that I think will be
particularly appealing to smaller firms. I think the liability
protection is going to be important to both large and small
firms.
So it is hard for me to choose among those three. I mean,
clearly, I hope that we are going to find it possible to
develop a consensus around the liability protection and the tax
incentives. The patent extension is the most provocative and
controversial, but, frankly, it may be the most effective to
engender a real response here.
Senator Burr. Do you possibly see a scenario, being
empathetic of Senator Schumer's position, where the patent
extension for a company might exist only to the Federal
purchases for the purposes of a threat situation? I think we
are somewhat confident that we are not buying 100 percent of
what we need were we to be attacked. A company having the right
to come back and sell under BioShield a second or a third time
without competition coming in, but they may not hold the patent
if it has run out in the general market. Is that a possibility?
Senator Lieberman. Well, that is one of the alternatives
that the Secretary of HHS has under the authority we give him
in this bill. I myself am skeptical about whether that will be
enough to engender the enormous investment that will be
required from the biopharma industry to come up with some of
the countermeasures we are talking about. But we should talk
more about it. In other words, I do think as provocative as it
is--you know, this idea of the patent extension came out of a
lot of talks we had, people on my staff and other staffs,
justified by the sense of urgency. What could we do to shake
this up to get this extraordinary industry with its enormous
innovational capacity that--let's be honest about it, it is
helping us live longer, better lives. We all criticize the
industry, sometimes correctly because we are upset about
pricing, for instance. But the fact is that the lives of all of
us and our families are being extended by what they are doing.
And the fact is they are not getting into this field because
the market incentives are not enough for them. That is why we
are looking at the patent extension.
Senator Burr. Senator, would you agree that if we found a
way to lessen the investment up front--research, development,
clinical trials, that whole process--if the capital investment
was less on the part of the companies, we can then moderate the
back end as it relates to what is needed.
Senator Lieberman. That is an interesting thought.
Possible. I mean, I think probably the most--I am not sure what
you are thinking about because there is a balance there, and
probably the most significant way we could do it is through tax
incentives for up-front investments to diminish the impact on a
company. And then I suppose you have the latitude to lessen
somewhat the incentives further on down.
This is a tough one because we are speculating about what
will bring other people into this field that we urgently need
them to get into and where what we have tried so far, BioShield
I, has clearly not worked. I mean, to some extent we probably--
and I know you have--should talk to the people in the industry
directly, although I understand that there would be some
skepticism about embracing every single word they say about
what they need.
Senator Burr. A broader question, and you alluded to this--
--
Senator Lieberman. Incidentally--excuse me--I know Senator
Schumer did not really mean this, but this bill was drafted by
my staff and the staffs of Senator Hatch and Senator Brownback.
Trust me, the biopharma industry had nothing to do with the
drafting of this bill.
I will say that the staff, particularly Chuck Ludlum, who
has now retired to go to Senegal, he had a regular daily e-mail
list that probably most people in this room and several hundred
others were on. So people knew about what we were doing, but
the drafting is ours.
Senator Burr. Your bill creates a number of different
things and a number of new offices in a number of different
agencies. I am going to ask you a question I have asked
everybody in the public arena, the private arena.
Senator Lieberman. Sure.
Senator Burr. From a standpoint of bioterrorism and
specifically the BioShield effort or biodefense effect, who
should be in charge?
Senator Lieberman. Well, ultimately I think the Secretary
of HHS has to be in charge. I mean, there are some parts of
this that the Department of Homeland Security will have,
naturally, and they have got to work together.
I had an interesting conversation with Secretary Chertoff
the other day about the extent to which he is now working, he
thinks, better and with clearer lines with Secretary Leavitt at
HHS. But----
Senator Burr. Would you agree that there needs to be
somebody named in charge of this effort?
Senator Lieberman. I do, and particularly insofar as the
focus here is on incentivizing the biopharma industry to
produce the countermeasures we need to protect the lives of the
American people from a bioterrorist attack and infectious
diseases. And that certainly seems to me to fall most naturally
under the Secretary of Health and Human Services.
Senator Burr. You have been here for several years and are
very familiar with HHS and NIH and CDC and how they work. Do we
have a cultural problem with what we are trying to do? Do we
have a need that may not culturally fit into how those agencies
currently operate? Would you like to comment on that?
Senator Lieberman. Well, it may be. I mean, I will say that
there is a judgment being made here, the proposal we are
making, which is that we are not going to get what we need for
our country in terms of meeting this threat with what might be
called a kind of big bureaucracy, command and control, frankly,
Department of Defense-type system where we are going to buy
everything. We think that will not work quickly enough, and it
will end up costing us more than it should. And so far the
attempt to put into effect in BioShield I has not worked. This
is a very different cultural model. You are absolutely right.
This is a model that says let's create--let's enter the market,
as I have been saying. Let us, through Government, create the
incentives for private capital to come in and get this job
done. Using private innovation, which is one of the great
strengths of our country, and let us get it done at a much
lower cost to the taxpayers.
Now, I am not concealing anything here. It could be that
one of the costs associated, as I said before, is that some
people on certain prescription drugs are going to end up paying
the same that they do now, because the patent is going to be
extended for 6 months or a year or whatever.
Senator Burr. You surprised me when you said that BioShield
has not worked. Most are not as bold to answer that. I think
the jury is still out in many people's minds. I would happen to
agree with you.
Senator Lieberman. Well, yes, I think maybe I should amend
it simply by saying that we do not see it working yet.
Senator Burr. As robustly as had been----
Senator Lieberman. Yes. And I understand, and there are
some responses to this in our proposal that some of it seems to
be cultural and bureaucratic. At least that is what the people
on the outside say. But I think it goes beyond that, that
basically, you know, the incentives that we put out, the system
we created for the contract and pledged to buy is just not
enough.
Senator Burr. In your conversations, would you agree that
the procurement process as designed has been a difficult
process for individuals who considered entering into BioShield
to understand?
Senator Lieberman. Absolutely. That is what we hear. That
is what independent reviews of what has happened so far have
told us. And that, no matter what else we do, is something that
we ought to try to fix. But it also--though this stuff is
mostly entrepreneurial, innovational, it could end up being
bureaucratic, too. It could end up being slowed up
bureaucratically if the system does not change the culture.
Senator Burr. Last question, and then we can both go vote.
Given your view of not just your legislation but what we need
to accomplish, if you could describe what success would be at
the end of this process, what would it be?
Senator Lieberman. Well, it would be a bill, a law that
will quickly bring the power of innovation and entrepreneurship
of the American biopharma industry to finding countermeasures
for bioterrorist attacks and infectious diseases. And I think
it has got to include extensions of--liability protection, tax
incentives, and, I believe, some kind of patent extension.
You know, Senator Hatch said it. We all live with this fear
that everybody can pick away at our proposal. Senators Hatch,
Brownback, and I intentionally went out further than
conventional legislation, because this is not a conventional
threat. And Senator Hatch said it. You can pick away at this
now, but God forbid we come to the day when there is a
bioterrorist attack or a terrible pandemic flu in this country,
535 Members of Congress are going to say, ``Well, why didn't we
do something more, quicker?'' And so I think what I would say
success would be is if we do something more, quickly, than
BioShield I.
Senator Burr. Senator, again, I thank you. This morning
when I got the e-mail that potentially the Tubes in London had
been attacked again, my initial thought was, Boy, this one may
be a bio attack. Maybe that means I need to get this bill done.
I have been working on this too long. I think that probably
went through the minds of a lot of folks who have sat down with
your staff, with you, with my staff, who really have conveyed
the sense of urgency that they have about the need to get this
bill out there, to get BioShield in a functional capacity and
to do it quickly.
The amazing thing--and I hope that Senator Schumer's staff
will convey this to him--is everybody that I have met with for
the past 6 months as it relates to this effort has been
incredibly helpful. Even the ones that may have had much
different approaches than you or than I might have, they have
been very patient to listen to new ideas.
There has not been an entity--and that includes the big
pharma, small pharma, bio device world. Nobody seems to have
been in for selfish reasons. I think there is a frustration by
big pharma, a frustration that is driven by how their
businesses are traditionally modeled, and the fact that they
have shareholders and the incredible Catch-22 that Sarbanes-
Oxley potentially puts them in when they cannot justify to
their shareholders anything other than a profitable venture,
which means if you have got a choice between sticking in the
private marketplace with patented drugs versus going over here
and accepting liability and potentially not knowing what the
time line is, and quite honestly in BioShield procurement, not
knowing until very late in the process exactly what the dosage
procurement is going to be.
Senator Lieberman. Right.
Senator Burr. It makes it pretty tough for a publicly
traded CEO. So this is not something that big pharma has been
engaged in. The great thing is that we have a very innovative
community out there that wants to participate. From a
standpoint of myself, I think I agree with you. Our effort is
to see how many--big pharma, small pharma, bio, everybody--that
we can get involved in this. My hope is that over the next 30
days we will have that blueprint that we can work in a
partnership to try to refine and address as many of the issues
that we all are passionate about as we possibly can. I thank
you.
Senator Lieberman. Thank you, Mr. Chairman. Again, you can
really make this happen, and, of course, we start with Senator
Frist being focused on this. What my hope would be is that you
bring a bill out this fall and we get to passage through the
Senate before the end of the year. It is just that urgent.
You know, your reaction to what happened in London today is
not a hallucination. I mean, look, we saw what happened in the
Japanese underground system some years ago. I remember the 9/11
Commission said that part of why 9/11 happened was a failure of
imagination. What they clearly meant is that we could not
imagine prior to 9/11 that people would actually do what those
fanatics did to us on 9/11. And now we just have to imagine
what others like them might try to do and make sure we are
ready. That is exactly the mission that you have accepted. I
thank you for it, and I pledge my full support to you as you go
forward.
Senator Burr. Thank you once again, Senator.
[Additional material follows.]
ADDITIONAL MATERIAL
Prepared Statement of Senator Kennedy
I commend Chairman Burr for his leadership on our
subcommittee. He has given us an effective start, and I commend
him for the impressive pace he has set.
I also commend Chairman Enzi for his leadership and his
strong commitment to biodefense issues, as well as two
distinguished former chairmen of our committee, Senator Gregg
and Senator Hatch.
Senator Gregg moved the first BioShield bill through our
committee last year. He is the lead sponsor of one of the
bills, S. 3, we are discussing today.
Senator Hatch and Senator Lieberman are the lead sponsors
of the proposal, S. 975, and I join in welcoming them to
today's discussion.
I look forward to our discussion about the measures we need
to take improve our biodefense capability and public
preparedness.
The barbaric attacks in London 2 weeks ago remind us again
that we're still highly vulnerable to terrorist attacks, and
must never relent in our efforts to protect the safety and
health of the American people. We're fighting the terrorists
overseas, but we can't neglect the real possibility that they
can strike us at home again, and we clearly haven't done enough
to respond to that threat.
A year ago today, we took a significant step in protecting
our citizens by enacting BioShield. This bipartisan legislation
moved the ball forward, most significantly by providing
dedicated funds to purchase countermeasures, and establishing a
process to assure biotech companies and pharmaceutical
companies that the Government will purchase the biodefense
products they produce if they protect our national security.
I believe additional action is needed. I'm hopeful we can
work together to pass a BioShield II bill that will further
improve the Nation's ability to respond to a bioterrorist
attack.
One goal is to fully engage the biotech and drug
industries, which are not yet adequately engaged in the search
for vaccines and drugs to keep us safe. In a sense, these
industries are like the defense contractors that do an
outstanding job in providing equipment and materials needed to
protect our security in other ways. We treat these contractors
fairly in building up an arsenal of weapons, and we must treat
other industries fairly in building up our biodefense arsenals.
One proposal is to offer liability protections to these
companies. A case can be made for such protections, coupled
with a compensation program to encourage vaccinations against
infectious bioterror agents or even pandemic flu. We must be
careful not to create broad protections for companies that are
negligent, simply because products have value for biodefense.
Liability protections are more questionable for products
brought to market for a biodefense use that also have a strong
commercial use.
On the defense contractor analogy, we should also consider
a greater role for the Government in the production of
countermeasures using direct Federal funding by contracts or
through a Federal production facility. Tax incentives are an
additional idea well-worth considering.
Increased patent protections or extended market exclusivity
are less appropriate for products that have a traditional
commercial use. The idea of a patent extension on a product
unrelated to a countermeasure, as in the so-called ``wild
card'' patent extension, is an unacceptable way of shifting the
cost of countermeasures to the health system when current
health costs are already unsustainable.
Patent extensions for products that have a strong
commercial use, even if they also have a biodefense use, would
impose unnecessary costs on the health system. The Government
should fund these costs directly, through appropriations, and
not shift the costs onto private payers or other Government
programs, such as Medicare or Medicaid.
Public health infrastructure is another area that needs our
immediate attention and equal priority with the development of
countermeasures. Just as we support our armed forces in Iraq,
we should support our front line defenses against bioterrorism
at home--our public health and medical professionals.
State and local health agencies and laboratories are
underfunded, understaffed, and poorly equipped to respond to
the threat. Law enforcement officials are worried too--with
good reason--that they're not adequately equipped to prevent
and respond to terrorism. What good are countermeasures if we
don't have the public health capability to detect an attack and
administer treatments? We need to do more to protect our
citizens.
Information technology is another indispensable part of
preparedness. Electronic health records allow real-time
tracking of disease outbreaks, so that early responses can be
made effectively. Rapid detection of a bioterrorist attack or a
new epidemic can mean the difference between a local outbreak
and a national disaster.
Our health defenses against biological attacks need to be
as strong as our military defenses. The Bioshield Act was a
significant step in providing greater protection for Americans,
but we obviously have much more work to do. I look forward to
working with the committee to strike the right balance.
Senator Burr. The Roundtable is adjourned.
[Whereupon, at 11:10 a.m., the Roundtable was adjourned.]