
Happy Opening Day to those who celebrate! Here’s
what we’re watching before turning our attention to the diamond.
We’ll be back in your inbox on Monday, so here’s wishing a happy
Easter to those who celebrate, too.
The Sniping Is Already Starting Over Baltimore Bridge
Rebuilding Costs
Although there’s no firm estimate yet on the cost of rebuilding
the collapsed Francis Scott Key Bridge in Baltimore, some details
are beginning to trickle in, along with hints of the political
battles that could lie ahead as lawmakers determine how to pay for
the disaster.
Federal officials said Tuesday that the rebuilding effort could
cost upwards of $2 billion, Roll Call
reports, although it’s not clear how much of that
sum would go toward a new bridge and how much would go toward
cleanup. A spokesperson for the Insurance Information Institute
told CNN that a new bridge alone could cost more
than $1.2 billion.
Maryland Sen. Chris Van Hollen said Thursday that 90% of the
construction costs will be covered by the Federal Highway
Administration’s emergency fund, a level of coverage reflecting
preestablished rules for interstate highways damaged in disasters.
(You can read more about those rules in this report
from the Congressional Research Service). As Transportation
Secretary Pete Buttigieg noted on Wednesday, the emergency fund
currently has about $950 million in it. Though some of that money
may already be attached to other projects, the fund typically
receives an additional $100 million or more from Congress each
year.
Van Hollen said he would work with fellow Democratic Sen. Ben
Cardin to ensure that the federal government picks up the other 10%
of the cost. That will likely require additional legislation from
Congress, and Van Hollen said he planned to call House Speaker Mike
Johnson to discuss the matter. "My message will be: We’re all
Americans. We should all be in this together to help a city in
need," he said. "This is an emergency situation and we’ve always
addressed emergencies through supplementals."
In the meantime, Maryland officials on Thursday requested $60
million from the federal government to cover immediate costs
associated with recovery and salvage at the disaster site. The
Federal Highway Administration covers 100% of the costs of
emergency repairs to highways and bridges within the first 270 days
of a disaster.
Funding questions on the right: The idea of using federal
funds to cover the full cost of rebuilding is meeting resistance
among some conservatives. Rep. Dan Meuser, a Republican from
Pennsylvania, expressed irritation that President Joe Biden was so
quick to pledge the full support of the federal government in the
recovery effort. "It was kind of outrageous immediately for Biden
to express in this tragedy the idea that he’s going to use federal
funds to pay for the entirety [of the rebuilding]," Meuser told Fox
News’s Maria Bartiromo on Thursday. "First reaction, frankly the
only reaction, tends to be to spend."
Meuser said the U.S. should consider pursuing payments from
Singapore, where the container ship MV Dali is registered, and from
the ship’s insurer. "We just can’t take the easy route all the time
and just try to spend the taxpayers’ money," Meuser said. (Treasury
Secretary Janet Yellen said Wednesday that she expected insurance
payments to cover some part of the costs.)
Meuser also noted that Maryland received billions in
transportation and infrastructure funding from the federal
government via the 2021 infrastructure bill, and claimed that the
state already has the money it needs for the bridge.
Republican Rep. Chip Roy of Texas, a member of the far-right
House Freedom Caucus, said that he is open to federal money being
used in response to the disaster, but was concerned about where the
funding will come from. "If we gotta go set aside X billion dollars
to deal with that port issue, then we should pay for it," he told
CNN. "Go find somebody who's paid for it. And so, well, I want to
have those conversations."
The bottom line: Funding issues aren’t expected to delay
relief efforts in the immediate aftermath of the Baltimore
disaster, but the long-term project of rebuilding the bridge could
spark political battles over who ultimately foots the bill.
Ozempic Costs Under Scrutiny as Medicare Spending Soars
Some widely used diabetes and weight loss drugs could be
profitably manufactured for far less than they currently cost,
according to a new study.
The analysis, published in
JAMA Network Open by researchers at Yale
University, King’s College Hospital in London and the nonprofit
Doctors Without Borders, finds that the blockbuster diabetes drug
Ozempic, widely used for weight loss, can be manufactured at a cost
ranging from 89 cents to $4.73 for a month’s supply. That includes
a profit margin. The drug has a U.S. list price of about $936 for a
month’s supply of injections, though that price does not factor in
insurance, discounts or rebates.
"The findings of this study suggest that robust generic and
biosimilar competition could reduce prices to more affordable
levels and enable expansion of diabetes treatment globally," the
researchers conclude.
Demand for Ozempic and related drugs in a class known as GLP-1s
has surged, raising questions about their affordability and leading
some insurers to stop covering them. Citing rising costs, North
Carolina’s state health plan this year dropped coverage of the
drugs for state employees who use the medications for weight loss,
though not for those with diabetes.
Sen. Bernie Sanders, the Vermont independent who chairs the
Senate Health, Education, Labor and Pensions Committee, pointed to
the new study in calling on Danish drugmaker Novo Nordisk to lower
the price of Ozempic and a related drug, Wegovy. Sanders said that
the company, which earned nearly $15 billion in profits in 2023,
had done the right thing by lowering the U.S. price of its insulin
products and should do the same for Ozempic.
"Novo Nordisk charges Americans nearly $1,000 a month for this
drug, while the same exact product can be purchased for just $155 a
month in Canada and just $59 in Germany," he said in a statement
Wednesday. "I am calling on Novo Nordisk to lower the list price of
Ozempic – and the related drug Wegovy – in America to no more than
what they charge for this drug in Canada. The American people are
sick and tired of paying, by far, the highest prices in the world
for prescription drugs while the pharmaceutical industry enjoys
huge profits."
Sanders said that, while Ozempic can be a "game changer" in the
fight against diabetes and obesity, millions of people who need the
drug won’t be able to afford it at current prices — and, he warned,
"this outrageously high price has the potential to bankrupt
Medicare, the American people and our entire health care
system."
Sanders is looking to discuss pricing with Novo Nordisk CEO Lars
Fruergaard Jørgensen.
The drugmaker reportedly responded by noting that it spent
nearly $5 billion on research and development last year, and will
spend more than $6 billion to increase production of the GLP-1s to
meet surging demand. It also said, per
CNBC, that three-quarters of its gross earnings go
to rebates and discounts to expand patient access to its
products.
CNBC’s Annika Kim Constantino also points to a
survey released this month by Evercore ISI that
found that more than half of people currently taking a GLP-1 said
they pay $50 or less per month.
Concerns about Medicare costs: The JAMA study comes just
days after a separate analysis found that Medicare spending on
Ozempic and other GLP-1s is skyrocketing.
The
analysis by KFF, a nonpartisan health policy
research organization, of newly released government data showed
that Medicare spending on weight loss drugs like Ozempic soared
from $57 million in 2018 to $5.7 billion last year.
KFF notes that Medicare could select Ozempic and related drugs
for price negotiations as early as next year, with negotiated
prices potentially taking effect starting in 2027. But Medicare
spending on these drugs could also be heading significantly higher
now that some Medicare plans have
started covering Wegovy for heart disease patients
and GLP-1s get cleared for other uses over time.
"These drugs offer substantial potential health benefits,"
the KFF report says, "but the combination of intense demand, new
uses, and high prices for these treatments is likely to place
tremendous pressure on Medicare spending, Part D plan costs, and
premiums for Part D coverage."
Number of the Day: $71 Million
The $1.2 trillion spending package approved by Congress last
week includes more than $71 million in earmarks for lawmakers who
voted against the bill, according to an analysis by Punchbowl
News, which notes that "it was once unheard of for a
member or senator to get an earmark in a bill and then vote against
the legislation" but that the practice has now become "relatively
commonplace."
Among those who did so this time were Democratic Sen. Michael
Bennet of Colorado, Independent Sen. Bernie Sanders of Vermont and
Republican Sen. Tommy Tuberville of Alabama. Some Republicans and
Democrats in the House "voted no but took the dough" as well.
"The main takeaway here is that earmarks aren’t the carrot they
used to be," Punchbowl’s Jake Sherman, Andrew Desiderio and John
Bresnahan write, noting that the offending lawmakers also aren’t
getting punished by congressional leaders like they once might have
been.
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Fiscal News Roundup
Maryland Senator: Federal Government to Cover 90 Percent of
Bridge Rebuild Costs – The Hill
Officials: Baltimore Bridge Price Tag Could Be at Least $2
Billion – Roll Call
Maryland Requests $60 Million for Baltimore Bridge Collapse
Recovery – Axios
First Medicare Health Plans to Start Paying for Weight-Loss Drug
Wegovy – Wall Street Journal
Bernie Sanders Wants to Meet Novo CEO Next Week on Ozempic
Price – Bloomberg
Novo Nordisk’s $1,000 Diabetes Drug Ozempic Can Be Made for Less
Than $5 a Month, Study Suggests – CNBC
Cole Considered Early Favorite to Win House Appropriations
Gavel – Roll Call
GOP Plans for Medicaid Cuts Could Face Backlash –
Axios
A Drug Half as Good as Ozempic for One-30th the Price
– The Atlantic
South Carolina to Use Congressional Map Deemed
Unconstitutional – Washington Post
Key Gauges of US Economy Advanced at Healthy Clip to End
2023 – Bloomberg
Views and Analysis
The Heroism of Ukraine and the Nihilism of Mike
Johnson – Amelia Glaser and Marci Shore, CNN
Social Security Is Again in the Crosshairs of a GOP Budget,
Even Though a Long-Term Fix Would Be Simple – Michael
Hiltzik, Los Angeles Times
Four Ways to Simplify the Income Tax – William
Gale and Samuel Thorpe, The Hill
I Work in Supply Chain Logistics. Here’s What I Advise After
the Tragedy in Baltimore – Ryan Petersen, New York
Times