Archive for November 14th, 2011

November 14, 2011

Obama’s Fate Now In Supreme Court’s Hands – A decision on Obamacare by July 20112

The Supreme Court agreed Monday to decide the fate of President Barack Obama’s healthcare law, with an election-year ruling due by July on the U.S. healthcare system’s biggest overhaul in nearly 50 years.

The decision had been widely expected since late September, when the Obama administration asked the nation’s highest court to uphold the centerpiece insurance provision and 26 states and a business group separately asked that the entire law be struck down.

The justices in a brief order agreed to hear the appeals.

At the heart of the legal battle is whether Congress overstepped its powers by requiring that all Americans buy health insurance by 2014 or pay a penalty, a provision known as the individual mandate.

The law, aiming to provide more than 30 million uninsured Americans with medical coverage, has wide ramifications for company costs and for the health sector, affecting health insurers, drugmakers, device companies and hospitals.

The law, Obama’s signature domestic achievement, will be a major issue in the U.S. elections in November 2012 as he seeks another four-year term. Republican presidential candidates oppose the law and Republicans in Congress want to repeal it.

A Supreme Court spokeswoman said oral arguments would take place in March. There will be a total of 5-1/2 hours of arguments.

The high court could leave in place the entire law, it could strike down the individual insurance mandate or other provisions, it could invalidate the entire law or it could put off a ruling on the mandate until after it has taken effect.

Legal experts and policy analysts said the healthcare vote may be close on the nine-member court, with five conservatives and four liberals.

It could come down to moderate conservative Justice Anthony Kennedy, who often casts the decisive vote.

Paul Heldman, senior analyst at Potomac Research Group, which provides Washington policy research for the investment community, said he still leaned toward the view that the law’s requirement that individuals buy insurance will be upheld.

“We continue to have a high level of conviction that the Supreme Court will leave much of the health reform law standing, even if finds unconstitutional the requirement that individuals buy coverage,” he wrote in a recent note.

via Healthcare Law’s Fate Now In Supreme Court’s Hands – CNBC.

November 14, 2011

Obama Cronyism: 1/2 Billion dollar No Bid Drug Contract, 180% Profit, Grousom Animal Testing and no FDA Approval

This article contains highlights from an article in the Los Angeles Times titled:

“Cost, need questioned in $433-million smallpox drug deal
A company controlled by a longtime political donor gets a no-bid contract to supply an experimental remedy for a threat that may not exist.” By David Willman, Los Angeles Times on November 13, 2011

Obama Cronyism – Ronald O. Perelman, SEIU Andrew Stern

Over the last year, the Obama administration has aggressively pushed a $433-million plan to buy an experimental smallpox drug, despite uncertainty over whether it is needed or will work.

Senior officials have taken unusual steps to secure the contract for New York-based Siga Technologies Inc., whose controlling shareholder is billionaire Ronald O. Perelman, one of the world’s richest men and a longtime Democratic Party donor.

Through September, the company has paid three lobbying firms $800,000 to represent its interests in Washington, public records show.

In a June 2010 email, Gary Disbrow, a virologist in HHS’ biomedical unit, shared with colleagues his assessment of where the FDA stood on the smallpox drugs being developed by Siga and Chimerix, the North Carolina company: “My interpretation of their current position is that there is NO foreseeable path to licensure.”

When Siga complained that contracting specialists at the Department of Health and Human Services were resisting the company’s financial demands, senior officials replaced the government’s lead negotiator for the deal, interviews and documents show.

When Siga was in danger of losing its grip on the contract a year ago, the [Obama] officials blocked other firms from competing.

Ronald O. Perelman donated an additional $50,000 to President Obama's inauguration.

Siga was awarded the final contract in May through a “sole-source” procurement in which it was the only company asked to submit a proposal. The contract calls for Siga to deliver 1.7 million doses of the drug for the nation’s biodefense stockpile. The price of approximately $255 per dose is well above what the government’s specialists had earlier said was reasonable, according to internal documents and interviews.

Perelman and others at Siga’s affiliate, MacAndrews & Forbes, have long been major political donors. They gave a total of $607,550 to federal campaigns for the 2008 and 2010 elections, according to records compiled by the Center for Responsive Politics.

Rose, Siga’s chief executive, served on the U.S. National Biodefense Science Board, which has advised Lurie on how to respond to biological terrorism and other potential health emergencies.

On April 6, Rose emailed the government’s chief negotiator, D. Andre Early, saying the two sides were “at impasse.” Rose said “any further negotiation should occur with a more senior official [with] the authority to take into account the important policy issues that surround this procurement.”

Two days later, Lurie wrote her conciliatory letter to Rose, pledging to install a new lead negotiator. Her top subordinate, Balady, followed through by naming Goodger to replace Early, who continued to work on the contract but not as lead negotiator.

Andrew Stern SEIU Socialist

In June 2010, Siga further heightened its presence in Washington by naming to its board Andrew Stern, former head of the Service Employees International Union and a frequent visitor to the Obama White House. The union is a wellspring of campaign money and volunteers for Democratic candidates.

But the federal contract required that the winning bidder be a small business, with no more than 500 employees. Chimerix Inc., a North Carolina company that had competed for the contract, protested, saying Siga was too big.

Officials at the Small Business Administration investigated and quickly agreed, finding that Siga’s affiliation with [Perelman’s holding company] MacAndrews & Forbes disqualified it.

The Obama administration could have awarded the contract to Chimerix as the only eligible small-business applicant. Or it could have reopened the competition to companies of any size.

Instead, the Obama administration moved to block all companies — except Siga — from bidding on a second offering of the contract.

In May of this year, Robert G. Kosko Jr., a manager in the FDA’s antiviral-products division, wrote that there was “no clear regulatory path” for approving antiviral drugs for smallpox — again because of the uncertainty surrounding proof of effectiveness.

180% Profit

Negotiations over the price of the drug and Siga’s profit margin were contentious. In an internal memo in March, Dr. Richard J. Hatchett, chief medical officer for HHS‘ biodefense preparedness unit, said Siga’s projected profit at that point was 180%, which he called “outrageous.”

In an email earlier the same day, a department colleague told Hatchett that no government contracting officer “would sign a 3 digit profit percentage.”

In April, after Siga’s chief executive, Dr. Eric A. Rose, complained in writing about the department’s “approach to profit,” Lurie assured him that the “most senior procurement official” would be taking over the negotiations.

“I trust this will be satisfactory to you,” Lurie wrote Rose in a letter.

Animal Cruelty

Once feared for its grotesque pustules and 30% death rate, smallpox was eradicated worldwide as of 1978 and is known to exist only in the locked freezers of a Russian scientific institute and the U.S. government. There is no credible evidence that any other country or a terrorist group possesses smallpox.

Representatives of Siga, speaking on the condition they not be identified, said the new drug has been effective in animal testing and that the company is being paid a price commensurate with its value.

The problem was the inherent limits of animal testing in determining whether the drugs would be safe and effective in fighting smallpox in humans. Researchers are prohibited from infecting humans with the virus.

via $443 million for a smallpox drug some experts say we don’t need – latimes.com.

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