Latest AAF Government Affairs Report

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Here is the latest from Clark Rector, Senior Vice President, AAF National.

Privacy Updates

AAF, in alliance with our industry partners, continues to work to convince California legislators to consider fixes to legislation to implement the California Consumer Privacy Act (CCPA). The goal is to ensure the final law and regulations will protect California consumers while not unnecessarily hampering businesses ability to responsibly use data to help market products and services to those consumers.

One of our strategies to reach lawmakers was to run an advertisement in the print and online versions of the Sacramento Bee and create a website that further explained our position on the issue.

The ad ran shortly before the legislature left for July recess. The California lawmakers will return in August to continue their consideration of how to implement the CCPA. The law is schedule to go in effect on January 1, 2020.

Privacy issues remain a major concern of lawmakers from the local to national levels.

New York City Council member has introduced a bill that would prohibit phone carriers and mobile app developers from selling data about peoples locations.

On the national level, Senators Marsha Blackburn, R-Tenn., and Dianne Feinstein, D-Calif., are co-chairing a task force of the Senate Judiciary Committee to examine tech industry issues such as privacy, data security, censorship, antitrust and competition.

AAF continues to work with the Privacy for America Coalition to develop a proposed national privacy standard that will both protect consumers and allow businesses to responsibly use data to continue to provide those consumers with the services and content they want and expect.

DTC Advertising Under Fire

As reported in the last issue of Government Report, a court challenge was filed against a U.S. Department of Health and Human Services rule requiring that direct-to-consumer advertising of prescription medications include the whole acquisition cost (WAC or list price).  In a bit of good news, the U.S. District Court for the District of Columbia granted a motion to stay the implementation of the rule.  The Court did not address plaintiff’s argument that the rule was a violation of the First Amendment guarantee of free speech, but held that HHS lacks authority under the Social Security Act to regulate pharmaceutical marketing.

The Court ruling is not a final disposition of the issue as Senate Committee on Finance Chairman Charles Grassley, R-Iowa and Senate Minority Whip Richard Durbin, D-Ill. have introduced legislation to require the price disclosure in DTC advertising.

On July 25, the Senate Committee on Finance conducted a markup of The Prescription Drug Pricing Reduction Act.  The measure requires manufacturers to disclose the roles of many factors in setting the price for prescription drugs including “total costs for marketing and advertising the drug.”  Prior to the session, Senator Sherrod Brown, D-Ohio, filed an amendment to disallow the business expense tax deduction for the cost of DTC advertising.  Senator Brown did not formally offer the amendment so no vote on the measure was held.

Senator Kamala Harris, D-Calif., candidate for the Democratic nomination for President, has released a proposal assigning the Department of Health and Human Services the job of setting “fair” prescription drug prices.  If that fails to reduce prices, the proposal would tax profits from the drug at 100 percent. The Senator has said she wants to do away with pharmaceutical companies’ federal tax deduction for advertising.   Senator Harris is a cosponsor of the bill introduced by Senator Jeanne Shaheen (D-NH), entitled the “End Taxpayer Subsidies for Drug Ads Act.” Other presidential candidates who cosponsored that legislation include Sens. Kirsten Gillibrand, D-New York, Bernie Sanders, I-Vermont, Amy Klobuchar, D-Minn., Elizabeth Warren, D-Mass., and Michael Bennet, D-Colo..

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