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House Panel Rejects Drug Pricing Plan  09/16 06:16

   A House committee dealt an ominous if tentative blow Wednesday to President 
Joe Biden's huge social and environment package, derailing a money-saving plan 
to let Medicare negotiate the price it pays for prescription drugs.

   WASHINGTON (AP) -- A House committee dealt an ominous if tentative blow 
Wednesday to President Joe Biden's huge social and environment package, 
derailing a money-saving plan to let Medicare negotiate the price it pays for 
prescription drugs.

   The House Energy and Commerce Committee vote to drop the proposal from its 
piece of Biden's signature 10-year, $3.5 trillion spending plan was not 
necessarily fatal. The separate House Ways and Means Committee kept it alive by 
approving nearly identical drug-pricing language.

   Even so, the provision's rejection by one committee underscores the clout 
that moderates looking to curb new spending -- or any small group of Democrats 
-- have as Biden and party leaders try pushing the entire package through the 
narrowly divided Congress.

   Facing unanimous Republican opposition, Democrats will be able to lose just 
three House votes and none in the 50-50 Senate to send the overall measure to 
Biden. That's a precarious margin for what will be an enormous bill laced with 
numerous politically sensitive initiatives on spending and taxes.

   The committees' votes on pharmaceutical drugs came as Biden held 
face-to-face meetings with two moderate Democratic senators who've said the 
overall size of the $3.5 trillion proposal is too big. The separate sessions 
with Sens. Kyrsten Sinema of Arizona and Joe Manchin of West Virginia 
underscored a stepped-up White House drive to avoid Democratic defections.

   The Energy and Commerce vote on the drug-pricing language was 29-29, with 
three moderate Democrats joining Republicans to oppose it: Reps. Scott Peters 
of California, Kathleen Rice of New York and Kurt Schrader of Oregon. Tie votes 
in Congress are usually insufficient to keep legislative provisions alive.

   Henry Connelly, a spokesman for House Speaker Nancy Pelosi, D-Calif., said 
lowering drug costs "will remain a cornerstone" of the party's push for the 
overall bill, Biden's top domestic priority.

   Democrats are counting on the drug-pricing provisions to pay for a modest 
but significant part of their $3.5 trillion plan to bolster the safety net, 
address climate change and fund other programs. Proponents say it could save 
$600 billion over the coming decade.

   The legislation would authorize Medicare to negotiate with pharmaceutical 
companies, using lower prices paid in other economically advanced countries as 
a yardstick. The savings produced would be used to expand Medicare coverage by 
adding dental, vision and hearing benefits.

   The Energy and Commerce vote showed "real concerns with Speaker Pelosi's 
extreme drug pricing plan," Debra DeShong, top spokesperson for the 
Pharmaceutical Research and Manufacturers of America, said in a statement. The 
industry says the drug negotiation plan would lead to price controls that 
reduce investment in research into promising new cures and treatments.

   Senate Budget Committee Chairman Bernie Sanders, I-Vt., a leading champion 
of the drug-pricing effort, said there was "no excuse" for Democrats to bow to 
"the extremely greedy and powerful" pharmaceutical industry. "The American 
people will not accept surrender," he added.

   Biden's talks with Sinema and Manchin came as centrists' unrest over the 
overall bill's cost has prompted a delicate hunt by party leaders for a topline 
figure that moderate and progressive lawmakers can endorse.

   "Today's meeting was productive, and Kyrsten is continuing to work in good 
faith with her colleagues and President Biden as this legislation develops," 
said Sinema spokesman John Labombard said. His assessment was a positive sign 
in a process that has seen the party's progressives and moderates stake out 
conflicting demands.

   Biden and Democratic leaders endorsed the $3.5 trillion figure, but in 
recent days have been more cautious about its ultimate size. The enormous 
package faces unanimous opposition from Republicans, who say its proposals are 
wasteful and would wound the economy.

   The measure would push utilities to produce cleaner energy, expand Medicare 
coverage, create new child care and family leave programs and provide free 
pre-kindergarten and community college.

   There would be a slew of tax breaks to help families cope with the costs of 
health care and raising children. Much of it would be paid for by boosting 
taxes on the wealthy and corporations.

   By Wednesday evening, all 13 House committees with pieces of the overall 
social and environment bill had completed their work, meeting a goal set by 
Democratic leaders.

   House Budget Committee Chairman John Yarmuth, D-Ky., said in an interview 
Tuesday that his panel would be ready next week to combine all 13 sections and 
send the overall bill to the full House. That might be delayed as lawmakers 
wait for the nonpartisan Congressional Budget Office to produce a cost estimate 
for the legislation, Yarmuth said.

   The Senate has yet to produce its own legislation, but leaders and other 
senators have been in talks with the House. Differences remain over taxes, 
health programs and other issues.

   Democratic leaders would love to send completed legislation to Biden for his 
signature in the coming weeks, but many think resolving the policy and 
political complications the party faces will take much longer. White House 
press secretary Jen Psaki told reporters Wednesday that they expect Congress to 
move the legislation before an international climate conference in November.

   Manchin has been an especially outspoken critic of the overall bill. He's 
called for a "pause" on the legislation, and said Sunday that he could not 
support $3.5 trillion, suggesting instead a topline figure in the $1 trillion 
to $1.5 trillion range.

   Progressives, who initially demanded a $6 trillion plan, have said cutting 
the package to Manchin's range would be unacceptable.

   The House Ways and Means Committee approved its part of the overall bill 
24-19, with moderate Florida Rep. Stephanie Murphy the only Democratic voting 
no. She cited "spending and tax provisions that give me pause" but expressed 
optimism about supporting a final version.

   That panel's revenue package includes $2.1 trillion in higher taxes, mostly 
on the rich and corporations. It also claims savings from its drug-pricing 
language, stronger IRS tax enforcement and an assertion that the legislation 
itself would spark economic growth.

   Democrats ridiculed that claim when Republicans used it to claim past GOP 
tax cuts would be paid for.

   Democrats would raise the top income tax rate rise back to 39.6% on 
individuals earning more than $400,000, or $450,000 for couples. There would be 
a 3% surtax on wealthier Americans with adjusted gross income beyond $5 million 
a year.

   The proposal would lift the corporate tax rate from 21% to 26.5% on 
companies' annual income over $5 million.

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