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Senate Confirms Price for HHS, But Stock Deals Still Raise Questions

Xconomy National — 

The Senate confirmed Tom Price as Secretary of the U.S. Department of Health and Human Services early Friday morning by a 52-47 vote that, as expected, fell largely on party lines.

Price is an orthopedic surgeon by training who has been a member of Georgia’s congressional delegation since 2004. He will now oversee a department that includes the National Institutes of Health, the FDA, the Centers for Disease Control and Prevention, and the Centers for Medicare and Medicaid Services. In total, the department has an annual budget that tops $1 trillion.

While in Congress, Price has been an outspoken critic of the Affordable Care Act and he is now in a position to oversee its potential dismantling. Price sponsored one of several legislative measures to replace the ACA. His “Empowering Patients First Act” called for the full repeal of the law, along with the ACA’s Medicaid expansion. Price’s plan offered tax credits as a means for consumers to purchase insurance coverage.

In committee hearings prior to the Senate vote, Democrats pushed Price to guarantee that Republican plans to repeal and replace the ACA would guarantee that no one would lose insurance coverage. Price said that he would make sure that anyone who lost coverage would have access, and also said favors returning healthcare decisions to states and to physicians.

Price’s nomination, however, stirred up questions about potential conflicts of interest—specifically, the nature of the sale and purchase of some biotech and medical device stocks. In committee hearings, Democrats queried Price about whether he received inside information before buying stock in an Australian company, Innate Immunotherapeutics. They also questioned Price on the timing of stock purchases in Zimmer Biomet (NYSE: ZBH), a medical device company that benefitted from a bill he sponsored and voted on. Price denied any wrongdoing and said that his broker handled all of his stock purchases without his knowledge.

Still, questions about Price’s financial transactions haven’t gone away. During a three-year Securities and Exchange Commission investigation, Price made dozens of stock trades involving healthcare companies, Kaiser Health News reported Tuesday, citing the congressman’s financial disclosure records. Those trades happened while Price was serving on the House Ways and Means Committee, which was the focus of the SEC investigation. Price was not the target of the investigation and no charges were brought, however.

With Price’s confirmation secure, the life sciences industry now awaits the president’s choice for FDA commissioner. While a physician has historically held the top post at the FDA, President Trump has signaled interest in nominating an outsider. One of the names that has emerged as a possible choice is Jim O’Neill, a hedge fund manager and associate of libertarian investor Peter Thiel. O’Neill has raised eyebrows in life sciences circles for 2014 comments at a conference that the FDA should only review whether drugs are safe, leaving it to the market to decide whether they actually work. Another potential pick, Balaji Srinivasan, is a partner in venture capital firm Andreessen Horowitz.

The other potential candidates who have surfaced offer a mix of medical and investment experience. Scott Gottlieb, a physician and former deputy FDA commissioner, is reportedly among those in consideration. Gottlieb is also a venture partner at New Enterprise Associates. Joseph Gulfo, a physician, former biotech executive, and the executive director of the Lewis Center for Healthcare Innovation and Technology at Fairleigh Dickinson University, has also spoken with the Trump administration about the FDA commissioner post, according to published reports.

Photo of HHS by Flickr user Tim Evanson via a Creative Commons license.