UPDATE 3-U.S. investigative panel to look into drug pricing next year

(Recasts with oversight committee plan to hold hearing)
By Sarah N. Lynch
WASHINGTON, Nov 16 (Reuters) - A U.S. House of
Representatives investigative panel said it plans to hold a 2016
hearing on skyrocketing drug costs, a move that comes at a time
when Valeant Pharmaceuticals (N:VRX) International is facing increased
scrutiny into its pricing practices.
A spokeswoman for the U.S. House Committee on Oversight &
Government Reform said on Monday the panel is conducting a
thorough investigation into drug pricing and has reached out to
drug companies to gather information.
Earlier this month, the U.S. Senate Special Committee on
Aging launched a new probe into drug pricing at Valeant VRX.TO
VRX.N and Turing, signaling growing bipartisan agreement on
the need to review the rising cost of prescription drugs in the
United States.
Democratic members have pressed House Oversight Chairman
Jason Chaffetz, a Republican, for months to invite Valeant Chief
Executive J. Michael Pearson (L:PSON) to testify at a hearing over his
company's massive price increases of two heart medicines.
The top Democrat on the investigative panel, Elijah
Cummings, had previously urged the panel to subpoena Valeant. On
Monday, Cummings also sent a letter to Pearson requesting
interviews with a handful of Valeant executives who were
directly involved in the operations of specialty pharmacy
Philidor Rx Services.
According to a letter seen by Reuters, Cummings asked
Pearson to make employees Gary Tanner, Bijal Patel and Alison
Pritchett available for "transcribed" interviews.
"Troubling new allegations suggest that a group of Valeant
employees helped launch Philidor's business in 2013 and have
remained involved in its daily operations," Cummings wrote.
"These allegations suggest that Valeant employees may have
been personally involved in questionable billing practices that
led Valeant to cut ties with Philidor last month."
Valeant is reviewing the letter and will respond, Valeant
spokeswoman Laurie Little said in an e-mailed statement.
"As we have said previously, Valeant's board of directors
has formed an ad hoc committee to review allegations related to
the company's business relationship with Philidor and related
matters."
Cummings' letter came just a few days after Reuters reported
about how several top Valeant employees worked closely with the
founders of Philidor to set up the business and expand its
operations.
Two Valeant employees, for instance, were copied on a
November 2014 email which contained an attachment explaining how
Philidor employees could bill the highest amount an insurance
company was willing to pay by resubmitting rejected claims at
different price points.
The email, reviewed by Reuters, was sent to Tanner and
Patel, who both used pseudonyms for their communications within
Philidor. Reuters also reported that Pritchett was involved in
building relationships with specialty pharmacies.
Valeant first disclosed its ties to Philidor late last
month, amid concerns over the pharmacy's tactics to get insurers
to pay for Valeant medications. It has since severed ties with
the pharmacy, saying it has "lost confidence" in Philidor after
questions about its business practices.
Committee spokeswoman MJ Henshaw said the panel is still in
fact-finding mode and "at this point we don't feel that a
subpoena is a necessary step that needs to be taken."
Valeant is also facing investigations by prosecutors in New
York and Massachusetts over its drug pricing and programs that
provide financial assistance to help patients cover
out-of-pocket expenses for their medications.