Development of non-opioid pain medicines threated by IRA’s ‘pill penalty’

The search for safer, effective replacements for opioids is a critical public health priority, but that effort is being undermined by the Inflation Reduction Act (IRA), which has added uncertainty to an already difficult scientific and regulatory challenge.

Effective pain medicines generally must be small molecules, a key attribute that helps the therapies cross the blood-brain barrier to access the nervous system.

The IRA, however, offers less protection to small molecules than it does to biologics.

• Small molecules may have their prices “negotiated” after only seven years on the market, whereas biologics have an 11-year reprieve before the process of implementing price controls begins. The gap between the two different types of medicines is known as the “pill penalty,” because of the way that small molecules—usually taken by mouth—are afforded less protection.
• A Pioneer Institute report suggested that this disparity—“contradicting every other federal policy on opioids”—would discourage the development of small-molecule non-opioid pain drugs.

Even before the IRA, the development of non-opioid pain medicines was faltering.

• A 2023 Biotechnology Innovation Organization (BIO) analysis found, “The industry-wide clinical pipeline for pain therapeutics consists of 124 active clinical-stage drug programs vs 220 in our report five years ago, a decline of 44%.” A similar decline was seen when only novel chemical entities were considered.
• The Pioneer Institute further analyzed the R&D pipeline, suggesting only nine viable opioid replacements are in clinical testing, a number that shows how vulnerable the pipeline is. Without additional incentives, that number may shrink further, the authors warned.
• The success rate for pain medicines lags behind other therapeutic areas, further discouraging investment and explaining the slide in the number of programs and the degree of funding.

Yet the need remains high. Effective pain control is an unmet need, and the cost of opioid-related addiction is staggering. A Milliman report prepared for the Society of Actuaries pegged the cost of the opioid epidemic between 2015 and 2018 at more than $600 billion, a far greater sum than the IRA is projected to save.

BIO’s View: Commercial decision-making is sensitive to incentives, which send signals about how and where innovation will be supported. Federal policy, however, is discouraging the development of small molecule, non-opioid pain medicines, offering such medicines considerably less protection from the Inflation Reduction Act’s price controls. That misaligned incentive jeopardizes one of the most important public health priorities in the country and underscores the need for common-sense fixes to the IRA.