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Seeking biotech-friendly policy from the new administration and Congress will be daunting and perhaps confusing, but there are still a lot of potential wins to be had, said experts at the 2025 Biotechnology Innovation Organization (BIO) CEO and Investor Conference in New York.
“The pace is just different. You know this is not federal government as usual,” said Remy Brim, Principal, Health Care Practice Head, BGR Government Affairs, LLC. “I think we just need to get used to that pace and not get distracted and continue to look at what our long-term objectives are.”
Bio.News interview with Pete Norman of Alkermes
She spoke during a Feb. 11 panel, “Policy Outlook: Navigating a New Congress and Executive Branch,” moderated by Anna Abram, Senior Advisor, Health Care Policy and Legislation, Akin.
Panelists said it is hard to be sure what actions will be taken, but they anticipate moves in deregulation. They also anticipate a price controls debate that gets pushed down to the state level, and recommended patients be allies in that debate.
‘A reset of what efficient government looks like’
The effort to achieve dramatic change could be beneficial, as the administration’s plan for sweeping change provides an opportunity to speed government with streamlined regulation.
“It’s a reset of what efficient government looks like,” said Pete Norman, SVP, Policy and Government Relations, at Alkermes, Inc. He said efforts to make big changes in efficiency in Medicare and the Food and Drug Administration (FDA) could be beneficial for biotechnology.
Brim agreed that there could be upsides to deregulation and a focus on reducing government obstacles. She said the FDA would be encouraged to change its outlook so it better appreciates the social cost of taking too long to approve drugs that are ready and needed.
Lindsay Androski, CEO of Roivant Social Ventures, also noted the potential for benefits from faster change among regulators.
“A couple of years ago, Congress gave the green light to the FDA to start incorporating more tech-enabled advances in drug development, but the FDA has been a little slow to do that so far,” she said, adding that improvements like eliminating animal testing in favor of organs on a chip or other technologies would benefit biotech.
“People are expecting cuts, but a flip side of fewer resources is that you have to be more efficient with the resources you have,” she said.
IRA and drug pricing
When it comes to the Inflation Reduction Act (IRA) and drug price controls, the panelists saw both threats and potential upsides.
Androski noted the IRA brought in a “pill penalty” by reducing the period of price control exemption for small molecule drugs in comparison to other drugs.
“Capital is like water, it’s going to go through the easiest path,” she said, which is why we’ve seen investors turn away from small-molecule drugs. She is optimistic that the new leadership would have an appetite to fix that.
Still, she said, the first Trump administration made it clear they favor drug price controls, and there are signs they could consider using the Bayh-Dole Act “march in rights” to take away patents as a means of price controls.
“From our perspective, it would be disastrous” to allow alterations in patent rights, which provide a guarantee that investors need, Androski said.
Reconciliation puts focus on Medicaid cuts
While Androski said that the real way to cut prices is to go after pharmacy benefit managers (PBMs), Brim said that the PBM reform proposals that were popular in the previous Congress are not likely to go to the floor in the early part of this year.
According to Brim, the Republicans could use the budget reconciliation process to pass legislation. This means they would focus on spending legislation until the budget is passed.
President Trump has other areas where he wants to spend money, including tax cuts. “Health care spending is being considered as a way to pay for all of these other things, so Medicaid cuts are being floated,” Brim said.
As far as action on PBMs, Brim said that’s possible but not likely by year’s end.
Norman agreed that the administration will be looking to save money on health costs, and anticipated proposals for Medicaid reforms in 2025 that could take effect in 2027. That could mean states take dramatic steps, such as spending caps, which would impact prices and investment decisions projected in 2027.
“If Medicaid is rewritten, the drug pricing debate that we’ve seen so hot on Capitol Hill in the past five years, I think you’re going to see it white hot in the states,” he said. He anticipates state governments pushing for state-level price controls, but a lot of push back as well.
“I think what we’re actually seeing, which is the exciting part, is really a historical reform, going from the Capitol all the way down to the states, and you’re really going to see what the value of medicines is to society,” Norman said. “It’s an opportunity to actually have a real conversation about the value of medicine in the healthcare system.”
When it comes to a state-level debate, the work of the Council of State Bioscience Associations (CSBA), comprised of 49 state groups affiliated with BIO, will be essential, according to Michelle Oshman, BIO’s SVP, External Affairs, and Head, Patient Advocacy Center of Excellence.
She said the trust that those groups have built on the state level could be essential.
Patients as allies
Another key group of allies in the debate, especially on the state level, are patients and patient advocate groups, Oshman said.
“You won’t find a more passionate group of individuals than people with lived experience as patients,” she said. “It’s never too early to incorporate the patient in your work, even if you’re still in the discovery phase. It’s really important to work with a community and understand from the patient perspective what you’re looking for.”
Brim agreed that patients are the best placed to explain the needs of modern drug development to policymakers and regulators. Many new drugs are not complete cures, but they improve people’s lives, and regulators need to know the importance of incremental improvement.
When it comes to explaining the importance of new drugs, “no one else has that patients’ level of experience,” she said. “They have to be a part of that culture from the beginning.”
