What we know (so far) the day after the midterms

While midterms results are still being tallied, we know a few key election results—and these results can give us some early insight into the political landscape in the near future and what the biotech industry can expect from Congress and the state legislatures in 2023 and beyond.

Pennsylvania and the U.S. Senate

As we noted yesterday, Pennsylvania is important for its impact on the biotech industry and what it tells us about the political landscape.

In the race for Pennsylvania’s open Senate seat being vacated by Sen. Pat Toomey (R-PA), Democrat John Fetterman defeated Republican Mehmet Oz (“Dr. Oz”). The biotech industry lost a strong ally with the retirement of Sen. Toomey, who was recognized by the Biotechnology Innovation Organization (BIO) in 2015 for his support for the sector.

Fetterman has been critical of “pharmaceutical companies that jack up the prices.”

As of this writing, control of the U.S. Senate is still up for grabs. Keep an eye on Georgia’s Senate race, where incumbent Democrat Sen. Raphael Warnock is neck and neck with Republican challenger Herschel Walker. If neither candidate reaches 50%, the race will go to a run-off on Dec. 6.

No ‘red wave’ in the U.S. House

Despite predictions of a “red wave” in the U.S. House races, Democrats have managed to hold or win several closely watched races. As of this writing, Republicans are still favored to win control of the House, but it’s by no means a wave, as POLITICO reported Wednesday morning.

BIO and the organization’s consultants watched three competitive Virginia races for signs of a wave. Democrat Reps. Abigail Spanberger (VA-7) and Jennifer Wexton (VA-10) held their seats against their Republican challengers, though Rep. Elaine Luria (VA-2) lost to Republican Jen Kiggans.

Democrats held seats in competitive races in New Hampshire, another state BIO’s consultants were watching closely.

What the election results mean for biotech

“The biotech industry likely will face continued strong headwinds if Democrats control the House and Senate,” said G. Hunter Bates, Partner at Akin Gump Strauss Hauer & Feld LLP, a consultant to BIO. “The most important biotech development on election night is whether Republicans flip either the House and/or the Senate, which would tip the balance in Congress more towards a pro-innovation policy agenda in contrast to the recent focus on price controls by Democrats.”

As we noted, this scenario is unlikely, and there’s a good chance Republicans will take the House and/or the Senate.

If Republicans take one or both chambers, “there will be pressure on Democrat leadership to get as much done as they can before they lose their majorities,” said experts at Todd Strategy Group. “But there are a number of ‘must-pass’ bills that need to get done, all of which will gobble up some floor time,” including the National Defense Authorization Act (NDAA) and government funding, which expires Dec. 16.

Regardless of the outcome, the biotech industry will need to spend time educating new (and returning) Members of Congress, said BIO Chair Paul Hastings, CEO of Nkarta Therapeutics.

He said we need to spend time meeting with freshmen Members of Congress and those who have been in office for a while to help them understand the health care ecosystem and how the industry works. “Being here and being present and spending that time is going to be really important.”

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What happened in the state-level midterms?

Early Wednesday, we caught up with Patrick Plues, BIO’s VP of State Government Affairs, to find out what we know about state-level elections.

Most incumbent governors held on to their seats, including Democrats Evers (Wisconsin), Whitmer (Michigan), and Lujan-Grisham (New Mexico).

Democrats won several closely watched gubernatorial races, as well.

In Pennsylvania, for example, Josh Shapiro trounced his Republican opponent, Doug Mastriano. And Democrats picked up two governorships previously held by Republicans: Maura Healy in Massachusetts and Wes Moore in Maryland.

Finally, New York Governor Hochul beat her Republican challenger to become New York’s first woman to be elected governor.

Republicans held most of their states except Massachusetts and Maryland. Florida Gov. Ron DeSantis crushed his Democrat opponent, Charlie Crist, as did Ohio Gov. Mike DeWine. In Georgia, Brian Kemp handily beat Stacey Abrams.

Several gubernatorial races, including closely watched Arizona, Nevada, and Oregon, are too close to call as of this writing.

Both chambers of the Michigan Legislature flipped from Republican control to Democrat control for the first time in 40 years, thereby creating a trifecta in the state where Democrats have total control.

What’s important for biotech to know? First, Democrats won in biotech-heavy states. California, Massachusetts, Illinois, New Jersey, New York, North Carolina, and Pennsylvania will have Democrat governors. Second, state-level ballot measures, particularly related to access to health care, brought people to the polls—especially in Michigan (abortion rights), Oregon (the right to health care), and South Dakota (Medicaid expansion). Axios explains in more detail.

Watch Good Day BIO and Bio.News for more analysis of the results as we have them and what biotech needs to know ahead of 2023.

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