Skip to content
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, panelists told the BIO CEO & Investor Conference in New York.
“The pace is just different. You know this is not federal government, as usual—that’s boring,” 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.”
We’re paying attention to a flurry of announcements, including on social media, but much of it can be hyperbole, just designed to start a conversation, according to participants in “Policy Outlook: Navigating a New Congress and Executive Branch,” the Feb. 11 panel hosted by Anna Abram, Senior Advisor, Health Care Policy and Legislation, Akin.
As for actions they really expected to be taken, panelists said it was hard to be sure, but they anticipate moves in deregulation. They also anticipated a price control debate that gets pushed down to the state level, and recommended patients as allies in that debate.
Benefits of speedy reform
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 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 reform around the Inflation Reduction Act (IRA) and the overall issue of drug price controls, the panelists saw threats, and some 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,” which is why we’ve seen investors turn away from small molecule drugs, she said. She expressed optimism 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 Bayh-Dole “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.
Brim suggested the possibility that Trump may be more enthusiastic about price controls than in his first term.
“We do know that President Trump loves to take credit for things. So I imagine he’s going to adopt the IRA as his own,” Brim said. “He made a comment toward the end of the campaign that he was going to be the one to finally bring down the price of GLP-1s”
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 the PBM reform proposals that were so popular in the previous Congress are not likely to be put on the floor of Congress in the early part of this year.
The Republicans’ apparent plan, according to Brim, is to use the budget reconciliation process to pass legislation. That would make passing their proposals easier, but it would mean the party is focused on spending legislation until the budget is passed.
Trump has other areas where he wants to spend money, including on tax cuts. “So 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 anticipated 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, 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 policy makers 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.”
