Good Day BIO: Senate passes drug price controls

The Senate passed innovation-killing drug price controls yesterday—here’s what you need to know about the legislation and what’s expected to happen next. Plus, with drought ravaging the U.S., we look at biotech solutions and the policy needed to deploy them. (823 words, 4 minutes, 6 seconds)

Senate passes innovation-killing drug price controls

The Senate yesterday passed drug price controls as part of its $740 billion reconciliation package, with all Democrats supporting the bill and all Republicans voting against it. 

The details: As passed by the Senate on Sunday, the Inflation Reduction Act would impose government price controls on drugs for which Medicare spends the most each year. The bill would regulate 20 drugs annually by 2029, and 45% of the drugs covered under Medicare Part B and D are likely to be included in the 100 drugs regulated between 2026-2031, an Avalere analysis found.

The impact: Limits on revenue imposed by the legislation will remove incentives to invest in R&D and innovation, BIO has explained. The result will be fewer cures and a loss of jobs and investments as the U.S. biopharma sector shrinks.

The likely targets: Among the first drugs regulated could be blood thinner Eliquis, cancer medication Imbruvica, and diabetes and obesity drug Ozempic, SVB Securities told investors, according to The New York Times.

Last-minute changes: On Saturday, the Senate Parliamentarian ruled that a provision forcing drug makers to pay rebates for price increases that exceed inflation could only apply to drug purchases by Medicare, not private insurers. However, most drug-pricing provisions remained in the bill.

BIO's view: “Nothing we heard from the lengthy floor debate on the Senate floor over the past two days can take away from the fact that every credible analysis of the Inflation Reduction Act comes to the same conclusion: fewer cures for patients. For that reason, we remain in staunch opposition to the government price control schemes included in the final reconciliation package passed today,” BIO President and CEO Dr. Michelle McMurry-Heath said in a statement yesterday.

Next steps: The bill is expected to be supported by the Democrat-controlled House, where Speaker Nancy Pelosi promised swift action, with a vote possibly coming by Friday.

More Health Care News: 

FDA: FDA approves first targeted therapy for HER2-low breast cancer
“It is estimated that 287,850 new cases of female breast cancer will be diagnosed in 2022 in the U.S. Approximately 80-85% of those new cases were previously considered to be HER2-negative subtype (including hormone receptor positive and triple negative breast cancer), which means the tumors do not overexpress, or make too many copies of the HER2 protein.”

Vital Health Podcast: Michele Oshman – Driving Innovation for the U.S.’ Biotech State Associations
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As drought ravages U.S., biotech is urgently needed

Drought is the new normal in the United States, impacting “43.16% of the U.S. and 51.39% of the lower 48 states” according to the National Integrated Drought Information System (NIDIS). We urgently need to deploy biotech solutions.

The situation: While a multiyear “megadrought” is impacting many western states, “flash droughts” caused by heat waves and low precipitation are hitting the Northeast—where several cities broke heat records—and Texas, where cattle ranchers are forced to sell livestock that they cannot keep alive. 

Expect continued drought conditions through the fall, says the National Weather Service.

But scientists called it—warning us for a long time about extreme weather, though the pace of change has surprised experts, Nature reports.

Biotech can help,we’ve reported—by reducing dependence on fossil fuels, by improving carbon sequestration, and by using less water for agriculture, as explained in a recent report by BIO. Gene editing also helps produce rice and other crops that are better able to withstand drought.

And policy can help us deploy these solutions:

• Congress is currently considering a bipartisan proposal that would improve regulation of biostimulants, which can improve natural plant nutritional processes, such as by enhancing nutrient uptake and efficiency, tolerance to heat or drought, crop quality, and yield.
• The reintroduced Growing Climate Solutions Act would create a voluntary, producer-led carbon sequestration certification program at the U.S. Department of Agriculture (USDA) and give farmers technical resources to participate in carbon markets.

Meanwhile: We can’t ignore the Inflation Reduction Act, which—while it includes harmful drug price controls that must be stopped—also includes climate measures expected to reduce emissions 40% below 2005 levels by 2030, per Bloomberg.

More Agriculture and Environment News: 

The Center Square: Illinois biofuel industry a jobs creator, new DOE report finds
“In 2021, 307 new jobs were added in Illinois, an increase of 4.6% over 2020, the 2022 United States Energy and Employment Report (USEER) said.” 

President Biden’s Monday: Flying with the First Lady to Chavies, Kentucky, to survey flood damage and speak to families impacted by the flood, ABC News reports. Meanwhile, the Biden administration is expected to extend the COVID-19 health emergency, “ensuring that federal measures expanding access to health coverage, vaccines, and treatments remain in place beyond the midterm elections,” POLITICO exclusively reports.

What’s Happening on Capitol Hill: It’s technically recess, but we’ll be watching to see what happens with drug price controls now that the bill has passed the Senate.