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BIO’s Phyllis Arthur will testify at the House Energy and Commerce Health Subcommittee about pandemic preparedness—we’ll recap tomorrow. In the meantime, Merck and the U.S. Chamber of Commerce filed lawsuits calling the drug price controls unconstitutional, and BIO and CSBA released a report highlighting best practices to grow their bioscience sectors. (736 words, 3 minutes, 40 seconds) |
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What to know about the price controls lawsuits |
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ICYMI: Merck & Co. and the U.S. Chamber of Commerce filed lawsuits last week seeking to halt the drug price controls established by the Inflation Reduction Act (IRA)—here’s what you need to know. Catch up: The IRA permits the Centers for Medicare and Medicaid Services (CMS) to negotiate the prices for certain drugs covered by Medicare, but the terms of the "negotiation" make it clear that the agency will actually be establishing price caps. The first 10 drugs will be named in September for price controls starting in 2026; the number of drugs will expand every year—and we’re already seeing the impact on innovation.
It’s unconstitutional, said lawsuits filed by Merck and the U.S. Chamber, because the law forces companies to accept prices set by CMS.
What Merck’s saying: The lawsuit, filed June 6, says the law violates the Fifth Amendment, which requires fair compensation when the government takes private property for public use, and the First Amendment, by making companies sign an agreement calling the prices fair, Reuters reports.
What the U.S. Chamber’s saying: “Congress created an unprecedented, one-sided regime that forces manufacturers to sell drugs at government-set prices,” argues the Chamber of Commerce lawsuit filed Friday. “The appropriate term for this is ‘mandated price control,’ not ‘negotiation.’”
Why it matters: Price controls will lead to fewer new drugs, say the lawsuits, as well as a recent Vital Transformation report, which found as many as 139 therapies may not be developed over the next 10 years.
The bottom line: "The Inflation Reduction Act couldn’t risk allowing genuine bargaining, on the chance that companies might choose not to sell their medicines at a money-losing price, leaving senior citizens without certain medications. Instead, Congress imposed an unconstitutional process. One can only hope that the courts won’t acquiesce in this charade. If they do, it will harm all Americans by dramatically diminishing incentives for companies to invest in new lifesaving therapies," writes Daniel E. Troy, former chief counsel of the Food and Drug Administration and a former general counsel of GSK.
More Reading:BIO panels break down IRA’s challenges for drug makers and patients |
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How can states grow their biosciences sectors? |
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In 2021, the biosciences sector grew its employment base by 1.4%—to more than 2.1 million jobs and 127,000+ business establishments nationwide. At the same time, the overall private sector employment base saw a 5.1% decline. A new report explores how states can help the bioscience sector continue to grow. The report:The U.S. Biosciences Industry in the States: Best Practices in Innovation, Partnerships, and Job Creation, produced by BIO and the Council of State Bioscience Associations (CSBA), analyzes state and regional policies that support the bioscience sector. 1. Building career pathways for future biosciences talent is crucial.
“Attracting and retaining a continuing flow of educated (Ph.D., MS, BS, AA) and technically-proficient workers is essential to a state aspiring to enhance a biosciences industry presence,” says the report.
2. States and regions are committed to biotech industry stability.
“This report confirms the vital role U.S. biosciences companies have in creating jobs and stimulating the economy, and illustrates the continuation of the increasingly supportive role that state and regional policymakers are playing in company retention and expansion in their locations,” explains BIO Senior Policy Adviser Pete Pellerito, the principal author of the report. |
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3. Innovative tax support strategies are on the rise. “Supportive measures include investor tax credits to spur more early-stage investment in Biosciences companies, and seed funds to bridge the funding gap for companies as they develop and advance their technologies, conduct initial research, and establish proof of concept before attracting larger investments,” says the report.
4. Universities and research centers remain strong partners.
“Thanks to a coalition of industry and university technology transfer groups across the nation that have provided strong support for enhanced federal legislation, including the Bayh-Dole Act of 1980, U.S. colleges and universities continue to be the international leaders in generating cutting-edge basic research and creating companies from that research effort,” says the report. Read more about the report in Bio.News. More Reading:Building a state and regional advocacy arm is critical to success, said a panel of experts at the BIO International Convention |
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