IRA Impacts: Cancer treatment research and development

The president’s recent budget indicates that despite the administration’s intent to further reduce cancer deaths, his policy recommendations are much more likely to halt progress in its tracks.

Portrait of Andrew Powaleny
Andrew PowalenyMarch 23, 2023

IRA Impacts: Cancer treatment research and development.

Last month marked the one-year anniversary of the reignited Cancer Moonshot, the White House’s ambitious goal of reducing the death rate from cancer by at least 50% over the next 25 years. Much of the positive trends in declining cancer mortality, down 33% since peaking in 1991, is driven in large part by innovative medicines researched and developed by America’s biopharmaceutical companies. But more needs to be done. Eradicating the hundreds of different diseases that make up cancer is a commitment we share with the administration, and the science has never been more promising.

Unfortunately, price setting provisions in the Inflation Reduction Act (IRA) could jeopardize future progress in cancer research. While the IRA took critical steps to improve affordability, some of its policies will have unintended consequences on the development of treatment options for cancer patients. Given the law is already forcing companies to make difficult decisions about R&D, the details of how it will be implemented are critical to patients and those who develop lifesaving cures and treatments. Here are three things to know: 

  1. Parts of the law discourage the development of medicines that come in pill or tablet form, often referred to as small molecule medicines, which are an important part of the cancer treatment arsenal. Under the law, the government can now start the process for price setting small molecule medicines as early as seven years and impose a set price as early as nine years after these types of medicines are first approved. This short timeline demonstrates how the government fails to recognize the importance of small molecule medicines and the real-life impact they can have on patients. As more has been learned about the molecular and genetic underpinnings of cancer, targeted small molecules have emerged as a critical tool due to their unique ability to target specific processes inside cells that allow tumors to grow and spread throughout the body. These medicines provide enormous benefits, not only because they target specific characteristics of an individual patient’s cancer cells, including genetic characteristics, but they may be taken orally which provides great convenience to patients who may otherwise be required to travel to receive regular infusions at an infusion center. The majority of cancer medicines approved by the U.S. Food and Drug Administration (FDA) today are small molecule medicines. Having a broad range of small molecule medicines, along with large molecule medicines (or biologics) which also serve unique and indispensable roles in the treatment of cancer, will remain critical to continuing to advance our collective cancer treatment arsenal and efforts to drive down cancer mortality in the years ahead. Unfortunately, the price setting provisions in the IRA specifically hinder their development.

  2. While biopharmaceutical companies are committed to continued R&D, they are already having to make hard choices about their investments as a result of the new law. Because the price setting provisions rely on arbitrarily predefined times after a medicine is initially approved to impose a government set price, companies are having to rethink how and where they invest in medical innovation. Some companies are having to cut certain projects or reconsider whether they can continue to pursue what may have been promising scientific leads. A recent survey of PhRMA member companies showed that, when asked if they expect to shift R&D investment focus away from small molecule medicines, 63% of those who responded to the question said yes. Of companies surveyed, 89% said they expect “substantial” impacts on pipeline projects for diseases including cancer. With the IRA, the government is telling companies they can no longer follow promising science due to arbitrary price-setting timelines, discouraging the development of some types of medicines and treatments for certain patient populations.

  3. The price setting provisions in the IRA put at risk the necessary research conducted on cancer medicines after they are first approved by the FDA especially for small molecule medicines. Because small molecule medicines can be selected for price setting so soon after initial approval, companies are discouraged from conducting critical R&D that continues in the years following approval. This post-approval R&D often results in real innovations that can improve patients’ lives. In fact, more than 60% of oncology medicines approved a decade ago received approvals for additional indications in later years, and most of those occurred seven or more years after initial FDA approval. Subjecting medicines to price setting so soon after they’re approved puts this much-needed R&D in jeopardy.  

The president’s recent budget indicates that despite the administration’s intent to further reduce cancer deaths, his policy recommendations are much more likely to halt progress in its tracks. Instead, Congress should make it a priority to preserve innovation in lifesaving treatments and medicines for hard-to-treat rare diseases and cancer. America’s biopharmaceutical companies have a critical role to play in making the Cancer Moonshot a reality, and we will continue to fight for policies that lower what patients pay out of pocket and that protect future biopharmaceutical R&D for patients with a wide range of cancers. For more information, visit phrma.org/cancer.

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