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Incubate In the News

Incubate Coalition

Incubate's three-pronged mission is to foster innovation, safeguard medical advances, and amplify the results of life sciences investment. We advance this mission by educating lawmakers and the public about the role of venture capital in drug development.

 

This year, Incubate's executive director, John Stanford, had the opportunity to speak to numerous journalists from trade and national outlets about policy that protects the role of venture capital in the life sciences.

 

Follow along with Incubate's work and John's interviews on X: @incub8coalition

 

Small molecule penalty

 

The small molecule penalty refers to the discrepancy between how biologics and small molecule drugs are treated in the Inflation Reduction Act. Under the law, price controls for small molecule drugs kick in nine years following FDA approval, while biologics receive 13 years of protection.

 

Inside Drug Pricing (2/5/2024): John Stanford, executive director of the venture capital firm Incubate, says passing the EPIC Act would be one of the best ways to, in some part, counter the negative effect negotiation is expected to have on investment in small molecule drugsThe most important thing is that 50% of a drug's revenue comes in years 10 to 13, so it's not like all years are created equal. That's why this has such a damning impact if we don't fix it.

 

March-in

 

The Biden-Harris administration says it plans to revoke exclusive patent licenses for certain widely available medications arising from federally funded research. Officials say the move would reduce the cost of some "unreasonably priced" drugs. The move would break with decades of bipartisan precedent and signal to life sciences investors that patents held by universities and federal labs can't be relied on.

 

Reuters (1/2/2024): Industry analysts also said lingering investor concern about high interest rates and government scrutiny of drugmakers could hamper a full funding recovery... Incubate's Stanford said some investors may remain on the sidelines due to increased oversight of deals in the sector, the government's drug price negotiation plans and the threat that the Biden administration is looking to seize patents of medicines developed with government funding if the prices are deemed to be too high.

 

The Ensuring Pathway to Innovative Cures (EPIC) Act

 

The EPIC Act is a bipartisan bill that would make newly approved small molecules and biologics eligible for Medicare drug price negotiations on the same timeline.

 

Pharma Voice (2/6/2024): To mitigate the added risk for small molecule drugs, lawmakers in Congress have introduced a bipartisan bill to extend the small molecule exemption so it's equal to biologics. Incubate supports the bill, and Stanford said the equalization of the negotiation period would keep the investment thesis for small molecules on an even keel with the rest of the industry.

 

Medicare drug price controls:

 

On August 15, after nearly a year of back-and-forth with drug makers, the Centers for Medicare & Medicaid Services announced new, government-set prices for ten drugs covered under Medicare Part D. The new prices are set to take effect in 2026.[1] Price controls will apply to an expanding list of Part B and Part D drugs in the years ahead.

 

Investor's business daily (8/15/2024): Stanford said the list compares the negotiated price to the list price for each drug. But no patient pays the list price. Instead, patients pay a lower price that includes rebates and discounts. That's why it's hard to know how much money patients will actually save, he told Investor's Business Daily.

 

Axios vitals (5/14/2024): How will investors and drugmakers react? The release of the maximum fair drug prices could clarify how risk-averse large pharmaceutical companies need to be in future acquisitions of smaller biotech companies, said John Stanford, executive director of Incubate, the life sciences investor lobbying group.

 

Bloomberg Law (8/16/2024): Ultimately, we don't know how much they saved, Stanford said. He expressed skepticism as to whether patients would ultimately save money as well, noting that copays and premiums will ultimately complicate matters. The sad reality is that patients will not necessarily fare better off under this system, Stanford said.

 

Rare disease drug research and development:

 

The Inflation Reduction Act discourages drug makers from investigating whether an approved rare disease drug -- also known as an orphan drug -- is effective against additional rare diseases. Incubate supports legislation, such as the ORPHAN Cures Act, to ensure life-saving treatments benefit as many patient populations as possible.

 

Bloomberg Law (6/17/2024): Companies need what's going to give them the best bang for their buck and rare disease drugs are less likely to fit that. Rare disease and small-molecule drugs are still investable but they're hard to justify right now, Stanford said.

 


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