With considerable fanfare this past February, the White House
announced
it was “reigniting” one of then-Vice President
Joe Biden
’s signature issues: the so-called cancer moonshot, which is supposed to “end cancer as we know it.”
Six short months later, the president signed the Inflation Reduction Act (IRA), a law that will discourage cancer research more than any other federal law ever enacted.
The IRA allows the federal government to set prices for the 60 top-selling drugs in the
Medicare
program for the first time. As most economists understand, price controls create scarcity, so the overall impact of the law will be fewer new drugs, including cancer drugs.
Less discussed, however, are the fine print provisions of the IRA that are particularly harmful to cancer research. One provision, for example, allows the federal government to set prices on small molecule drugs only 9 years after they are launched, compared to large molecules (sometimes called “biologics”), which will get 13 years of immunity from price controls.
While there are some biologics that work well against cancer, small molecule drugs have certain advantages in treating cancer. As one biotech expert
points out
, “Small molecules can hit targets inside cells and cross the blood-brain barrier more easily than biologics.”
In other words, the IRA creates a disincentive to invest in the research and development of small molecule drugs — a move that is antithetical to curing cancer.
This disincentive is already at work. Just this month, Eli Lilly canceled a research project into a small molecule blood cancer drug, citing the IRA. Lilly’s
statement
read, “The IRA changes many dynamics for small molecules in oncology and when we integrated those changes with this program and its competitive landscape, the program’s future investment no longer met our threshold.”
It is also possible that, since price controls will apply in the Medicare program that covers older Americans, cancer R&D will shift to childhood cancers where new therapies will not be subject to Medicare’s price controls, and research on cancers that typically impact older Americans will likely move to the back of the R&D line.
A second provision of the IRA will likely discourage research into certain rare cancers. The provision exempts orphan drugs with only one indication from price controls. That is, if a company successfully pursues research to prove the drug works on a second disease, i.e., a second indication, the drug becomes eligible for price controls.
This is a particularly harmful provision for
cancer
research, as many cancer drugs work effectively on more than one type of cancer, and many cancer drugs become commercially viable when they secure multiple indications. It is not uncommon for companies that successfully bring a cancer drug to market to quickly pivot and begin clinical trials for that drug on other types of cancer. Under the IRA, companies that pursue those projects are potentially subjecting their drug to government price controls.
Once again, we have already seen an important research project canceled because of this provision. Massachusetts-based biotech company Alnylam successfully secured FDA approval for Amvuttra to treat a rare heart condition. Amvuttra was also thought to be a promising therapy for Stargardt disease, a rare genetic eye disease that can cause vision loss. But there will be no trials to test Amvuttra on Stargardt patients since, as the company’s CEO noted on a
call
with the media, a drug “with one single orphan designation is exempt from potential price negotiations.”
Sure, Amvuttra is not a cancer drug, but the same logic and disincentive will apply to the pursuit of research on additional rare cancer indications.
What is most discouraging about the harmful impacts of the IRA on cancer research is that, before its passage, we were witnessing a booming ecosystem of oncology innovation. As the pharmaceutical consulting firm, IQVIA,
described
the situation prior to the IRA, “Global oncology is witnessing a remarkable surge in R&D and innovation, potentially leading to new therapies for unresolved cancers and including some of the most advanced breakthrough science in the life sciences. These therapies represent the largest area of collective research and the largest overall area by drug spending in the world.”
While one can hope that the president’s moonshot succeeds, his embrace of the IRA makes such success less likely.
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William S. Smith, Ph.D., is senior fellow and director of the Life Sciences Initiative at Pioneer Institute in Boston.
