Measuring the IRA's Impact on Innovation

My original intent was to launch Cost Curve with an issue of exclusively navel-gazing exposition, talking about what I’m trying to do (provide comprehensive curation with enough additional perspective to prompt conversation) and talk about the various sections (“The Arc” for deeper looks, “Quick Turns” for brief summaries, etc.).

But, naturally, there is already news I’m behind on, so it makes sense to jump right in. Here we go.

The item worth highlighting today is BIO-funded research out last week from Vital Transformation that tries to answer the question: how much will the Inflation Reduction Act impact innovation?

The Vital Transformation work suggests that the answer is “a lot.” If the law had been in place in 2014, the analysis posits that at least 24 medicines now on the market would never have been developed. Going forward, the research estimates that 139 would-be medicines won’t make it to market for IRA-related reasons over the next 10 years.

You can check the details here. There are other ways of looking at the “how many drugs will be lost” question, and I’d be remiss if I didn’t point out that industry skeptics have come to other conclusions.

But losing future innovation isn’t the only way that patients could be harmed by the IRA. There is now an incentive for companies to approach development in a way that keeps patients waiting.

So later this week -- unless I get knocked off track by breaking news -- I’ll look at the way that oncology drug development is already being scrambled. Part of that deep dive will be based on a new PhRMA-fundedstudy that dropped last Thursday. At the risk of scooping myself: it’s worth the read.

It’s possible that we’ll see the Vital Transformation/BIO research again this week. The annual BIO confab kicks off today, and IRA is on the agenda. Specifically, it’s on the agenda for Wednesday afternoon, when the head of Vital Transformation takes the stage, along with BIO’s chief advocacy officer and a Biogen exec.

The whole “value” track is probably worth a look, especially if you’re on the ground. I can’t be in Boston, so please hit me up with intel if you’re able to attend.

• Joe Grogan, a former Trump White House official, wrote an op-ed in the Washington Examiner warning Republicans to back off of efforts to regulate PBMs. Grogan has been on the record in support of PBMs before but -- somewhat confusingly -- has also fiercely backed the pharma position on the IRA.

• I’m a huge Lou Garrison fan, and the economist, along with the Office of Health Economics’ Adrian Towse, has a great piece out in Health Affairs Forefront today that makes the point that a focus on drug R&D costs -- mandated by the IRA -- is a dumb way of thinking about drug value. Garrison and Towse don’t actually say it’s “dumb” — they use “short-sighted” and “irrelevant” — but you get the idea.)

• There is good — if discouraging — stuff out of ASCO on prior authorizations, including some evidence that the use of prior auths for oral cancer meds has skyrocketed and a study that suggests that prior auths erode trust in both doctors and the system as a whole.

• WSJ’s Heard on the Street weighs in on Mark Cuban and biosimilar Humira.

• Prescription Drug Affordability Boards are low-key one of the most intriguing trends of 2023, and Axios took a look at what’s going on in Colorado, which looks to be the bellwether state for the approach.

• There is new data out on how much is being spent on medicines in the UK, maintaining the spotlight on how the country can balance its desire to keep drug spending flat without prompting drugmakers to avoid doing business in the UK.

“On Loop” is where I’m going to stick the short-form video content that I’m developing. The world might be awash in TikToks right now, but there is an alarming lack of 101-type content aimed at the average American.

If there is an element of the current health care system that deserve illumination, let me know.