U.S. Senate Passes the Inflation Reduction Act of 2022 |
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The United States Senate voted to approve the broad legislative package on Sunday afternoon following over 24 hours of debate and a “vote-a-rama” during which hundreds of amendments were proposed — most of which failed to be adopted. Prior to the final vote on the bill, the Parliamentarian evaluated its provisions and determined that several related to drug pricing were out of order.
Under the first of those revisions, while the bill still requires manufacturers to pay rebates to Medicare if prices rise above the rate of inflation, the private market is now excluded from this provision. Similarly, the Parliamentarian ruled that the $35 cap for insulin prices under private insurance should be struck from the bill while sustaining the cap for Medicare beneficiaries. While a motion was proposed to waive budget limits to implement the initial provision, it fell 3 votes short of the 60-vote threshold needed following a point of order raised by Senator Lindsay Graham (R-SC).
The final two amendments that were adopted prior to the passage of the bill are also worth noting, as their adoption resulted in an increased likelihood of the IRA being passed by the House. An amendment by Senator Thune (R-SD) would have extended the limitation on the SALT deduction, a concern voiced in the past by several members of the House, several of whom are members of the New Jersey delegation, including Representatives Josh Gottheimer (D-NJ) and Mikie Sherill (D-NJ). However, immediately following its adoption, an amendment by Senator Warner (D-VA) replaced that extended limitation on the SALT deduction with an alternative source of revenue. Given that the SALT deduction has been one of the few outstanding public sources of potential opposition in the House among Democrats, this final amendment is expected to all but guarantee the passage of the Inflation Reduction Act in the House.
Several amendments that were proposed and failed to be adopted are noteworthy for their relevance to the life sciences:
- Sen. Cassidy (LA), exempting oral cancer drugs from the negotiation title
- Sen. Blackburn (TN), relating to reimbursement and treatment of biosimilars under the negotiation title
- Sen. Young (IN), Motion to Commit the bill back to Committee with the goal of exempting antibiotics from the negotiation title
- Sen. Marshall (KS), PBM reimbursement reform (related to fees)
- Sen. Tillis (NC), making permanent the small biotech exemptions to the negotiation title
- Sen. Tillis (NC), exempting innovative genetically targeted therapies from the negotiation title
- Sen. Tillis (NC), exempting vaccines from the negotiation title
- Sen. Tillis (NC), equalizing small versus large molecules
- Sen. Cramer (ND), striking the prohibition on judicial review in the legislation
- Sen. Barrasso (WY), addressing concerns related to provider reimbursement under the ASP system
The House is expected to vote on the bill this Friday, August 12. BioNJ has engaged in multiple outreach efforts to the New Jersey delegation to convey the ramifications that this legislation will have for the life sciences sector. We will continue to emphasize the consequential diminution of research and development into new cures for Patients and we will continue to identify opportunities to address these concerns following the legislation’s likely passage.
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BioNJ President and CEO Debbie Hart's Statement on
Inflation Reduction Act of 2022
"Although BioNJ is pleased with several provisions in the Inflation Reduction Act of 2022, we are very disappointed to see that the “price-setting” structure through direct negotiation in Medicare remained in this legislation despite pleas from numerous leading Patient organizations and recognized studies that demonstrated the devastating impact direct negotiations in Medicare would have on access to medicines and future medical innovation.
"Several provisions in the Inflation Reduction Act of 2022 should be recognized that help Patients, specifically the cap on out-of-pocket costs to Medicare beneficiaries and the expansion of the low-income subsidy program. Eliminating the provision requiring rebates be provided in the event that prices rise above inflation was also important to ensure future investments in therapeutic disease areas such as cancer, diabetes, hypertension and rare diseases.
"BioNJ will continue to advocate for modifications to the Inflation Reduction Act of 2022, particularly the removal of the price control provisions in the direct negotiation in Medicare. We look forward to continuing to work together to ensure that treatments are more affordable, that medical innovation continues, and that Patients have access to the therapies they need."
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Click here for a statement from Dr. Michelle McMurry-Heath, President & CEO of BIO.
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CHIPS Act Signed into Law |
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Yesterday, on August 9, President Biden signed the bipartisan CHIPS Act. In response to a global shortage of semiconductors, this legislation is intended to provide subsidies and tax credits to manufacturers within the U.S. to incentivize domestic production, in part because 75% of production occurs in East Asia.
Specifically, among the roughly $280 billion authorized in the bill’s language, the Department of Commerce would be allocated $50 billion over 5 years for programs that build, expand or modernize domestic facilities and equipment for semiconductor fabrication, assembly, testing, advanced packaging or R&D. The NSF will receive $81 billion over 5 years, a significant funding increase relative to baseline. The bill will require yearly appropriations by Congress for this funding to be provided.
Click here for a section-by-section summary by the House Committee on Science, Space & Technology.
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Senators Tillis (R-NC) & Leahy (D-VT) Propose Reform
of Section 101 of the Patent Act
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Section 101 of the Patent Act sets the baseline for what is eligible for patent protection in the U.S., and has been debated over its interpretation. A lack of clarity regarding patent eligibility and consequent inconsistency in court determinations has resulted in a lack of certainty regarding the prospects of protection, prompting efforts to address these deficiencies for several years. The legislation that has been proposed, which is the product of substantial collaboration and deliberation, would more clearly define what is ineligible for protection, helping to promote greater consistency and predictability. |
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Debbie Hart, President & CEO of BioNJ, issued the following statement in support of Section 101 reform:
“BioNJ supports the bipartisan legislation sponsored by Senators Thom Tillis (R-NC) and Patrick Leahy (D-VT) to reform Section 101 of the Patent Act that will improve the clarity and predictability in the patent system and encourage future medical innovation. The current uncertainty in the patent system fails to provide effective protections for medical innovations, results in inconsistent court rulings and diminishes investment in future cures and discoveries. We thank the Senators for their thoughtful approach and bipartisan collaboration and look forward to increased investments in lifesaving medical innovations now and in the future, stimulated by the reforms proposed in this legislation.”
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Small Business Innovation Research (SBIR)
Set to Expire September 30
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The SBIR program is a significant source of funding for entities conducting research and development in pursuit of achieving commercialization throughout the country, including in the life sciences, and it must be periodically reauthorized by the U.S. Congress. The program is administered by eleven federal agencies, with the National Institutes of Health (NIH) administering the second-largest amount of grant funding.
New Jersey ranks among the states that receive the greatest amount of SBIR funding as determined by the National Cancer Institute (NCI) — resulting in approximately $345 million in total output of goods and services, along with about $125 million in labor income, throughout the State. Nearly every congressional district in the State is home to an entity that has received support through SBIR for projects, including the identification of new biomarkers for neurological diseases and disorders, new therapeutics to treat cancer and novel drug delivery technologies.
The program is currently set to expire on September 30, 2022. Senator Paul (R-KY), who is the ranking member of the Small Business and Entrepreneurship Committee in the Senate, has expressed concerns that the program is wasteful and potentially results in national security vulnerabilities. However, recent assessments of the program have found that, between 1998 and 2010, a significant proportion of projects resulted in entities successfully reaching commercialization.
Senator Paul has recently expressed an interest in working with legislators to address his concerns with the goal of reauthorizing SBIR. Senator Ben Cardin (D-MD), the Chair of the Committee, has stated similar sentiments with the goal of reauthorizing the program prior to its expiration. Proposals to address the concerns with the program include restricting eligibility based on the total number of awards received from the program’s inception, restricting eligibility to programs based on the total number of awards received over a five-year period and restricting eligibility associated with rate of commercialization benchmarks.
Moving forward, there are several possibilities for SBIR to be reauthorized, including standalone legislation, the attachment of reauthorization language to a continuing resolution, and the attachment of language to the National Defense Authorization Act (NDAA). Currently, it is included in the NDAA’s provisions. However, while the NDAA is considered “must-pass” legislation, it will not necessarily pass prior to the expiration of the SBIR program.
Accordingly, BioNJ will be working with partner organizations to convey the importance of SBIR funding in ensuring the life sciences industry continues to thrive both nationally and in New Jersey — guaranteeing companies have the resources they need to develop new cures and treatments for Patients around the world.
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We Need Your Help: Support BioNJ Policy and Advocacy Efforts |
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BioNJ is the voice of New Jersey’s life sciences sector in Trenton and Washington. BioNJ’s Public Policy Support Series sponsorship opportunities are still available for 2022. Help ensure BioNJ continues to deliver our message of improved Patient access and enhanced innovation through a Public Policy Support Series Sponsorship.
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Thank You to Our Public Policy Sponsors |
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