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Yahoo
27-05-2025
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What's next for Trump's ‘most favored nation' policy?
This story was originally published on PharmaVoice. To receive daily news and insights, subscribe to our free daily PharmaVoice newsletter. Following through on President Donald Trump's 'most favored nation' policy, the HHS is about to drop a drug pricing hammer on the pharma industry. But that doesn't mean drugmakers will comply. The policy, issued by an executive order earlier this month in an attempt to bring U.S. drug prices in line with those paid in other countries, asks drugmakers to voluntarily lower their own price tags first. If they don't, HHS is then directed to 'impose' the policy, which is expected to be met with legal challenges, as it was when Trump proposed a similar plan during his first term. Meanwhile, pharma's largest lobbying group is aiming to shift the blame for drug prices to pharmacy benefit managers and the 340B hospital drug pricing program. PhRMA launched a new ad campaign last week that called out 'markups' from the hospital program and 'middlemen fees' from PBMs as reasons for higher drug prices in the U.S. compared to the rest of the world. While HHS takes its first steps toward implementation, Congress is also looking into new reforms to lower drug prices. As HHS determined target prices that 'pharmaceutical manufacturers are expected to meet,' the agency disclosed that they're equal to the lowest price paid by an OECD country with a GDP capita that's at least 60% of the U.S. measure. And the president and HHS Secretary Robert F. Kennedy Jr. plan to highlight price commitments from drugmakers in the coming weeks, the agency said. 'For too long, Americans have been forced to pay exorbitant prices for the same drugs that are sold overseas for far less,' Kennedy said in a statement. 'That ends today. We expect pharmaceutical manufacturers to fulfill their commitment to lower prices for American patients, or we will take action to ensure they do.' In his executive order and accompanying fact sheet, Trump called out European countries for 'free-riding' on American pharma innovation by charging lower prices than the U.S. for the same medicines. Trump hopes the plan will convince other countries to raise drug prices to make up for lost pharma revenues. Kennedy last week called the plan a 'revolution in healthcare affordability', drawing on price comparisons for GLP-1 drugs in the U.S. and the U.K. — a patient may pay $88 for the same weekly shot in London for which an American shells out more than $1,000, he said. HHS announced the new targets just over a week after Trump directed the agency to implement the lower prices within 30 days. Despite HHS expecting compliance from drugmakers, many critics and analysts have noted the policy lacks teeth for enforcement and therefore may have a limited effect in lowering drug prices. While the policy may impact list prices, many patients would not see a change in drug costs because most pay a different price through their insurance. 'We do not [expect pharma companies to voluntarily comply], given that this is coming out of an executive order, and we have precedent from the first administration of this president where this was attempted; we expect a strong legal response, just like last time,' Maximilian Vargas, vice president, U.S. access strategy at Certara, said in an email. 'Federal authority to regulate drug pricing in the commercial books of business compared to government is limited.' HHS could come up with an enforcement mechanism down the line through a proposed rule, but firmer drug pricing reforms are already in the works. Two bills have been introduced in Congress that target drug prices, including one that codifies core provisions of Trump's most favored nation executive order into law. The Global Fairness in Drug Pricing Act, introduced the same day as HHS' price target announcement, would similarly direct HHS to propose a rule to implement the MFN strategy. It would also facilitate direct-to-consumer sales of drugs at the new benchmark prices and authorize the FDA to import prescription drugs from countries with lower prices. The FDA already allows states to apply for waivers to import drugs from other countries, and last week said it would enhance these options for imported drugs from Canada in compliance with the executive order. So far, only Florida has been granted a waiver to import drugs from Canada at a lower price. Canadian officials noted last year that the nation intended to 'safeguard' its drug supply, underscoring importation plans may meet roadblocks from other countries. Sen. Bernie Sanders, I-Vt., also introduced a bill targeting pharma companies that charge prices that are higher than the median in other countries. The legislation, sent to the Senate HELP committee, would end pharma monopolies in the U.S., according to Sanders. Recommended Reading Trump's 'most favored nation' policy is back. Here's why it failed the first time.
Yahoo
16-05-2025
- Business
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A new CFO tasked with taking ‘scrappy' Editas from last year's layoffs into new gene editing territory
This story was originally published on PharmaVoice. To receive daily news and insights, subscribe to our free daily PharmaVoice newsletter. Welcome to First 90 Days, a series dedicated to examining how pharma executives and other leaders are planning for success in their new roles. Today, we're speaking to Amy Parison, CFO at Editas Medicine, which is undergoing a shift in focus to in vivo therapies and navigating the many challenges of the gene editing space. Gene editing biotech Editas Medicine is no stranger to the drug development pivot. And along with a major reorganization and scientific focal shift, the company has put its financial decisionmaking in the hands of a first-time CFO while it gears up for the next phase. After a cost-cutting shuffle announced at the end of last year in which the company slashed roughly 65% of its workforce, Editas switched gears from an ex vivo gene editing platform to in vivo technology. The change moves the therapeutic process from an external procedure in a lab to one that's delivered directly into a patient. Editas' previous lead ex vivo candidate in sickle cell anemia wasn't a clinical failure. Rather, the drug, called reni-cel, suffered from a lack of a commercial partner, leading to a cash crunch at Editas. Now back to the drawing board, the company is focusing on preclinical candidates using hematopoietic stem cells in diseases like sickle cell and beta thalassemia as well as liver-directed gene editing, all with the more convenient and practical application of in vivo delivery. Navigating the transition is newly minted CFO Amy Parison who, after working as head of finance alongside the company's former CFO, took the reins at the end of March. "In biotech, you grow numb to operating at a loss. You're thinking more about cash runway and how to extend that." Amy Parison CFO, Editas Medicine Tasked with launching into the company's new focus, Parison looks at Editas as a 'scrappy' biotech willing to change its priorities to match the moment. Gene editing has long been a tricky area both in terms of the complex science and the financial calculus it takes to pull it off. Here, we spoke to Parison about Editas' unique position in the gene editing space, what lies ahead for a CFO managing a platform shift while maintaining a cash runway, and some of the potential political and financial snags the company could face as it heads in this new direction. This interview has been edited for brevity and style. AMY PARISON: What jumps out to me is our science and what we're showing in our data, and even with former programs, what we've done is special. There's a lot of potential, and I'm excited [about] how we've pivoted to in vivo [gene editing]. That's the future of gene editing and where it's going to have the biggest impact. A few months before the transition, I read an article about how women are well-positioned to be great CFOs even though it's been such a male-dominated field — it's about forming connections. I've seen that finance touches everything, that we're the lifeblood of the company. Beyond what people traditionally think of as the number crunching and investor outreach, what I'm excited about is being a part of the whole company and thinking strategically about not only their finances but everything they're doing. In biotech, you grow numb to operating at a loss. You're thinking more about cash runway and how to extend that. So while I was trained as an accountant, my financial acumen and strategy overpowers traditional accounting. My predecessor [former Editas CFO Erick Lucera], who set me to take the reins, instilled in me that the best cash is the cash you have. That's how I think about expenses and operating where we are, especially in these markets — being scrappy and capital efficient and making sure we're producing the best science with the best capital we have. Scrappy is being resourceful and rolling up your sleeves to do things that aren't necessarily in your job description or even where you've had formal training, but something you're excited about and committed to seeing through to the end. That's super important for biotech success. We don't have the luxury of a large headcount or huge infrastructure or resources, but that's motivating. The people who are scrappy are generally the ones who are motivated to move forward. There are lots of different flavors of gene editing. We can look at ex vivo gene editing, and Editas did have a phase 3 program. But there are lots of ways to deliver gene editing therapy — and we are moving from ex vivo to in vivo, and that's where the industry is at with gene editing. It's a fairly new technology, and so I think people need to understand how it works and how to think about it. There's been a lot of political uncertainty over the past few months, and we're all digesting what's being said and how to take that forward. It's been challenging to interpret that type of narrative and figure out what to do with it. So far, we haven't seen any ramifications of that rhetoric, and while the administration is fairly new in their tenure, once we understand what is being said or not being said, I think things will start to level out. We're always looking to the future. And while these are early-stage discussions for us, we're fortunate that we've seen companies like Vertex [Pharmaceuticals] and Bluebird [Bio] price their therapies on the market. There's a balance to figuring out the pricing for these therapies that can be a one-and-done treatment. I'm looking forward to thinking more about that, and we're using that as a guidepost. As the industry matures, we'll be part of it and mature with it. Recommended Reading Why layoffs are not the answer to biopharma's troubled market Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
14-05-2025
- Business
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Trump's ‘most favored nation' policy is back. Here's why it failed the first time.
This story was originally published on PharmaVoice. To receive daily news and insights, subscribe to our free daily PharmaVoice newsletter. President Donald Trump is bringing back a controversial policy idea from his first term targeting drug costs. The 'most favored nation' policy would bring U.S. drug prices in line with the nation that pays the lowest price 'anywhere in the world,' Trump said on social media this week. Implementing such a plan would reduce drug prices 30% to 80% 'almost immediately,' Trump claimed. However, there's still a ways to go before the policy would take effect — and looking back at why the approach failed in Trump's first term provides insight into the challenges ahead. Through an executive order, Trump ordered HHS and its agencies to create a proposed rule to achieve the policy's ends — a move met with immediate criticism from some members of Congress as well as the pharma industry. The industry association PhRMA used the executive order as an opportunity to slam pharmacy benefit managers — their usual target — as the culprits for high drug prices in the U.S. 'The U.S. is the only country in the world that lets PBMs, insurers and hospitals take 50% of every dollar spent on medicines,' PhRMA president and CEO Stephen Ubl said in a statement. 'The amount going to middlemen often exceeds the price in Europe.' PhRMA also called the plan 'a bad deal' that would threaten jobs, hurt the economy and place more reliance on China for America's medicines. BIO similarly criticized the policy, calling it 'deeply flawed' and arguing it would 'devastate' the biotech industry. Trump's executive order claimed the U.S. funds three-quarters of global pharma profits despite holding just 5% of the world's population. The president also claimed that drug manufacturers agree to the demands of other countries to offer lower prices, with Americans effectively subsidizing innovative medicines developed in America — 'freeloading,' he called it. As such, HHS Secretary Robert F. Kennedy Jr. is ordered to enable direct-to-consumer sales of drugs at the 'most-favored-nation price.' HHS would create a mechanism to facilitate the sales directly from the manufacturer and bypass the middleman, according to a White House fact sheet. If manufacturers don't comply and offer the new prices, HHS would impose the most-favored-nation pricing outright. Trump noted he would target pharma companies that fail to comply. '[S]hould drug manufacturers fail to offer American consumers the most-favored-nation lowest price, my administration will take additional aggressive action,' the order stated. HHS is directed to give the new prices to drugmakers within 30 days of the order. With such a short turnaround to get the policy off the ground, many questions remain as to how it will be executed. Wall Street analysts have wondered about HHS' authority to enact such regulations if pharma companies don't voluntarily comply, BioPharma Dive reported. Trump also said Monday that he believes Europe will feel pressure to raise drug prices as a result of the policy if drugmakers face lower revenues as a result, NPR reported. How the policy will impact Medicare's drug price negotiation program as established in the Inflation Reduction Act is still unclear. The government has already negotiated the first set of 10 drugs selected for the program, with implementation slated for next year. The revival of the most favored nation policy comes after Trump tried a similar tactic during his first term, but the new plan doesn't follow the same lines. During his first term, the policy was limited to certain Medicare Part B drugs, but the new order is vague regarding which plans will be affected. The policy was similarly challenged by pharma groups, including BIO, which won an injunction to stop HHS from implementing it in 2020. A handful of other court orders also stopped the rule from moving forward. When President Joe Biden came into office shortly thereafter, the new administration pulled back the policy. Trump originally proposed the idea in 2018, but he only attempted to push it through in the last few months of his first term unsuccessfully. Trump has also run into a lack of Republican support, who failed to add a most favored nation provision in their upcoming economic bill, several news outlets have reported. However, a bipartisan bill introduced in the Senate earlier this month would prohibit pharma companies from selling drugs in the U.S. at prices higher than the international average. With Trump's aims more wide-reaching this time, the policy is 'almost certainly' expected to be challenged in court, where it may once again get shot down. Recommended Reading FDA's future in MAHA hands: How leadership is changing the agency's trajectory
Yahoo
13-05-2025
- Business
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AI is already delivering pharma value — and not just in drug discovery
This story was originally published on PharmaVoice. To receive daily news and insights, subscribe to our free daily PharmaVoice newsletter. AI-driven drug discovery has gotten much of the glory in pharma. Isomorphic Labs — which is leveraging an AI drug discovery platform based on Nobel Prize-winning AlphaFold software — pulled in the largest biotech investment haul this year to date with a $600 million fundraising round in March. And drug discovery is a prime focus for many of the highest valued AI companies working in pharma. Tempus AI, which has a market cap of about $9 billion, got its start leveraging molecular data for precision cancer care and has since expanded its capabilities to include drug discovery. Its services have been used by almost all of pharma's largest public companies. So far, none of this momentum has resulted in a new drug approval. Insilico Medicine is one of the frontrunners in that race with a candidate it calls the 'first end-to-end generative AI-assisted drug,' that could soon move into phase 3 after garnering positive topline results late last year. But before an AI-discovered drug proves its worth in the clinic, the technology is shining in other areas such as diagnostics and data management, according to Jessica Owens, co-founder of the healthcare-focused venture capital firm Initiate Ventures. 'I think there are going to be winners on the periphery far before we're high-fiving about AI-discovered drugs,' she said. 'What they're doing is not glamorous, but it's super important." Jessica Owens Co-founder, Initiate Ventures These AI-driven advances may fly under the radar despite their impact because the space is currently dominated by small companies with 'baby point solutions,' Owens said. 'They are all picking off one piece of the preclinical value chain,' she said. Startups offering single service-based solutions also don't attract as much buzz on the investment scene. 'Historically, VCs don't like service companies because the margins don't work as well and they're too hard to scale,' Owens said. 'With those business models, it's hard to get that hockey stick kind of growth.' But that isn't to say these startups aren't offering strong ROI. Here's where the technology is delivering breakthroughs throughout pharma. While shaving time off of drug discovery for a single asset can be a boon for one company, Owens sees wider value in AI technologies that offer to streamline development for the entire industry — especially in clinical trials. In particular, Owens pointed to Axiom Bio, a startup taking aim at predicting liver toxicities, which it says are linked to 20% to 25% of clinical drug failures. Using what it describes as the 'world's largest primary human liver dataset,' Axiom tested its AI model against assays used by Pfizer and AstraZeneca that demonstrated it was just as effective at a much lower cost. Ultimately, Axiom is positioning the technology to help phase out animal modeling and plans to extend its use to other organ systems including the heart and brain. AI solutions are also making an impact for ICON, a large research, development and commercialization firm based in Ireland. The company has implemented several AI tools, some of the proprietary, that tackle onerous aspects of clinical trial work including document storage, endpoint strategies and resource forecasting. In one case, ICON's site selection tool, One Search, helped a sponsor bounce back from enrollment challenges by quickly identifying 'high-performing sites' and reversing 'enrollment shortfalls,' said Gerard Quinn, ICON's vice president of IT innovation and informatics, in an email. Across the clinical trials industry, AI companies are working to develop solutions that automate patient enrollment and recruitment, and 'match patients to trials in minutes rather than months,' Owens said. Initiate's portfolio is also giving rise to several biotechs. The VC is currently building a startup called Tensor Bio that's developed an AI-powered blood test for MASH that will create personalized treatment plans. Pinpointing effectiveness will be critical as new and high-profile MASH therapies come into play. 'This is big,' Owens said. 'The first drug for MASH was recently approved, but there was a graveyard of drugs that failed before that. Some GLP-1s [could get] label expansions but none are silver bullets, so we are moving towards a combo treatment approach.' Another Initiate-backed company, Cornerstone AI, has developed a solution for a major behind-the-scenes problem in healthcare — cleaning large amounts of 'messy' real-world data. 'What they're doing is not glamorous, but it's super important,' Owens said. Cornerstone has worked with a wide swath of companies, including biopharmas and large healthcare systems, to leverage an AI assistant that Owens said works like a 'spellcheck for data' by identifying and correcting errors. 'What would take four data scientists four months to do, can now be [done] in a week with one data scientist,' Owens said. AI capabilities aren't quite ready to steal the spotlight in every area of R&D. Like many industry leaders, Owens argued that pharma still has a long way to go before animal modeling can be replaced by alternative testing methods based on AI, partially because the technology can't yet replicate the intricacies of biology. 'There's a lot [that] AI can't predict with respect to biology. It's just too complex,' Owens said. 'But we'll get there.' And although pharma's AI space has already been flooded with scores of companies, there are still lingering gaps in the market. For example, there could be an opportunity for a company pulling multiple solutions under one roof and providing more end-to-end drug development services based on AI. 'We are interested in companies linking these solutions together,' Owens said. And as the AI market continues to develop, the companies that ultimately succeed will also likely have a platform based on proprietary — rather than public — data. 'The way I would predict who the winners are going to be is by … looking at companies that were built on proprietary data,' Owens said. 'Those are the companies that will create value over time.' Recommended Reading The year's biggest biotech haul shows investors are still chasing the AI dream Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
12-04-2025
- Business
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Pharma's US manufacturing moment: Where companies are making the biggest moves
This story was originally published on PharmaVoice. To receive daily news and insights, subscribe to our free daily PharmaVoice newsletter. The U.S.'s billowing trade policies rattled global markets this week with the onset of new tariffs that were then mostly paused. Although the uncertainty took a bite out of Big Pharma stocks, the industry was mostly spared from the worst of the upheaval. 'The Trump administration's North American, universal and China-targeted tariffs had limited direct impact on pharma due to exemptions for active pharmaceutical ingredients so far,' said Zara Muradali, head of life sciences and tax principal at Grant Thornton Advisors. Still, a deepening trade row has fueled speculation over whether it would incentivize pharma to buck a long-held reluctance to manufacture in the U.S. Although tariffs alone are unlikely to offset the high cost barriers that remain for U.S. drug production, pharma could rethink its supply chain as the rubber hits the road on other policies, Muradali said. 'Factors influencing this shift include the U.S. government emphasizing reduced reliance on foreign suppliers; major pharmaceutical companies making … U.S. expansions; and policy incentives with the Inflation Reduction Act and CHIPS and Science Act, which include provisions for advanced manufacturing … through tax credits and R&D funding,' Muradali said. The U.S. is capable of handling a manufacturing burden, though, as demonstrated by the rapid scale-up and production of COVID-19 vaccines just a few years ago. 'Another example in generics and non-patented drugs would be Civica Rx, a nonprofit generic manufacturer that raised $125 million to produce essential generics, addressing shortages and price volatility,' Muradali pointed out. A slew of technological advances such as continuous manufacturing, AI-enabled processes, robotics and automation have brought labor costs down, and regulators are offering more support. 'The FDA's Emerging Technology Program fast-tracks approvals for innovative production methods, cutting regulatory timelines,' Muradali said. 'Also, the FDA's Advanced Manufacturing Center promotes agile approvals for technologies like 3D-printed drugs.' While some pharma companies are turning to contract manufacturers to help expand their U.S. footprint as the trade battles play out, others are likely to 'wait and see,' Muradali said. Regardless of where the Trump administration lands on tariff policies, several large pharmas are already in the midst of U.S. capacity expansions to meet rising demand for key products. Novartis became the latest company to make a major manufacturing move this week when it revealed plans to pump $23 billion into building or expanding capacity at 10 sites in the U.S. Here's a look at some of the other large manufacturing investments pharma companies have revealed in recent months. Few companies are pumping as much cash into U.S. manufacturing as Eli Lilly. After a string of production investments, the company said in February that it plans to expand American capacity once again — bringing its five-year U.S. manufacturing spend to $50 billion dollars. Lilly will use the new capital investments to build four production sites in the U.S., including facilities that make active pharmaceutical ingredients and injectable drugs, while creating up to 10,000 construction jobs and 3,000 permanent roles for high-skilled workers, the company said. While Lilly's quest to crank out more drugs has benefited from sales of its weight loss and diabetes medications, the company said it's optimistic about the potential of oncology, immunology and neuroscience pipelines, as well. Lilly's also looking at ways to refine the manufacturing process. The company recently teamed up with Merck & Co. and Purdue University to launch a consortium that will research and develop new manufacturing technologies. Amid skyrocketing demand and sporadic shortages for its blockbuster diabetes and weight loss medications, Novo Nordisk has also shelled out billions to expand its global manufacturing footprint in recent years. Most recently, the company announced a $1 billion upgrade to a facility in Brazil that makes injectable drugs, including GLP-1s like Ozempic. The investment marks one of the heftiest ever seen by the pharma manufacturing industry in the country. In the U.S., the Danish pharma's splashiest — and most controversial — deal was its $16.5 billion acquisition of Catalent, a contract manufacturing firm previously aligned with many of Novo's rivals. Although the matchup was met with some industry resistance amid concerns it could hamper Catalent's other contracts, it was ultimately finalized in December. Novo also funneled $4.1 billion into building a second fill-finish facility in North Carolina and made similar investments around the world last year, including production expansions in Denmark and a $200 million deal to purchase a Novavax plant in the Czech Republic. The company plans to keep the spending spree going in 2025. Novo said in an annual report that it will invest about $9 billion throughout the year to shore up its capacity and supply chain network. Amgen is expanding its production prowess in North Carolina, the company announced in December. The $1 billion investment will establish a new drug substance facility and create 370 new jobs, Amgen said. Amgen's earnings rose by 13% in the third quarter of last year thanks to increasing sales for osteoporosis and cholesterol meds, beating analyst expectations. The new production investment builds on a previous $550 million commitment the company made at its Holy Springs campus in the state, and is one of several pharma-backed capital infusions recently announced in North Carolina, which boasts over 100 pharma manufacturing sites. J&J is shelling out in the notorious biotech innovation state with a $2 billion plan to build a biologics manufacturing site in Wilson, the company said in October. The new facility, which will help ensure 'a resilient supply chain,' will produce oncology, immunology and neuroscience drugs and staff 420 workers, the company said. Recommended Reading Trump's tariff tirade and sudden calm keep Big Pharma on its toes Sign in to access your portfolio
