Pharma’s new scapegoat

An interesting trend has cropped up during earnings season this quarter — pharmaceutical companies are blaming Democrats’ new drug pricing law when they slow-walk various drugs in their development pipelines.

Critics of the law are crowing that it really is stifling innovation, like the industry had claimed all along, and that the law does disincentivize companies finding new uses for existing medicines. 

But it’s unclear whether the drugs would even work, or whether they’d sell anywhere near enough to fall into Medicare’s negotiation program, which only applies to high-spend drugs. The program doesn’t even kick in for many years after a drug has been approved. 

It’s a space worth watching as regulators and legislators are closely monitoring the law’s implementation, and these call-outs could become fodder for the law’s opponents. 

Here are the mentions we’ve seen so far: 

• Alnylam Pharmaceuticals claimed the Inflation Reduction Act contributed to its decision to hold off on a Phase 3 study for vutrisiran in Stargardt disease, a rare genetic eye disease. That would be the second orphan drug indication for the medication, which would void its exemption from the Medicare drug price negotiation program.

• Eli Lilly didn’t mention the law on its earnings call, but the company told Endpoints after the fact that it is stopping its investment in a Phase 1 trial for a blood cancer treatment in part due to considerations about the law’s incentives for developing small-molecule drugs.

• Sanofi, on the contrary, downplayed concerns about the law and said it didn’t expect the Medicare price negotiation process to impact its blockbuster versatile inflammatory disease antibody drug Dupixent before 2031.

Democrats’ canary in the coal mine

Trudy Busch-Valentine, the Democratic Senate candidate in Missouri (Michael M. Santiago/Getty Images)

Missouri’s Senate race has all the makings of a national bellwether on abortion politics. And it’s not looking good for Democrats, my colleague Nick Florko reports in a dispatch from Kansas City.  

The contrast couldn’t be more stark. The Republican candidate, Eric Schmitt, used his previous post as Missouri’s attorney general to ban all abortions in the state even in cases of rape and incest. The Democrat, Trudy Busch Valentine, is a nurse who has made Schmitt’s attacks on abortion a central part of her campaign.

But even though a big majority of Missourians believe women should have more access to abortion services, Valentine is trailing. Read the full story for more analysis on whether the race could spell trouble for Democrats nationally. 

Medicare’s doozy of a rule drop

Medicare officials dropped back-to-back rules this week that outline how physicians and outpatient providers get paid for services, and our all-star business team has double header stories on the biggest takeaways. 

My colleague Bob Herman previews an end-of-year showdown where physicians will be desperately lobbying Congress to avert a 4.5% pay cut finalized Tuesday night. When factored in with other Medicare cuts embedded in law, physicians and policy experts say, the reductions will be closer to 8.5%, and could easily surpass 10% after factoring in the effects of inflation.

And our resident hospital finance expert Tara Bannow breaks down the developments related to how Medicare’s structuring a new type of rural provider designation. There’s a perk that they won’t have to report quality metrics, but they would also be excluded from a lucrative drug discount program, making it a tough financial tradeoff. 

Separately, Tara wrote that Medicare’s final outpatient rule also made good on the agency’s promise to end Trump-era cuts to the 340B program. The big, outstanding question is how Medicare plans to repay hospitals for the underpayments dating back to 2018, as some estimates have put the tab at up to $10 billion.

Musings on the future of drug development

(Mike Reddy for STAT)

STAT’s senior writer covering medicine, Matt Herper, is out with an opus this morning about the tremendous potential of biology this century, and some of the pitfalls holding progress back. Right now, conducting clinical trials is too expensive, and too siloed, to really capture the potential of all the potential drugs that work. 

Matt has some provocative ideas about how to harness the potential of data to solve ailments that aren’t incentivized by the current system, and potentially make treatments more affordable for patients.

A Twitter mystery, solved

My eagle-eyed colleague Nick Florko spotted that Scott Gottlieb, a former FDA Commissioner and familiar face in the D.C. health policy sphere, registered a new Twitter handle this week, @CellTherapyCure. The account has a small handful of followers.

After some sleuthing, Nick figured out that Gottlieb isn’t starting a new company or anything — the new handle is reserved for his next book with HarperCollins, Gottlieb said. It will be about the modern history of cell therapy with a focus on cancer. Gottlieb worked on expanding the group that reviews cell therapies as FDA commissioner.

What we're reading

• ‘Intriguing and sobering’: Enthusiasm over psilocybin’s effect on depression tempered by questions about durability, STAT

• What causes Alzheimer's? Study puts leading theory to 'ultimate test,' NPR

• Opinion: Give Americans the right to save on health care, STAT

• Why does chronic pain hurt so much? The Atlantic