Recently, a bipartisan group re-introduced the Ensuring Pathways to Innovative Cures (EPIC) Act in the United States House of Representatives. The legislation aims to fix the small molecule “pill penalty” in the Inflation Reduction Act, to encourage ongoing research and development investments into small molecule medicines.
Under the Inflation Reduction Act, small molecule drugs are eligible for the Medicare Drug Price Negotiation Program 7 years after they are approved by the FDA, followed by a two-year “negotiation period,” with the potential price control going into effect in year nine. Biologics, on the other hand, are eligible 11 years after they are approved by the FDA and after the two year “negotiation period,” would have the price control effective in year 13.
Under the proposed legislation, the approval period would be equalized between biologics and small molecule drugs, with both becoming eligible for the Drug Price Negotiation Program 11 years after they are approved by the FDA.
“Small molecule drugs, basically pill-form medication, play an essential role in treating Americans battling cancer, neurological disorders, and other severe illnesses,” said Congressman Greg Murphy, M.D. “Unfortunately, the Inflation Reduction Act’s price-fixing scheme destroys research and development, reducing treatment options for patients. American innovation leads the world in breakthroughs and life-saving advancements towards eradicating disease and cancer. Proposals like the “pill penalty” undermine progress, make it harder to lower drug costs, and reduce access to critical therapies for those most in need.”
“We must encourage innovation, investment, and the development of new medicines to treat unmet medical needs, especially in underserved and rural communities,” said Congressman Don Davis. With diseases such as diabetes, Alzheimer’s, and cancer often having a disproportionate impact on vulnerable patients, access to high-quality, innovative healthcare treatments must remain a high priority.”
Reactions to the Legislation
Sue Peschin, MHS, President and CEO of the Alliance for Aging Research, applauds the introduction of the legislation, saying in part, “Creating disincentives for the development of one category of drugs over another without any medical or scientific rationale does not make sense. There is also an element of irony to steering the future of pharmaceutical development toward biologics, because small molecule drugs are in most cases less expensive for patients and more easily genericized than biologics, leading to greater adoption and lower long-term costs. To the extent biologics become more dominant due to the IRA, they will lead to lower adherence but still higher Medicare costs overall.”
“One of the most damaging consequences of the IRA is the ‘pill penalty,’ which severely disincentivizes the development of small molecule drugs,” said Dan Leonard, Executive Director of We Work For Health. “The EPIC Act represents an important first step toward addressing this critical issue. We need to inspire scientists and investors to continue advancing small molecule research and safeguard America’s global leadership in life sciences. Ensuring that medications remain accessible, affordable and effective is a goal that policymakers from both sides of the aisle can and should rally behind.”