The Vital Transformations study was released this week, and it estimates that there would be more than 235 fewer FDA approvals of new medicines for patients battling cancer, neurological, and rare and infectious diseases over the next decade as well as 15,714 lost jobs for Georgia workers if proposals to expand federal government-mandated drug pricing policies are implemented. Among the proposals under consideration is allowing Medicare to set prices for specific drugs five years after FDA approval, which would lead to significant lost therapies, innovation, and jobs in the biopharma ecosystem at an even more accelerated pace. These proposals are included in the Executive Branch’s FY 2024 budget as well as the Senate’s SMART Prices Act.
Research firm Vital Transformation modeled the impacts of expanded federal government-mandated drug pricing policies at five years following FDA approval. The study analyzed the reduction of new drug approvals and loss of jobs if these policies or others similar to them were enacted into law.
Key Study Highlights:
The study found that, if proposed expansions of government-mandated drug pricing policies are implemented, there are serious consequences around the development of and investment in new medicines, and significant job losses in major innovation hubs like Georgia.
- Lost Therapies: More than 80 currently available therapies of 121 identified for price setting – approximately 70% – would likely not have been developed had the pricing provisions been in place prior to their development.
- Lost Innovation: More than 235 fewer FDA approvals of new medicines or new uses over a 10-year period. Impacts of the proposed policies will be felt most heavily in many areas of unmet need, particularly in oncology, neurology, and rare and infectious diseases.
- Lost Jobs & Investment: Loss of 3,202 direct biopharmaceutical industry jobs and a total loss of 15,714 in Georgia. Loss of ecosystem investments into 50 different therapeutic indications including $3.680 B in Georgia.