The 21st Century Cures Act – A Cure for Industry Woes?
January 31, 2017

The 21st Century Cures Act – A Cure for Industry Woes?

Think back to the last time you can remember Democrats and Republicans working together and passing legislation for the benefit of the American people. The Reagan era maybe? Right after 9/11? It might surprise you to hear that it was only two months ago.

On December 7, 2016 the senate approved the 21st Century Cures Act by a vote of 94 to five. President Obama signed it into law a week later. That kind of bipartisan support is almost unheard of in modern politics.

This wasn’t just a symbolic effort either. The legislation runs almost one thousand pages long and has a budget of over $6 billion over the next ten years.

The law provides $4.8 billion to the National Institutes of Health (NIH) for biomedical research. This will include the Joe Biden-inspired “Cancer Moonshot.” This effort to finally cure cancer is his memorial to his son who died of brain cancer last year.

Researchers who receive NIH funds are thrilled. Pharmaceutical companies and medical device companies are happy because this early research fills their pipeline with new ideas for further development.

The Cures Act also provides a billion dollars in state grants to help with drug addiction in the face of today’s raging opioid crisis.

It also provides funding for mental health services and suicide prevention with a focus on children’s needs.

And the FDA receives $500 million to streamline the various approval processes.

These things all sound good, virtuous even – more medical research, a cure for cancer, funding to address the opioid epidemic and youth suicides, and a more efficient drug approval process.

So why did five senators vote against this law? Including, notably, Elizabeth Warren and Bernie Sanders? And why did the pharmaceutical industry trade group PhRMA spend $24.7 million lobbying for this law? Total lobbying may have reached a half billion dollars.

Pay attention to the change in the FDA procedures. Before this law was passed, a drug had to be studied with good research methodology before it could be promoted for a new use. The expectation was that these studies would employ the best research methodology possible, often double-blind, randomized, placebo-controlled studies (RCTs). This is the best way to test for how effective a drug is.

But the streamlined approval process provided for in the 21st Century Cures Act allows the FDA to use a lower standard of evidence. They can use “real world” experience – things like observational studies and even insurance claims. You might also call it anecdotal evidence. It provides nowhere near the quality of evidence as an RCT.

The FDA, first and foremost, has a consumer protection mandate. However, as of 2016, the FDA received roughly half its funding from tax dollars and half from industry user fees.

So today, industry pays half the operating costs for the FDA, and it has been written into law that the FDA can use lesser evidence for its approval process. It makes you wonder – who does the FDA really work for?

Critics suggest that was the entire purpose of the law to begin with. There are two reasons for the suggestion. First, everything but the FDA piece must get funding reapproved each year. So it is possible that after the first year of the law, the only piece that would remain standing is the streamlined FDA approval process.

Second, not all the funding for the project is new funds. It comes from the Public Health Fund – a component of the Affordable Care Act. It’s questionable that this will even be around for long. But even if it lasts, those funds are already being used for research into things like Alzheimer’s, prevention of diabetes, and improvement of vaccine delivery infrastructure.

So the 21st Century Cures Act is taking money from one research pot and putting it in another.

The rest of the funds will come from selling off Strategic Petroleum Reserves. Without going into a lot of analysis, this is a reasonable short-term source of funds. But legislation involving oil is always rife with controversy. It’s naïve to think this will clear the reapproval process year after year without some pushback.

So in the end, only one aspect of this legislation is guaranteed to stand because it doesn’t rely on reapproval of funds. That’s the easier path for pharmaceutical companies and device manufacturers to get their products to market.

It’s clear why industry lobbied for this law, but it’s not so clear why our legislators did.

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