The landmark legislation has recently passed both houses of Congress and President Obama is set to sign it into law. The bill provides billions for medical research, helps expedite the development and approval of new drugs, and reforms policy. Let’s take a look at the sweeping changes, and consider their implications for pharma…
Sprawling across 996 pages, the text of House Amendment to the Senate Amendment to H.R. 34, Tsunami Warning, Education, and Research Act of 2015—with the short title “21st Century Cures Act”—is not only the biggest health reform bill since the Affordable Care Act, but is arguably the most significant piece of legislation impacting the pharmaceutical industry since Hatch-Waxman.
Receiving overwhelming bipartisan support (94 to 5 in the Senate, 392 to 26 in the House), the bill took more than three years to craft, and input from the FDA, NIH, a broad range of scientists, healthcare advocates, and other experts. As the name suggests, the act is designed to streamline regulatory and research processes to reflect the new century’s advances in biotechnology, devices, and data—and address challenges including the opioid epidemic.
As Klick Health CEO Leerom Segal commented in an Op-Ed, the careful debate in Congress centered around how to remove obstacles to innovation while preserving what we need to make medicine safe and effective. President Barack Obama believes the bill succeeded in striking that balance, and expressed his support. “The Cures Act makes important investments that will save lives,” he said in a statement after the Senate approval.
“This is a reminder of what we can do when we look out for one another,” the President said. “Like Joe Biden and so many other Americans, I’ve lost people I love deeply to cancer. I’ve heard often from those whose loved ones are suffering from Alzheimer’s, addiction, and other debilitating diseases. Their heartbreak is real, and so we have a responsibility to respond with real solutions. This bill will make a big difference, and I look forward to signing it as soon as it reaches my desk.”
Scanning the bill’s table of contents, the depth and breadth of the act is stunning: From governmental and state responses to the opioid abuse crisis, to sweeping regulatory and policy changes at the NIH and FDA, to advances in healthcare delivery, savings, and mental health treatment, to expanded Medicare and family services—billions of dollars and hundreds of agencies are impacted, ultimately influencing the lives of every American.
Shortly after an earlier draft passed the House in the summer of 2015, Klick Health released a POV describing what the bill may mean for pharma and healthcare marketers—an overview that for the most part still accurately reflects the final approved legislation. Now that the bill will be signed into law, let’s highlight a few of its provisions set to transform how drugs and devices are researched, developed, and ultimately commercialized:
Funding Medical Research and Innovation
The bill pours $4.8 billion over 10 years into the NIH for medical research, including $1.8 billion for the “Cancer Moonshot,” and $1.6 billion for the Brain Research Through Advancing Innovative Neurotechnologies Initiative to study Alzheimer’s and other CNS diseases. Funds will also be used for various biomedical research objectives, including early stage investigations, drug manufacturing studies, health software, and disease history.
Expediting Drug Development and Approvals
Under the new law, pharma companies will be able to use surrogate endpoints and clinical experience data to obtain approvals faster and more cost-effectively. By simplifying and shortening the process, companies can innovate more and patients can benefit from new therapies received much faster. And by reducing the overall cost of approvals, smaller innovators and entrepreneurs can produce new and potentially beneficial treatments.
Simplifying Expanded Indications
A provision within the bill specifies the Department of Health and Human Services establish a regulatory framework within two years—the goal being creation of guidance to support new indications for drugs using real world evidence, rather than more time-consuming and expensive clinical trials currently demanded by the FDA. The result would be expanded use and new patient populations for drugs already approved for other uses.
Connecting Manufacturers with Payers
Another provision would allow drug manufacturers to provide healthcare economic information of therapies and technologies to formulary committees under specific conditions. Likely meant to finalize the FDA Modernization Act of 1997, the change in law would help pharma and device companies share outcomes data to substantiate the real world value of their products for the broader healthcare system.
Delineating Device and Software Regulation
The bill also helps differentiate between the specific types of devices and software that should and need not be FDA regulated. Specifically, the act defines regulated medical software as providing “patient-specific diagnosis, treatment, or course of action,” and defines unregulated health software as providing only “recommendations to consider.” The distinction means the vast majority of apps fall out of the need for FDA approval.
Utilizing “Real World” Evidence
Supporting and expanding on the Precision Medicine Initiative, the newly signed act also paves the way for post-market data collected from patients to help validate medical devices. Less expensive, faster and more efficient to obtain, and potentially more meaningful, “real world” evidence has already made it into draft guidance, and will play an increasingly significant role the moment President Obama signs 21st Century Cures into law.
Consult with an Expert
Here at Klick Health we’ve been tracking the 21st Century Cures Act from its earliest stages, and embrace the goal of fostering innovation and getting new treatments to patients faster. We’ll continue to share POVs of this act and other developing news, and look forward to helping our clients understand and implement the many benefits. Together we can realize our joint mission of improving and extending life for millions of patients worldwide.