To even the most casual observer, 2015 has been a big year in the biotech industry, particularly in Congress and in other venues wherein public policies that affect the sector take shape. Given the importance of the policy environment in determining how successful companies in our industry can be at delivering new cures and treatments to patients – and a return to the investors who finance their activities – we decided that a close look at some of those key policy issues was in order for the 2015 BIO Investor Forum. That panel, Policy Outlook—Valuation Model Implications of 21st Century Cures, IP Reform, TPP, and PDUFA VI, took place on the opening afternoon of the event.
Moderated by Jeanne Haggerty, BIO’s Senior Vice President of Federal Government Relations, the panel included:
- Brenden Gingrich, PhD, Partner, Knobbe Martens
- Paul J. Hastings, Chairman & CEO, OncoMed Pharmaceuticals
- Elizabeth Krutoholow, Analyst, Bloomberg Intelligence
- Sara Radcliffe, MPH, President & CEO, California Life Sciences Association
On the subject of 21st Century Cures, OncoMed’s Paul Hastings emphasized the importance of the provisions which advance patient involvement and input into the drug development and regulatory decision making processes:
The focus on patients in the 21st Century Cures bill is amazing. Congress doesn’t always get everything that we do in great detail, but when it comes to patient advocacy it’s something everybody understands. The engagement of patients in their own Patient Reported Outcomes and clinical trials, much like what the Parent Project Muscular Dystrophy did together with Janet Woodcock and the FDA is an example of something that the 21st Century Cures bill looks at – patients being involved in discovery and development, and actual outcomes that are meaningful to them.
Intellectual property is another area that has seen a great deal of developments in the policy sphere this year, most notably with the advent of the use of the Inter Partes Review (IPR) process to challenge the validity of patents for medicines, and the provisions related to data exclusivity for biologics in the Trans Pacific Partnership (TPP).
On IPR, Bloomberg’s Elizabeth Krutoholow emphasized that the fear and uncertainty injected into the market by the new dynamic and lack of clarity surrounding patent life for medicines has many investors scared. She noted that when Kyle Bass first announced his challenge of the patent for Acorda Therapeutics’ MS medicine Ampyra, the company’s stock fell 10% in one day, even though many investors didn’t really know what that IPR challenge entailed.
While final text of the TPP agreement is still being awaited, the announced framework with respect to biologics is that each country must ensure a minimum of five years of data exclusivity plus an additional three years of ensuring that competing products do not come to the market. Knobbe Martens’ Brendan Gingrich was skeptical of how realistic it would be to enforce that additional three years:
It’s going to require the implementation in every country and seeing what their statutes look like. From what I’ve read, it’s sufficiently permissive to allow a country to pursue what it wants with respect to the exclusivity. So the countries that were opposed to a longer term I think will have ways of making sure that there is no extent of the term.
In closing, each panelist was asked what one or two steps they would recommend Congress could take to encourage a healthy ecosystem of biotech innovation. CLSA’s Sara Radcliffe recommended starting with two very big themes:
One is enabling the life science sector generally to focus on science and to bring exciting scientific innovations through the development process to patients. So that’s a very big theme, but obviously we’ve already talked about a number of ways in which that becomes very specific. Biomarkers is one. Making sure that the [FDA] has the ability to react to advances in science and technology that are coming from the environment. The second big theme for me is value… We really have to make sure that the public understands the value of the products being produced and also what it takes to get there so that reimbursement is reflective of that value. At the congressional level with extraordinary budget pressures we often hear proposals being put forward that suggest that reimbursement for particularly cutting edge, rare disease products be cut. Not going in that direction is very important.