United States: Winners And Losers Under The 21st Century Cures Act

Last Updated: December 10 2016
Article by Kevin M. Granahan

This week, the Senate passed an expansive health bill known as the "21st Century Cures Act" after the bill received approval from the House earlier this year.  Due to its far-reaching effects in the healthcare and life science industries, among others, the bill was one of the more lobbied pieces of legislation in recent history.  President Obama is expected to sign the bill into law by the end of the year.

Highlights of the bill include significant amounts earmarked for improving cancer research (including funding for the Cancer Moonshot initiative championed by Joe Biden), fighting the epidemic of opioid abuse, making improvements in mental health treatment, helping the Food and Drug Administration (FDA) speed up drug approvals, and facilitating improved use of technology in medicine (such as the Brain Research through Advancing Innovative Neurotechnologies® (BRAIN) Initiative and the Precision Medicine Initiative).

Below is a brief summary of winners and losers under the bill:

Winners

  • Healthcare Information Technology and Software Companies: Healthcare IT companies and data management companies are set to gain millions of dollars in new business as a result of incentives in the bill for federal agencies and healthcare providers to use electronic health records systems and enhance research and treatment through the collection of electronic data.
  • Pharmaceutical and Medical Device Companies: The bill allows the FDA to require fewer studies from pharmaceutical and medical device companies and gives the FDA additional resources to speed up approvals. This will likely allow drug and device companies to save billions of dollars in bringing products to market.
  • Medical Schools, Hospitals and Physicians: Subject to annual appropriations, the bill provides $4.8 billion over 10 years in additional funding to the National Institutes of Health. This funding is intended to open the door to hundreds of millions in additional research grant dollars for researchers at universities and medical centers, many of whom will be focusing on cancer, neurobiology and genetic medicine.
  • Mental Health and Substance Abuse Advocates: The bill provides $1 billion in state grants over 2 years to address opioid abuse and addiction. The majority of this amount will fund both new and existing treatment facilities, while the remainder will fund improvements in mental health research and treatment.
  • Patient Groups: Many specialty disease and patient advocacy groups receive a portion of their funding from drug and device companies. With the allocation of additional dollars and requirements for more patient input in the drug development and approval process under the bill, these patient groups are slated to wield more power and influence.

Losers

  • Preventive Medicine: The bill cuts $3.5 billion, or about 30 percent, from the Prevention and Public Health Fund previously established under Obamacare. This fund promotes prevention of Alzheimer's disease, hospital-acquired infections, chronic illnesses and other ailments.
  • The FDA: The bill provides the FDA with an additional $500 million through 2026 and more hiring authority. A win?  Sure, but the FDA contends that these measures aren't enough to offset the additional workload that the bill will impose on its resources.  In addition, the agency fought and lost with respect to a controversial voucher program which awards companies that approve drugs for rare pediatric diseases.
  • Consumer and Patient Safety Groups: Many consumer and patient safety advocates (such as Public Citizen and the National Center for Health Research) are adamant that the bill will result in unsafe drug and device approvals and doesn't address rising drug costs.
  • Hair Growth Patients: Under the bill, federal Medicaid will no longer help pay for drugs that help patients restore hair. Hair growth patient advocates such as the National Alopecia Areata Foundation spent significant sums of money to fight this.

While some of those against the bill continue to be disappointed and claim that "Congress gave Big Pharma and the medical device industry an early Christmas present by passing the 21st Century Cures Act", most seem to be encouraged by lawmakers' renewed and bipartisan efforts to focus on scientific research, effective care delivery, and the removal of barriers to scientific progress.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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