Brooks Blog

Tuesday • April 18, 2017

21st Century Cures Act Stuck on the Runway

21st century new image

Change has been slow on the Hill since the passage of the 21st Century Cures Act in December of last year.

The bipartisan legislation was signed into law the month before both a temporary federal hiring freeze and a regulation reduction executive order slowed down its rollout. The sweeping 2016 legislation that Mitch McConnell called “the most important legislation that Congress will pass this year” was designed in part to speed drug approvals through bureaucratic hurdles, but faced similar hurdles itself.

The hiring freeze was lifted this week, removing one bureaucratic hurdle from the effort to speed the Act’s implementation. However another remains: reauthorization of the funds the Act will rely on. The reauthorization of critical U.S. Food and Drug Administration (FDA) funding sources such as the Prescription Drug User Fee Act (PDUFA) is, according the FDA, mission critical to fulfilling the goals of the Act and continuing “PDUFA-enabled consultations between FDA and drug sponsors.”

Recent research shows that the FDA is already actually significantly (60 days) faster at approving new therapies than the comparable regulating body of Europe, the European Medicines Agency. After appropriating funds via the PDUFA in 1992, the US became most global products’ launching pad:

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But the 21st Century Cures Act aims to shoot higher and faster. Despite some criticism, concerns about drug and device safety being a lingering one, the final Act received broad bipartisan support. In sum, it directs the FDA, the National Institutes of Health (NIH) and Centers for Medicare and Medicaid (CMS) to:

  • Incorporate real-world, patient-reported evidence in the approval process
  • Grant additional periods of exclusivity for certain brand-name drugs approved for a new indication that treats a rare disease or condition;
  • Create new technologies for that will allow for comprehensive mapping of the human brain ($1.56 billion)
  • Address mental health, hospital readmissions
  • Address the opioid crisis ($1 billion)
  • Implement Joe Biden’s Cancer Moonshot ($1.8 billion)
  • Collect genetic data on one million American volunteers that will be used to help develop new treatments ($1.4 billion)

The Act is predicted to cost the federal government $6.3 billion, with $4.8 billion going to the National Institutes of Health (NIH) and $1 billion over two years directed at the opioid crisis. Direct funding allocations come from cuts to the Prevention and Public Health Fund created under the Affordable Care Act and a draw-down from the Strategic Petroleum Reserve.

Advocates for the Act warned Congress that if they do not reauthorize prescription drug user fee agreements which are key funding sources for the agencies responsible for implementing the Act, these initiatives will stagnate. With funding expiring at the end of September, Senate health Committee Chairman Lamar Alexander urges congress to move forward with reauthorizations of  before August recess or expect significant delays due to layoffs at the FDA.

Brooks Insights

Regardless of what happens at the federal budget level, we expect to see a steeper increase of manufacturers applying for orphan drug designations and continued growth of the oncology markets.

Despite the continued rapid growth (and expense) of the oncology market our conversations with providers indicates that the vast majority of oncologists are still able to gain access to the agent they desire for their patients. With healthcare already consuming 19% of the US GDP, and virtually every entity that pays for oncolytics attempting to establish pathways and guidelines in an effort to balance costs with patient outcomes, it will certainly be interesting to see how long this unrestricted access lasts. And of course all this while there is an increasing emphasis on amplifying the voice of the patient.

Now here’s some food for thought: If the speedier approvals lead to, say, placebo-like results and payers learn that only after paying for a drug via a value-based contract, do they get their money back? Time will tell.

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