Pharma Companies Emerge as Major Beneficiaries of the 21st Century Cures Act, Poised to Accelerate New Indication Approvals

On July 10 of this year, the U.S. House of Representatives easily passed the long-debated “21st Century Cures Act” by a vote of 344 to 77. On November 29, the U.S. Congress finally published the final version of the 21st Century Cures Act (hereinafter referred to as the “Cures Act”) on its official website. On December 8, the U.S. Congress approved the 21st Century Cures Act, which could fundamentally reform the development of the U.S. healthcare sector.

The “21st Century Cures Act” was jointly introduced by Republican Congressman Fred Upton and Democratic Congresswoman Diana DeGette, aiming to reform drug regulatory policies, accelerate the approval of urgently needed therapies, and bridge the gaps among medical research, the pharmaceutical industry, and drug regulation. It took a total of two years from the initial proposal of the Cures Act, through successive revisions, to the release of this final version.

The Therapeutic Act will provide legal assurance for a series of research and innovation projects to be implemented in the United States over the next decade, with a funding of $4.8 billion.These include brain research initiatives, cancer research programs, and precision medicine projects designed based on individual genomic profiles.. Of this total budget of $4.8 billion,The “Precision Medicine” initiative proposed by Obama has been retained and received $1.4 billion in funding, while the White House’s “Brain Research Initiative,” aimed at promoting the development of innovative neurotechnologies, received $1.6 billion from this allocation.Meanwhile, Vice President Biden’s proposed “Cancer Moonshot” initiative has secured $1.8 billion in funding.

In addition to the aforementioned $4.8 billion in funding allocations, the legislation stipulates an appropriation of $500 million to support the FDA in reforming its drug approval processes. It mandates reforms to expedite the approval pathways for certain antibiotic drugs and medical devices, while providing new guidance documents for drug development. On one hand, it relaxes or waives regulatory review requirements for auxiliary health-related software and fitness products, such as smart bands and calorie-tracking applications. On the other hand, it allows for a reduction in the scale of clinical trials for drugs targeting rare, life-threatening diseases.

Proponents of the Cures Act state that the legislation allocates substantial funding for medical research under new regulations, thereby driving the U.S. Food and Drug Administration (FDA) to accelerate the approval of drugs and medical devices. As such, they argue that the implementation of the act will create a win-win situation. However, this is merely the perspective from Washington. Although the bill was introduced with bipartisan support and passed the House of Representatives by an overwhelming margin, and is expected to pass the Senate on Tuesday as well, its enactment will inevitably produce not only a series of winners but also some losers. VCBeat (WeChat ID: vcbeat) has outlined these winners and losers to help you keep abreast of the latest developments in U.S. healthcare reform.

Previously, more than 1,300 lobbyists were actively canvassing Capitol Hill to advocate for the passage of the Cure Act. According to some reports, the vast majority of these lobbyists were working on behalf of pharmaceutical companies. Evidently, their efforts have now begun to yield results.

The bill also proposes supporting the approval of new drugs for new indications through “data integration,” rather than relying solely on clinical trial data. Meanwhile, the bill will expand insurance coverage to include additional drug uses beyond those previously approved, thereby broadening the market for pharmaceutical companies.

However, pharmaceutical companies have not fully achieved their demands; among the provisions rejected by the Democratic Party was one addressing the long-term market monopoly of certain drugs.

The Advanced Medical Technology Association, representing more than 300 medical device companies, stated that the CURE Act builds upon the FDA’s existing frameworks, thereby facilitating faster market entry for breakthrough medical technologies targeting patients with life-threatening or irreversibly debilitating conditions, as well as for limited alternative therapies.

“The passage of the CURE Act will be a milestone in improving and enhancing the ecosystem for medical technology innovation, as well as in making it possible to ensure the use of new emergency drugs, medical devices, and diagnostics in patients,” said Scott Whitaker, President of the Association.

On the other hand, this initiative has also drawn criticism. For instance, Public Citizen Health Research Group argues that the definition of so-called “breakthrough” medical devices is overly broad, which could lead to the clearance of certain devices that are not yet ready for market entry.

The National Institutes of Health (NIH) has seen its research funding hover around $9 billion for many years. Previously, an earlier version of the bill passed by the House of Representatives proposed establishing a temporary “Innovation Fund” to accelerate the discovery and development of novel therapies. This fund would provide $8.75 billion to the NIH over five years, with each of its 27 institutes receiving a total of $500 million annually for research innovation. The remaining funds would be allocated to support young scientists in conducting high-risk, high-reward research, as well as to intramural research programs focused on basic medical sciences.

However, in the current final version of the bill, this appropriation has been reduced to $4.8 billion, little more than half of what was proposed in earlier versions. Given that President-elect Trump has previously given the NIH a “poor” rating, this funding is likely to be cut even further.

This landmark legislation will provide funding over the next decade for three government research initiatives signed into law by President Obama: the “Cancer Moonshot” ($1.4 billion, to accelerate the translation of research into new treatments for more patients while enhancing cancer prevention and early detection capabilities); the “BRAIN Initiative” ($1.8 billion, to help researchers discover new ways to treat, cure, and prevent brain disorders such as Alzheimer’s disease, epilepsy, and traumatic brain injury); and the “Precision Medicine Initiative” ($1.6 billion, to pioneer patient-centered research, accelerate biomedical discoveries, and equip clinicians with new tools, knowledge, and therapies to select the most effective treatments for their patients).

Next January, Upton will step down as Chairman of the U.S. House Committee on Energy and Commerce, having long urged the passage of the bill. Over the past three years, Upton, together with DeGette, has garnered support from numerous patient advocacy groups, pharmaceutical and medical device manufacturers, and even rock star Roger Daltrey.

At last, all the efforts paid off, and the bill was ultimately passed in the House of Representatives by an overwhelming margin of 392 to 26. In addition, Upton received some financial support: during the period when he was drafting the bill, he obtained over $1.3 million in sponsorships from several healthcare political action committees.

Psychologist Murphy, however, emerged as an unexpected winner. In the days leading up to the vote, House leadership incorporated his mental health legislation into the Cures Act.

Dr. Maria A. Oquendo, President of the American Psychiatric Association, expressed strong appreciation for the mental health provisions in the Curing Act, stating that they would greatly benefit patients. The legislation adopts Senator Murphy’s proposal to establish an Assistant Secretary for Mental Health and a Chief Medical Officer within the U.S. Department of Health and Human Services. These new positions will bring greater medical expertise and accountability to the Substance Abuse and Mental Health Services Administration, thereby enhancing service efficiency.

Furthermore, $1 billion in government funding was allocated to research on the opioid epidemic, as more U.S. citizens die annually from drug overdoses—primarily involving opioids—than from motor vehicle accidents. The legislation also seeks to strengthen laws requiring governments and insurers to treat mental illness on par with other medical conditions. Additional provisions include using a portion of the funds to launch suicide prevention programs and improve the quality of children’s mental health services.

“Congress has finally united, with both parties working together to lead those suffering from severe mental illness out of the shadows,” said Murphy. “To patients in critical condition and their families, I promise that I will never cease fighting to ensure that those most in need receive the care they deserve before tragedy strikes.”

Since the House of Representatives passed the draft Cures Act and sent it to Alexander’s committee in July 2015, Tennessee legislators have been facing immense pressure from both the Democratic and Republican parties.

Lamar Alexander’s Republican colleagues staunchly oppose any bill that requires spending, no matter how noble its intent, unless the funds are offset by cuts to another program.

Democrats, however, do not see the merit in the Cures Act’s primary objective of accelerating the FDA’s work. The majority of them believe that the FDA already operates with sufficient efficiency; imposing excessively rapid timelines could compromise quality and potentially jeopardize the agency’s position as a global leader in pharmaceutical regulation.

Therefore, Alexander devised a plan: he broke down the comprehensive cure legislation into smaller “medical innovation” bills that had reached consensus within the committee. These bills encompassed measures ranging from assisting the NIH in recruiting and retaining scientists to developing better methods for managing electronic health records. He then left the stubborn and difficult-to-handle opponents for the Senate and the House of Representatives to deal with, thereby achieving the current compromise.

Since the passing of his son, Beau Biden, from brain cancer, the Vice President has devoted himself entirely to the “Cancer Moonshot” initiative, which aims to accelerate therapeutic development by compressing a decade of medical research into five years. The Moonshot initiative seeks to accelerate the translation of research findings, making new therapies available to more patients while enhancing capabilities in cancer prevention and early-stage detection. Legislative resources will support investments in new therapeutic approaches, such as cancer immunotherapy, novel preventive tools, the development of cancer vaccines, new early screening tools, and interventions for pediatric cancers.

However, the future of this bill was originally bleak due to the new government’s ascent. But the passage of the Cure Act saved it, allocating $1.8 billion over the next five years ($1 billion in the first three years) to continue implementing the program.

Biden’s bill has received the White House’s support, and congressional leaders have highly praised his efforts.

Michael Milken, once known as the “Junk Bond King,” has reinvented himself as a philanthropist. From Lake Tahoe in Nevada to New York, he has hosted numerous dinners that bring lawmakers face-to-face with renowned scientists, patient advocates, Cabinet secretaries, and CEOs of biopharmaceutical companies—all with the aim of garnering support for medical innovation initiatives.

Michael Milken’s FasterCures, a center within the Milken Institute, was also part of the development of the Cures Act. Other organizations, including the American Cancer Society and Research!America, supported the Cures Act, although some expressed disappointment over the reduction in funding in the final version of the legislation.

Although the bill proposes $500 million to fund the FDA’s new responsibilities, it lacks any other provisions that would substantially address the agency’s long-standing issues. The U.S. Government Accountability Office has identified two particularly critical high-risk areas for the FDA: one is food safety regulation, and the other is the oversight of medical products approved through expedited review pathways.

FDA’s Robert Califf believes that the current Cure Act has not allocated funding for research on aging and disease progression, which will lead to serious consequences.

The Cures Act will guide the FDA in evaluating “real-world evidence” to facilitate the review and approval of drugs already approved by the FDA but proven effective for new indications. Supporters of the legislation view this as a means to obtain practical, real-time data through observational studies, case reports, serendipitous data, and other research methods, and to apply such data to the approval of medical devices and pharmaceuticals.

Before new drugs can be approved and marketed by the FDA, their efficacy and safety must be clinically verified through extensive randomized clinical trials. However, as real-world evidence standards have become the gold standard for evaluating the safety of pharmaceuticals and medical devices, legislative adoption of these standards may signal a diminished role for randomized clinical trials in the approval process for drugs and devices.

Illinois Senator Mark Kirk suffered a stroke in 2012. Earlier this year, he introduced the Regenerative Medicine Therapy Act, aimed at expanding treatment options for patients with stroke, Alzheimer’s disease, Parkinson’s disease, and diabetes. Kirk’s proposal would allow the FDA to approve stem cell therapies under certain conditions without requiring large-scale, late-stage clinical trials. Republican leaders have also attempted to incorporate this proposal into the Cures Act.

However, many researchers believe that stem cell therapy is still in its early stages in terms of safety and efficacy; therefore, at this stage, Congress should not grant the FDA this review authority.

It is understandable that the final draft of the curative legislation did not permit new regenerative medicine products, including stem cell therapies, to bypass Phase III clinical trials. However, it did allow for FDA accelerated approval, provided that surrogate endpoints could be demonstrated to indicate the drug’s mechanism of action and warrant further investigation.

Last week, Warren criticized the Cures Act before the Senate, stating that it had been “hijacked” by the pharmaceutical industry. She argued that the legislation weakens safety requirements for drugs and medical devices, while mandating annual appropriations as a “compromise.”

Warren’s colleagues—Senator Dick Durbin of Illinois and Senator Jeff Merkley of Oregon—both agree that the CURE Act should be repealed. However, she still lacks broad support, even within her own party.

The Citizen Health Research Institute and the National Health Research Center strongly oppose the Cure Act. Both organizations argue that, although the bill may bring about certain changes, it will threaten public health by lowering FDA standards.