NYC Gazette

U.S. Representative Nicole Malliotakis (R-NY) has voiced concerns over the potential negative impact of the "pill penalty" provision within President Biden's Inflation Reduction Act (IRA) on the biopharma industry, particularly in the New York City metro area.

The provision in question targets "small molecule" drugs that are in pill form, and has sparked a debate over its potential to hinder research and development for biopharma companies. Patient access to essential medication— in some cases, life saving drugs— is also in question under the "pill penalty" provision. 

The consequences are far-reaching, particularly for marginalized patients who rely on pill forms for treatment and care, as noted by various advocacy groups. Oncologists in particular have voiced concern that the ‘“pill penalty” will stifle research into cancer care. 

"The 'pill penalty' provision in President Biden’s 'Inflation Reduction Act' is forcing manufacturers away from the research and development of critical small-molecule drugs and life-saving treatments that those with cancer and other chronic diseases rely on," Malliotakis said in a statement provided to the NYC Gazette.

Malliotakis further emphasized the need for equal treatment of small-molecule drugs and biologics. A potential solution is the "Ensuring Pathways for Innovative Cures (EPIC) Act," which aims to equalize the exemption period for both biologic and small-molecule drugs, providing a more level playing field for pharmaceutical innovation.

"Treating small-molecule drugs differently from biologics does not make sense and presents a hurdle in our shared goal of providing Americans continued access to high-quality healthcare with as many treatment options as possible," Malliotakis said.

The "pill penalty" will potentially impact up to 24 biopharma companies in New York City alone.

The Congresswoman's comments shed light on the ongoing debate surrounding healthcare legislation and its impact on the biopharma industry, particularly in regions like New York City, where numerous companies are engaged in research and development efforts.

The Inflation Reduction Act, while primarily focused on clean energy subsidies, also introduces price controls on certain advanced medicines for Medicare patients, disproportionately impacting easy-to-take pill medications. 

Critics argue that discrimination against pills threatens innovation in the pharmaceutical industry, with a survey indicating a shift away from small-molecule medicines. 

James K. Glassman, formerly a senior fellow at the American Enterprise Institute who served as under secretary of State in 2008 and 2009, has urged Congress to take the opportunity to rectify this through legislation like the EPIC Act. 

In an opinion piece published in The Hill, Glassman said the legislation aims to equalize exemptions for small-molecule drugs and biologics, ultimately improving access to innovative cures and fostering better health outcomes for all Americans.

The biopharmaceutical industry has played a pivotal role in reducing the cancer death rate by 33% since 1991, according to PhRMA. 

Malliotakis has taken a bold stance in the pharmaceuticals sector, including against what she perceives as the unfair practices of pharmacy benefit managers (PBMs), highlighting their detrimental impact on small, independent pharmacies within her district.