How the 21st Century Cures Act Affects Drugs and Medical Devices

After inspiring a rare wave of bipartisan support, a sweeping new health care bill, called the 21st Century Cures Act, was approved recently by both houses of the United States Congress. This act is intended to funnel over $6 billion in funding towards important areas of medical research and innovation, and is likely to stir up big changes in the world of pharmaceuticals and medical devices.

The Cures Act has been a long time in the making, with very strong support behind the scenes from lobbyists in the pharmaceutical and medical device business. This isn’t only expected to help “Big Pharma,” however: Some of the money wrapped up in the bill is intended to address mental health reforms and opiate addiction, and to improve health information technology.

So where, exactly, is all that money going?

Drug and Medical Device Companies and the FDA

The biggest names in the medical device and pharmaceutical industries have been lobbying for some of these changes for years, and the push intensified as the Act took shape. Over the past two years of discussions around the Cures Act, interested parties spent over a quarter billion dollars on lobbying. It appears to have paid off: With this win, manufacturers of drugs and medical devices stand to save billions of dollars over the next decade. That’s because this Act gives the FDA more discretion when it comes to the sorts of studies that manufacturers must perform as they bring new drugs or devices to market.

Reflecting an understanding of the changing world of biotechnology and individualized medicine, the bill is a shift towards flexibility in the regulatory approval process for new and innovative treatments. Many within the FDA have been hoping for this change, as drug approval is faster and less costly in the European Union than in the United States.

New drugs can take over a decade to make their way through the research and development pipeline and past FDA approval to the consumer market on the other side, and the process costs drug companies on average $2.5 billion for every drug they develop. Pharmaceutical and biotech companies argue that by streamlining the approval process and allowing for increased flexibility in the type and number of studies that must be done for new drugs, drugs can be developed faster and more efficiently. Faster and cheaper development of new treatments, they say, will ultimately mean better access for patients, and could also lead safer medications. For the millions of people taking Xarelto, the slow approval process of an antidote to reverse the severe bleeding side effects could be putting patients at risk. These side effects, and lack of appropriate warnings have resulted in over 18,000 Xarelto lawsuits being filed to date. Previously, the blood thinner Pradaxa had been through a similar round of litigation that resulted in a $650 million settlement fund.

There’s a risk inherent in removing some of the requirements in the testing phase, however. It’s difficult to know where streamlining ends and corner-cutting begins, and some physicians groups worry that the impact to patient safety could be disastrous. It’s very clear that in the era of 21st Century medicine, one size can’t possibly fit all when it comes to new devices and drugs. But with so much lobbying money behind the passage of this bill, one wonders whether allowing industry to decide on the fit is in our best interests.

Of course, medical devices and pharmaceuticals are still subject to federal oversight, even with the passage of the new Cures Act. In fact, the bill includes extra funding for the FDA to develop and manage the new programs associated with the Act: another $500 million for its budget through 2026, along with increased hiring power. Even so, critics argue that the amount is insufficient to cover the cost of the increased workload, and doesn’t allow for any hope of improving some of the FDA’s long-standing problems.

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Focus On Patient Care

A portion of the bill’s funding will go to the National Institutes of health to back more biomedical research in neuroscience, genetic medicine, and cancer prevention and treatment. The $4.8 billion would support research at other institutions as well, in the form of grant money for important projects. doled out in portions over the next decade, is subject to approval in annual appropriations bills. While this means it’s not guaranteed funding for the NIH, it’s still an encouraging sign that lawmakers on both sides of the aisle agree that funding basic medical research needs to be a national priority.

The Cures Act also sets aside funding for mental health and treatment of substance abuse – $1 billion is set aside to deal with the national problem of opiate addiction, mostly through increasing access to rehabilitation and treatment programs. The language of the bill also strengthens the mental health parity law, which says that health insurance companies must provide coverage for psychiatric illnesses just as they do for physical ones. While that law already exists, many patients requiring psychiatric hospitalizations found themselves left with the bill when insurance companies argued that inpatient care wasn’t medically necessary.