Democrats’ 2022 Inflation Reduction Act wasn’t designed to kill cancer innovation, but new evidence reveals that’s what it’s doing. The law strongly discourages drug companies from performing the “follow-on” research after initial discoveries that accounts for a disproportionate share of progress in the fight against cancer.
The crux of the problem is that the IRA imposes price caps that shorten the effective life of a patent and applies those price controls even to later-approved uses. Thirteen years after FDA approval, biologics, which are typically infused or injected, become subject to price controls. For small-molecule drugs, typically pills or tablets, the window is only nine years. The clock starts at a drug’s first approval, leaving a follow-on or alternative use, approved years later, an insufficient period to make up the cost of research.