Week in Review: Astellas Withdraws IRA Lawsuit, New Illumina CEO and More
Pictured: Hand changing blocks from Plan A to B/iStock, BrianAJackson
Last week’s big news was the publication of the list of the first 10 drugs that will be subject to Medicare price negotiations with pharma companies under the provisions of the Inflation Reduction Act (IRA). None of the 10 medicines are from Astellas. And, the company this week dismissed its lawsuit against HHS seeking to challenge the IRA’s constitutionality. While it withdrew its suit, Astellas said it “does not change our fundamental belief that in its current form, the Medicare Drug Price Negotiation Program created by the IRA is a bad policy and unconstitutional.”
Monitoring rebates from drugmakers will be critical as aspects of the IRA are implemented by CMS, including drug price negotiations, according to a new Government Accountability Office report released this week. The monitoring of rebates “will be particularly important as the agency implements the provisions of the Inflation Reduction Act of 2022, which will change Part D plan sponsor, beneficiary, and Medicare drug spending responsibility and may affect formulary design and rebates,” the GAO said.
With several of the first 10 selected drugs facing patent expirations and generic competition, the drug price negotiations dictated by the IRA may not greatly affect revenues, according to reporting this week by BioSpace. Some experts suggest that the financial ramifications for drugmakers will be limited, at least in the near term and for this initial list of medicines whose new prices will go into effect in 2026. However, they say that could change as HHS is authorized to negotiate the prices for 15 Medicare Part D drugs in 2027, 15 total drugs from Parts D and B in 2028, as well as 20 drugs from Parts D and B in 2029 and beyond.
One company that recently lowered its financial outlook is Illumina. This week, the troubled biotech announced that former Agilent Technologies executive Jacob Thaysen will take the reins later this month, replacing CEO Francis deSouza, who stepped down in June following a proxy fight with activist investor Carl Icahn. Evercore ISI analyst Vijay Kumar in a Tuesday note to investors said that Thaysen “checks all the boxes” and “comes with a core [life science] tools background, which was critical in our mind given the context of previous hire being outside the industry,” while emphasizing his “deep science background.”
On the heels of the Labor Day weekend, BioSpace this week looked beyond the C-suite at a recent report on life sciences workforce trends which found half of entry-level jobs in the U.S. require skills considered middle and lower level that could be filled by people with less than a four-year degree. As a result, biopharma companies are showing more flexibility in the types of credentials they will consider for new hires, particularly key technician roles, with community colleges helping to address the skills gap.
The week ended with a slew of collaboration announcements. Seeking to deepen its neurology and rare disease pipelines, AstraZeneca’s Alexion has joined forces with Verge Genomics to leverage AI in drug discovery and development. To build its ophthalmology portfolio, Japan’s Otsuka Pharmaceuticals has teamed with Shape Therapeutics to develop adeno-associated virus gene therapies for eye diseases. And Seagen and Nurix Therapeutics in a deal worth up to $3.4 billion are developing a portfolio of degrader-antibody conjugates, a potentially new class of antibodies that selectively kill cancer cells.