In this week’s edition of InnovationRx, we look at the shutdown’s impact on healthcare, the Nobel Prize winners in medicine, Amgen’s direct-to-consumer effort, and more. To get it in your inbox, subscribe here.
Hospitals and health systems across the country are telling some Medicare and Medicaid patients that they can’t schedule telehealth appointments due to the federal government’s shutdown, now heading into its second week. That’s because Medicare reimbursement for telehealth expired on September 30, leaving health systems with the choice of pausing such visits or keeping them going in hopes of retroactive reimbursement after the shutdown ends.
Reimbursement for the Hospital at Home program, which allows patients to receive care without being admitted to a hospital, also lapsed with the shutdown. That led to providers scrambling to discharge patients under the program or admit them to a hospital. Mayo Clinic, for example, had to move around 30 patients from their homes in Arizona, Florida and Wisconsin to its facilities.
At issue in the government shutdown is healthcare, specifically tax credits for middle- and lower-income Americans that enable them to afford health insurance on the federal exchanges set up by the Affordable Care Act. Democrats want to extend those tax credits, which are set to expire at the end of the year, while Republicans want to reopen the government first and then negotiate about the tax credits in a final budget.
The impasse has prevented the Senate from overcoming a filibuster, despite a Republican majority. Around 24 million Americans get their health insurance through the ACA, and the loss of tax credits will cause their premiums to rise an average of 75%–and as high as 90% in rural areas–and likely cause at least 4 million people to lose coverage entirely.
The government’s closure has reverberated through its operations in healthcare. The Department of Health and Human Services has furloughed some 41% of its staff, making it harder to run oversight operations. CDC’s lack of staff will hinder surveillance of public health threats. And FDA won’t accept any new drug applications until funding is restored.
When the government might reopen remains unclear. Most shutdowns are relatively brief, but the longest one, which lasted 35 days, came during Donald Trump’s first term. Senate majority leader John Thune, R-S.D., and Speaker of the House Mike Johnson, R-La., have both said they won’t negotiate with Democrats, and the House won’t meet again until October 14. Bettors on Polymarket currently expect it to last until at least October 15. Pressure on Congress will increase after that date because there won’t be funds available to pay active military members.
Three Researchers On Autoimmune Diseases Win Nobel Prize
Nobel Prize winners Mary Brunkow, Fred Ramsdell and Shimon Sakaguchi
TT NEWS AGENCY/AFP via Getty Images
Three scientists whose insights may one day help cure autoimmune disorders won this year’s Nobel Prize in Medicine.
The winners, Mary Brunkow, Fred Ramsdell and Shimon Sakaguchi will share the approximately $1.2 million prize for their discovery of regulatory T-cells, which prevent the immune system from attacking the body’s own tissues.
Sakaguchi, a professor at Japan’s Osaka University, discovered these cells in 1995, upending the scientific consensus on how the immune system is regulated and paving a new understanding of how it works. Brunkow, now a senior manager at the Institute for Systems Biology in Seattle, and Ramsdell, a scientific advisor to startup Sonoma Therapeutics, built on Sakaguchi’s discovery when they found a mutation in a gene called Foxp3 that made a strain of mice particularly susceptible to autoimmune diseases in 2001. Two years later, Sakaguchi discovered that Foxp3 controls the development of regulatory T-cells.
Today, there are more than 200 clinical trials for medicines using regulatory T-cells to treat a variety of autoimmune disorders and help prevent organ rejection after transplant. In 2019, Ramsdell cofounded San Francisco-based Sonoma Biotherapeutics to develop regulatory T-cell based therapies for rheumatoid arthritis and a chronic skin condition called hidradenitis suppurativa, both of which are in phase 1 trials.
“Their discoveries have been decisive for our understanding of how the immune system functions and why we do not all develop serious autoimmune diseases,” Olle Kämpe, chair of the Nobel Committee, said.
BIOTECH AND PHARMA
Moderna cofounder Bob Langer launched a new biotech, Souffle Therapeutics, with $200 million in funding. Langer, an MIT professor worth $1.2 billion, according to Forbes, holds more than 1,400 patents and has cofounded dozens of companies, including SQZ Biotechnologies, Seer and Sigilon Therapeutics. Souffle plans to develop medicines using a type of RNA called siRNA that inhibits gene expression. Its first therapies will focus on muscular dystrophies, heart failure and metabolic disorders. Langer’s daughter, Susan Langer, is the company’s founding president and chief business officer. Its CEO is Polaris Partners’ Amir Nashat.
Plus: AstraZeneca’s potential new blood pressure drug, baxdrostat, met its goal of meaningfully reducing high blood pressure over 24 hours compared to a placebo in patients with resistant hypertension in a late-stage clinical trial. The Anglo-Swedish drugmaker hopes that the drug could generate up to $5 billion in annual sales once approved, helping it meet its target of $80 billion in revenue by 2030.
DIGITAL HEALTH AND AI
Amgen will begin selling drugs direct-to-consumer for discounted cash prices, starting with its cholesterol drug Repatha, at a monthly price of $239, or 65% below its list price. The move comes as the Trump Administration has pressured pharmaceutical companies to drop their drug prices and announced its own TrumpRx site. Amgen released clinical trial data last week that showed Repatha significantly reduces the risk of a heart attack in combination with statins.
Plus: Australian health tech startup Heidi raised $65 million led by Point72 Private Investments at a valuation of $465 million to accelerate development of its AI scribe technology.
PUBLIC HEALTH AND HOSPITALS
Climate pollution from asthma inhalers has the impact of half a million cars per year, according to a study published in JAMA. Metered dose inhalers, which rely on greenhouse gases also used in refrigeration and air conditioning, accounted for 98% of that pollution. Dr. William Feldman, a pulmonologist and health services researcher at UCLA who co-authored the study, told CNN that “it’s an eminently fixable problem” because of alternative products currently available and in development.
Plus: Acting CDC director Jim O’Neill called for the MMR vaccine against measles, mumps and rubella to be broken into three separate shots–despite no evidence this is safer or more effective. No such vaccines are currently available in the U.S., and giving each vaccine separately would require children to have six injections instead of two, which could lead to fewer being vaccinated.
WHAT WE’RE READING
Pfizer’s deal with Trump to cut drug prices has little impact on the bottom line–but removes a lot of regulatory uncertainty. Investors love it.
The ER told a college student he just had a virus. Days later, he was dead.
Women make up just 11% of biopharma CEOs as the industry makes minimal progress on gender diversity.
Biotech startup Kernal Biologics received a $48 million federal grant to develop its mRNA-based CAR T-cell program against certain cancers.
The American Hospital Association and the FBI warned healthcare providers using Oracle software to immediately fix a major security flaw that leaves them vulnerable to hackers.
Six former surgeon generals, who served in both Republican and Democratic Administrations, warned that HHS Secretary Robert F. Kennedy, Jr.’s policies are a danger to public health, calling his policies and positions a “profound, immediate and unprecedented threat.”
The Supreme Court suggested it could limit bans on LGBTQ conversion therapy–at least as applied to talk therapy–during oral arguments in a case challenging Colorado’s ban. More than 20 states have passed laws banning or restricting conversion therapy, which repeated studies have shown has harmful effects for patients.
Online prescription drug delivery startup BlinkRx–a company tied to Donald Trump, Jr.–stands to benefit from his efforts to overhaul drug sales.