At J.P. Morgan, most biopharma executives expressed a neutral stance on the incoming administration, but just days later, President Trump issued multiple executive orders that concern the industry.
One of President Donald Trump’s first acts upon reassuming office on January 20 was to renew a bid to withdraw the U.S. from the World Health Organization. He also revoked a policy that sought to establish a pathway for coverage of expensive cell and gene therapies.
The news comes just a week after biopharma leaders met in San Francisco for the J.P. Morgan Healthcare Conference, where Trump and his potential impact on the industry was the elephant in almost every room.
Most executives who BioSpace spoke to had neither strong positive nor strong negative opinions of the incoming administration, but rather kept the conversations relatively neutral while acknowledging that the research and strategic business moves that drive drug development forward must continue to serve the patient populations that biopharma ultimately seeks to help.
Speaking with BioSpace a little under a week before the WHO withdrawal was announced, Novavax CEO John Jacobs admitted that the impact of Trump’s nominees on vaccine policy “is on everybody’s mind.”
Trump tried to leave the WHO in his first term, citing the organization’s “mishandling of the COVID-19 pandemic,” but the effort was overturned on former President Joe Biden’s first day in office in January 2021. Leerink Partners said Trump’s new executive order to revive the U.S.’s departure from the WHO is “disappointing for prevention of disease.”
The firm also noted that the proposed WHO withdrawal is likely to affect the perception of vaccine companies such as AstraZeneca, BioNTech, GSK, Merck, Moderna, Novavax, Pfizer, Sanofi, CSL and Vaxcyte, just as Trump’s nomination of Robert F. Kennedy Jr. as head of Health and Human Services did. Following the announcement of that intended nomination last fall, stocks of vaccine makers dropped, with Moderna’s share prices falling almost 7% and Pfizer’s taking a 4.5% hit.
Novavax, a company focused on vaccine development, could also be among the companies whose perception is affected by speculation regarding Trump’s cabinet and policies. “But look, we’re politically neutral as a company, right? We’re focused on science and helping improve global health,” Jacobs said in an interview. “We’re going to approach this from a positive perspective, to partner with the new administration, whoever gets the lead, whoever’s in charge.”
But that doesn’t mean staying silent, he added. “We will step up and have a voice as we do so.”
Finding Common Ground
Gilead CEO Daniel O’Day also took a pragmatic approach to the incoming administration’s controversial agency picks, noting that his company’s approach to preventing chronic diseases like HIV or hepatitis C “fits very nicely” with some of Kennedy’s stated goals.
“From a healthcare perspective, we’ve worked closely with every administration in the past and every Congress in the past. I’ve said this many times, the types of issues that we’re working with, and have been for the past five years, are truly bipartisan issues at the end of the day,” O’Day said during a reporter roundtable event on the sidelines of JPM. “So we’re going to roll up our sleeves.” He also said that work on reducing out-of-pocket drug costs and reforming the role of pharmacy benefit managers’ in drug pricing will continue with the new administration and Congress.
But Trump’s initial actions suggest sweeping changes to come. The Cell and Gene Therapy Access Model was an attempt to address the high, inaccessible cost of new cell and gene therapies by providing a framework for outcomes-based agreements between states and manufacturers of sickle cell disease gene therapies. Alliance for Regenerative Medicine (ARM) CEO Tim Hunt told a packed crowd at the group’s State of the Industry briefing during JPM that the model has been embraced by industry, with Vertex Pharmaceuticals and bluebird bio, both makers of sickle cell gene therapies, signing on to participate.
“This looks like it could be a major step forward for advancing the commercial model,” Hunt said of the model before it was revoked, adding that half of the populations who need these gene editing therapies are probably on Medicaid. He said the attempt to find a way to pay for access was “a major advancement for our field” and thatARM wanted to see that model continue.
In the aftermath of the access plan withdrawal, ARM spokesman Stephen Majors told BioSpace via email that there are still many unknowns about what Trump’s actions mean, specifically what the immediate impact will be to Centers for Medicare and Medicaid Services’ (CMS’) policies, and whether the model will continue.
“ARM views the model as a common-sense, nonpartisan initiative to modernize how Medicaid pays for transformative therapies,” Majors wrote. “We are hopeful that the model will expand access for patients with severe sickle cell disease and serve as a blueprint for how government and industry can collaborate to bring cutting-edge medicines to more patients who otherwise face death or serious disability.”
Elsewhere on drug pricing, many industry watchers are awaiting action that may impact the Inflation Reduction Act. The legislation, among other provisions, sought to lower prescription drug prices by allowing CMS to negotiate the prices of some key drugs. Days before leaving office, Biden’s CMS released the latest list of drugs that will be subject to price negotiations for the 2027 year. Among the new targets are Novo Nordisk’s GLP-1s Wegovy and Ozempic, which cost the public program more than $14.4 billion between November 2023 and October 2024, and Pfizer’s cancer meds Ibrance and Xtandi.
Nkarta CEO Paul Hastings has been a particularly outspoken critic of the IRA, arguing that the law stifles innovation and puts a penalty on certain modalities over others by giving biologics more time than small molecules before they may be subject to negotiations. In an interview at JPM, Hastings said he expects changes to the IRA.
“I can’t predict whether they’ll be changes for the good or changes for the bad,” he said. “This administration will definitely not embrace anything that was done by the last administration.”
