As we approach the 2024 presidential election, Stephen Ubl, president and CEO of the pharmaceutical industry’s DC-based trade group PhRMA, said “the political process has really never been more volatile.”
Endpoints News spoke to Ubl over a half-hour at PhRMA’s office in Washington. In the wide-ranging conversation, the relentlessly-on-message trade group leader answered questions on Medicare price negotiations and the legal fight against the IRA, US tensions with China, the importance of “scientific independence” for the FDA, and the impact of a Trump or Harris administration on the industry.
This interview has been substantially edited for length and clarity.
Nicole DeFeudis: I want to start with the question that’s on everyone’s minds right now — what are you hearing about IRA negotiations?
Stephen Ubl: I think, unfortunately, the process has played out as we expected. It’s a flawed and political process. And it’s really operated like a black box. There’s more questions about it than we know. It’s unclear, for example, how these prices will be informed by manufacturer views, by patient views, by provider views.
We haven’t heard a lot about the process, specifically.
DeFeudis: As more information becomes available in the coming weeks, do you expect companies will maybe push back harder in the future? Or potentially even say no to negotiations?
Ubl: I don’t think it’s a negotiation, just for the record. Because of the dynamics of the process, it’s not really fair to call it a negotiation. It’s speculative right now to say what companies may or may not do in response to this initial wave of price setting.
DeFeudis: There have been seven lawsuits filed by drugmakers against the IRA, and another filed by PhRMA alongside other organizations. Many of those have been rejected in district court (but are now in appeals). Does the industry need to change tactics?
Ubl: No. We’re still in the early innings. We continue to have constitutional and due process concerns with the law. I’m not aware of any price-setting regime where essentially the government will not take comment on the most central elements of the process, including how drugs are selected. And if you disagree with those decisions, you have no or limited judicial review. We think as the litigation process unfolds, the courts will find that improvements are required.
DeFeudis: Drugmakers have taken a very vocal stance against the IRA in these lawsuits and also in comments to the media, arguing that negotiations will threaten innovation. Pfizer CEO Albert Bourla likened it to “negotiation with a gun to your head.” But they seem to be changing their tone. Pfizer said in March that the impact over time would be modest. Bristol Myers’ Chris Boerner said last week that after seeing the final offer, he’s “increasingly confident in our ability to navigate the impact of IRA.” How do you make sense of that tone shift?
Ubl: I sort of disagree with the premise of the question, to be honest. I think if you actually go back and read the transcripts of what these CEOs have said, they’ve been very clear about the adverse impacts associated with the law. It’s an inappropriate yardstick to look at what the corporate financial impact is of price setting on one medicine. It really loses the forest for the trees. And I think the CEOs have been quite clear about some of the adverse innovation impacts which are already occurring as a result of the law.
DeFeudis: How do you think the next round of Medicare negotiations would play out in a Trump presidency versus a Harris presidency?
Ubl: I suspect that if it were a Harris administration, we would see it proceed along the lines that it’s already proceeding. I don’t sense a major departure from how they would approach negotiation. Although, we would certainly continue to advocate for improvements in the law. In terms of a Trump administration, I think that’s pretty speculative. It’s hard to say how they would approach negotiation.
DeFeudis: I want to shift to another big topic in drug pricing, PBMs. What do you expect to come out of the recent FTC report on PBMs, if anything?
Ubl: I think there’s now overwhelming evidence of the need for substantial PBM reforms. And you mentioned the FTC, which is only the latest actor to really step into this discussion and say that consolidation in this space has led to abusive practices that need to be addressed. It’s unclear how that might unfold, whether they’re going to sue those companies, or other reforms that they might recommend. But it’s long overdue.
DeFeudis: The FDA’s decision-making authority was also the subject of scrutiny this year, as the Supreme Court considered both the mifepristone case and the Chevron case. What’s PhRMA’s stance on this? Where should the line be drawn between courts and the FDA?
Ubl: Deference to FDA is incredibly important. Companies need that predictability in order to make the investments that they do in long-term research and development. I think the impacts of the Chevron case are still being digested and we’re processing them. We could see more cases aimed at the FDA decision-making, which I think would be problematic.
DeFeudis: Are you worried about the stability of the current regulatory system?
Ubl: I tend to believe the FDA will remain the gold-standard regulatory body and review process not only in the US, but around the world. It may be buffeted by these developments, but I remain confident in the FDA.
DeFeudis: I also wanted to ask about the Biosecure Act. The latest version of the Biosecure Act would give companies until 2032 to cut ties or reduce their reliance on contractors like WuXi. Is PhRMA pursuing any additional changes?
Ubl: We certainly understand policymakers’ interests in this area, and in global competitiveness and public health and ensuring intellectual property protection. We’ve been engaging very pragmatically to ensure that policymaker interests are satisfied, but [also that] we don’t make any changes that exacerbate problems that policymakers are trying to solve — things that would lead to shortages in medicine, or disrupt patients’ involvement in clinical trials or the underlying research and development process.
DeFeudis: BIO came out in support of the Biosecure Act. How is PhRMA’s strategy similar or different?
Ubl: We haven’t taken a formal position on the law. We’re trying to engage responsibly and deferentially to the concerns raised by policymakers.
DeFeudis: You’ve been with PhRMA for almost 10 years now.
Ubl: Nine! [Laughs] I’m just kidding.
DeFeudis: What’s on the agenda for the next 10 years? Are you sticking around?
Ubl: I consider it a privilege to represent this industry and our companies. And I’m still very much enjoying it. I’ll serve as long as the companies believe that my leadership is effective. I personally don’t believe it’ll be 10 years, but I’m looking forward to the years ahead.