Issue Brief: The Impact of HR 5376 on Antiviral Innovation and Patient Health | November 2021

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This issue brief reviews the evidence-base to assess the impact HR 5376 on innovation into antivirals and patient health. A large academic literature estimates the effect of future drug revenues on R&D spending and finds that on average that a 1 percent reduction in revenue leads to a 1.5 percent reduction in R&D activity. We find that HR5376 will reduce revenues by 15 percent through 2039 and therefore that the evidence base predicts that R&D spending on antivirals will fall about 23.1 percent, amounting to $165 billion. We find that this cut in R&D activity leads to 21 to 43 fewer new antivirals, dependent on methodologies used to estimate new drugs from R&D spending. This drop in new antiviral drugs is predicted to generate a loss of 82.4 million life years, about 7.7 times as large as the life years lost from COVID-19 in the US to date. For HIV, the largest antiviral class, we find 4 to 9 fewer new drug approvals during that period with 2.5 to 5.1 million lost life years for HIV patients, about 24 to 48 percent of COVID-19 losses in the US to date. These estimated effects on new number of drugs are about 37 to 68 times larger than projected by CBO which finds that only about 5 fewer total drugs will be lost until 2039, equaling a 0.63 percent reduction. In addition, we find that the changes in the catastrophic phase of Medicare Part D will add additional negative impact on antivirals as they are often for chronic conditions such as HIV that involve large annual spending. The incentives for the rapid response in antivirals we saw in response to the COVID-19 pandemic would be greatly reduced under HR 5376.Click here to read the full paper.


Posted on

November 29, 2021

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