Incubate releases statement on Fitch Ratings’ analysis of Medicare drug price negotiations
Fitch Ratings recently released an analysis showing that Medicare's drug price negotiation program is expected to deter investments into small molecule drugs.
09.26.2023
WASHINGTON, DC: On Friday, Fitch Ratings released an analysis showing that Medicare’s drug price negotiation program is expected to deter investments into small molecule drugs.
Incubate executive director John Stanford issued the following statement:
“For over a year, Incubate has sounded the alarm about how the small molecule penalty will negatively affect investments in life sciences and lead to worse patient outcomes. Last week, one of the largest credit rating agencies in the world has echoed our warnings.
A new analysis from Fitch Ratings finds that ‘Companies may focus more on complex biologic products that benefit from longer periods before price negotiation is required, with less attention and investment for small molecule drugs, as they tend to lose the vast majority of their sales in the 12 months following patent expiration. This may affect pharmaceutical companies’ product diversification and growth prospects.’
Incubate remains committed to educating policymakers on the need for 13-year parity for small molecule drugs and biologics.”
###
About Incubate
Incubate is a 501(c)(4) organization of venture capital firms representing the patient, corporate, and investment communities. Our primary aim is to educate policymakers on the role of venture capital in bringing promising treatments to patients in need.