Venture Capitalist Letter Addressing President Trump’s MFN EO
early stage life sciences community, write in strong opposition to the recently signed Executive Order (EO), Lowering Drug Prices by Putting America First.
August 21, 2020
The Honorable Donald J. Trump
President of the United States
The White House
1600 Pennsylvania Avenue NW
Washington, DC 20500
Dear President Trump:
At a time of global health crisis, we the undersigned leaders in the early stage life sciences community, write in strong opposition to the recently signed Executive Order (EO), Lowering Drug Prices by Putting America First.
While the life sciences community works tirelessly, and in unprecedented time, to create solutions and develop vaccines for patients in need, the recent “most favored nation” (MFN) Executive Order from President Trump will effectively disrupt the American drug discovery pipeline responsible for such scientific strides.
As stewards of drug discovery, we are concerned about the unintended consequences of these orders on the future of American drug innovation. We previously warned about the dangers of price controls through reference pricing, but it is evident that we must underscore the dangers that this policy would bring.
Capital is the vehicle that drives innovation forward in the risky and expensive world of medicine, transforming discoveries into life-saving drugs. If the policy this EO appears to outline is implemented, VC funding from pensions, endowments, and other large pools of capital will dry up and the industry will receive less investment due to diminished return on investment (ROI). Once the incentive to invest is removed from the equation, scientists and entrepreneurs will no longer have funding to pursue their discoveries, thus crippling the greater American biopharmaceutical economy.
We fear that under this Order, the U.S. will fall behind in global competitiveness in the biotechnology and pharmaceutical sectors and will forfeit its role as a champion of medical discovery. The price of drugs in Europe and other countries cannot sustain the costs of innovation, and, if implemented in the U.S., we worry that potential cures and technologies will never reach fruition.
We understand the significant need to lower drug prices for patients, however, tying Medicare prices for drugs to those paid by other countries is not the answer. Instead, we must find a solution for patients that continues to incentivize innovation supported by both public and private capital.
The public-private collaboration has allowed research that, we are optimistic, will find a vaccine for COVID-19. Last week alone, NIH and Moderna announced the start of phase 3 trial for its mRNA-1273 vaccine and the NIH clinical trial testing began for the Adaptive COVID-19 Treatment Trial 3 (ACTT 3), a combination of Gilead Sciences’ Remdesivir and interferon beta1a. Whether or not these discoveries become the solutions to the current pandemic, we should recognize the collective R&D effort from our early stage ecosystem that has driven this innovation.
This pandemic has shown that we are nowhere near the apex of scientific discovery. The potential of American R&D is exponential, and COVID-19 will not be the last pandemic we face. Now is not the time to stifle the opportunity to save lives and help those in need. On behalf of the early- stage life sciences community, we urge you to reconsider the “most favored nations” Executive Order, for the patients of today and of the future.
John Stanford Executive Director Incubate
Ari Glantz Director New England Venture Capital Association
Anthony Walsh Partner Mission BioCapital
Stephen Rapundalo President and CEO Michigan Biosciences Industry Association
Marc Goldberg Managing Partner BioVentures Investors
Amy Millman President Springboard 2000 Enterprises Inc.