September 2023 Update

Serving the NC Life Sciences Industry

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After adjourning Aug. 16, the General Assembly is not anticipated to return for another voting session until the second week of September. 

 

While there are tentative plans to finally consider the state budget proposal that week, negotiations between the chambers continue to be fraught with difficulties. Points of contention exist both within the budget itself and with various policy provisions, like gaming, that have been part of the discussions. 

 

It’s also possible that committee meetings could be held in either chamber, but no floor votes are expected until at least the week of Sept. 11.

 

Before they adjourned, lawmakers voted to overturn six vetoes by Gov. Roy Cooper. The following bills will become law despite the governor's objections.

• HB 574 Fairness in Women’s Sports Act prevents biological men from competing in women’s sports.
• HB 808 Gender Transition/Minors prohibits gender transition surgery and puberty blockers for minors.
• HB 219 Charter School Omnibus makes various changes to laws affecting charter schools.
• HB 618 Charter School Review Board gives more authority over charter schools in North Carolina to the Charter Schools Review Board.
• HB 488 Code Council Reorg. And Var. Code Amend reorganizes the Building Code Council to create a new Residential Code Council and amends various North Carolina State Building Code provisions.
• SB 49 Parents’ Bill of Rights enumerates certain rights of parents related to the education, health, privacy and safety of their child.

North Carolina’s fiscal year ended on June 30 with total revenues of $33.5 billion, approximately $3 billion above the certified budget of the year.

 

Vacancy rates for state agencies have remained above 20%, which plays no small role in creating the surplus. For more information on state revenue, check out this revised consensus general fund revenue forecast from the NC Office of State Budget and Management and the General Assembly's Fiscal Research Division.

If there are any topics or issues that are affecting your business

or you want to know more about, please contact Laura Gunter.

The federal government announced on Aug. 29 that it will begin negotiating prices for the first 10 drugs covered by Medicare Part D. The drugs are:

• Eliquis by Bristol-Myers Squibb
• Xarelto by Johnson & Johnson
• Jardiance by Eli Lilly and Boehringer Ingelheim
• Januvia by Merck
• Farxiga by AstraZeneca
• Entresto by Novartis
• Enbrel by Amgen
• Imbruvica by AbbVie/Johnson & Johnson
• Stelara by Johnson & Johnson
• Fiasp; Fiasp FlexTouch; Fiasp PenFill; NovoLog; NovoLog FlexPen; and NovoLog PenFill by Novo Nordisk

The selection of several Novo Nordisk insulin drugs as a single product on the initial list of 10 Medicare Part D drugs selected for negotiation is a surprise. CMS said in June that the Inflation Reduction Act allows it to aggregate all dosage forms and strengths of a drug that have the same active ingredients. Novo Nordisk’s Fiasp, Fiasp Flextouch and Fiasp Penfill have insulin aspart as the active ingredient. However, Novolog, Novolog Flexpen and Novolog Penfill have insulin aspart recombinant, a different active ingredient.

 

The negotiations are expected to begin in October 2023 and will be completed by August 2024. If drug makers refuse to participate in the negotiations, they could face steep excise taxes.

 

"The Medicare price control provisions of the IRA are already significantly, and negatively, impacting the research and investment decisions of the biotech industry in the US," said Rachel King, BIO interim president and CEO.

 

"As we have said many times before, the IRA impacts not just the drugs targeted on today’s list, but the entirety of the biotech ecosystem that must make research and funding decisions many years in advance of ever hoping to bring a product to patients. BIO and our members will continue our efforts to thwart the overtly negative impact the IRA’s price control provisions will have on patient access, innovation and economic development more broadly."

 

Drug makers have sued the government in an attempt to block the price negotiations. However, the government is confident that the law is constitutional and that the negotiations will go ahead.

 

The announcement is a major victory for the Biden administration, which has been pushing to lower prescription drug prices. The administration has also implemented a number of other measures to lower drug prices, including a $35 monthly cap on insulin costs for Medicare beneficiaries.

 

CMS plans to publish the final negotiated prices by Sept. 1 of next year, and they will go into effect at the start of 2026.

 

The number of drugs subject to price negotiations will likely increase every year. The law allows CMS to negotiate the price of an additional 15 Medicare Part D drugs for 2027. For 2028, CMS can select another 15 Part D or Medicare Part B drugs, which covers drugs administered in a doctor’s office, such as chemotherapy.

 

Starting in 2029 and each subsequent year, CMS can add another 20 Part D or Part B drugs to the drug price negotiation program.

Drugmakers and trade associations have filed eight lawsuits challenging the Inflation Reduction Act’s Medicare drug price negotiation program. Here are summaries of the cases and where they stand:

 

Dayton Area Chamber of Commerce v. Becerra, U.S. District Court for the Southern District of Ohio (Sixth Circuit)

Filed: June 9

 

This challenge ? which was joined by the U.S., Michigan and Ohio chambers of commerce ? argues that the law violates the First, Fifth and Eighth Amendments of the Constitution.

 

Plaintiffs filed a motion for a preliminary injunction on July 12 to halt implementation of the drug price negotiations by Oct. 1, when drug makers are due to sign agreements with CMS to negotiate over the first 10 drugs selected. The Justice Department moved on Aug. 11 to dismiss both the case and the preliminary injunction request.

 

The chambers must reply to the government motions by Aug. 25, with a final DOJ response due Sept. 8.

 

National Infusion Center Association v. Becerra, U.S. District Court for the Western District of Texas (Fifth Circuit)

Filed: June 21

 

PhRMA brought this lawsuit with infusion providers and a colon cancer patient advocacy group.

 

They argue the law violates the due process clause of the Fifth Amendment and excessive fines clause of the Eighth Amendment by constraining drug makers’ ability to seek review of pricing decisions and imposing a large excise tax if they decline to participate. They also maintain that the government program “violates the separation of powers and the nondelegation doctrines” of the Constitution, which says Congress can't delegate its powers to other entities.

 

PhRMA and the groups filed a motion for summary judgment on Aug. 10. DOJ must file its opposition and cross-motion for summary judgment by Sept. 29. Replies from plaintiffs and the government are due Oct. 26 and Nov. 17, respectively.

 

Bristol Myers Squibb v. Becerra, U.S. District Court for the District of New Jersey (Third Circuit)

Filed: June 16

 

BMS argues the program violates the First and Fifth Amendments. BMS maintains the deals they’d have to sign with Medicare infringe upon free speech by “compelling” drug makers to echo the government’s “political messages.” The company also argues the program’s goal of prodding manufacturers to sell their products to the government below fair market value amounts to an illegal grab under the Fifth Amendment’s “takings” clause.

 

BMS filed a motion for summary judgment on Aug. 16. DOJ must file its opposition and cross-motion for summary judgment by Oct. 16. Replies from BMS and DOJ are then due on Nov. 10 and Dec. 8, respectively.

 

Janssen Pharmaceuticals v. Becerra, U.S. District Court for the District of New Jersey (Third Circuit)

Filed: July 18

 

J&J’s lawsuit is similar to many of BMS’ arguments, so much so that the drug makers agreed with the Justice Department to follow a combined briefing schedule to streamline the process.The drug maker also argues that the IRA illegally conditions Medicare and Medicaid participation with acquiescence to price negotiations.

 

Merck v. Becerra, U.S. District Court for the District of Columbia

Filed: June 6

 

The manufacturer claims the program violates the First Amendment and the Fifth Amendment’s "takings" clause, echoing fellow drug makers’ arguments. It expects CMS to name its diabetes drug Januvia as one of the first products subject to negotiation.

 

Merck filed a motion for summary judgment on July 11. DOJ must file its opposition and cross-motion for summary judgment by Sept. 11. Replies from Merck and DOJ are then due on Oct. 19 and Nov. 21, respectively.

 

Astellas Pharma v. HHS, U.S. District Court for the Northern District of Illinois (Seventh Circuit)

Filed: July 14

 

The Japanese drugmaker’s U.S. affiliate argued that the IRA violates the First Amendment and the Fifth Amendment's "takings" and due process clauses. Astellas has requested that its lawsuit be dismissed. Its prostate drug Xtandi was not included among the first drugs subject to Medicare price negotiations.

 

Boehringer Ingelheim v. HHS, U.S. District Court for the District of Connecticut (Second Circuit)

Filed: Aug. 18

 

The German pharma company echoes many of the same legal arguments made by other manufacturers ? that the program violates the First, Fifth and Eighth amendments’ protections for free speech, takings and excessive fines, as well as due process and the separation of powers.

 

AstraZeneca Pharmaceuticals v. Becerra, U.S. District Court for the District of Delaware (Third Circuit)

Filed: Aug. 25

 

The British drugmaker argues that CMS violated the Administrative Procedures Act because guidance implementing the program "impermissibly" redefines a "qualifying single source drug" to cover all dosage forms and strengths of a drug marketed with the same active ingredient. It also argues that the IRA is unconstitutional because it violates the Fifth Amendment's due process clause by eschewing notice-and-comment rule making.

The 340B Program has grown exponentially as hospitals take advantage of the opportunity to profit from drug discounts while the low-income and uninsured patients the program was meant to serve do not benefit, says the Biotechnology Innovation Organization in comments to a Senate working group.

 

The Senate’s 340B bipartisan working group is planning legislation to reform the troubled 340B system. The working group requested input as it investigates appropriate legislation to modify the program. BIO submitted a 12-page letter outlining the problems and suggesting potential solutions.

 

The 340B program is meant to allow hospitals and clinics serving low-income patients to obtain discounts on prescription drugs from drug manufacturers, and use those savings for the benefit of patients, but hospitals appear to be abusing the program.

 

“BIO believes that 340B discounts should be passed along to low-income and vulnerable patients. Congress created the 340B Drug Discount Program to help uninsured and vulnerable patients gain access to affordable prescription drugs and/or other healthcare services,” according to the letter from BIO. ”However, there are many covered entities that have abused the program and caused it to extend well beyond its intended purposes.” More at BIO >>

President Joe Biden's pick to run the National Institutes of Health has agreed to a pair of major ethics demands made by Sen. Elizabeth Warren but still faces hurdles to confirmation.

 

Monica Bertagnolli, who was nominated more than three months ago, pledged to not seek employment or compensation from any of the world's largest pharmaceutical companies for four years after she leaves government. She also agreed to recuse herself for four years from NIH decisions related to companies with which she's had prior relationships.

 

However, Bertagnolli is still mired in a separate standoff with Sen. Bernie Sanders (I-Vt.) that continues to block her path to the NIH job. Sanders, who chairs the Senate committee responsible for vetting Bertagnolli's candidacy, is denying her a confirmation hearing over demands that the White House take greater unilateral action to cut drug prices.

 

Sanders has pushed the White House for months to take a series of aggressive unilateral steps to slash drug costs. But Biden officials have so far resisted because of the practicality and legality of such moves, arguing that they've already taken the most effective action to rein in drug prices through the passage of the Inflation Reduction Act.

The Centers for Medicare & Medicaid Services announced on Monday a new program that will allow seniors to spread their out-of-pocket drug costs over 12 months. The program, called the Medicare Prescription Payment Plan, is voluntary and will start on January 1, 2025.

 

The program is part of a larger redesign of the Medicare Part D prescription drug benefit, which was passed under the Inflation Reduction Act. The IRA also includes a $2,000 annual cap on out-of-pocket drug costs under Part D, which also starts in 2025.

 

Under the Medicare Prescription Payment Plan, seniors will be able to choose to pay their out-of-pocket drug costs via capped monthly installments instead of all at once at the pharmacy. This will be helpful for people with Medicare Part D who have high cost-sharing earlier in the plan year, as it will allow them to spread out those expenses over the course of the year.

 

CMS has released the first of two draft guidance documents outlining the program. The second guidance document, which will include more details about how the program will impact insurers, is expected to be released in early 2024.

 

Medicare recipients can opt into the new program starting with the 2025 plan year by contacting their insurer.

On Aug. 22, FDA Commissioner Robert Califf said he was concerned about the growing number of drug shortages in the United States. He called the shortages a "national security threat" and said they are not good for society.

 

Califf said the root of the problem is that the generic drug industry is being squeezed by low prices. He blamed the pricing squeeze on the success of generic drug laws, which have enabled wider access to generic drugs over the last several decades.

 

Califf said it's time for changes to the generic drug market so that the industry can be sustained. He also placed some blame on consolidation among hospital pharmacies and distributors.

 

To help right the ship, Califf said the FDA needs more information to map out the entire pharma supply chain to identify weaknesses. He suggested that the FDA should be able to intervene when there is an impending shortage.

 

The FDA is also moving toward greater transparency in two related areas:

• Plant inspections will be more available on the internet and easier to find.
• The agency will also work to illuminate its "quality management framework" for those inspections.

Meanwhile, lawmakers are well aware of supply chain problems. In one recent bid to improve the situation, Sen. Gary Peters, D-Michigan, proposed a bipartisan bill to create a federal database to map supply chain vulnerabilities.

 

The proposed legislation would require the Department of Health and Human Services to track the origin of each drug, quantities available and the location of the facilities used to manufacture them. The law would also map out inspections, recalls and import alerts. More at Fierce Pharma

Rep. Wiley Nickel and staff representatives from the offices of Sen. Ted Budd; Rep. Gregory Murphy, M.D.; and Rep. Deborah Ross were part of a roundtable convened by NCBIO and hosted by Alexandria Real Estate Equities to discuss the small molecule penalty that is part of the IRA, as well as the R&D tax amortization issue. Both are affecting many NCBIO members with smaller, early-stage companies being hit particularly hard. The roundtable gave several companies, including G1 Therapeutics, Mycovia Pharmaceuticals, Tavros Pharmaceuticals and Ribometrix, the chance to share their pain points.

To be included in member news, send information about your organization to David Etchison.

The North Carolina Biotechnology Center awarded 31 grants and loans totaling $2,764,811 to universities, life sciences companies and non-profit organizations in the fourth quarter of its fiscal year.

 

Four life sciences companies received loans totaling $1.25 million to advance their research, product development, commercial viability and funding efforts. Seventeen life sciences companies that previously received loans from NCBiotech raised $44.7 million in follow-on funding from other sources in the fourth quarter, according to NCBiotech.

 

Transylvania County received a $40,000 Partnership Development Grant to support Raybow Pharmaceutical’s expansion in Brevard. 

 

Seven universities were awarded 19 grants totaling $1,443,323 to advance bioscience research. Six universities received eight Flash Grants, which support creative ideas that show early indications of commercial potential. Three Innovation Impact Grants were awarded to support the purchase of research equipment for core facilities at academic or nonprofit institutions that foster innovation. Eight Translational Research Grants were awarded to fund projects that explore potential commercial applications or initiate the early commercial development of university-held life sciences inventions.

 

Two universities and two nonprofit organizations received Biotechnology Event Sponsorships, which provide up to $3,000 to support life sciences-focused events held primarily for a North Carolina audience. One university and one nonprofit organization received Biotechnology Meeting Grants, which provide up to $10,000 to support national and international life sciences-focused meetings held in North Carolina. More at NCBiotech >>

BD received FDA 510(k) clearance for the BD Respiratory Viral Panel for BD MAX System, a single molecular diagnostic combination test that identifies and distinguishes SARS-CoV-2, influenza A, influenza B and Respiratory Syncytial Virus in approximately two hours. More >>

 

BioAgilytix Labs, LLC has endorsed the United Nations Global Compact formally committing to align company strategies and operations with the UNGC Ten Principles and to take action to advance the United Nations Sustainable Development Goals. More >>

 

Biogen Inc. and Sage Therapeutics, Inc. announced that the FDA approved ZURZUVAE (zuranolone) 50 mg for adults with postpartum depression. More >>

 

Cushman & Wakefield was named one of the Triangle Business Journal's 2023 Best Places to Work. More >>

 

G1 Therapeutics was named one of the Triangle Business Journal's 2023 Best Places to Work. More >>

 

Novo Nordisk hosted 100 students from around the world at its Future Scientist Summer Camp in Denmark. Two of the three students representing the United States were from the greater Triangle region, home to Novo Nordisk’s largest U.S. manufacturing footprint.

 

The PPD clinical research business of Thermo Fisher Scientific Inc. has been granted a five-year award to provide a Transplantation Statistical and Clinical Coordinating Center for the National Institute of Allergy and Infectious Diseases. More >>

 

Smith Anderson was named one of the Triangle Business Journal's 2023 Best Places to Work. More >>

 

Wyrick Robbins was named one of the Triangle Business Journal's 2023 Best Places to Work. More >>

Save Sept. 12 at noon for the NCBIO DEI Virtual Forum Rising and Failing of Employee-Led groups.

 

Find out more about business resource groups, employee resource groups and affinity groups during this NCBIO virtual forum. Groups can cover a diverse range of DEI areas including neurodiversity, generational issues and disabilities in the workplace.

 

Panel members are:

• Josh Jones, director, sales and business development, Frankel Staffing (moderator)
• Ellen King, micro lab group leader / DE&I manager, Novozymes
• Jamie Ousterout, chief experience officer, The Diversity Movement

In addition to the panel discussion, three breakout sessions will give forum participants a chance to discuss how to set up employee groups and share experiences on what does and doesn’t work.

Register now for this year's Annual Meeting on Oct. 4. There is a $50 registration fee per attendee.

 

The program features a keynote presentation by Emily Chee, U.S. general manager, Novartis Gene Therapies, and three panel sessions. 

• Federal Update featuring ACRO, AdvaMed, BIO, IQVIA and PhRMA
• ​Navigating Regulatory Hurdles in Pharma and Food with Azzur Group, Duke University School of Medicine, Novozymes, Pairwise and Syneos Health
• The Customer's Journey moderated by Care4Carolina and features patients impacted by spinal muscular atrophy, sickle cell, cardiovascular disease and diabetes

See the complete list of speakers here. You will have a number of opportunities to connect with attendees during the day. We hope you will join us on Oct. 4.

Podcast Sponsor

Register today for MDMA's 2023 virtual Executive Forum, which will be held on Sept. 22.

 

MDMA is the leading voice for innovative and entrepreneurial medical device companies, and this year's Executive Forum will deliver key insights on regulatory, reimbursement and other issues facing our industry.  

• MDMA Members - $395
• State Members - $495
• Nonmembers - $595 

Contact Amber Niebauer for a discount code for 10% the registration fee.

Regarded as a homecoming for the global medtech community, this event serves as the incubator for the ideas, partnerships and innovations that lead to a healthier world.

 

The 2023 conference will take place in Anaheim, Californa, where you can engage in face-to-face conversations that will enhance your passion for what you do, enjoy quality programming focused on today’s hot topics and experience the best networking in the business. Tomorrow’s advancements start with us ? be part of the most prestigious gathering of medtech leaders.

Join the Economic Development Partnership of North Carolina and its partners from US Commercial Services and the Small Business & Technology Development Center for a lunch and learn about the free services and grants available to help achieve new sales in international markets for both new-to-export and experienced companies.

 

The panel will also provide insight from North Carolina companies; National Drug Source, which has successfully used these resources and exports to dozens of countries; and Sciencix, which received the National Small Business Exporter of the Year Award by the Small Business Administration.

 

Panel

• Lisa Bamford, director of business development and global marketing, Sciencix (moderator)
• Emily Gereffi, senior international trade specialist, USCS
• Mike Hubbard, director of international trade, EDPNC
• Ethel Torres, president & CEO, National Drug Source
• Alex Viva, director of international business development and director of Capital Regional Center, SBTDC

Save the date for a Pfizer Ignite event to be held at the NC Biotechnology Center Nov. 13. Hosted by NCBIO and NCBiotech.

The High Flyer Awards Luncheon celebrates and honors those companies and individuals who have contributed to high science, high impact innovation and the entrepreneurial ecosystem as a whole.

 

Join First Flight Venture Center in celebration of the entrepreneurial spirit at our Third Annual High Flyer Awards Luncheon on Nov. 17 from 11 a.m. - 1 p.m. at Prestonwood Country Club.

• BIO Investor Forum Event Preview and Partnering Best Practices  (9/7/2023)
• Doing Business in Southeast Asia: Business Culture Tips for Singapore and Malaysia hosted by EDPNC (9/8/2023)
• Automation, Process Control, and Real-time Monitoring of Yeast Culture hosted by BTEC (9/12/2023 to 9/14/2023)
• PAT for Real-time Culture Monitoring and Closed-Loop Process Control hosted by BTEC (9/12/2023 to 9/14/2023)
• NCBIO DEI Virtual Forum: Rising and Failing of Employee-Led Groups (9/12/2023)
• BioPharm America (9/13/2023 to 9/14/2023)
• Tecnosalud International  (9/13/2023 to 9/14/2023)
• ABCs of New Technology and Brews + Bytes hosted by NC TECH (9/13/2023)
• Cell Culture Engineering: A Single-Use Perspective hosted by BTEC (9/19/2023 to 9/21/2023)
• Market Shaping to Build Awareness in Advance of New Product Launches hosted by NCBiotech (9/19/2023)
• Informing Innovation hosted by NCBiotech (9/20/2023)
• Brews + Bytes hosted by NC TECH (9/20/2023)
• Privilege Walk hosted by The Diversity Movement (9/21/2023)
• Medical Technology Executive Forum hosted by MDMA (9/22/2023)
• Certified Industrial Hygienist Review Course hosted by UNC (9/25/2023 to 9/29/2023)
• Navigating the EU Medical Device Regulation (MDR) hosted by U.S. Department of Commerce (9/26/2023)
• Early Career Development hosted by ISPE CaSA (9/26/2023)
• North Carolina Engagement Meeting hosted by NIIMBL  (9/27/2023)
• NCBIO Annual Meeting 2023 (10/4/2023)
• Navigating the EU Medical Device Regulation (MDR) hosted by U.S. Department of Commerce (10/5/2023)
• Science of Socializing hosted by Azzur Group (10/5/2023)
• MedTech Conference hosted by AdvaMed (10/9/2023 to 10/11/2023)
• Hands-On Single-Use Processing for Biopharmaceuticals hosted by BTEC (10/10/2023 to 10/12/2023)
• Microbial Contamination Control in Bioprocessing Operations hosted by BTEC (10/10/2023 to 10/12/2023)
• International Life Sciences and Real Estate Conference hosted by BISNOW (10/11/2023 to 10/12/2023)

ALT is hosting a summer sale with special pricing on the following Agilent Certified Pre-Owned Gas Chromatography Systems: the state-of-the-art 7890A+/5975C GC/MSD and the versatile 7890A with FID systems. Additionally, ALT is offering various configuration options to suit diverse analytical needs.

Life Sciences and biotechnology companies invest substantial amounts of time performing research and development activities. These activities often involve significant expenditure in developing, designing, and testing new scientific theories, associated with the creation of therapeutics, drugs and devices. Even if the development was not considered successful, companies like yours can benefit from federal tax laws that extend and broaden the availability of R&D tax credits. If your company invests in qualified research activities, you may be able to reduce your income tax liability or your payroll tax liability.  

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