Murphy Introduces Legislation to Eliminate IRA "Pill Penalty" and Support Small Molecule Drug Innovation

Washington, D.C. — Congressman Greg Murphy, M.D. introduced the Ensuring Pathways to Innovative Cures (EPIC) Act alongside Congressmen Don Davis (D-NC) and Energy and Commerce Health Subcommittee Chairman Brett Guthrie (R-KY). This legislation fixes the Inflation Reduction Act's small molecule “pill penalty,” to ensure continued R&D investments into small molecule medicines.

"Small molecule drugs are critical therapies that Americans with cancer, neurological conditions, and other debilitating diseases rely on every day," said Congressman Greg Murphy, M.D. "The IRA’s price-fixing scheme shifts research and development away from these life-saving medications, ultimately leaving patients with fewer treatment options. American innovation leads the world and is critically important in saving lives and making progress towards eradicating cancer. Shortsighted proposals such as the "pill penalty" inhibit meaningful strides to lower drug costs and reduce access to life-saving treatments for those most in need."

"We must support the development of critical, life-sustaining medical treatments and cures," said Congressman Don Davis. "Access to high-quality, innovative health care must remain in reach for our most vulnerable patients."

"We are at the cusp of a revolution in health care, thanks to the innovation happening right here in the U.S. Patients and their families rely on these life-saving products for a better quality of life and for more time with their families," said Chairman Brett Guthrie. "Congress should be incentivizing investments in and development of cutting-edge therapies, not penalizing innovators for helping to drive real change in our health care system. The EPIC Act will ensure these life-saving products reach patients without picking winners and losers like the IRA currently does. I am proud to lead this bipartisan bill along with Congressmen Murphy and Davis and look forward to working with my colleagues toward advancing this bill."

Background
Under the Inflation Reduction Act's price-fixing model, small molecule drugs are eligible for selection to the “Medicare Drug Price Negotiation” program following 7 years after FDA approval – there is a two-year “negotiation period” and the price control then goes into effect at year 9.

Biologics are eligible for selection following 11 years after FDA approval – there is a two-year “negotiation period” and the price control then goes into effect at year 13.
 
The cost to bring a new drug to market can cost from several hundred million to several billion dollars. By reducing the ability to recoup losses incurred during drug development, many pharmaceutical companies have stopped pursuing new cures. R&D investments are already shifting away from small molecule medicines and manufacturers have paused clinical trials, harming patients with cancer and rare diseases. 

According to a University of Chicago policy brief, due to the 9-13 disparity, 188 fewer small molecule medicines will come to market, leading to 116 million life-years lost.

View the bill here