Countdown to the US presidential election! How do Trump and Harris feel about the biotechnology sector?

With less than 24 hours to go before the official voting of the US presidential election, American voters are heading to polling stations one after another. The campaigns of the two presidential candidates, Harris and Trump, have entered the final sprint. Who will they be able to move into the White House? And what different impacts will they bring to the pharmaceutical industry?

Firstly, Harris, as the new leader introduced by the Democratic Party, will continue to promote the series of policies deployed by the Biden administration in terms of policy advocacy, namely the health insurance," the Biosecure Act, and so on. Specific operations include, but are not limited to, increasing health insurance coverage; continuing to restrict cooperation and development with Chinese pharmaceutical companies under the pretext of "national security," etc.

At present, the Inflation Reduction Act has completed the first round of negotiations, and the Centers for Medicare & Medicaid Services (CMS) has announced that the price reduction for the first batch of ten drugs can reach more than 50%.

If Harris is elected, in the future, it is possible to implement the health insurance drug price negotiation plan, that is, in 2025, another 15 Part D drugs will be selected for negotiation, and the prices will take effect in 2027; in 2028, another 15 Part D and Part B drugs will be selected; and from 2029 onwards, 20 Part D and Part B drugs will be selected each year.

It is worth mentioning that Trump's control over drug prices is relatively small, and he is more inclined to regulate prices through market competition. In 2020, Trump adopted a similar method to reduce drug prices, proposing a model that would link Medicare Part B prices to the prices paid by other countries. This attempt was eventually withdrawn by CMS under the Biden administration.

As for the Biosecure Act, it has currently passed the vote in the US House of Representatives. The next step is to be voted on by the Senate. If passed, it will eventually be signed into law by the president. With the election about to be decided and the White House facing a change of personnel, will Trump continue to support the Biosecure Act?

In the field of biomedicine, Trump's attention to it is relatively weaker compared to the Democratic Party. In 2016, GEN conducted a survey of 2,300 members from the global biotechnology and academic communities.

The results showed that 47.7% of the respondents believed that Trump might not support funding for the National Institutes of Health (NIH), and only 25.52% of the respondents believed that Trump's election as president would have a positive impact.

However, this does not mean that Trump will not affect the biopharmaceutical industry; on the contrary, he may be more aggressive. For example, extreme tariffs to curb Chinese imports and promote the return of domestic manufacturing, adhering to the "America First" philosophy.

In 2018, the Trump administration imposed high tariffs on goods imported from China, but pharmaceutical products, including biopharmaceuticals, were not included in the tariff list. Representatives of the US pharmaceutical industry believe that China is the world's largest producer of active pharmaceutical ingredients, and many chemical raw materials are only produced in China, and suppliers cannot be found in the US or markets other than China.

However, during the outbreak of the COVID-19 pandemic, the Trump administration's own biosafety governance capabilities were widely questioned by the world. For example, taking unilateral measures to compete for epidemic prevention resources from allies; weakening global biosafety governance mechanisms and withdrawing from the World Health Organization.

Will Trump change his previous attitude this time and change the scope of tariffs?

An American lawyer said, "What you might see is that the Trump administration is willing to implement (the Biosecure Act) more quickly and combine it with many trade issues they are concerned about."

For Chinese pharmaceutical companies, this may reduce their opportunities to export raw materials and intermediates to the United States, but it may also prompt them to seek new market opportunities and partners.

As of the date, the voting for the 2024 US election has begun. Dixville Notch, a small town in New Hampshire, USA, as the first voting point, announced the voting results of six registered voters, with Harris and Trump tied at 3 votes each.

US media generally believes that the 2024 election is the most closely contested presidential election in the United States in recent years, and it is difficult to predict who will win or lose.

But no matter who is elected between Trump and Harris, they both maintain a tough stance on China. What can be foreseen at present is: (1) the reduction of US drug prices will trigger a price adjustment in the global pharmaceutical market; (2) it will affect China's innovative drug export strategy.

Chinese innovative pharmaceutical companies should actively respond by optimizing cost structures, exploring diversified export models (NewCo, etc.), and mastering core patents to change the situation of being at the mercy of others.

【Editor’s note】The above content (~4600 words) is a quick translation of a Chinese article (posted on 2024-11-05) by DrugTimes team. To read the original article, please click here. All comments are warmly welcome. Many thanks!