Medical innovation has transformed once-deadly diseases into manageable conditions and dramatically improved life expectancy. But these advances depend on sustained investment in research and development.
When policymakers undervalue high-impact medical interventions, the consequences extend far beyond short-term savings and reduced patient access. Reduced incentives to innovate can weaken the entire ecosystem that supports the discovery of new medicines. The ecosystem is built on three interconnected pillars: public-private partnership, intellectual property (IP) protection and reimbursement that incentivizes continued innovation.
The first pillar is investment in research and robust public-private collaboration. Public-sector research often contributes to foundational basic scientific understanding, but the reality is that private biopharmaceutical firms are responsible for the vast majority of the discovery, development, clinical trials, regulatory approval and manufacturing that brings medicines to patients. This public-private partnership is not incidental to drug discovery and translational research; it is foundational to it.
The second pillar is intellectual property protection. Patents are the cornerstone of the American IP system, providing innovators with a limited-term protection that makes high-risk, long-horizon investment possible. Evidence shows that when IP protections are weakened, private-sector investment quickly declines due to uncertainty about whether a society values new innovation and whether innovators can realize a fair return on the value of their contributions to society. IP rights promote innovator-versus-innovator competition by attracting investment and encouraging the development of alternative treatments during the exclusivity period. Weakening IP protections undercuts the incentive to take on the massive, high-risk investments required to bring a medicine from an idea, through discovery, development, approval, access and reimbursement, to the patient. As evidence makes clear, the U.S. biopharmaceutical innovation ecosystem was built on a well-calibrated, balanced IP framework, and now supports a competitive pipeline of more than 8,000 new medicines globally being developed across the industry.
The third pillar centers on incentives and pricing structures. Pricing and reimbursement signal whether developing the next generation of therapies is worth the considerable effort and risk. Recent policy changes illustrate how incentives influence investment decisions. The Inflation Reduction Act (IRA) established a process for the federal government to set the Medicare price of drugs with manufacturers, prior to expiration of IP protections. The timetable for products to be subject to this price-setting is shorter for small-molecule drugs than for large-molecule drugs (i.e., biologics). Because government-set prices disincentivize future investment, small-molecule development is likely to decline relative to biologic development. Consistent with market-based economic principles, early evidence indicates this is occurring. Data now shows that the monthly average of small-molecule trials dropped by 45% post-IRA (compared with a 33% drop for biologics). These findings highlight that when the government sets prices and signals reduced interest in innovation, R&D and clinical trials respond.
This dynamic would only be further compounded by proposals to import foreign price controls into the American market.
What policies help patients access innovative medicines in the United States?
The progress achieved through medical innovation reflects long-standing support for a uniquely American ecosystem that turns scientific discoveries into a broad set of novel medicines available to patients.
To guarantee that Americans continue to benefit from therapeutic advances, policymakers must prioritize patient-centered policies, such as protecting IP policies. While comprehensive systemic changes will take sustained effort, the following tangible objectives can be advanced now:
- Preserving a balanced intellectual property framework that encourages medical advances and supports competition.
- Standing against initiatives that erode patent protections.
- Affirming that robust IP supports competitiveness and improves health outcomes.
Medical innovation has delivered extraordinary progress over the past several decades. By adopting policies that sustain investment while improving access, the United States can enjoy the benefits of breakthroughs that improve and save lives.
Across this series, we have seen how medicines have transformed diagnoses into manageable conditions and extended American lives, how the U.S. delivers those breakthroughs to patients faster than any other country and how the ecosystem that makes all of this possible depends on getting incentives right. The value of health is real, measurable and worth protecting. Undervaluing medicines threatens the entire chain of innovation, access and value.
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