Navigating the IRA, Tariffs, and the Current Pharma Landscape: Q&A with Rob Abbott

Rob Abbott
CEO and executive director
ISPOR

Rob Abbott, the CEO and executive director of ISPOR, spoke with Pharmaceutical Executive about the how the industry can strategize in the current environment. While tariffs are a major concern, there are also other issues that present both opportunities and challenges to the pharma industry.

Pharmaceutical Executive: The collection of data has become more accurate, widespread, and precise. So how is this shaping the role that real world data is playing in the modern pharma landscape?
Rob Abbott: It's probably fair to say that the acceleration of technology and the digital transformation of health are mega-trends. Within healthcare, broadly speaking, data is going to be you. It’s the key arbiter of decisions. Moving forward, it's quite clear that real world data and evidence are going to be informing healthcare decisions. They're also going to be informing drug development decisions, to an extent that honestly, we can only begin to imagine. We're likely still going to be surprised by the scope and impact that data has.

Now, one caveat that I would introduce here (and there's probably more than one) is data quality. This has been getting better, but we must pay real attention to the quality of the data. If we're basing decisions on data that is not of high quality or uniform, that potentially creates problems down the road.

PE: What are your predictions for the IRA’s impact on drug pricing reforms?
Abbott: From my perspective, it's fundamentally about value. How do we get to greater value for patients? How do we bring the best that medical science has to offer to the greatest number of patients at reasonable cost? It's important to keep a watching brief on this, but the new administration has signaled an interest in the continuation of drug price negotiations, so I anticipate that there will continue to be this dialog between the federal government and the pharmaceutical industry on the other. From the government's perspective, they view this as negotiating. Within the pharmaceutical industry, there's a desire that it be a genuine negotiation. It'll be interesting to see how this plays out. It's still very early days, and we've been through an initial round of drugs. We're poised now for this the second round. There's a lot of learning that's going on both sides. I anticipate that this will continue to be a key input into the price of drugs and the pharmaceutical piece of the healthcare ecosystem. I would just like us not to lose sight of that entire ecosystem.

PE: If drug prices do increase, what impact would that have on other health care costs?
Abbott: The affordability challenge is being felt not only in the United States, but around the world. This is why it's so important to look at the healthcare ecosystem, because if drug prices increase, that ultimately is going to mean that more people are going to be challenged in accessing new treatments because they won't be able to afford them. That's coming at it from a patient perspective, but if we look at it from a payer perspective, that burden is also going to be very high. I have spoken to payers and insurers, not only in the United States, but elsewhere in the world. There's an excitement about new, innovative therapeutic treatments, but there's also this feeling of concern about how we are going to pay for that. The affordability challenge goes far beyond drug pricing. It includes all of the components of the healthcare ecosystem, and we need to look at all of those components if we're actually going to get to a genuinely sustainable solution.

PE: What are the biggest opportunities the pharma industry has in the current environment?
Abbott: Related specifically to drug pricing: this is where things get especially interesting. It brings us into the realm of innovation. On the one hand, there is an argument that the IRA and the focus on drug price negotiating could result in less revenue for pharmaceutical companies. That would be a curb on innovation. And there's an argument that can be made that a lot of the really innovative discovery research is happening in smaller companies that have been spun out of university research labs. There's an impact on the larger pharmaceutical companies, for certain, but there's also an impact on those smaller startups. The opportunities have a lot to do with focusing on those interventions or drugs that are likely going to have the greatest therapeutic benefit, and it’s very difficult to say with precision that this intervention will convey more benefit or have more positive impact than another.