(The Center Square) – South Dakota could lose over 270 jobs tied to the biopharmaceutical industry because of the Biden administration’s proposed drug pricing policies, a new study found.
The Smart Prices Act is part of President Biden’s 2024 budget.
It would allow Medicare to set prices for some drugs five years after FDA approval, among other things.
A study released by Vital Transformation and We Work for Health found if the government-mandated drug pricing policies were implemented, it would result in a loss of up to nearly 90 direct biopharmaceutical industry jobs in South Dakota and a total loss of 272 jobs in the state.
“It’s frustrating to see the consequences that the Inflation Reduction Act is already having on research and development and it’s even more frustrating to see what we can expect if lawmakers expand government-mandated price policies,” said Joni Ekstrum, executive director of the South Dakota Biotech Association. “Studies show that expansion of these flawed policies could cost South Dakota 272 jobs and result in a drastic reduction of treatments for patients. We encourage our elected leaders in South Dakota to work with their colleagues in Congress to find solutions that support job growth and supports patients.”
Throughout the United States, potential estimated job losses tied to the SPA were between 146,000 and 223,000 for direct biopharmaceutical industry jobs and 730,000 to 1.1 million total job losses across the U.S. economy, according to the study.
The projected drop in revenue meant a reduction as high as 68% in future FDA approvals, the study said.
“The SPA penalizes the most innovative, successful therapies which fund an outsized amount innovation in the U.S. biopharma ecosystem,” the researchers said.
They said the impacts would be felt the most in rare diseases, oncology, neurology, and infectious disease.
Lawmakers who support the SPA say it is meant to help make medications more affordable.
“No American should go broke just to afford the medications they need to stay healthy. Our Inflation Reduction Act finally empowered Medicare to negotiate for lower drug prices, but that was just the first step to tackling big drug companies’ high costs,” said Sen. Tammy Baldwin, D-Wisc. “We need to do more to hold big pharma accountable and provide relief for our seniors who are struggling to afford their medications. The SMART Prices Act builds on the progress we’ve made for our seniors by lowering the cost of more prescription drugs, sooner, and saving taxpayers money.”
