WASHINGTON, D.C. – Today, Chairman Roger Williams (R-TX) led a full Committee on Small Business hearing titled “Stifling Innovation: Examining the Impacts of Regulatory Burdens on Small Businesses in Healthcare.” Chairman Williams issued the following statement after today’s hearing

“Today’s hearing shined a light on how burdensome and sometimes unnecessary regulations can be harmful to small business innovation,” said Chairman Williams. “We must ensure the healthcare industry’s regulatory environment appropriately allows small businesses to create new medicines and treatment options without sacrificing patient safety. The House Committee on Small Business will continue to fight for our nation’s entrepreneurs in every industry.”

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Watch the full hearing here.

Below are some key excerpts from today’s hearing:

Chairman Williams: “The American Dream is built on risk and reward. If there's not going to be a profit incentive to bring new drugs to the marketplace, fewer businesses will dedicate the necessary research and development dollars to make them a reality. So, Mr. Newell, as a small pharmaceutical company, how do the IRA's price controls impact your business and deter innovation?” Mr. Newell: “Thank you, Chairman Williams. As you will have heard from my testimony, we've raised a substantial amount of capital through the years to bring our medicines forward and to build our business. We work in the biologics field, and I have other colleagues who work on small molecule medicines. In particular those are things that are pills that are given to patients. Particularly in the IRA we see that there are substantial disincentives for investors to invest in companies that make small molecule medicines, because of the different terms allowed for the introduction of the price negotiations that are mandated by the IRA. For biologics companies like Sutro, we have a 13-year window, but a small molecule manufacturer, innovator has a nine-year window. That is a disincentive to investors, given the tremendous amount of money that it takes to bring a drug forward to prove its safety and efficacy.”

Rep. Van Duyne: “Dr. Miller, I'm going to ask you, can you tell us how China is using the Inflation Reduction Act against us when it comes to new drugs?” Dr. Miller: “Thank you for the question. China views the biopharmaceutical industry as a place where it wants to be completely dominant, and the IRA sent a massive negative signal to all entrepreneurs, small companies and large companies basically saying that you're going to undergo centralized administrative price regulation. That plus the inability for the FDA to modernize clinical trials, means that the cost of developing drugs and doing trials in the U.S. and manufacturing is very high. I know people who are building companies, developing new therapies, and they're looking at lower cost sites, and they always ask me about China. They want to manufacture products in China. They want to do clinical trials in China. So that scientific knowledge, that technical knowledge, that manufacturing knowledge, the clinical knowledge in addition to all of the jobs which are highly paid and create a great innovative economic and scientific ecosystem, those ecosystems are leaving for China. And we just passed a law that sent and told the pharmaceutical industry to do more development in China, where it's a lower cost. So, we essentially functionally supported our greatest adversary.”

Rep. Alford: “Dr. Eagle, I want to start with you. You talked about how difficult it was to maintain your independent practice, that you eventually were forced to join a large hospital system. It's something I hear from my constituents as well. They're worried they won't be able to continue their small practices that serve rural Americans. Why is it so difficult to maintain a small practice, especially in rural America?” Dr. Eagle: “I think the two primary drivers, thank you for the question, are economics and regulations. You know, I think that, you know, the practice I had in North Carolina was more suburban than rural. But I think the problems are similar. You know, I think rural practices, you know, suffer from all the same problems that the other practices do. But, you know, you know, regulation is harder to manage in those situations. And reimbursement has been declining for those private offices the same as everybody else. I can't speak as an expert on rural medicine in that regard because I've never practiced in a truly rural, rural setting. But I think the problems are the same. There's just harder to solve.”

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