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LATEST RESEARCH
VT Research Finds a 37% Decline in Small-Molecule Oncology Follow-On Research Following the Inflation Reduction Act
Key Findings
1. Decline in overall follow-on research
The observed number of follow-on studies decreased by approximately 12%, from 610 before the IRA to 535 afterward. Oncology accounted for much of this decline, with the observed number of follow-on cancer studies falling by 20%, from 325 to 260.
2. Significant decline in small-molecule cancer research
The study’s statistical models estimated a 37% decline in the average annual number of small-molecule oncology follow-on studies, from 52 before the IRA to 33 afterward. The analysis also identified a modeled 27% decline in lead-indication small-molecule oncology approvals.
These findings provide evidence that research involving small-molecule cancer medicines may have been particularly affected following the IRA’s introduction.
3. Reduced share of research targeting rare cancers
The proportion of follow-on oncology studies focused on rare diseases, known as orphan indications, declined by 14% after the IRA’s introduction. This finding raises questions about the potential implications for research involving patients with rare cancers and limited treatment options.
4. Different trends in hematology
In contrast to oncology, the study found an increase in follow-on small-molecule hematology studies. However, this increase started from a low baseline, and the overall findings for hematology differed from those for oncology.
LATEST COMMUNICATIONS
Our Communication Services
In this episode of the Vital Health Podcast, host Duane Schulthess speaks with Harry Bowen, Economics Research Partner at Vital Transformation, about their newly published study on the Inflation Reduction Act (IRA) and late-stage drug research, including additional uses of medicines after their first FDA approval.
They explain why separating small molecules from biologics and examining the mix of research across disease areas can reveal patterns hidden in aggregate results. The conversation also covers policy expectations, venture capital, global biopharma competition, and the economic trade-offs involved in tariffs and domestic manufacturing.
MORE RESEARCH
Antimicrobial Resistance (AMR) Project
- Antimicrobial resistance (AMR) increases healthcare costs, hospital stays, and readmission rates, creating a growing economic burden on the U.S. healthcare system.
- Based on a cohort of 50,189 patients, with 13% experiencing AMR infections, the following impacts were observed:
- An additional 4 days of hospitalization per AMR infection.
- An additional $21,453 in direct medical costs per AMR infection.
- A 28% hospital readmission rate for AMR patients, compared to 21% for non-AMR patients.
- AMR is estimated to cost the U.S. $31 billion annually in 2025, increasing to $52 billion by 2045.
- The projected 20-year economic burden of AMR in the U.S. is $655 billion in net present value.
PREPRINT NEW RESEARCH: The Inflation Reduction Act’s Impact Upon Late-Stage R&D
Vital Transformation is preparing a new analysis with a total of 1148 secondary trials from 364 FDA-approved medicines, published from 2018 to 2025, obtained from Biomedtracker and clinicaltrials.gov. Using fractional multinomial logit, we model the share distribution of secondary indication studies across 19 disease groups and assess the change in this distribution post-IRA. We also assessed the number of secondary treatment studies pre- vs. post-IRA using multiple linear regression.
PREPRINT NEW RESEARCH: The Impact of MFN on Oncology and Hematology Treatments
Vital Transformation is preparing a new analysis about the potential implications of Most Favored Nation (MFN) drug pricing policies for the U.S. oncology ecosystem, focusing on how international reference pricing could reshape provider economics, patient access, and innovation incentives. The analysis models the effect of benchmarking U.S. prices for cancer medicines against lower prices in selected peer countries and estimates substantial reimbursement reductions across multiple therapies.
VITAL HEALTH PODCASTS
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VT on X
Claims that the IRA wouldn’t affect innovation overlooked how early-stage investors really make decisions. Our research shows the pipeline for senior-focused therapies is already narrowing.
— VitalTransformation (@VitalTransform) April 18, 2025
Read the full breakdown: https://t.co/4EzJGdMcU4@weworkforhealth #IRA #DrugPricing
The IRA’s 9-year cap for small molecules and 13-year cap for biologics rerouted investment away from the pills seniors rely on. We sat down with @steveusdin1 to unpack how this shift skews R&D incentives and future therapies.
— VitalTransformation (@VitalTransform) April 27, 2025
Listen here: https://t.co/FCjKFdIhsU@weworkforhealth pic.twitter.com/phoDI4ZrhK
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