For the pharmaceutical industry caught in the crosshairs of a potential trade war, the consequences of U.S. tariffs on China or Europe remain largely speculative, although both would be detrimental, according to a Korea Biotechnology Industry Organization (KoreaBIO) issue briefing Feb. 7.
“This current administration is like nothing that we've seen before,” said a managing partner of a global venture capital firm who spoke to BioWorld on the condition of anonymity. “President Trump’s first term was bad,” he said, “but nobody knows what’s coming.” “This is truly nationalism at its worst, because he won on the campaign [largely] to protect American jobs, claiming that Americans have been unfairly treated.” And it's not just China, he said, but India and other countries will also likely be affected.
In fiscal 2023, the NIH spent more than $35 billion on nearly 50,000 competitive grants to more than 300,000 researchers at more than 2,500 universities, medical schools and other research institutions across the nation. Of this funding, the NIH said about $26 billion was spent on direct research costs, while $9 billion was allocated to help cover “facilities and administration” through the agency’s indirect cost rate.
The fast pace in which the Trump administration has rolled out changes to how government and businesses operate – a disruptive effort that appears to be creating a new world order – has caught the attention of biopharma industry leaders who spoke Tuesday at the Biotechnology Innovation Organization’s CEO and Investor Conference in New York.
The immediate implementation of the U.S. NIH’s guidance to cut indirect costs included in its grants to 15% was quickly halted late Feb. 10 when a federal district judge granted a nationwide temporary restraining order in two separate challenges to the cuts that were to go into effect that day on all existing and new NIH grants.
The European Commission issued a set of guidelines for the use of AI as a supplement to the EU’s Artificial Intelligence Act, a document of which chatbot developers will want to take note.
Cognition Therapeutics Inc. evolved from the work of a neuroscientist and a chemist working in the San Francisco Bay area, seeking out targets to block the effects of Alzheimer’s disease. Since the company’s 2007 inception, it has received close to $200 million in U.S. NIH grant funding. Investors often tell CEO Lisa Ricciardi, who joined the company in 2020: “’That’s because you have a relationship with the FDA.’ Well, no. It’s because it’s competitive” and the company’s research has met the muster. “You have to apply two or three times. … It’s with rigor that these results are generated and that we’re able to get more funding.”
From Feb. 10, the U.S. NIH is to cut the amount of its grants that go to indirect costs, in a move it says will save $4 billion per annum, but which scientists say will hit breakthrough biomedical research. The NIH announced the cut on Friday, Feb. 7, saying there would be a flat rate of 15% for indirect costs, such as running laboratories, buying and maintaining equipment, data processing and storage, across all of its grants. That compares to an average rate historically of between 27% and 28%, the NIH said.
For the pharmaceutical industry caught in the crosshairs of a potential trade war, the consequences of U.S. tariffs on China or Europe remain largely speculative, although both would be detrimental, according to a Korea Biotechnology Industry Organization (KoreaBIO) issue briefing Feb. 7.
“This current administration is like nothing that we've seen before,” said a managing partner of a global venture capital firm who spoke to BioWorld on the condition of anonymity. “President Trump’s first term was bad,” he said, “but nobody knows what’s coming.” “This is truly nationalism at its worst, because he won on the campaign [largely] to protect American jobs, claiming that Americans have been unfairly treated.” And it's not just China, he said, but India and other countries will also likely be affected.
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