Washington Editor

With more than a week having passed since the conclusion of a contentious presidential election race, the biotech populace has settled in and is pondering the pros and cons of another term with President Bush.

For drug development companies and related firms, general feelings hold that Republicans are good for business. That old adage might partially explain the stock market run-up in the days following the election, in which the Grand Old Party also secured a more decisive hold on seats in the Senate and House of Representatives.

Carl Feldbaum, president of the Biotechnology Industry Organization (BIO) in Washington, attributed such feelings to conventional wisdom about the country's two leading political parties. But he added that there is more depth to another Bush term.

"I think you have to look a little deeper into the picture here," Feldbaum told BioWorld Today. "When you do that, you have two things."

Namely, he said, the industry would be affected by future presidential appointees, such as filling the vacancy at the head of the FDA. Currently run on an interim basis by acting Commissioner Lester Crawford, who formerly led the agency, the opening came about when Mark McClellan left the FDA to lead the Centers for Medicare and Medicaid Services. (See BioWorld Today, March 15, 2004.)

Some speculate that McClellan will leave his CMS spot to move into a cabinet position atop Health and Human Services, should Secretary Tommy Thompson decide to resign. Two other cabinet leaders already have decided to leave their posts after serving during the first Bush term.

And there are other issues.

Feldbaum said he expects that California's Proposition 71, which allows for the state's backing of $3 billion in stem cell research money, could pressure the federal government into supporting stem cell research more than it does now. Specifically, he thinks Prop. 71 could spur the government to add to the number of stem cell lines available for federal research funding, a departure from policy in the previous Bush term. (See BioWorld Today, Nov. 4, 2004.)

"The president's announcement in August 2001 was an inhibitor of development of the research," Feldbaum said. "I think it's fair to say that established companies would have done more in this arena, and there might have been some companies established specifically to do stem cell research."

In terms of drug pricing, he noted that pharmaceutical industry support for the Republican Party would not insulate those companies from drug reimportation, especially since seven new senators were elected from states that have embraced the idea.

"The politico-economic pressures are pretty much the same, no matter who got elected, regarding drug pricing," Feldbaum said. "A related issue to drug pricing comes up in the guise of importation, and also it's related to the growing furor over follow-on biologics."

Drug reimportation was discussed earlier this week by a group of health care analysts from PricewaterhouseCoopers LLP, who also offered their views on wider-ranging health care issues during an event held at the National Press Club in Washington. Speakers from the financial firm's newly formed Health Research Institute gave perspectives on Bush's second-term health care agenda and implications of policies and proposals aimed at the nation's health care system.

"Many states have passed some kind of legislation that talks about reimportation," said Sandy Lutz, the institute's director. "This could have a big effect on R&D, but we think that if something doesn't happen this year, interest in this issue will probably wane, because by 2006, virtually all seniors will have their drugs paid for."

In general, she and her Health Research Institute colleagues said Bush's health care initiatives differ from those that would have been pursued by Sen. John Kerry. Kerry likely would have emphasized expanded access to health care insurance, they said, while Bush administration policies would shift the insurance industry to high-deductible health plans that are designed to make consumers more financially responsible, based on their needs.

They also said they do not see Bush as likely to authorize additional federal funding for stem cell research, but they expect plans to privatize Medicare through the use of private health and drug plans, to progress as passed in the Medicare Modernization Act.

"We think that this is going to go forward, but there will probably be some tweaks to the Medicare Modernization Act," Lutz said. "Public perceptions continue to be mixed among seniors about this, even though it's a big shift from private to public spending . . . It is a huge increase in the Medicare budget, and that's going to impact other parts of the industry."

But their overriding theme focused on consumers' ownership of their health care choices.

"Consumer-driven health care could transform the structure of the health insurance industry by shifting health insurance from employers to individuals and providing lower-cost options and coverage for many of the 44 million Americans without health insurance," said Ron Bachman, a principal in PricewaterhouseCoopers' human resource services group.