CNBNews

By Kevin Kimble and Pamela Warner

Imagine a world where a cure for sickle cell disease -- the blood disorder that afflicts roughly one in every 365 Black Americans -- never leaves the lab, because scientists couldn't raise the funding for further research. This is the future we're sleepwalking into, courtesy of the Inflation Reduction Act's well-intentioned but flawed drug pricing policies.

The IRA empowers Medicare to negotiate lower prices for certain medications. Officials recently announced the final prices of the first 10 drugs selected for negotiation. 

But in healthcare, simple solutions often spawn complex problems. And it's the most vulnerable -- particularly Black Americans -- who will bear the brunt of the unintended consequences.

By reducing the potential returns on successful drugs, the IRA's price negotiations deter biotech companies from investing in risky research projects. That's especially true for treatments aimed at illnesses with smaller patient populations -- including those like sickle cell disease, where about 90% of patients are Black, and most of the rest are Hispanic. When the financials don't add up, potential investors take their money elsewhere. 

Since the IRA's passage, 36 research programs and 21 drugs have been shelved. Novartis has abandoned early-stage cancer drugs; Merck executives have said the company's breakthrough cancer treatment would have been unfeasible had the IRA been in effect at the time of its development. And the problem is poised to get worse: A new study projects 135 fewer drugs will be developed by 2039 due to the IRA. 

We're witnessing in real-time the evaporation of hope for millions suffering from conditions that have long plagued Black Americans at higher rates. Consider diabetes, a condition that has reached epidemic proportions in the Black community. Black adults are 60% more likely to be diagnosed and twice as likely to die from complications compared to the white population. Or take hypertension, often called the "silent killer." Black Americans are more likely to have high blood pressure and have a 30% higher death rate from heart disease than the overall white population. 

Innovative treatments for diabetes, hypertension, and heart disease could dramatically reduce these disparities. But IRA's price-setting policies threaten to stifle this innovation and calcify existing disparities. 

The law is also causing unintended short-term consequences. The IRA made substantial changes to Medicare's "Part D" drug benefit. Monthly premiums surged an estimated 21% from 2023 to 2024. 

For low-income seniors, disproportionately people of color, this isn't just a statistic -- it often means having to choose between medication and groceries. With 34% fewer free plans available, millions of beneficiaries face increased out-of-pocket costs. 

To be clear, drug pricing reform is necessary. Too many Americans struggle to afford their medications. 

But we need a nuanced approach that balances affordability with innovation. We need policies that incentivize research into diseases affecting communities of color, ensure genuine access to affordable care for low-income seniors, and align innovation with public health priorities. 

Despite lawmakers' good intentions, the IRA isn't delivering those policies. 

Kevin B. Kimble, Esq., is the founder and executive director of the Southern Christian Leadership Global Policy Initiative. Pamela Warner is co-chair of the Healthcare Inclusion Task Force at the Financial Services Innovation Coalition. This op-ed originally appeared in the Detroit News.