In an industry such as this, with hundreds of
participants and contributors, it is imperative to have federal
regulations set in place, especially due to the weight of dealing with
human lives. However, outdated regulations may play a role in
preventing innovative companies and research institutions from getting
their product or therapy to reach the market. In 2016, the 114th United
States Congress signed the 21st Century Cures Act into law – an act
designed to accelerate medical product development and fund innovative
Century Cures Act
The Cures Act aims to accelerate the development of
medical products and treatments to battle the increasing rates of
diseases such as diabetes and cancer, as well as the ongoing opioid
epidemic. It authorized $6.3 billion in funding for general medical
research, revising the Food and Drug Administration’s review process,
and addressing the opioid epidemic.
This article will discuss the changes that the Cures
Act brought about as well as its role in the future of healthcare. It
will further present an overview of the federal tax credit opportunity
available for companies investing in medicine and healthcare innovation.
Research & Development Tax Credit
Enacted in 1981, the now permanent Federal Research
and Development (R&D) Tax Credit allows a credit that typically
ranges from 4%-7% of eligible spending for new and improved products
and processes. Qualified research must meet the following four criteria:
Eligible costs include U.S. employee wages, cost of supplies consumed
in the R&D process, cost of pre-production testing, U.S. contract
research expenses, and certain costs associated with developing a
On December 18, 2015, President Obama signed the
PATH Act, making the R&D Tax Credit permanent. Beginning in 2016,
the R&D credit can be used to offset Alternative Minimum tax for
companies with revenue below $50MM and for the first time,
pre-profitable and pre-revenue startup businesses can obtain up to
$250,000 per year in payroll taxes and cash rebates.
- Must be technological in nature
- Must be a component of the taxpayers business
- Must represent R&D in the experimental sense and
generally includes all such costs related to the development or
improvement of a product or process
- Must eliminate uncertainty through a process of
experimentation that considers one or more alternatives
and Drug Administration Review Process
As previously stated, the Cures Act was designed to
accelerate medical product development by expediting the process a
product must undergo through the U.S. Food and Drug Administration
(FDA) for approval. The drug development process, according to the FDA,
consists of five steps :
research is done in a
Research: drugs undergo laboratory and animal
testing for safety measures.
drugs are tested on people to further
ensure safety and effectiveness.
Review: FDA review teams thoroughly examine all of the
submitted data related to the drug or device and make a decision to
approve or not to approve it.
Monitoring: FDA monitors all drug
and device safety once products are available for use by the public.
Additionally, the clinical stage is further broken
up into four phases: testing the safety and dosage, testing the
efficacy and side effects, testing efficacy and monitoring of adverse
reactions, and testing efficacy and safety. Many potentially
lifesaving drugs get stuck in the clinical research step due to the
amount of evidence needed to pass this stage.
Cures Act, the first three phases of the clinical research stage will
be combined into one, creating a more seamless trial that will
consequently reduce the amount of time that drugs are in the review
process. For many Americans, a speedy FDA approval can be the
difference between life and death, which is why the Cures Act has
harbored the support of cancer patients as well as their family and
Scott Gottlieb, MD and FDA Commissioner, has already
implemented other measures of simplifying the FDA review process,
specifically for 3D printed medical devices. In the “Leapfrog
Guidance,” a nickname for the Technical Considerations for Additive
Manufacturing Medical Devices, the FDA sets up parameters that
manufacturers should have prepared when submitting their 3D printed
medical devices for review. By providing the guidance and
transparent process, manufacturers will be able to bring their devices
to market more efficiently.
The majority of the $6.3 billion in funding
authorized by the Cures Act was allocated to the National Institutes of
Health (NIH), the nation’s medical research agency. The agency will
receive a total funding amount of $4.8 billion over ten years.
The NIH is responsible for the largest research initiatives in the
United States, including precision medicine.
Precision medicine is an innovative approach to the
prevention and treatment of diseases that takes into account individual
differences in patients’ genes, environments, and lifestyles. It
eliminates the notion of “one size fits all medicine” and recognizes
that even if two people have the same disease, it may progress
differently due to the varying environments of the patients. The
objective is to provide precisely targeted treatments to the molecular
underpinnings of a disease by observing the patient’s genetic and
clinical data. Precision medicine also seeks to accumulate
data–including biospecimen, physical measurements, questionnaires,
imaging, and more–from millions of people to create a database that is
critical in understanding the unique characteristics as well as the
genetic features that predispose people to certain conditions.
The All of Us Research Program, coordinated by the
NIH, is building the world’s largest and most diverse biomedical data
set for the advancement of precision medicine. The funding will support
the All of Us program through enrollment of participants, collection
and storage of data, as well as genotyping/genome sequencing.
In a recent White House hearing, the NIH shared its
progress in relation to the All of Us program and the Cures Act. It was
revealed that as of July 2018, there were approximately 86,000
volunteers signed up for the program. Additionally, All of Us will
begin enrolling children to further diversify the collection of data in
The brain is one of–if not the most–vital organ for
human life. As a matter of fact, death is medically defined as the
cessation of all vital functions, especially the stoppage of brain
activity, along with the heart and respiration. The brain is also the
most complex and least understood organ in the human body. Its makeup
entails billions of neurons, or brain cells, with trillions of
connections between them. These connections, called synapses, is what
allows electrical signals to travel from neuron to neuron, ultimately
causing a reaction that can be anything from the uncontrollable
rumbling of the stomach to a ballerina’s graceful and elaborate
Evidently, the billions of neurons and trillions of
synapses makes the brain an extreme challenge to scientists and
researchers alike. In 2013, the NIH initiated the BRAIN Initiative, an
acronym for Brain Research through Advancing Innovative
Neurotechnologies. The underpinning of the BRAIN Initiative lies in the
detrimental effects of brain disorders such as Alzheimer’s,
schizophrenia, Parkinson’s, and substance abuse. With a deeper
understanding of the functioning of the brain, researchers will
consequently gain a better understanding of these disorders and
hopefully find methods of prevention as well as surefire cures.
The NIH developed a detailed twelve year plan for
developing and applying innovative technologies to advance brain
research. With the $1.5 billion authorized under the Cures Act, the
BRAIN Initiative will be able to accelerate progress toward meeting
some of their goals. The NIH allocated their funding towards the
following seven objectives :
Diversity: identify and experiment with
different brain cell types to determine their roles in health and
Scales: Generate circuit diagrams
to research information flow in the brain.
Action: produce a dynamic picture of the
functioning brain through large-scale monitoring of neural activity.
Causality: linking brain activity to
behavior with interventional tools that change neural circuit dynamics.
conceptual foundations for understanding the biological basis of mental
processes through development of new theoretical and data analysis
Neuroscience: develop innovative
technologies to understand the human brain and treat its disorders.
to the Brain: integrating new
technological and conceptual approaches to discover how dynamic
patterns of neural activity are transformed into cognition, emotion,
perception, and action.
By 2025, the NIH aims to have increased research
opportunities as well as gained more understanding of brain cells and
their trillions of synapses, and hopefully taken steps towards cures
for brain disorders.
Cancer has been catching up to heart disease as the
leading cause of death in the United States for nearly fifty years. In
1969, heart disease caused more than twice as many deaths as cancer.
Today, cancer trails behind by only 4% less and it has become the
second leading cause of death in the country.
Cancer is not just one disease. It is a category of
chronic illnesses characterized by uncontrolled growth. Countless
research has been done on the chronic illness and more research is
Even with its high prevalence, cancer is one of the
most highly researched diseases. National programs, such as the
National Cancer Institute and the Center for Disease Control and
Prevention, allow researchers from all over the country to collectively
work towards improving treatments. The Cancer Moonshot, initiated by
the National Cancer Institute, is a project that aims to make therapies
for all types of cancer widely available, improve prevention methods,
and advance early detection strategies. The project was announced
in January 2016 and continues to make strides toward a cure.
The 21st Century Cures Act authorized $1.8 billion
in funding over seven years for the Cancer Moonshot. These funds will
be dedicated to advancing the key initiatives of the Cancer Moonshot.
Three of the initiatives entail collecting large amounts of patient
data to create comprehensive networks of evidence that can be shared
between thousands of researchers. Additional initiatives include
Network: patients will
“contribute their comprehensive tumor profile data to expand knowledge
about what therapies work, in whom, and in which types of cancer.”
Detection of Hereditary Cancers:
improve current methods and develop new strategies of prevention in
high risk individuals.
Tumor Atlases: create 3D maps of
tumors to document the evolution from precancerous lesion to advanced
Other initiatives include the Adult, Pediatric, and
Drug Resistance Networks, National Cancer Data Ecosystem, Drivers of
Childhood Cancers, Symptom Management, Hereditary Cancers,
Retrospective Analysis of Biospecimens, and New Enabling Cancer
Chronic illness is so detrimental because it slowly
deteriorates the body’s tissues until function is impaired – and if
left untreated, until all function is lost. Treatments for chronic
diseases – like chronic kidney disease or multiple sclerosis – focus on
slowing down the consequences of the damage tissue. However, even with
palliative treatments many patients find themselves in need of a
Medical research is paving the way for treatment to
switch from palliative medicine to regenerative medicine. Regenerative
medicine “addresses the underlying causes of disease and has the power
to restore lost functionality of organs and tissues.” There are
specifically three approaches to regenerative medicine: replacement,
rejuvenation, and regeneration. Replacement, which is already widely
used in medicine, is taking tissue from donors to replace damaged ones.
Rejuvenation consists of enhancing the body’s own natural healing
capacity. Lastly, regeneration involves the delivery of cells or cell
products to diseased tissues or organs.
The 21st Century
Cures Act authorized $30 million for clinical research in the field of
regenerative medicine. In the past 25 years, only 10 regenerative
medicine therapies were approved by the FDA. With the funding from the
Cures Act, clinical studies will be “standardized, reproducible, and
generalizable.” This and the collaborative effort between
researchers across the nation will expedite advancements in
Products Approved by the FDA
David J Mooney. “Regenerative medicine: Current therapies and future
Proceedings of the National Academy of Sciences of the United States of
vol. 112,47 (2015): 14452-9.
The 21st Century Cures Act initiated a time of
focused research and development on the health issues that highly
impact the United States. Since its announcement in 2016, much improvement
has been made in the clinical research process, medical therapies, our
knowledge of how the body works, and the process of bringing new
therapies to the market. R&D tax credits can help to offset the
costs involved in all of these processes and they are available to
companies that are innovating in this area.