MassBio CEO & President Kendalle Burlin O’Connell posted this update first to LinkedIn.
Washington’s focus on the life sciences is increasingly converging around a few big questions: how to protect the independence and stability of early-stage biomedical research, how to make the U.S. a faster and more attractive place to develop new medicines, and how trade, China competitiveness, and drug pricing policies will affect the U.S. biotech ecosystem. Here’s what we’re watching this week:
NIH Grant Oversight Proposal Appears Stalled, But the Broader OMB Fight Is Far From Over: A reported White House executive order that would have created an additional layer of political review over NIH grant awards now appears to have stalled following bipartisan pushback, including from Senate Appropriations Chair Susan Collins. That is an important development for the research community, but it does not resolve the larger issue. OMB is separately pursuing a government-wide overhaul of federal grant rules that would require review by senior political appointees before certain awards are issued and give agencies broader authority over grants. Congress temporarily blocked implementation of this proposal but only through the end of the current Continuing Resolution on December 11, making federal research policy an issue to watch closely as lawmakers return to government funding negotiations after the November election.
FDA Leadership Takes Center Stage as Overton Faces the Senate: The Senate HELP Committee is holding Dr. Heidi Overton’s FDA Commissioner confirmation hearing this morning, with her prepared remarks placing speed, clinical trial modernization, and U.S. competition with China at the center of her agenda. The hearing comes at a consequential moment for FDA policy: the Agency has launched a new Expedited IND Pilot aimed at shortening the path to first-in-human trials, while the PDUFA VIII reauthorization process is moving forward following FDA’s September 16 public meeting on proposed commitments for FY2028–2032. For Massachusetts biotechs, the coming year will provide an important opportunity to shape how FDA improves predictability, accelerates development, and makes the regulatory system easier to navigate for small and emerging companies.
Pharmaceutical Tariffs Take Effect Next Week, With an Important R&D Carveout: The next phase of the Administration’s Section 232 pharmaceutical tariffs takes effect September 29, with a default 100% tariff on certain imported patented medicines, APIs, and key starting materials for companies not covered by alternative rates or agreements. However, Commerce provided important clarity this week for the innovation ecosystem: pharmaceuticals and ingredients imported for clinical trials, research and development, or other non-commercial uses will receive a zero percent tariff rate. Commerce also outlined zero-tariff treatment for certain specialty products, including orphan drugs, cell and gene therapies, and antibody-drug conjugates when specified conditions are met. That should substantially limit the direct effect on many pre-commercial biotechs, although commercial-stage companies’ exposure will continue to depend heavily on product type, country of origin, manufacturing footprint, and company-specific agreements.
U.S.-China Biotech Policy Comes into Focus as Treasury Prepares Outbound Investment Rules: Treasury is preparing regulations to implement the COINS Act, with a September release currently on its regulatory agenda. Recent reporting suggests the Administration is considering an approach that would allow most pharmaceutical licensing transactions with Chinese companies to continue while concentrating restrictions on biotechnology presenting more direct national-security risks. The debate is far from settled. The bipartisan, bicameral Biotech Investment National Security Act, or BINSA, would explicitly bring pharmaceutical development, biologics manufacturing, and clinical research within the outbound investment framework. The National Defense Authorization Act (NDAA) is one of Congress’s major remaining legislative vehicles and could provide an avenue for BINSA, much as COINS moved through last year’s defense bill. That makes the coming months an important test of how broadly Washington ultimately chooses to define biotechnology-related national security risk, and how those restrictions could affect the partnerships, licensing deals, and investment flows that increasingly shape global drug development.
