Early impact of the Inflation Reduction Act on small molecule vs biologic post-approval oncology trials

Introduction Under the Inflation Reduction Act (IRA), small molecule drugs are subject to a shorter timeline toward eligibility for selection to the Drug Price Negotiation Program (DPNP) than biologics (7 vs 11 years post-approval), raising concerns about incentives for post-approval clinical development. Methods Using Citeline's Trialtrove database (7/2014-8/2024), this longitudinal study explored the impact of IRA's passage on industry-sponsored, post-approval phase I-III clinical trials in small molecule vs biologic oncology drugs, excluding vaccine-related trials. We used a difference-in-difference design to explore the impact of the IRA's differential DPNP timeline on small molecule trials in oncology by comparing changes in the number of newly initiated post-approval trials in small molecule drugs after the IRA (first difference) with changes in biological trials (second difference). Results The monthly average of small molecule and biologic trials dropped by 45.3% (P < .01) and 32.5% (P < .01) post-IRA, respectively. Compared with biologics, small molecules were associated with an additional decrease of 4.5 trials/month (−4.5, 95% CI, −7.1 to −1.9; P < .01) after the IRA's passage. Conclusion This finding supports hypotheses that the IRA's differential timelines toward DPNP eligibility for the 2 molecule types may disproportionately disincentivize post-approval research in small molecule drugs.