Behind the Headlines: Episode 13; Budget Cuts, Reshoring, and Biotech Buyouts

Behind the Headlines is a bi-weekly panel discussion examining the latest trends, readouts, and other factors that drive pharmaceutical news and innovation. Each episode features consultants, venture capitalists, scientists, patient advocates, and journalists discussing theprior weeks’ top news while seeking to highlight the more enduring lessons that hide behind the headlines. 

In this episode, Neil Hunter, Independent Communications Consultant;Alex Philippidis, Senior Business Editor for Genetic Engineering & Biotechnology News, Inside Precision Medicine; Joanna Sadowska, PhD, EMBA Technical Writer, Be Biopharma;and Carl Schoellhammer, PhD, Partner - Life Science / Biopharma Strategy Consulting, DeciBio examine whether small government in the U.S. is bad for big pharma’s business interests. With massive cuts to the federal budget and access to public funding reduced, potential investors are further discouraged not only because innovation is stymied but also because pressure to lower drug prices(1) and overall accessibility means return on investmentin the pharmaceutical sector, along with the broader healthcare markets, are increasingly uncertain.

Panelists also discussed the effects of tariffs on accelerating near-shoring and reshoring of manufacturing to the U.S., with the most recent example being Merck’s announcement of an expansion of capacity for Gardasil (2).Lastly, in a deal that puts an exclamation point on a torrid time for bluebird bio’s spinout, BMS buys 2seventybio (3), while Astra Zeneca acquires EsoBiotec, whose technology can genetically modify immune cells directly inside the body, affording “many more patients access to transformative cell therapy treatments delivered in just minutes rather than the current process which takes weeks,” according to a statement from the company (4).

References

1. HHS Announces 15 Additional Drugs Selected for Medicare Drug Price Negotiations in Continued Effort to Lower Prescription Drug Costs for Seniors. Press release. Centers for Medicare and Medicaid Services. January 17, 2025. https://www.cms.gov/newsroom/press-releases/hhs-announces-15-additional-drugs-selected-medicare-drug-price-negotiations-continued-effort-lower
2. Merck Unveils New Facility to Increase Vaccine Production Capacity. News release. Merck. March 11, 2025. https://www.merck.com/news/merck-unveils-new-facility-to-increase-vaccine-production-capacity/
3. 2seventy bio Enters into Definitive Agreement to be Acquired by Bristol Myers Squibb. News release. 2seventy bio. March 10, 2025.https://ir.2seventybio.com/news-releases/news-release-details/2seventy-bio-enters-definitive-agreement-be-acquired-bristol
4. AstraZeneca to acquireEsoBiotec to advance cell therapy ambition.News release. Astra Zeneca. March 17 2025.https://www.astrazeneca.com/media-centre/press-releases/2025/astrazeneca-to-acquire-esobiotec.html