Congress must pass EPIC Act to stop 'pill penalty' | Opinion
Eddie Pauline is the president and CEO of Ohio Life Sciences, the industry association representing the interests of Ohio’s nearly 5,000 life sciences establishments. OLS’s mission is to grow the life sciences market.
The Inflation Reduction Act was intended to lower prescription drug costs, but an unintended consequence is threatening the future of lifesaving medicines.
The so-called "pill penalty" — a flaw in the act's drug pricing provisions — disproportionately harms small-molecule drugs, which account for more than 90% of prescriptions in the United States. These medicines treat a wide range of common and life-threatening conditions, including cancer, cardiovascular disease and mental illness. Without action, this policy misstep will discourage investment in small-molecule innovation, limiting treatment options for millions of patients.
The root of the problem lies in the act's drug pricing provisions for Medicare. The law imposes government-mandated price controls on certain drugs, forcing manufacturers to comply or face steep tax penalties. But it treats small-molecule drugs unfairly. It allows biologic drugs — typically injectable treatments administered in hospitals or clinics — a 13-year window before government price setting begins. In contrast, small-molecule drugs, which are usually taken as pills or capsules, are given only nine years. This four-year gap creates a significant financial disincentive for companies to invest in small-molecule innovation.
This disparity undermines the long-standing Hatch-Waxman framework, which has balanced innovation and affordability for decades by ensuring a period of market exclusivity before generics enter the market. By shortening this window for small-molecule drugs, the IRA makes these treatments less attractive for investment, shifting focus toward biologics and leaving patients with fewer oral medication options.
The impact is already being felt. A 2025 study found that some biopharmaceutical companies reduced investment in small-molecule drugs by 70% following the passage of the IRA. Furthermore, a 2022 survey showed that 63% of pharmaceutical companies planned to shift research and development away from small molecules altogether.
The good news is that Congress has an opportunity to fix this mistake. The bipartisan Ensuring Pathways to Innovative Cures Act (HR 1492) would correct the imbalance by aligning small-molecule drugs with biologics, granting them the same 13-year timeframe before Medicare price setting begins. This simple yet critical fix would restore fairness, incentivizing continued investment in small-molecule drug development and ensuring that patients have access to cutting-edge treatments.
The EPIC Act isn’t just about pharmaceutical innovation, it’s also about supporting local economies and job creation. Ohio, for example, has a thriving life sciences sector that benefits directly from pharmaceutical R&D and industry-funded clinical trials. A recent TEConomy Partners report ranked Ohio among the top five states benefiting from these investments. In 2023 alone, pharmaceutical clinical trials generated $2.4 billion for Ohio’s economy, with nearly 1,500 active trials enrolling over 36,000 patients. These trials are essential for advancing medicine, supporting high-paying jobs, and bringing hope to patients battling serious diseases.
The stakes are clear. Without the EPIC Act, innovation in small-molecule drugs will continue to decline, reducing treatment options for patients with chronic conditions such as diabetes, heart disease and neurological disorders. Congress must act to ensure that the next generation of breakthrough medicines, including those that can be taken in the form of a simple pill, remains a priority.
Ohio’s Congressional delegation should champion this critical legislation to protect patient access, foster medical innovation and support the state’s growing life sciences sector. The time to act is now. Lawmakers must pass the EPIC Act and end the pill penalty before its unintended consequences become irreversible.
Please learn more about the EPIC Act and urge Congress to support this vital legislation.
Eddie Pauline is the president and CEO of Ohio Life Sciences, the industry association representing the interests of Ohio’s nearly 5,000 life sciences establishments. OLS’s mission is to grow the life sciences market.