innovation in health care 2022 conference. i am caitlin owens, health reporter for axios, joining you from i home in washington dc. -- from my home in washington dc. if you want to follow on twitter, do so @axios, and #axiosevents. we will explore the pandemic and health care in 2020 to two and beyond. our first guest is dr. pete schultz, joining us from san diego. welcome, dr. schulz. dr. schultz: happy to be here. caitlin: thank you so much for joining us today to talk about important takeaways from the pandemic. a natural place to start would be the mrna, which has been transformational. what do you see going forward, once we are through with covid, what are promising uses for mrna in research and development? dr. schultz: the vaccine area is probably where it is going to continue to have its largest impact. just because of the speed with which you can make vaccines, and because of the multiple constructs. but folks are starting to look at mrna therapeutics for heart failure and for delivering genes to various organs, and so on. beyond covid, it will be interesting to see whether rna vaccines could have an impact on hiv and other infectious diseases, tb, malaria, for which we still don't have effective vaccines. caitlin: another one that has come up a lot is the flu, which seems less dramatic some of these other diseases, but our flu vaccines don't work very well. do you think mrna could transform flu vaccines? dr. schultz: that remains to be seen, how efficacious the mrna vaccines are relative to the current flu vaccines. part of the problem is just keeping up with new mutations in the flu. but when sars-cov-2 came around and came a pandemic, i think at some level, people were expecting influenza would be the next major pandemic. so, i do -- i do think we need to think about flu having the pandemic potential of covid-19. if that happens, i think the speed to which you can adapt to those new strains will be really important, and that is really where mrna vaccines xl. i want to serve -- caitlin: i want to circle back to some of the other innovations you brought up. i don't want to talk about science fiction, can you talk about mrna use for things like cancer or other diseases? dr. schulz: you know, there is a lot of interest now in the pharmaceutical industry and gene therapy, and correcting diseases by making changes to dna. and that can either be editing out mutations from dna or providing genes that are absent or ineffective -- that are absent in people whose are defective. mrna also represents a really interesting way to deliver genes. the current viral vectors are limited by the science of the cargo, so you can only deliver relatively small genes. that is a major challenge in the field. the other challenge in the field is how you deliver specific genes to specific cell types, and not all cell types. those are some of the challenges, and mrna good address --mrna could address some of those challenges on selectivity and delivery. caitlin: something you have interest in is the research and development structure itself. what have we learned about finding new scientific innovations, and then the next step, bringing those to market for actual use? dr. schultz: the interesting thing when the pandemic started, there was a huge focus of the scientific community on sars-cov-2. it was almost like a manhattan project. everybody turned their attention to how we deal with this, how do we understand the virus and the biology of the virus and the structure of the virus? how do we make new antivirals? how do we monitor transmission of the disease, and how do we make new therapeutics, either as antivirals or as vaccines? i think that was a very interesting case of the entire scientific community turning its attention to a major health problem. and along with that came a huge increase in speed in which you could test new therapies and get emergency use authorization of new therapies. i think you could start with clinical trials, and within one and a half to two years, get to emergency use authorization, which is really unprecedented. it will be interesting to see how that impacts other diseases like cancer and heart disease, and other diseases, but it does illustrate that incredible progress can be made very quickly when the desire is there. but you know, like you say, we have few challenges -- we have huge challenges in the infectious disease area, tuberculosis, hiv, hepatitis cause a huge number of deaths every year, and cancer and heart failure and other diseases also exacerbate a huge toll. so, there are still major health challenges and you are right, it would be nice if we could take some of the lessons we have learned from covid and apply those to these other diseases. caitlin: i went to hit on something you brought up, antivirals. we have talked so much about vaccine throughout this pandemic, but there has recently been progress made on antivirals, which is great news. but it hasn't received the same attention as vaccines have, so can you tell us what we have learned about antivirals and how we can apply those lessons going forward? dr. schultz: developing antivirals has historically been a longer process than making a vaccine. we started in this area, we have a large vaccine effort at scripps, but we have a large infectious disease effort going on in collaboration with the gates foundation trust. but as you think about making an antiviral, the first thing people thought about, does an existing antiviral work against sars-cov-2? or, does an existing drug work against sars-cov-2? we heard about all these old medicines that might work against covid-19. to look at that carefully, we, in collaboration with the gaetz foundation, used a huge repurpose and collection that we built, about 13,000 to 14,000 drugs that are approved or in clinical trials or late-stage clinical trials. and in collaboration with 20 or 30 laps around the world, academic labs, pharma, we tested a huge number of existing medicines for their ability to block replication of the virus. and unfortunately, despite that massive effort, we really did not find anything. so now is the first stage of the first four new antiviral -- so the first stage of the search for new antivirals was to look at old antivirals. and other diseases, mers and others came to light. remdesivir was the first, and there have been others, and those had modest activity. the challenge with remdesivir is that it has to be taken by iv infusion, so you have to be in a hospital. more recently, there has been a protease inhibitor. the main targets people have looked at what replicates the virus, and the protease inhibitor targets that. pfizer received emergency youth authorization -- emergency use authorization for its protease inhibitor, and it is oral. so that is really exciting news. the world is beginning to really focus on the idea of, can you have a z-pak where you take one pill a day, and it either treats or protects you from the virus, and broadly, against coronavirus . that is the idea. and i think if that happens, if we do get a virus that the vaccines are relatively ineffective against, or for people who are immunocompromised or who we can't get the vaccine to, or who choose not to take the vaccine, then the idea of having a five-till z-pak for sars -- five-pill z-pak for sars-cov-2 or bacterial infections would be really interesting. you are exposed at you take a pill once a day for five days. and if the current pfizer drug, although it has some limitations , it still prevents roughly 90% of people from being hospitalized, if you can even do better than that, and there is a possibility to do better than that by combining an oral inhibitor containing remdesivir and an oral protease inhibitor, that combination could have 98% 1099% efficacy and also be -- 98% to 99% efficacy and also be resistant to mutations. it could be broadly effective against mutants that come up, and if a mutants comes up that the vaccine doesn't work for, the antivirals good. i think now, there is a lot of optimism that we could get to that kind of combination therapy. and that kind of combination therapy is what worked with hiv and hcv. both of those killed huge numbers of people. and i think there is no optimism we can get there with coronavirus in the next few years. that is a really promising path forward. it has been delayed relative to the vaccine, but the impact, i think, could be huge. caitlin: that seems like a great note to end on, because we are out of time, dr. schultz, but thank you for leaving us with a dose of optimism. and thank you for your time today. next, we have a view from the top segment with my axios colleague, founder and president roy schwartz. roy: it is my pleasure to bring you a conversation with stephen j. ubl, president and ceo of farmer. thank you for doing this, and thank you for pharma for sponsoring the event. americans are concerned about their health care. what is top of mind for them going into 2022? stephen: when we ask what americans care most about, two things rise quickly to the top. the first thing is their insurance, out-of-pocket costs for insurance premiums, deductibles and co-pays. a close second place would be ending the pandemic, which our industry is playing a key role in developing vaccines and therapeutics. -- medicine is well down the risk, which is not a surprise. out-of-pocket costs of grown 50% in's 2014. -- grown 50% since 2014. americans want regulators to focus on those insurance out-of-pocket costs. roy: policymakers seem focused on drug pricing. what do you think their current proposal is getting right, and wrong? stephen: it is unfortunately like the clint eastwood movie, "the good, the bad and the ugly" from our perspective. let's start with the good come of the $2000 out-of-pocket cap the medicare part d program. it allows seniors to spend across the calendar year so that no senior will pay more than $167 a month. those are important reforms. we supported them and they are going to benefit a lot of patients. unfortunately, the bad outweighs the good. a few things we are focused on, the first is, it is going to stifle innovation. the government price setting regime set forth in the bill focuses on government price setting on products after nine years, were typical medicines are 13 years -- where typical medicines are 13 years. but the latest innovations happen because our companies are studying new uses for existing drugs. we may testament us and for breast cancer and overtime initiate studies for other forms of cancer. under this bill, there is not much incentive to do that because the clock doesn't start, you don't get additional years of protection from the government setting the price by virtue of doing additional studies on new uses for the medicine. another big problem with this bill is that it doesn't incentivize the use of generic medicines. 90% of medicines are generic and bio similars are on track to save consumers millions of dollars. under this bill, those are going to have to compete with government-set priced drugs, which may not provide incentives for generics for manufacturers to recoup their investment. and we think the bill destabilizes the very popular part d program, where it undermines competitive elements of the part d program. today, beneficiaries have very high satisfactions, part d premiums are low or stable and gliding, and they can vote with their feet and pick a plan that is best for their needs. we are concerned this bill sets up a government formula because plans are going to have incentives to steer patients to the government-set price. even if they medicine is working for you, plans may steer patients and force you to first take the cheapest medicine before being able to use other medicines. roy: health care is very complicated. as lawmakers are working to make the health care system run more efficiently, what should they be looking at? stephen: maybe that is the ugly. the bill ignores some of the largest problems in the health care system. prescription care spending is 10% to 15% of overall spending and the bill doesn't address health plans that capture a rebate on the list price of the medicine, but they don't have those savings [indiscernible] a health plan may get a 50% discount, the patient may go to pick up insulin at the farm he see -- insolent the pharmacy and is paying the full list price. nothing in the bill addresses that problem. hospitals routinely markup the cost of medicine by 500% to 1000%. a program which was well-intended designed to offer lower-cost medicines to hospitals that treat a disproportionate share of underinsured or uninsured, the program exploded exponentially, it grew 38% last year alone and there is very little evidence those discounts the hospitals are receiving, which are substantial, are making [indiscernible] we think there are fundamental flaws in the system without addressing a solution. roy: thank you, steve, and thank you to phrma for sponsoring the event. caitlin: thanks, roy. our final guest is congresswoman cathy mcmorris rodgers, joining us from washington dc. welcome. rep. rodgers: thanks. it is good to be with you. caitlin: one of the most pressing questions for congress is how we keep this from happening again and how we do better next time. what are important steps congress could take to get us more prepared for the next pandemic? rep. rodgers: that is a great question. as we focus on the current pandemic, there are a lot of lessons we can learn from this pandemic. it underscores the importance of us modernizing our health care system and also underscores the importance of american innovation, american leadership. it was extraordinary what was accomplished in operation warp speed, the public-private partnership that came together to develop a vaccine in less than a year. we had people that doubted it could get done and because of american innovation, we were able to accomplish that goal. there is a lot of lessons we can learn from that. we learned what reforms need to take place within the fda. real-time review. in years past, it would take longer to bring that kind of vaccine to market and the able to distribute it as quickly as we did. it underscores the importance of american innovation when it comes to new breakthroughs and therapies and it is part of why i believe it is important we not pass the current prescription drug bill that imposes government price controls. that will be a step backward at the very time we want to make sure america is leading in innovation and breakthroughs. the university of chicago released a study on the proposal , the government price control proposal, and estimated 130 five fewer new drugs coming to market. think about the impact on als, alzheimer's, cancer, we don't know, but i am concerned about this legislation. and it gives the secretary of health and human services the ability to set the minimum price for the negotiation of drugs at zero. it raises questions as to how that would work, how it would impact janeiro -- impact generic drugs, bio similars that may come to market. thinking of lessons we have learned, americans can't afford price controls and the impact it would have in destroying innovation, leading to fewer cures. we need to make sure we stay on the forefront and not allow china to rise as the biomedical leader of the world. the pandemic, we found ourselves dependent upon china's ppe and other supplies. we learned we were depending upon china. we do not want to do that when it comes to innovation and breakthroughs and preparing for the next pandemic. caitlin: i want to rewind. you mentioned operation warp speed speed. the u.s. government partnered with drug companies, directing them to bring vaccines to market quickly. what lessons do you think that market holds for us for other disease areas? rep. rodgers: there is a number of lessons we can learn. i mentioned the real-time review which in years past, a company would bring their new drug, their new breakthrough, they would present it to fda, and they might have to wait months, three months, six months, maybe longer, to get feedback from fda. through operation warp speed, that was expedited so there was real-time review. fda was involved on a more regular basis, understanding what was being developed and giving feedback quicker so that delays that often take place when it comes to bringing a new breakthrough, a new drug to help people, that would really shut down, that length of time was reduced. that is one of the big takeaways when it comes to how we can expedite the development of more cures and breakthroughs. caitlin: you know, there has been throughout the pandemic a lot of criticism about the fda and cdc, criticism of each agency. it has raised the question about whether these agencies need reform. do you agree, and if so, what could congress do to improve pandemic response or even public health response, from these agencies? rep. rodgers: when you raise the question around the pandemic response and concerns with cdc, fda, i would add to nih. it goes to this core question of trust and the fact that, since the beginning of covid-19 and the first person in america, and washington state, that tested positive for covid-19, there has been mixed messaging at different times, heading in one direction and then going another, and the question around vaccines, vaccine mandates, whether to wear a mask, i think it is very important that these agencies are building trust and being transparent, that they are being accountable to americans, that they are being accountable to the taxpayers. it is the taxpayers that are funding these agencies. these are hard earned taxpayer dollars funding agencies like cdc, fda, nih, and it is fundamental that they are transparent. i have had too many examples in leading the energy and commerce committee that has jurisdiction over these agencies where they have not been responsive to letters, they have not answered simple questions about what was going on at the wuhan lab, and u.s. taxpayer dollars being used fund activities at the wuhan lab, or why certain decisions were made that were in conflict with the world health organization. there has been too many examples that have resulted in trust being broken. so, i would urge leadership at these agencies to be transparent , and accountable over how taxpayer dollars have been used, and the importance of following the science that has been a mantra. we have seen science evolve, we continue to learn more and we need to be open to where the science is evolving, and making sure we are being reds parent with ms -- being transparent with americans. caitlin: the pandemic has raised the tension between immediacy and the need to meticulously collect data and ensure we are getting things right. we have seen that in the drug approval process. how do you balance that? what do you think is the best way to balance the tension between speed and accuracy? rep. rodgers: you balance it by being honest, and not making decisions prematurely. the cdc last august, they said there was going to be a mask mandate in schools. when cdc director wilensky called me, she gave me the heads up, which i appreciate that they were going to be releasing new guidelines around masks in schools before the school year started. i asked her what the data was to back up that decision, and the world health organization had said kids under age five should not wear masks, that it would be harmful to them, and they recommended that those under 12 do not wear masks, and yet she was moving ahead with these guidelines. she did not have the science or the data to back it up. she said they were working on it. when something like that comes forward, it is important you take the time to make sure you are making decisions based upon data, based upon the science, and bringing people along, recognizing that the science may evolve and that we continue to learn, and being transparent about why this decision is being made. i am concerned the pandemic response, into many examples, felt like it was being politicized. that decisions were being made for political purposes rather than being based on data and science, and what was really going to help us save lives, keep people safe, get our kids in school in a responsible and safe way. caitlin: congresswoman, we are out of time. thank you for joining us today. rep. rodgers: good to be with you. thank you. caitlin: thank you for joining this afternoon for another virtual conversation that made everyone smarter.

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