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First came the new teaser for Nathan Fielder’s documentary on Elizabeth Holmes. Now come the memes. Bring it on.

FDA names permanent heads of drug and biologics centers

For the past few months, key centers at the FDA have been led by acting officials. The agency said yesterday it will now make them permanent. Michael Davis will be director of the Center for Drug Evaluation and Research, and Karim Mikhail will be director of the Center for Biologics Evaluation and Research.

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I hope you all had a good Labor Day weekend. Robots may be able to run extremely fast now, but at least we know how to stop. Run your thoughts to me anytime: bob.herman@statnews.com.

A cash parade for a top House Democrat

UnitedHealth Group’s top executives, including CEO Stephen Hemsley, and board members recently flooded the campaign coffers of Rep. Katherine Clark of Massachusetts, the No. 2 Democrat in the House who just beat two opponents in a closely watched primary.

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House Republicans canceled the last two weeks of their session in September, which means House lawmakers will have gotten at least 15 weeks off between Memorial Day and the midterms on Nov. 3. Send news tips and PTO requests to John.Wilkerson@statnews.com or John_Wilkerson.07 on Signal.

House Democrats’ agenda takes shape

In the week that the House was in town, a fuzzy outline of the health care agenda that Democrats are considering should they win back the House started to take form.

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Today, we delve into how an FDA approval paradoxically complicated access to Revolution Medicines’ new pancreatic cancer drug for some patients, see standout mid-stage results for Roivant’s pulmonary hypertension drug, and more.

Hope you had a lovely long weekend! Estoy trabajando en este Readout de la Biblioteca Vasconcelos en la CDMX.

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Hello, diligent HCI readers! I hope everyone enjoyed their Memorial Day weekends. We’ve got a lot of numbers in today’s edition. Get out your abacus. And tell me if you want more or less math in here: bob.herman@statnews.com.

$775 billion

Centers for Medicare and Medicaid Services

Republicans’ recent tax law targets supplemental Medicaid funds that have increasingly propped up hospitals. The cuts are expected to be even bigger than originally forecast, which almost assuredly will provoke an opposition campaign from hospitals.

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Hi! Hope you had a nice extended weekend.

Today: Eli Lilly’s gene-editing data seems promising for high cholesterol, an AI drug discovery CEO dispelled some AI drug discovery hype, and the new interim FDA chief is so far well received.

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Hospitals and other providers are bracing for an end to the extra money they’ve gotten for treating Medicaid patients, one of the many cuts contained in Republicans’ sweeping 2025 tax law.

But the Trump administration disclosed this week that it plans to take the cuts to state directed payments even further, setting up what’s likely to be a showdown with provider groups. 

Since 2024, some hospitals, doctors, nursing homes, and other types of providers have been reimbursed for Medicaid services at much higher commercial rates, thanks to a Biden-era change. The One Big Beautiful Bill Act, passed in July, directs the Centers for Medicare and Medicaid Services to gradually trim those payments beginning in 2028 until they’re close to or on par with Medicare rates. 

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Merck’s bet on an antibody-drug conjugate developed in China has paid off in a major Phase 3 lung cancer study, where sacituzumab tirumotecan paired with Keytruda sharply outperformed Keytruda alone in a subset of lung cancer patients.

Also, the NIH is down another leader, and Sam Altman-backed longevity startup Retro Biosciences raises more funds.

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CAR-T therapies are continuing to gain traction in autoimmune disease, with a notable new case.

Also, the FDA has withdrawn approval of GSK’s leucovorin for a rare brain disorder tied to autism, closing out an unusual episode shaped in part by political pressure.

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Zac Jiwa, a federal Medicare official, delivered a eulogy of sorts at a Thursday Medicare event highlighting the successes of the Health Tech Ecosystem initiative. 

The eulogy’s subject? The clipboard. 

For the past eight months, hundreds of health tech companies have been working to meet goals set out by the federal government to make patient records more portable, create systems that import patients’ data into providers’ electronic health records systems, and stand up various patient apps. The idea is to make filling out a stack of paperwork at every doctor’s visit, on that ubiquitous clipboard, a thing of the past.

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In which RFK Jr. says the “government lies to us” while sitting in front of an HHS seal. Send news tips and podcast recommendations to John.Wilkerson@statnews.com or John_Wilkerson.07 on Signal.

First, control health care costs

Last month, a group of 12 Senate Democrats proposed a framework for rebuilding the health care system. The idea was to spur input from others ahead of when Democrats might get a chance to act on those plans.

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PhRMA CEO Steve Ubl is stepping down. Biotech investors are grappling with pressure from AI and rising competition from Chinese labs, even though firms sit on large cash reserves.

Also, the Trump administration is stepping back from the “indirect cost” fight at the NIH, and new data suggest genetics may modestly influence responses to GLP-1 drugs.

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The 2026 STAT Madness competition was stacked with research on topics like smart dental floss that monitors stress, Baby KJ’s personalized gene therapy, and an artificial intelligence model designed to predict cell behavior. Check out the winner, unveiled this morning. And as always, send news tips to John.Wilkerson@statnews.com or John_Wilkerson.07 on Signal.

Budget reruns

The 2027 budget that the Trump administration released on Friday is in many ways a repeat of last year’s proposal: It includes deep cuts to the National Institutes of Health, the elimination of a health research agency, and the creation of a new agency devoted to chronic diseases called the Administration for a Healthy America.

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WASHINGTON — The Food and Drug Administration used the president’s budget to propose policies aimed at encouraging domestic development and manufacturing of drugs.  

FDA Commissioner Marty Makary has said the agency needs “giant, big ideas” to counter China’s dominance in early-stage clinical development of drugs. Among the FDA’s ideas are proposals to make it easier to run early-stage trials in the U.S. and to hand an advantage to U.S.-based generics manufacturers.

The Trump administration has been using a variety of policy levers to try and bring drug manufacturing to the U.S. For example, many of the brand drugmakers that struck deals to lower U.S. prices also promised to increase domestic manufacturing, under the threat of tariffs.

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Companies that sell Medicare Advantage plans will receive a 2.5% pay bump on average in 2027, up significantly from what was proposed and a win for an industry that has experienced higher medical costs and has opposed nearly all reforms to the lucrative taxpayer-financed program.

More importantly, the Trump administration scrapped a proposal that would have used more updated data in the payment process, ensuring that Medicare Advantage insurers retain billions of dollars.

The finalized rate is estimated to add $13 billion in revenue next year for insurers, according to the Centers for Medicare and Medicaid Services. During trading after the markets closed, the stock prices of UnitedHealth Group, Humana, and CVS Health each climbed by more than 8%. Those companies are the three largest Medicare Advantage insurers, and together cover almost 60% of all people enrolled in the program.

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Well hullo! You think you can get the last word, literally, with AI? Think again. There’s always human interaction available here: bob.herman@statnews.com.

Today’s the day

By law, the 2027 Medicare Advantage payment regulation must come out today. It will set the tone for how the Trump administration wants to work with the health insurance industry: as the “new sheriff in town” or just another friendly regulator.

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A four-month FDA delay prompted a cash-strapped biotech company to shutter. The White House’s proposed NIH cuts are drawing bipartisan backlash. Peptide hype is outpacing evidence. And more!

The need-to-know this morning

• Neurocrine Biosciences said this morning that it would buy Soleno Therapeutics and its treatment for Prader-Willi syndrome for $2.9 billion. Neurocrine is paying $53 a share for Soleno, a 34% premium to its closing price on Thursday.
  

A four-month FDA delay derailed a small biotech. Is it a sign of the times?

FDA delays can happen. For large drugmakers, they can be frustrating; for small drugmakers, they can be existential.

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