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Always Something to Worry About

Biotech CEOs are now more concerned about insurers than the Food and Drug Administration's regulatory process, reports Luke Zimmerman at Xconomy, drawing on a new survey put out by BayBio, the California Healthcare Institute, and PwC of 157 biotech CEOs in California.

"Getting FDA approval is now one step in the process," Gail Maderis, BayBio's CEO, tells him. "We're seeing a shift in concern from the FDA to insurance coverage. From a company's very early days, corporate partners and venture capitalists now want to know that if a product gets to the market, will it be reimbursed?"

Zimmerman notes that the shift comes at a time of high numbers of new product approvals by FDA, but also at a time of closer scrutiny of rising healthcare costs by insurers. Additionally, the upholding of the Patient Protection and Affordable Care Act of 2010 by the Supreme Court, and the subsequent re-election of President Barack Obama "dashed whatever hopes biotech executives may have had for a return to the days of virtually unlimited product pricing power," he adds.