Healthcare Brew covers pharmaceutical developments, health startups, the latest tech, and how it impacts hospitals and providers to keep administrators and providers informed.

Healthcare Brew

Will Peischel

Healthcare Brew delivers the latest news and trends in healthcare.

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A mountain of pharmaceutical pills in front of the US capital building

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Shelves filled with brightly covered products

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A pharmacist measures someone's blood pressure

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Pharma

Nicole Ortiz

It’s time yet again for pharma companies to report their earnings. And while it’s sure to be a mixed bag, one thing is certain: 

That’s because the White House on July 28 announced 15% tariffs on pharmaceutical products imported from Europe to the US. Though this is much lower than the previously threatened 200% tariffs, analysts reportedly told 

 the trade deal could still cost the pharma industry as much as $19 billion.

“Every dollar spent on tariffs is a dollar that cannot be invested in American manufacturing or the development of future treatments and cures for patients,” Alex Schriver, SVP of public affairs at drug industry group PhRMA, said in an emailed statement. “Placing tariffs on medicines would be counterproductive to these efforts.”

 at the end of July to top execs at 17 pharma companies like Pfizer, AbbVie, Novo Nordisk, Bristol Myers Squibb, Johnson & Johnson, and more, giving them 60 days to 

Here’s what some execs in Big Pharma had to say about tariffs this quarter.

The first half of the year has looked relatively positive for New Jersey-based J&J. The company saw $23.7 billion in overall revenue, it reported on its Q2 earnings call on July 16, with a little over $15 billion of that coming from medicine sales (cancer meds, in particular).

In its Q1 earnings, J&J predicted the impact from tariffs would be approximately 

. But a quarter later, it halved that to $200 million instead and predicted tariffs would only impact its medtech division, EVP of Innovative Medicine and R&D John Reed said on the call, which took place before the 15% tariffs were announced.

CEO Joaquin Duato reiterated J&J’s $55 billion investment to build out US-based manufacturing, R&D, and tech efforts, including four new facilities.

“Our goal is to be able to manufacture in the US all the medicines that are consumed in the US,” he added.

Following the call, J&J’s stock increased more than 6%.

The UK-based pharmaceutical showed a positive trajectory, with total revenue up 11% to $28 billion for H1 2025. Its stock has also continued on an 

Group CFO and Executive Director Aradhana Sarin said in the company’s July 29 earnings call that AstraZeneca “will not be significantly impacted by tariffs” largely because the company already has “capacity” to sell its drugs in the US and it only imports “a handful of products” from Europe.

Sarin also pointed to new and expanded manufacturing efforts the company is making across the US, which it had announced a week before its Q2 call, to produce its 

 and other weight loss drugs. The company plans to invest $50 billion through 2030 into bolstering US operations, according to a press release.

Merck has struggled in earnings so far this year. After lowering its full-year guidance during Q1, EVP and CFO Caroline Litchfield said on its July 29 Q2 earnings call that the company plans to cut $3 billion in costs by 2027. That also comes after the New Jersey-based company announced in March it would shut down a manufacturing site in Pennsylvania, 

 that tariffs would cost it roughly $200 million this year. Chairman and CEO Robert Davis said tariff impacts for the year should be “minimal,” thanks to work the company has done moving manufacturing to the US.

But Davis added he needs more clarity from the Trump administration on how tariffs are going to play out before he can comment on how they’ll affect business in 2026 and beyond. It’s not clear, for example, when the 15% pharma tariffs will go into effect, he said.

 the tariffs wouldn’t go into effect until the Trump administration concludes a Section 232 

, initiated in April, which looks into the national security implications of importing goods, including pharmaceutical products, from other countries.

Merck’s shares fell about 6% following the earnings call.

Unlike Merck, AbbVie reported pretty positive Q2 earnings on July 31, raising full-year adjusted earnings per share guidance to $11.88–$12.08, up from $11.67–$11.87. Shares increased about 3.3% after the earnings call.

Though the Chicago-based drugmaker has a large presence in Ireland, Robert Michael, chairman and CEO, said AbbVie is “fairly insulated” from any effects of the EU tariffs—at least for 2025.

“Without policy details, we’re not going to speculate on the longer-term impact,” Michael added, saying it’ll be hard to know what to expect until the results of the Section 232 investigation are released.

“What I can say is that we do not expect our exposure to be outsized relative to peers,” he said.

He noted that Skyrizi, an immunology drug that’s currently the company’s best-selling product, is made in the US, and he highlighted the company’s 

 $10 billion investment into expanding its US manufacturing, which includes adding four new manufacturing sites to make active pharmaceutical ingredients, peptides, and more.

Aug. 5 was a good day for New York-based Pfizer, which beat its Q2 earnings projections, coming in with revenue of $14.7 billion compared to its goal of $13.5 billion.

David Denton, CFO and EVP, said Pfizer has taken into account the current China, Canada, and Mexico tariffs for its full-year guidance.

When asked to comment on the letter the Trump administration sent to major pharma companies, CEO Albert Bourla said the company is in “very active discussions” with the president and other government officials. Similar to Merck, he also added that he’s “waiting for the 232 report.”

Denton expressed more optimism about the future, anticipating the first phase of Pfizer’s manufacturing strategy will result in $1.5 billion in savings by the end of 2027 and an initial impact in the latter half of this year. The company has 11 manufacturing sites in the US, which Reuters 

 in March could help it dodge the impact of tariffs if it were to reshore overseas production.

Stakeholders also questioned whether the Trump administration would take issue with Pfizer’s China-made biotech, but Bourla reiterated Pfizer has exclusive global rights to its recently acquired biotech, which it plans to manufacture in the US and commercialize globally.

“But don’t take me wrong,” he added. “China is something that is very high in the radar of the political life of the US, and we need to be careful with that.”

Despite reporting better-than-expected earnings and raising its yearly outlook (to $60 billion–$62 billion, up from a previous estimate of $58 billion–$61 billion), Indiana-based Eli Lilly’s stock dropped 14% on Aug. 7 following its Q2 earnings call.

That’s because the company reported its 

 study results, which showed the drug was less effective than investors had expected, the 

That higher outlook estimate doesn’t take into account the recently announced 15% tariffs on pharmaceuticals entering the US, according to a press release. Eli Lilly has manufacturing sites in Ireland, Italy, Spain, France, and Germany.

“The potential effect of tariffs remains dynamic, and we will continue to update our estimate as the situation changes,” EVP and CFO Lucas Montarce said on the call. “We expect the 2025 impact of currently announced tariffs to be modest, and this has been factored into our 2025 guidance range.”

The guidance does, however, factor in tariffs already in place, such as those on goods from China, according to the release.

Photo collage of shipping containers and a hand holding a prescription bottle contained in abstract shapes.

Big Pharma talks tariffs, manufacturing in earnings

Largely, major players had pretty positive calls despite pressure from the White House.

The opioid epidemic has been a defining public health crisis in the US for the past quarter century. 

With more than 800,000 people dead from overdoses over nearly 25 years, it’s hard to find an event—outside of the 

—that has impacted the US healthcare system more. The economic cost of opioid use disorder and opioid overdoses in the US was estimated to be more than $1 trillion in 2017 alone, according to 

Today, the number of overdose deaths has 

. But experts warn impending changes to Medicaid could slow that progress.

Further, overdose deaths are still higher than they were pre-pandemic, Thuy Dieu Nguyen, an assistant professor of health management and policy at the University of Michigan School of Public Health, told Healthcare Brew.

“We still have an ongoing opioid crisis,” she said.

The CDC breaks the opioid epidemic into three waves.

The first began in the 1990s, when doctors started prescribing more opioids for pain control, driven largely by Purdue Pharma’s OxyContin hitting the market in 1996. The second wave that began in 2010 saw an increase in heroin deaths, as the drug became cheaper and more available in the US. The third wave began in 2013 as synthetic opioids, primarily fentanyl-based drugs, rose in popularity.

The CDC first called the opioid crisis an “epidemic” in 2011, and in October 2017, President Donald Trump declared it a public health emergency.

 targeted opioid manufacturers, pharmaceutical distributors, and pharmacies for allegedly “aggressively marketing” the drugs while “downplaying addiction and overdose risks.”. In 2019, Purdue Pharma, the maker of OxyContin, 

. Though the company had profited $35+ billion from opioid sales, it was later forced to 

But what didn’t receive much legal attention—until recently—is the role of 

 (PBMs), which negotiate with drug companies to create formularies for insurers.

A group of lawmakers asked the Department of Justice in December 2024 to investigate 

 in the opioid epidemic, saying in a letter that 

 and a review of confidential files suggested the Big 3 PBMs—CVS Caremark, Express Scripts, and Optum Rx—“colluded and conspired to steer patients toward OxyContin in exchange for $400 million.”

 in December they offered payers the option to restrict opioid prescriptions.

After skyrocketing during the pandemic, the number of opioid-involved deaths started falling in 2023 for the first time since 2018, according to CDC data.

Between 2022 and 2023, the number of overdose deaths involving synthetic opioids fell by 2%, heroin by about 33%, and prescription opioids by almost 12%.

Further, provisional CDC data shows total drug overdose deaths fell about 27% from 110,037 to 80,391 between 2023 and 2024.

Experts aren’t sure why, exactly, overdose deaths have started dropping so significantly, but Nguyen said there are a few potential explanations.

First, some experts think that because fentanyl overdoses have already killed so many people in recent years, the number of high-risk drug users is shrinking, she said.

Second, harm reduction measures, like increased access to naloxone, an opioid overdose reversal drug, may be working. In March 2023, the FDA 

 over-the-counter Narcan (a brand-name naloxone), which can also be bought online.

“The interventions are now working,” Nguyen said. “People have easier access to naloxone, fentanyl testing strips, or certain things that have helped individuals to cope with deadly fentanyl products.”

Access to other opioid use disorder treatments, such as buprenorphine, has also been expanded significantly, Nguyen said. For instance, during the pandemic, the Drug Enforcement Agency and Substance Abuse Mental Health Services Administration allowed providers to prescribe buprenorphine after an audio-only telehealth call instead of requiring patients to go in person. That rule became permanent in January 2025.

And policies passed during the pandemic, including 

 that allowed beneficiaries to stay enrolled through the public health crisis, likely helped, she added. 

 shows that 47% of nonelderly adults with opioid use disorder are Medicaid beneficiaries.

Additionally, many states no longer require prior authorization for at least one type of buprenorphine, Heather Saunders, a senior research manager for KFF’s program on Medicaid and the uninsured, told us. That’s led to an increasing number of prescriptions for the treatment, she added.

Potentially the biggest threats to this progress are the looming 

, as Medicaid “finances the largest share of medication-assisted treatment,” Saunders told us.

, which was signed into law on July 4, cuts Medicaid funding by about $1 trillion over the next 10 years and puts work requirements in place, which means beneficiaries must prove they spend 80 hours per month working, going to school, or doing other approved activities like community service.

The added paperwork burden that comes with work requirements may cause coverage gaps, which could raise the risk of overdose deaths, Saunders said.

Stopping opioid use disorder treatment is linked to a 6x higher mortality risk for the first four weeks after interrupting treatment, according to the KFF analysis, which Saunders co-authored.

 overall will become uninsured,” she said. “So, to the extent that includes people with opioid use disorder, that might have implications for them being able to access treatment continuously.”

Where the opioid epidemic stands amid Medicaid cuts, work requirements 

Cuts to Medicaid funding could have a chilling effect on recent progress curbing opioid overdose deaths. 

Where the opioid epidemic stands amid Medicaid cuts 

illustrated headshot of caroline catherman, healthcare brew reporter

Caroline Catherman

There’s a multibillion-dollar game of tug-of-war happening between drugmakers, hospitals, and Medicaid over a popular drug discount program, and everyone says they’re fighting for the greater good.

According to a new report funded by trade group PhRMA (aka the pharmaceutical industry’s lobbyist squad), the 340B program reduced the amount rebated to managed care beneficiaries by $6.5 billion in 2024.

 requires drugmakers that participate in Medicaid to give drug discounts to hospitals and clinics; these “covered entities” treat a large proportion of low-income, uninsured patients.

The idea is for medical centers to use these discounts to help serve their communities and 

. But critics have accused some providers, especially large nonprofit health systems, of using program savings 

 rather than reinvesting them into costly community care.

In 2023, 340B covered entities purchased a record 

 in drugs, up from $53.7 billion the year before, according to government data.

“It’s a massive program that’s impacting what patients, employers, and taxpayers are all paying for prescription drugs,” Robby Zirkelbach, PhRMA’s chief public affairs officer and head of strategic initiatives, told Healthcare Brew.

Bharath Krishnamurthy, director of health policy and analytics at trade group the American Hospital Association (AHA), a big-time hospital industry lobbyist, said these discounts are necessary to combat 

 price hikes by pharmaceutical companies—a fact “this drug industry-funded report conveniently ignores.”

 found drug companies are less likely to be in compliance with 340B’s rules than hospitals are. The association is pushing for more program oversight of Big Pharma, rather than hospitals.

The new report from PhRMA, conducted by the Berkeley Research Group, examines states that use private managed care organizations (MCOs) to operate their Medicaid programs.

Basically, when a Medicaid patient gets a drug, the drug manufacturer typically has to give money back to states. This type of discount is called a rebate. For most brand-name drugs, the rebate is at least 23.1%. 

But drugmakers don’t have to give Medicaid a discount if the drug gets one through the 340B program. So, as 340B grows, states and the federal government miss out on more money, but participating clinics and hospitals get more.

“It’s a discount that the state would be getting that is instead going to hospitals,” Zirkelbach said.

 by AHA found the rebates given through 340B in 2023 only equaled about 7% of drug companies’ US revenue.

Using each state’s specific 340B and Medicaid policies, this new report claimed that if the 340B program hadn’t exempted certain prescriptions from Medicaid rebates, drugmakers would have handed over $6.5 billion more to Medicaid in 2024, including $4.2 billion to the federal government and $2.3 billion to states.

Hospitals use the money saved to invest in their community, said Krishnamurthy in his statement, which cited a 2020 

 that found 340B hospitals provided $84.4 billion in community benefits like patient financial assistance and contributions to local groups.

, however, suggested hospitals didn’t seem to start investing more in the community after they joined the program.

The Trump administration recently proposed moving oversight of this program from the Health Resources and Services Administration to the Centers for Medicare and Medicaid Services, which has a history of 

Percentage with arrows pointing down crack

PhRMA report finds 340B program lost states $6.5b in rebates last year

Welcome to the latest installment in Big Pharma vs. Big Hospital. 

Sarepta Therapeutics is laying off 36% of staff—500 employees—a move expected to be “substantially completed” by the end of Q3, it announced in a July 16 

As part of these changes, the company is scrambling its C-suite:

The company is terminating Dallan Murray, EVP and chief customer officer, though he will remain a consultant through January 2026.

Ian Estepan, former EVP and CFO, is now president and chief operating officer.

Former president and CEO Douglas Ingram will solely be CEO from now on.

Ryan Wong has taken over Estepan’s old positions.

Louise Rodino-Klapac is now the company’s president of R&D and technical operations. She was previously EVP and chief scientific officer, and headed R&D.

Sarepta will also add a black-box warning—the most serious kind—for acute liver injury and failure for Elevidys, per the FDA’s request. Elevidys, the company’s most profitable product, is the only FDA-approved gene therapy for deadly muscle-wasting disease Duchenne muscular dystrophy.

Elevidys has been somewhat controversial since its June 2024 approval.

Then-director of the Center for Biologics Evaluation and Research Peter Marks overruled his staff to give the drug full approval for ambulatory patients ages 4+ and accelerated approval to nonambulatory patients.

This happened even though the FDA’s clinical and clinical and clinical pharmacology review team wrote it had “no satisfactory data to support effectiveness claims for all ages and for nonambulatory patients,” 

In the year since the drug’s approval, two nonambulatory patients taking Elevidys died of acute liver failure. One case was disclosed in 

After the second death, Sarepta announced it was pausing shipping Elevidys to nonambulatory patients.

Sarepta added in its July 16 update that an internal expert committee has devised an “enhanced immunosuppressive regimen” for nonambulatory patients to take in order to reduce their chances of acute liver failure.

The company plans to submit that to the FDA and start gathering evidence on how to safely resume the treatment in patients who can’t walk.

In total, more than 900 people have taken the drug worldwide, according to the company.

the Sarepta Therapeutics company logo is seen displayed on a smartphone screen.

Sarepta to cut 36% of staff, add black-box warning to Elevidys

The layoffs come after two deaths of patients who had taken its most profitable product, Elevidys. 

Karen Fischer

Though UK-based pharmaceutical company Compass Pathways reached its primary endpoint from its June 23 Phase 3 trial to use synthetic psilocybin for treatment-resistant depression (TRD), investors were seemingly underwhelmed. That same day, shares plunged 46% to a record low of $2.35 a share for the biotech firm.

But Kabir Nath, CEO of Compass, defends the results of the trial, telling Healthcare Brew the team isn’t focused on share prices. The results are significant, he said, and ample bipartisan support in 

 means this changes nothing about the quest for more research into psilocybin to treat certain mental health disorders.

The psychedelic healthcare market has been ramping up since June 2023 when the FDA 

 for biopharmaceutical firms interested in pursuing research on psychedelic drugs to treat psychiatric and substance use disorders. The three main drug compounds of interest were psilocybin, LSD, and MDMA. 

Trial participants were patients with TRD—a diagnosis given after first-line treatments such as antidepressants fail two or more times to manage symptoms—and were living with multiple episodes of chronic depression for an average of three years. 

“This was a population with a high-level of suicidal thinking [in the past],” Nath said. 

The first of Compass’s two Phase 3 trials started with patients completing a Montgomery-Åsberg Depression Rating Scale (MADRS). This is a common way of 

 in adults through a seven-point scale response rate.

Patients were then randomized into two groups: one that received a placebo in the form of a sugar pill and the second that was given a single 25mg dose of psilocybin on the first day. Researchers checked on patients for safety the following day and again two weeks later, then administered another MADRS test six weeks after the first dose.

Study results showed that after one dose of psilocybin, patient symptoms improved with an average 3.6-point decrease in MADRS scores, which is positive from both clinical and trial perspectives. 

The subsequent stock drop can be attributed to the fact that investors had their sights set on a five-point MADRS decrease, which would be a stronger finding for a new field of study, even with 

Psychedelics are an effective alternative to traditional pharmaceuticals for mental health disorders, according to the 

, because they can target serotonin receptors and forge fresh neural pathways in people with severe depression. Over the last decade in the US, the CDC reports that rates of depression have increased 60%, and 1 in 10 adults have taken medication to combat it.

By 2031, the global psychedelics market is 

—Compass, Jamaica-based Minerco, and Canada-based Numinus Wellness—are working on developing psilocybin-based products. Minerco and Numinus are developing raw psilocybin materials or manufacturing processes to produce pharmaceuticals while Compass is actively developing a therapeutic for TRD.

Aside from other common treatments like SSRIs, Spravato (an esketamine nasal spray) by Johnson & Johnson is another drug in the US market used for treating TRD. It received initial FDA approval in 2019 and was approved as a standalone treatment for major depressive disorder and suicidal ideation in January. (There’s 

 over its status as a psychedelic drug, however.)

But psychedelics have been hit hard by roadblocks to FDA approval. In August 2024, pharma company Lykos Therapeutics’s MDMA therapy to treat PTSD and other mental health disorders was 

. According to Lykos, this came following questions about its efficacy as a new body of research and whether existing interventions already address the need for this population, Healthcare Brew previously reported.

Compass has a second Phase 3 trial underway with preliminary results expected sometime in the second half of 2026. Psilocybin doses will be administered twice at three weeks apart, and the dosages will vary between 1mg, 10mg, and 25mg.

Nath is optimistic about the existing and growing bipartisan support for alternative treatments to depression, including 

 from Health and Human Services Secretary Robert F. Kennedy, Jr.

Lynn Marie Morski, president of the Psychedelic Medicine Association, is also optimistic about the future of psilocybin research, even if these trial results were not what investors expected.

“[Psilocybin] is being investigated for such a wide range of indications that I believe it will still eventually get FDA approval for one or more of those, and show itself as a very versatile and safe option,” she told us.

Across the field, Morski said she has her eye on psychedelic therapies like biotech MindMed’s LSD-based therapy for generalized anxiety as well 

person with hands in their lap on left, brain and a hand holding mushrooms on right

Support for psychedelic treatments means full steam ahead at Compass, despite stock drop

Investors were seemingly not satisfied with psilocybin trial results, but the psychedelic health community disagrees.

Drug and medical device companies paid at least $13.2 billion to medical professionals in 2024, according to CMS data released June 30.

There’s been steady growth in these payments over the last few years, which include everything from research payments to free meals to promotional or conference fees. Drug and medical device companies paid out $13.1 billion in 2023, $13.1 in 2022, and $12.6 in 2021.

If you’re a medical provider, you’ve probably gotten one of those perks from a drug or medical device company and thought it wouldn’t affect your decision-making. But 

 suggests physicians are more likely to prescribe drugs from companies that pay them, with some studies specifically associating this with drugs that are 

“Really well-trained people who affirm an oath to do no harm can be influenced, and are,” Neil Jay Sehgal, associate professor of health systems and population health at the University of Washington School of Public Health, told Healthcare Brew.

Most of last year’s payout—$8.5 billion—was for research.

“The research payments are what you want to see. You want to see industry and academia working together,” Joseph Ross, an MD and Yale School of Medicine professor of medicine and of public health, told us.

But the companies also doled out $3.3 billion in “general payments,” which are not associated with a study.

The American Medical Association emphasizes in guidance on its website that physician–industry relationships don’t “automatically mean…professional judgment has been influenced inappropriately.” This funding advances medical knowledge and promotes the education of medical professionals, the website notes.

Sehgal countered that “the industry wouldn’t be doing this if they weren’t getting good value for their spend.”

The data shows certain companies have outsized influence. The top five medical device companies by market cap, for instance, paid out a cumulative $379 million in general payments last year to physicians and nonphysician practitioners like physician assistants, nurse practitioners, and clinical nurse specialists.

Abbott: $38 million in general payments, $51 million in research payments

Boston Scientific Corporation: $60 million general, $30 million research

Stryker Corporation: $135 million general, $5 million research

Medtronic: $118 million general, $61 million research

Edwards Lifesciences Corporation: $28 million general, $65 million research

The five largest drug manufacturers, also ordered here by market cap, paid a cumulative $327 million.

Eli Lilly and Company: $8 million in general payments, $626 million in research payments

Lilly USA: $46 million general, $5 million research

Janssen Biotech: $31 million general, $600,000 research

Janssen Pharmaceuticals: $15 million general, $729,000 research

Janssen Research & Development, LLC: $5 million general, $340 million research

Pharma

Big Pharma talks tariffs, manufacturing in earnings

Where the opioid epidemic stands amid Medicaid cuts

PhRMA report finds 340B program lost states $6.5b in rebates last year

Sarepta to cut 36% of staff, add black-box warning to Elevidys

Support for psychedelic treatments means full steam ahead at Compass, despite stock drop

Drug, medical device industry paid physicians $13.2b in 2024

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