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NJ Poised to Benefit from Major Federal Funding for Healthcare Innovation

Garden State could tap into billions of dollars in new investment for research, drug reviews, mental health, and more

Pres. Obama signs law
President Barack Obama

A new federal program pledges to invest more than $6 billion to promote cutting-edge healthcare initiatives, including research on cancer and brain disorders, and improve access to treatments for mental health and substance use disorders.

And New Jersey, with its established pharmaceutical industry, is well positioned to benefit from the new law, observers suggested.

On Tuesday President Barack Obama signed the 21st Century Cures Act, which he said will promote “medical breakthroughs” and help address some of the nation’s most pressing healthcare challenges, including addiction, cancer and mental illness. It also seeks to address what experts have described for decades as a lack of sufficient funding for scientific research and growing competition for the dollars that remain.

The law, developed over the past two years with support from much of New Jersey’s federal delegation, includes $1.8 billion for Vice President Joe Biden’s Cancer Moonshot, in hopes of improving prevention and treatment of the deadly disease; $1.5 billion over ten years to fuel the president’s Precision Medicine Initiative, which seeks to match patients with genetic-specific care; and $1.5 billion for research on brain disorders like Alzheimer’s and epilepsy.

It also provides $500 million in additional funding to the Federal Drug Administration to expedite reviews of drugs and medical devices.

These aspects of the new law could prove particularly advantageous for a state like New Jersey, explained U.S. Rep. Frank Pallone, (D-Long Branch), who helped lead the fight for its approval. The state is known for its pharmaceutical industry and is now home to medical device makers and major research institutes, several of which are doing groundbreaking work on precision medicine, he said. “I think we benefit greatly because we have so much research, both at public institutions and in the private pharmaceutical industry,” Pallone said.

Debbie Hart, president and CEO of BioNJ, an alliance of hundreds of life-sciences companies, called it a “groundbreaking” and “revolutionary” law that will help patients get therapies and cures more quickly, while reducing healthcare costs overall. In addition to new funding, the law calls for reforms to the drug approval process, greater collaboration among diverse researchers, and more racial diversity and patient engagement in federally funded health studies.

“And given the prominence and prevalence of the biopharmaceutical industry in New Jersey, our State is particularly well situated to benefit from this legislation,” she said. Garden State companies are already leading the way on precision medicine, Hart said, and the new law will allow them to recruit and train staff and otherwise build capacity.

Overhauling the FDA’s review process and expanding support for new disease research were elements that attracted U.S. Rep. Chris Smith (R-Monmouth) to support the law. Smith has pushed for better care for those with autism, Alzheimer’s and Lyme disease, among others.

“We have seen that despite the tremendous advances in research that are unlocking the mysteries behind some of the most debilitating diseases, cures and treatments remain stymied by institutional biases and outdated and bureaucratic procedures at NIH and FDA,” Smith said when the House of Representatives passed the bill, earlier this month. The law “will provide the catalyst that puts more treatments — and more affordable treatments — in the hands of patients and families who now have limited, if any, options,” he said.

Pallone, Smith and others also praised elements of the law that called for significant investment in treatments for mental illness and drug abuse. The act provides $1 billion to expand care for those with opiate addictions, estimated at more than 20 million people nationwide and at least 256,000 in New Jersey, Pallone said.

The law also calls for regulatory reforms to expand access to mental health services for children on Medicaid, improve coordination between behavioral health and primary care providers, support evidence-based treatments and fund drug abuse and suicide-prevention programs, among other things. New Jersey has made strides to address some of these issues, but Smith said more than 10 million Americans suffer from a serious mental illness and seven out of ten don’t receive proper treatment.

Mental health advocates in New Jersey welcomed the new law, which they said includes the most significant changes to the nation’s mental health system in more than a decade. “All of these initiatives are greatly needed, as they will give individuals with mental illnesses and substance use disorders opportunities to manage these illnesses while addressing physical health conditions,” said Debra Wentz, president and CEO of the New Jersey Association of Mental Health and Addiction Agencies. “NJAMHAA applauds and thanks our federal leaders for making mental health and substance use care priorities and taking action through this momentous legislation,” she said.

While the law is now official and has received strong bipartisan support, federal funding — which happens through the annual appropriations process — requires another step. Pallone said Republican leaders, who control both houses of Congress, have pledged their backing for the measure. He noted in a press release, “We will hold them to these promises.”

Pallone also noted that, while the mental health benefits in the new law are significant, these gains would be quickly erased if President-elect Trump succeeds in his commitment to repeal the federal Affordable Care Act and replace aspects of the program with a Medicaid block grant that would limit the state’s funding capacity. A repeal would cause “catastrophic harm to individuals with mental illness,” Pallone said.

Linda Schwimmer, president and CEO of the New Jersey Health Care Quality Institute, largely agreed. While there are many ways the Garden State stands to benefit from the law, it does nothing to protect against the potential loss patients with mental illness would face if the ACA disappeared. “Although this law affords them greater protections, if they lose Medicaid coverage, then what?,” she asked.

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