Blog | 11/7/2025

Sharp Strategy Spotlight: November 7, 2025

Strategic perspectives on the trends, policies, and ideas shaping healthcare.

NOTE: All words/analysis are those from the source noted, opinions are those of the original authors and not reflective of Health Advances in general nor any individual. All sources are non-confidential and in the public domain (but some may be behind paywalls).

This issue reflects news as of 11 AM on November 6, 2025. The details and broad themes may have changed.

KEY FEDERAL GOVERNMENT NEWS

CDER chief George Tidmarsh resigns as deleted LinkedIn post prompts Aurinia lawsuit, FDA probe

  • High-ranking FDA official George Tidmarsh, M.D., Ph.D., has tendered his resignation after an unconventional LinkedIn diatribe landed the senior drug regulator at the center of a lawsuit and an internal probe. 
  • Tidmarsh was placed on administrative leave Friday as the FDA kicked off an investigation into the Center for Drug Evaluation and Research (CDER) head over a complaint lodged by Tidmarsh’s former colleague and healthcare investor Kevin Tang, Stat reported Sunday.
  • Capping off the tumultuous weekend, Tidmarsh on Sunday resigned from his post outright.
  • https://www.fiercepharma.com/pharma/cder-chief-tidmarsh-resigns-deleted-linkedin-post-blasting-lupkynis-prompts-aurinia-lawsuit

Day after resigning, Tidmarsh now says he'll fight exit from FDA

  • One day after stepping down as CDER Director, George Tidmarsh has said he will fight the investigations into his conduct and is reconsidering his decision.
  • Tidmarsh’s intentions were shared with a handful of senior FDA staff in the Office of New Drugs (OND) during a meeting of supervisors on Monday, which was held virtually.
  • At the meeting, OND Director Mary Thanh Hai relayed Tidmarsh’s comments to staff that he was on administrative leave and that he’s not resigning, according to a person familiar with the session.
  • The person spoke to Endpoints News on condition of anonymity.
  • https://endpoints.news/day-after-resigning-tidmarsh-now-says-hell-fight-exit-from-fda/   (subscription required for full text)

FDA's Top Cancer Regulator Declined CDER Directorship

CMS Finalizes Key Medicare Reimbursement Policies for Telehealth, Chronic Disease, and Digital Health

  • Last week, the U.S. Centers for Medicare & Medicaid Services (CMS) released a display copy of the Calendar Year (CY) 2026 Medicare Physician Fee Schedule (PFS) Final Rule (PFS Final Rule).
  • CMS finalized several notable proposals from the CY 2026 PFS Proposed Rule that will have a significant impact on Medicare reimbursement for physician services, including a 3.85% increase in physician reimbursement rates following five consecutive years of rate cuts.
  • CMS also finalized certain proposals, or is seeking comment on items, of significant importance with respect to Medicare reimbursement for telehealth services, chronic disease and behavioral healthcare, and digital health.
  • Analysis: https://www.sidley.com/en/insights/newsupdates/2025/11/cms-finalizes-key-medicare-reimbursement-policies-for-telehealth-chronic-disease-and-digital-health

Trump’s HHS Orders State Medicaid Programs To Help Find Undocumented Immigrants

  • The Trump administration has ordered states to investigate certain individuals enrolled in Medicaid to determine whether they are ineligible because of their immigration status, with five states reporting they’ve together received more than 170,000 names - an “unprecedented” step by the federal government that ensnares the state-federal health program in the president’s immigration crackdown.
  • KFF Health News in October reached out to Medicaid agencies in 10 states. Five provided the approximate number of names they had received from the Trump administration, with expectations of more to come: Colorado had been given about 45,000 names, Ohio 61,000, Pennsylvania 34,000, Texas 28,000, and Utah 8,000. More than 70 million people are enrolled in Medicaid.
  • Most of those states declined to comment further. Medicaid agencies in California, Florida, Georgia, New York, and South Carolina refused to say how many names they were ordered to review or did not respond.
  • Press: https://kffhealthnews.org/news/article/trump-hhs-medicaid-eligibility-reviews-states-cms-immigrants/

Merkley, Wyden pressure CMS over Medicare provider directory

KEY REVERSALS – RESCINDED ITEMS - LAWSUITS

Trump HHS Gives Details of Shutdown-Related Cuts in Court Filing

  • The US Department of Health and Human Services provided a federal judge with new details on planned workforce reductions issued during the government shutdown, the latest update in the Trump administration’s battle with federal worker unions that puts hundreds of jobs at stake.
  • Provided by Thomas J. Nagy Jr., the HHS deputy assistant secretary for human resources/chief human capital officer, the numbers come in response to a court order for the Trump administration to pause certain workforce reductions.
  • The most comprehensive look at the HHS shutdown reduction effort thus far, the document lays out which HHS agencies were hit with notices, along with the number of workers protected by the court order and details on where they’re staffed.
  • Filed Wednesday, the document comes after President Donald Trump carried through on his threats to initiate a new wave of layoffs during the government shutdown that began in October, sending termination notices to at least 4,100 employees.
  • About 1,760 workers received termination notices at the HHS, many of which Nagy in October admitted to being unintentional, issued on account of “data discrepancies and processing errors.”
  • In a lawsuit brought by federal labor unions, the court has since ordered the federal government to hold off on layoffs. US District Court for the Northern District of California Judge Susan Illston issued a preliminary injunction Oct. 28 that “enjoins further shutdown-related layoffs” and “pauses the clock on those RIF notices that have issued during the shutdown until this lawsuit can be resolved.”
  • https://news.bloomberglaw.com/health-law-and-business/trump-hhs-gives-details-of-shutdown-related-cuts-in-court-filing   (subscription required for full text)

NIH, universities clash in appeals court over payment cut plan

  • The government is back in court to defend its plan to limit spending on overhead research costs for NIH grantees.
  • The US Court of Appeals for the First Circuit heard arguments on Wednesday afternoon over whether to uphold a permanent injunction on the NIH’s proposed 15% limit on indirect cost reimbursements. The NIH appealed that ruling in April, leaving uncertainty over whether the payment cap would eventually come to fruition.
  • Several states, universities and organizations challenged the proposed cap in lawsuits filed in Massachusetts federal court. Some universities said the cap would cause them to lose millions of dollars in annual funding.
  • But in a May court filing to the First Circuit, attorneys representing NIH said its proposed cap is lawful, “reasonable and reasonably explained.” They also argued that the district court lacked jurisdiction and that spending on administrative overhead has “increasingly displaced NIH’s ability to fund direct medical research.”
  • On Wednesday, Department of Justice attorney Jennifer Utrecht said that the proposed cap would redirect the funds to direct research costs.
  • https://endpoints.news/first-circuit-hears-arguments-over-nih-indirect-cost-cuts/  (subscription required for full text)

Appeals court judges seem skeptical of Trump administration’s defense of capping NIH overhead payments

  • Federal appeals court judges’ questions and comments during a hearing Wednesday suggested they may be skeptical of some of the Trump administration’s central arguments in a lawsuit challenging its proposed changes to research overhead payments.
  • The case revolves around a multibillion dollar question: Did the National Institutes of Health, the nation’s premier funder of biomedical research, violate federal law in an announced plan to slash support for research overhead?
  • The plaintiffs, which include 22 states as well as universities and academic groups, allege that the NIH policy seeking to cap overhead payments, currently blocked by a lower court ruling, is “arbitrary and capricious” and thus violates the Administrative Procedure Act, a law that governs how federal agencies implement new regulations. They also claim the policy violates language included in congressional appropriations.
  • The Trump administration has argued that the federal district court did not have jurisdiction to issue its ruling, and that even if it did, the NIH has the authority to restrict overhead payments and announced the policy in a manner consistent with federal statutes. The administration has requested that the appeals court either reverse the lower court’s decision or send the case back to the district court with instructions that it be dismissed due to a lack of jurisdiction.
  • https://www.statnews.com/2025/11/05/nih-indirect-costs-lawsuit-argued-federal-appeals-court/  (registration required)

KEY BIOPHARMA NEWS

HHS approves 340B rebate model plans for Merck, Bristol Myers and others

  • HHS has approved applications from eight drugmakers to participate in the government’s pilot program testing a rebate model for certain 340B discounts.
  • The green light from HHS’ Health Resources and Services Administration means companies can begin implementing their rebate model plans in January, marking a significant change to the way the 340B discount program has operated for decades. Under a rebate model, health centers would purchase certain 340B-eligible drugs at market price, then recoup the discounts via rebates, as opposed to upfront.
  • A handful of pharma companies have been battling HHS in court for months over their own proposed 340B rebate models. For now, the pilot program is limited to drugs subject to the first round of Medicare negotiations, a group that includes Bristol Myers Squibb’s blood thinner Eliquis, J&J’s plaque psoriasis drug Stelara, and others.
  • https://endpoints.news/hhs-approves-340b-rebate-model-plans-for-merck-bristol-myers-and-others/  (subscription required for full text)

Hospitals sound alarm on new drug rebate program

  • Nonprofit hospitals and health clinics are alarmed about a change that's coming to federal drug purchasing discounts next year.
    • They'll have to pay up front and then get rebates — rather than direct price cuts — in a pilot with eight pharmaceutical companies.
  • Why it matters: The new system, greenlit by the Trump administration, is a win for drugmakers, and it could be a big hassle for providers.
    • Under the test, which starts in January, providers will pay full price for drugs they currently get at a steep discount.
    • They'll get reimbursed the difference after the drugmaker determines they qualify for the lower price under the 340B program, which allows nonprofit safety net providers to access lower-cost outpatient drugs.
  • Where it stands: The Health Resources and Services Administration last week approved 340B rebate programs for nine popular drugs, including Bristol Myers Squibb's blood thinner Eliquis and Janssen's Stelara and Xarelto.
    • The pilot will run for at least one year to test whether rebates work for 340B discounts, Health and Human Services said in July when it first announced the idea. Only drugs that have been selected for Medicare price negotiations are eligible for the test.
    • Once the pilot starts, providers will receive rebates from the drugmakers no more than 10 days after submitting the required data. Drugmakers have to provide "rationale and specific documentation" for denying rebate claims, HHS said.
  • Analysis: https://www.axios.com/2025/11/06/trump-rebate-drug-prices-program-hospitals  (subscription required for full text)

Trump lands sweeping cost cuts on Lilly, Novo weight loss drugs in exchange for Medicare coverage

  • Since President Donald Trump began his emphatic push to reduce drug prices, a looming question has been how low he could bring down the price of weight loss drugs that have skyrocketed in use.
  • The answer came on Thursday.
  • The White House unveiled multifaceted deals with Eli Lilly and Novo Nordisk, securing discounts for their megablockbuster GLP-1 drugs in exchange for Medicare coverage. Administration officials said the average monthly price of both companies’ injectable and oral products will be $350 per month. Lilly said in a separate release that it will offer the lowest dose of its Zepbound multi-dose injectable pens for $299 per month, with additional doses at $449 per month.
  • Novo currently offers Wegovy directly to cash-paying patients for $499 per month. Lilly offers the starting dose of Zepbound for $349 per month, with all other doses climbing to $499.
  • The deals mark the latest agreements with drugmakers in Trump’s “most favored nation” push and are the most substantial to date, given the demand for the GLP-1 drugs and their inclusion in Medicare. Like the previous drug pricing deals with Pfizer and AstraZeneca, Lilly and Novo are guaranteeing MFN pricing on all new medicines they bring to market. They’ll also each receive a three-year reprieve from tariffs.
  • “This is the most important of all the MFN announcements we’ve made, this is going to have the biggest impact on the American people,” HHS Secretary Robert F. Kennedy Jr. said Thursday at the White House.
  • The cash price of the injectables will lower to $250 over two years, senior administration officials said on a press call. The lowest dose of the oral versions, should they be approved, will be sold on TrumpRx at $150 per month for the lowest dose. That will also be the price on all other direct-to-consumer offerings from Novo and Lilly.
  • https://endpoints.news/trump-lands-sweeping-cost-cuts-on-lilly-novo-weight-loss-drugs  (subscription required for full text)

Pharma groups seek expansion of FDA’s PreCheck program

  • Numerous pharmaceutical industry groups are advocating for the expansion of the US Food and Drug Administration’s (FDA) PreCheck program to cover existing manufacturing facilities, as well as new ones.
  • Additionally, some groups recommend that PreCheck be integrated with current programs.
  • The generic drug industry has also suggested that other government initiatives and support should be implemented to strengthen this sector.
  • These comments were made in response to the FDA’s request for public input on the PreCheck program, which seeks to encourage pharmaceutical companies to establish new manufacturing facilities in the United States.
  • The program was announced by FDA Commissioner Marty Makary in August 2025.
  • https://www.raps.org/news-and-articles/news-articles/2025/11/pharma-groups-seek-expansion-of-fda-s-precheck-pro

Medicare Chief Presses Plans To Implement Prior Auth Deal

KEY DIAGNOSTICS – LIFE SCIENCE RESEARCH NEWS

Shutdown Puts RESULTS Act and Lab Relief on Hold Until Congress Reopens

  • The bipartisan RESULTS Act, designed to overhaul Medicare’s payment system for clinical laboratory testing, is on hold amid the ongoing government shutdown. With cuts of up to 15% set to hit 800 common lab tests in 2026, laboratory leaders warn that the delay threatens patient access and lab stability nationwide.
  • Efforts to reform how Medicare pays for clinical laboratory testing have hit a standstill as the ongoing federal government shutdown freezes legislative progress on Capitol Hill, delaying long-awaited relief for labs facing steep payment cuts in 2026.
  • At stake are payment reductions of up to 15% for more than 800 commonly ordered laboratory tests, scheduled to take effect on January 1, 2026.
  • The RESULTS Act seeks to overhaul the payment process to ensure rates reflect the full diversity of the laboratory market, including independent, hospital outreach, and physician office laboratories.
    • It would reduce administrative burdens on both labs and the Centers for Medicare & Medicaid Services (CMS), cap annual payment reductions at 5% instead of 15%, and extend data reporting cycles to every four years.
    • The bill would also empower CMS to work with an independent third party to collect more representative market data and make rates subject to administrative or judicial review.
  • https://www.darkdaily.com/2025/11/05/shutdown-puts-results-act-and-lab-relief-on-hold-until-congress-reopens/   (subscription required for full text)

KEY HEALTH INFORMATION TECHNOLOGY (HIT) NEWS

FDA digital advisers confront risks of therapy chatbots, weigh possible regulation

  • A Food and Drug Administration advisory committee will meet Thursday to explore a topic that’s been taboo during the Trump administration: Regulating artificial intelligence.
  • The FDA’s Digital Health Advisory Committee (DHAC) will convene to discuss nitty-gritty details around the regulation of therapy chatbots and other mental health devices that use generative AI. The meeting is part of the agency’s ongoing effort to clarify how regulation applies to medical devices based on newer forms of AI, including large language models that produce conversation-like outputs that are not predictable and may misguide users or lead to patient harm.
  • The DHAC will spend much of the meeting hearing public commentary as well as discussing different scenarios relating to a hypothetical “therapy device” built on a large language model with “with unique outputs that mimic a conversation with a human therapist.” The committee will be asked to consider the device for both prescription and over-the-counter contexts; for adults as well as adolescents; and with indications for major depressive disorder and for multiple mental health conditions. The feedback generated from the meeting will help inform the agency’s work on AI.
  • https://www.statnews.com/2025/11/05/fda-digital-advisers-therapy-chatbots-regulating-generative-ai/   (subscription required for full text)

KEY MEDTECH NEWS

FDA issues draft guidance on QMSR information for premarket submissions

  • The US Food and Drug Administration (FDA) issued draft guidance for device makers that outlines its expectations for implementing the Quality Management System Regulation (QMSR).
  • The guidance details the information that should be included to support Premarket Approval Applications (PMAs) and Humanitarian Device Exemption (HDE) applications, ensuring alignment with the QMSR.
  • FDA has indicated in its guidance that starting 2 February 2026, it will assess compliance with QMSR requirements.
  • According to Michael Heyl, an attorney with Hogan Lovells, the guidance represents a shift from the previous quality system requirements to the QMSR.
  • Key changes include a strong emphasis on risk management and increased transparency.
  • Under the new QMSR, FDA inspectors will now have the authority to review the results of both internal audits and supplier audits.
  • https://www.raps.org/news-and-articles/news-articles/2025/11/fda-issues-draft-guidance-on-qmsr-information-for

Legislators object to proposed CMS payment changes for diabetes tech

  • In a letter to CMS Administrator Mehmet Oz, diabetes caucus leaders raised concerns that the agency’s proposals will reduce access to glucose monitors and insulin pumps.
  • In their letter, Sens. Jeanne Shaheen, D-N.H., and Susan Collins, R-Maine, and Reps. Diana DeGette, D-Colo., and Gus Bilirakis, R-Fla., raised concerns that a few suppliers would be responsible for furnishing durable insulin pumps and CGMs to beneficiaries if the proposal were made final. These suppliers would also be responsible for maintenance, software updates and recalls. Currently, manufacturers are responsible for support.
  • “We also are concerned that these proposed policies will have the unintended consequence of reducing choices for CGM or durable insulin pump beneficiaries,” the legislators wrote. “Suppliers would not be required to carry all types and combinations of CGMs and durable insulin pumps under this proposal, which would push beneficiaries closer to a one size fits all model that would not meet their needs.”
  • They added that while they support the goal of allowing people to switch to newer technologies more often than every five years, they believe there are other ways for the CMS to achieve this. The caucus leaders also noted that there is currently a national coverage determination request to align Medicare coverage of insulin pumps with the standard of care.
  • https://www.medtechdive.com/news/legislators-object-cms-proposal-diabetes-tech/804640/

FDA Launching New Medical Device RWE Program Amid Staff Losses

KEY ACRONYMS

  • ACA = Affordable Care Act
  • CDC = Centers for Disease Control and Prevention
  • CDER = Center for Drug Evaluation and Research
  • CGM = continuous glucose monitors
  • CMS = Centers for Medicare & Medicaid Services
  • DHAC = Digital Health Advisory Committee
  • FDA = Food and Drug Administration
  • HDE = Humanitarian Device Exemption
  • HHS = Department of Health and Human Services
  • NIH = National Institutes of Health
  • OND = Office of New Drugs
  • PFS = Physician Fee Schedule
  • PMAs = Premarket Approval Applications
  • QMSR = Quality Management System Regulation
  • RWE = real world evidence

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