Small Biotech Innovation Act

This bill creates an exception from Medicare drug price negotiation for certain small biotech manufacturers that invest heavily in research and development, starting in 2029. Sec. 2, Research and development-intensive small biotech manufacturer exception from Medicare drug price negotiation program: The bill amends the Social Security Act to exclude qualifying single source drugs of a "research and development-intensive small biotech manufacturer" from the definition of "negotiation eligible drug" for initial price applicability years beginning with 2029. A "small biotech manufacturer" is defined as one with 5 or fewer qualifying single source drugs. A "research and development-intensive small biotech manufacturer" is a small biotech manufacturer that invests at least an "applicable percent" of its average net revenue from the previous three years in research and development. The applicable percent ranges from 30% for a manufacturer with 1 qualifying single source drug to 70% for one with 5 such drugs. If a manufacturer is acquired after 2029 by another manufacturer that does not meet the definition, the drug loses its exception status at the beginning of the next plan year. To qualify for the exception each year, the manufacturer must submit an application to the Secretary of Health and Human Services containing information on net product revenue and R&D expenditures, a certification of accuracy, and other specified information. The Secretary must also develop a process for manufacturers to appeal a determination that they are not a research and development-intensive small biotech manufacturer.