The Advocate

July 2025: Volume 5, Issue 7

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In This Issue:

Final F&A Reimbursement Model Restructures Research Funding
President Trump Signs Reconciliation Package into Law 
Read Our Comments on FDA’s Real-World Data Interoperability Docket 
ASGCT Submits Response on Deregulation Efforts 
Watch: Congressional Policy Fellow Discusses Life on Capitol Hill
Congressional Committee Discusses Regulatory Pathways for Regenerative Medicine  
Register to Learn About India’s Role in Global CGT Advances 
New Community Quick Take Explores the Use of Biomarkers  
In Brief: Policy Updates

ASGCT Advocacy

Final F&A Reimbursement Model Restructures Research Funding

In response to the proposed caps on indirect cost rate reimbursements through NIH, the Joint Associations Group (JAG) on Indirect Costs has released two draft “Fiscal Accountability in Research” (FAIR) models as potential successors to the current F&A system. Stakeholders were invited to test the models and submit feedback. 

The final model was presented at a town hall on July 15. The hybrid model restructures research funding by creating three distinct cost categories: Research Performance Costs (formerly direct costs), Essential Research Performance Support (project-linkable costs previously buried in indirect expenses), and General Research Operations (institution-wide infrastructure that can't be allocated to specific projects). This approach aims to eliminate the current negotiation system between institutions and the federal government while ensuring that overhead rates would vary based on the actual type of research being conducted at each institution, using established tools like recharge centers and space surveys to map specific research requirements to facilities and services. 

President Trump Signs Reconciliation Package into Law 

President Trump signed an FY25 reconciliation package into law on July 4, which included significant changes to US health policy. The legislation, which narrowly passed the Senate and House in recent weeks, cuts more than $1 trillion from federal health programs over the next decade while extending 2017 tax cuts.  

The bill implements a number of changes to Medicaid: 

• Work Requirements: Adults under 65 (including parents of children older than 14) must work, volunteer, or attend school at least 80 hours per month to maintain coverage, beginning December 2026. 

• Eligibility Verification: States must check enrollees' eligibility every six months instead of annually starting in 2027. 

• Cost-Sharing: Beneficiaries with incomes above the poverty line must pay co-pays up to 5% of their annual income. 

• Provider Tax Limits: Freezes provider taxes in non-expansion states and gradually reduces allowed rates in states that expanded Medicaid through the Affordable Care Act. This represents a shift in how states can draw down federal Medicaid dollars without increasing state spending.  

• Federal Medical Assistance Percentage Changes: Modifies federal Medicaid matching rates and restricts state-directed payments. In particular, it limits the ability of states to use supplemental payments (like directed payments to hospitals and managed care plans) as a mechanism to draw down enhanced federal funds. ASGCT has previously advocated for increased FMAP rates to help state budgets accommodate CGTs with high upfront costs.  

According to the Congressional Budget Office, nearly 12 million Americans will lose insurance by 2034. A $50 billion rural healthcare relief fund was included to offset the law’s impact on rural hospitals. ASGCT advocates for robust Medicaid funding to ensure that patients eligible for CGTs maintain access to these innovative treatments. 

Read Our Comments on FDA’s Real-World Data Interoperability Docket 

Real-world data (RWD) are health information captured outside traditional clinical trials, through electronic health records, claims files, patient registries, etc. For rare disease therapies these data can fill evidence gaps, support external control arms, and enhance post-approval safety monitoring. ASGCT has supported the use of RWD to circumvent unique CGT challenges. In a new comment letter to FDA’s docket on Exploration of Health Level Seven Fast Healthcare Interoperability Resources (HL7 FHIR) for Study Data Created From Real-World Data Sources, ASGCT welcomed the agency’s push for standardized RWD and a system that gives sponsors clearer pathways to use it, while helping regulators consistently evaluate that evidence. 

ASGCT Submits Response on Deregulation Efforts  

ASGCT submitted comments to HHS in response to a Request for Information (RFI) titled Ensuring Lawful Regulation and Unleashing Innovation to Make America Healthy Again. This RFI was issued in line with a previous executive order which requiring federal agencies to identify and eliminate regulations they consider unnecessary. 

In response, ASGCT emphasized the importance of maintaining science-based FDA guidance for CGTs, while supporting the retirement of outdated regulations that no longer serve meaningful public health purposes. The Society specifically advocated for the publication of several key FDA guidance documents scheduled for 2025, including guidance on potency assurance, safety testing, and accelerated approval pathways for rare diseases. ASGCT also recommended that FDA better align established policy tools like the Advanced Manufacturing Technologies Designation Program with existing regulatory frameworks. These recommendations aim to reduce scientific uncertainty, streamline development pathways, and ultimately accelerate patient access to safe and effective transformative therapies. 

Watch: Congressional Policy Fellow Discusses Life on Capitol Hill

In a conversation with AAAS, ASGCT Congressional Policy Fellow Dr. Adriana Bankston explained her day-to-day on Capitol Hill and why scientists should consider working in science policy. Watch the recording and keep an eye out this fall when applications open for the 2026-2027 ASGCT Policy Fellowship. 

Congressional Committee Discusses Regulatory Pathways for Regenerative Medicine  

At a recent House Energy & Commerce Health Subcommittee hearing on the HHS budget, CGTs were a frequent topic. HHS Secretary Robert F. Kennedy Jr. told lawmakers that FDA is “doubling down” on accelerated-approval and compassionate-use mechanisms. Rep. Gus Bilirakis (R-FL) urged reinstatement of the lapsed Rare Pediatric Disease Priority Review Voucher (PRV), which ASGCT supports. Kennedy called the vouchers “proven accelerants,” pointing specifically to sickle cell gene therapies. Committee members separately asked about the administration’s proposed NIH budget cuts, warning that canceling or freezing clinical trials could slow progress for patients. Kennedy said HHS will comply with a federal court order reinstating targeted grants, though he acknowledged that cost–benefit reviews and restart timelines are still being drafted.  

Rep. Dan Crenshaw (R-TX) discussed HR 1082, which he co-sponsored, and which passed the House but has not been brought up in the Senate. Among other elements, the bill directs FDA to hold a public meeting on regulations for human cell and tissue products (HCT/Ps). ASGCT has a patient education page on stem cell products, focusing on how to tell the difference between legitimate CGT clinical trials and unproven, potentially harmful stem cell products. 

Register to Learn About India’s Role in Global CGT Advances 

Catch up on ASGCT’s latest Around the World event, spotlighting India’s growing impact in cancer and blood disorder gene therapies. Regional experts shared clinical breakthroughs, expanded treatment access, and advances in research that position India as a rising leader in the global CGT landscape. 

New Community Quick Take Explores the Use of Biomarkers  

Watch our latest Community Quick Take, featuring Dr. Rebecca Ahrens-Nicklas breaking down how biomarkers are chosen for rare disease CGT treatments—and why advocacy groups play a key role in shaping these decisions. This 15-minute video shares information on when biomarkers matter and how they can help therapies move forward.  

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In Brief: Policy Updates 

• CAR T Regulatory Update: The FDA has eliminated Risk Evaluation and Mitigation Strategies (REMS) requirements for six approved CAR-T cell therapies, removing requirements that patients stay near treatment centers for four weeks.  

• New National Priority Vouchers: A limited number of non-transferrable vouchers will be piloted to speed drug development aligned with US health priorities. Full details are forthcoming, but eligible programs must address pressing health needs like innovation, unmet public health challenges, or domestic manufacturing. Vouchers offer expedited review, rolling submission benefits, and enhanced FDA engagement.   

• PDUFA VIII Public Meetings: FDA held the first public meeting on July 14 to discuss proposed recommendations for the reauthorization of the Prescription Drug User Fee Act (PDUFA) for FY28 - FY32. Commissioner Makary announced he wants to lower user fees in the next iteration of PDUFA to reduce barriers for small companies, while predicting at least 20% more drug approvals this year than last. 

• Reducing Use of Animal Models: NIH announced it will no longer seek research proposals exclusively involving animals and will require all new funding opportunities to include language on non-animal methods. FDA is also working to reduce animal testing in drug development. 

• Diversity Action Plan Guidance: A federal judge ruled that the Trump administration violated the law by removing FDA clinical trial diversity guidance and other health webpages, ordering the agencies to restore the removed content by July 11.  

• Prior Authorization: HHS and CMS leaders announced that major insurers signed a pledge to streamline prior authorization. The insurers promised to cut the number of services needing prior approval, boost transparency on decisions and appeals, and other reforms. The pledge is voluntary, but CMS leadership said that they will regulate if needed.  

• House Appropriations Report: In a recent House Appropriations Committee report, appropriators called on FDA to establish pathways with novel safety and efficacy endpoints, utilize accelerated development pathways for therapies with significant clinical evidence or unmet patient need, and enhance alignment between FDA and patients on risk tolerance.