There are fewer than two weeks to go until the results of the 2020 US presidential election are announced, and for the first time in decades the healthcare sector’s support seems to have shifted firmly into the Democrat camp.

Drug and device makers’ financial contributions to the US Democratic Party have reached their highest level in 20 years in the runup towards the 2020 election, according to analysis from the Center for Responsive Politics. During the 2020 US election cycle, 56% of all political contributions from the healthcare sector have gone to the Democrats.

Political donations to the Democrats from the healthcare sector have risen steadily since 2012, when the party received 42% of the donations. But it’s only during this election cycle that the Democratic party has taken the majority share of industry contributions, something that has only occurred before during the 2008 and 2010 election cycles, when it received 52% of donations.

Republican candidates have historically received the vast majority of healthcare industry contributions, particularly during the early 2000s, when the party brought in between 65% and 74% of the sector’s donations.

What would a Democrat win mean for medtech?

The future of the Affordable Care Act (ACA) hinges on the outcome of the election, and it could have a substantial impact on medical device manufacturers. While Biden plans to eliminate the 400% income cap on tax credit eligibility and lower the limit on the cost of coverage from 9.86% of income to 8.5%, the Republican party under President Donald Trump has attempted to make many more regressive amendments to the ACA since 2017 and will likely continue to do so if elected in 2020.

The US Supreme Court is scheduled to hear oral arguments for the California v. Texas case challenging the constitutionality of the ACA on 20 November, weeks after the final result of the election is announced. Their final decision could come as late as June 2021, but if the act is repealed, around 20 million Americans will be left without health insurance.

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By GlobalData

If Medicare coverage were reduced, there could be a decline in elective procedure coverage for US citizens, meaning medical device companies may see a negative impact on their sales. This would be especially likely to impact manufacturers of devices stationed in hospitals, such as the da Vinci robotic systems made by Intuitive Surgical, the ventilation devices that have become so essential during the Covid-19 pandemic or scanning devices like x-ray or MRI machines.

This is because ACA elimination could cause a substantial increase in bad debt expenses, which businesses incur when the repayment of credit previously extended to customers is estimated to be uncollectible. This would hurt hospitals’ finances and result in smaller scope for capital expenditure, meaning they may be unable to purchase new systems.

Trump’s pressure on the FDA may have harmed popularity

Another factor that may have harmed the Republicans’ reputation in the healthcare sector is the pressure President Trump has been putting on the US Food and Drug Administration (FDA) to approve Covid-19-related drugs and devices under Emergency Use Authorization (EUA).

EUA allows unapproved medical products or unapproved uses of approved treatments during emergencies, such as a global pandemic. While many pundits have floated concerns about a vaccine being approved too early, the same has also applied to Covid-19 testing – particularly cheap, rapid tests that .

False positives briefly threw off the National Football League’s Indianapolis Colts in mid-October, after four players who tested positive were re-tested and found to be negative. In August, Ohio Governor Mike DeWine tested positive on a rapid test, only for three rapid tests to confirm he did not actually have Covid-19. More concerningly, on 2 October Nevada officials ordered nursing homes to stop using two government-issued rapid tests made by BD and Quidel, which produced a concerning number of false positives that could not be confirmed by more accurate tests. Under pressure from the federal government, the order was reversed a week later.

Although rapid tests are cheaper and more convenient than laboratory tests, they’re also more likely to deliver less accurate results. Not only can false positives lead to unnecessary anxiety and self-isolation, but they could even lead to Covid-negative people becoming exposed to the virus if they’re quarantined with people who really are ill. Plus, false negatives mean people who have the virus won’t isolate and could hasten the spread of the disease.

With so many rapid tests being rushed through under EUA legislation, it’s no wonder medtech stakeholders are concerned. If firms are put under pressure to rush their rapid tests on to the market before they’re truly ready, they may find their reputation takes a beating later on, as a swathe of inaccurate Covid-19 test results could seriously damage consumer faith in these brands, not to mention the regulatory regime that exists to keep people safe.