Uncompensated care study: Case of Wishful Arithmetric

08/25/2008 09:55 PM |

Today's study in Health Affairs tries to suggest, once again, that  universal health care of some sort would cost only less than paying out for uncompensated care to the uninsured who receive most of this "free" care. 

The researches argue that neither health care spending or private premiums would go up that much because "hospital spending on uncompensated care has been relative stable.  That is partly because the public hospitals and clinics that most often care for the uninsured often don't have many privately insured patients to absorb the costs."

Translation: most uncompensated care is due to the fact that Medicare and Medicaid don't pay the full cost of medical expenditures.  Uncompensated spending has been stable because Medicare and Medicaid have held reimbursement rates steady and because in many cases the state match (to pay for the care of illegals) has skyrocketed with most of the money going to urgent care and maternal health, not complex medical procedures. 

GIve people a full blue plate entitlement and watch both government expenditures rise and uncompensated care increase as well.  In every state where a single payer plan has been enacted uncompensated care continues to go up.  The best example is the Oregon Health plan which ensures the uninsured by rationing access to cutting edge treatments and raising taxes.  The trend of uncompensated care since 1994 in that state is below.

Statewide Uncompensated Care by Year:
	Year	Charity Care	% Change from Prev. Year	Bad Debt	% Change from Prev. Year	Total Uncomp. Care	% Change from Prev. Year
	1994	74,653,735		90,272,616		164,926,351
	1995	55,645,120	-25.5%	90,262,052	0.0%	145,907,172	-11.5%
	1996	53,036,784	-4.7%	80,387,137	-10.9%	133,423,921	-8.6%
	1997	55,123,781	3.9%	83,974,361	4.5%	139,098,142	4.3%
	1998	58,291,332	5.7%	96,289,876	14.7%	154,581,208	11.1%
	1999	53,994,527	-7.4%	102,732,393	6.7%	156,726,920	1.4%
	2000	64,916,584	20.2%	128,914,104	25.5%	193,830,688	23.7%
	2001	77,772,655	19.8%	138,822,832	7.7%	216,595,487	11.7%
	2002	107,854,204	38.7%	164,629,911	18.6%	272,484,115	25.8%
	2003	183,626,444	70.3%	221,580,947	34.6%	405,207,391	48.7%
	2004	268,333,010	46.1%	269,741,864	21.7%	538,074,874	32.8%
	2005	374,330,244	39.5%	301,574,208	11.8%	675,904,452	25.6%
	2006	445,884,426	19.1%	305,343,908	1.3%	751,228,334	11.1%
	2007	524,707,945	17.7%	351,866,447	15.2%	876,574,392	16.7%

The same thing happened in Tennessee when Tenncare was enacted.  The idea that a single payer system will eliminate uncompensated care is bogus unless the single payer doubles what it pays providers, hospitals, etc.  Just the opposite takes place in a single payer system.   What will reduce uncompensated care -- apart from rationing which will drive up costs elsewhere --  are changes to the financial and technological structure of healthcare that reward saving and investment in personal health and staying healthy.   Indeed, as the percent of people in consumer directed plans increases and includes the uninsured, the amount of out of pocket spending has remained stable and as a RAND study last year shows, the consumer directed plans are associated with reduced hospital and physician visits and increased access to prescriptions.  This does not always "control" costs but does appear to improve quality by encouraging more management of costly chronic illnesses,

http://content.healthaffairs.org/cgi/content/full/hlthaff.27.5.w399/DC1
  Read More & Comment...

When is Off-Label not Off-Label?

08/25/2008 12:57 PM |

When is off-label not off-label?  When it's on-formulary and off-patent of course.

At least that seems to be the position of some state Medicaid plans.

Case in point, pregabalin (Lyrica) and Iowa (coincidentally, the state represented in the United States Senate by Charles Grassley).

Iowa Medicaid requires preauthorization for pregabalin -- which is FDA-approved for (among other indications) fibromyalgia.  In Iowa a patient with a diagnosis of fibromyalgia must first fail on at least two  of the State's "preferred" agents -- trycyclic anti-depressants, topical lidocaine, or gabapentin.  None of these three agents are approved by the FDA for the treatment of fibromyalgia.

But they are less expensive than the on-patent, on-indication product.  So what we've got here is step-therapy based on off-label usage.  Not unheard of, certainly , but it does start sending some interesting policy messages about the appropriateness of off-label use in various circumstances.  (And it's more than a little bizarre when you consider that Pfizer, the manufacturer of pregabalin, had to pay a $430 million fine for off-label promotion of gabapentin.)

The actions of the Hawkeye State Department of Human Services are even more peculiar considering that Senator Grassley (R, IA) asked the U.S. Government Accounting Office (GAO) to investigate off-label prescribing -- and not because he thought it was a valuable tool for patient care.

So here's where we stand:  Off-label use of on-patent medications is bad, but off-label use for generics is good.  Translation:  off-label use is good when it saves the payer money.

Is cost-based trial-and-error medicine really the path we want to take in the era of personalized medicine?

What about science?

What about relying on the professional judgment of the physician?

What about what's best for the patient? 



  Read More & Comment...

Patient-Centric Care? He knows it when he sees it

08/22/2008 11:45 AM |

John F.P. Bridges, Assistant Professor, Department of Health Policy and Management at the Johns Hopkins School of Public Health and Senior Fellow at the Center for Medicine in the Public Interest, is the featured interview in the current edition of DIA Today.

It's a Q&A.  Here's a sample:

DIA:  Do you think that the general public -- the average "patient on the street" -- would recognize the concept of patient-centered care?

JB:  "I think that if they experience it, they can tell the difference, but at the moment we're setting up barriers to patient-centered care.

To find out what that means, have a look at the compete interview here.  It begins on page 18.
  Read More & Comment...

Is It Worth Letting Women Get Cervical Cancer

08/21/2008 01:16 PM |

I guess if you take a "societal" (read government or HMO) perspective it does, especially if you believe that an additional yearl of disease free life for a women 21-26 is only worth $100K, which is an arbitrary numbe developed in 1985 that reflects a "societal perspective" on the cut off or rationing point...

"We adopted a societal perspective, discounted costs and benefits by 3% annually, and expressed benefits as quality-adjusted life-years (QALYs) gained. After eliminating strategies that were more costly and less effective or less costly and less cost-effective than an alternative strategy, incremental cost-effectiveness ratios were calculated as the additional cost divided by the additional health benefit associated with one strategy as compared with the next-less-costly strategy. Although there is no consensus on a cutoff point for good value for resources, we interpreted our results in terms of a commonly cited threshold of $50,000 per QALY gained, as well as an upper-bound threshold of $100,000 per QALY gained."

Hmm, and what does that cover...

"The routine vaccination of 12-year-old girls, in the context of current screening and assuming lifelong vaccine-induced immunity, had an incremental cost-effectiveness ratio of $43,600 per QALY gained, as compared with screening alone (Table 2). The addition of a 5-year catch-up program for girls between the ages of 13 and 18 years cost $97,300 per QALY, and extension to 21 years of age cost $120,400 per QALY. The extension of the catch-up program to 26 years of age cost $152,700 per QALY, as compared with the catch-up program to 21 years of age."

The extra $52 K is really society saying, we have decided after $100K  we will roll the dice and see if we have to pay for all the costs relateded to screening, treatting, etc. cevical cancer.   It does not even address what a 26 year old woman might think a catch up shot is worth....

Oh,  and the additional benefits. like avoiding screening and the worry or other illnesses were never counted either.

"when the potential benefits associated with preventing noncervical HPV-16–related and HPV-18–related cancers and HPV-6–related and HPV-11–related juvenile-onset recurrent respiratory papillomatosis were included, cost-effectiveness ratios were reduced"

So of course the NEJM runs an editorial claiming the vaccine is not cost effective, it's press department hypes that and not the guts of the study and the rest of the media takes the lead and will ikely cite (via misrepresentation) the study as proof that many new products are not worth their cost.  .

Still believe cost-effectiveness will certainily be a patient-centered and objective process taking into account all stakeholder concerns.  

http://content.nejm.org/cgi/content/full/359/8/821
  Read More & Comment...

Cost-effectiveness wars

08/21/2008 12:44 PM |

John F. P. Bridges, Assistant Professor at Johns Hopkins Bloomberg School of Public Health, a Senior Fellow at the Center for Medicine in the Public Interest and the Founding Editor of The Patient, comments on the new Hanover Consensus and the future of comparative effectiveness.

Here's what he has to say:

 
Peter Pitts’ depiction of the almost ten year old “cost-effectiveness” wars in Germany (See Uncommon Denominator) is just an introduction to the debate over economic evaluation of medicine in Germany, Europe and beyond. While it is commonly believed that Europe had long ago fallen to the dark forces of cost-effectiveness analysis, the German defiance referred to in Peter’s article has highlighted that this is not really the case (and there are plenty more counter examples out there). 

Two key issues central to the German debate over economic evaluation are, (1) what methods constitute “best practice” in the economic evaluation of health care, and (2) what type of evaluation is needed for a system that is based on a combination of employer and private health insurance, albeit a system that is subjected to an increasing government presence – along with calls for major reforms to create (attention Obama-ites) a national health care system.

The Hanover Consensus Group has consistently taken the line that “everyone else is doing it, so why aren’t we?” (Although a cynic might read “other health economists are profiting from it and we want too as well!”) While cost-effectiveness analysis is a regularly accepted rule, it’s wrong to consider it as accepted best practice.  Even for those who herald its use, it is often understood as a “necessary evil”.  Furthermore, in an evidence base world, there has never actually been a technology assessment performed on cost-effectiveness analysis, hence we don’t know if it does or does not lead to better health care investments or lowers overall expenditures. Anecdotal evidence in Ontario indicates that it failed to decrease -- and potentially increased -- the rate of medical inflation following its implementation.  Based on the experience in Australia, cost-effectiveness analysis can decrease total expenditures -- but by delaying reimbursement decisions -- a de facto shortening patent life on drugs – or through the negotiation of major price discount, and not by weeding out bad practice. 

The more subtle point in this debate relates to the compatibility of cost-effectiveness with the German health care system.  Created by Otto von Bismarck at the end of the 19^th century, the system of Social Health Insurance was based on the principles of solidarity and subsidiarity.  While Angela Merkel’s health care reforms have threatened the latter to promote affordability, the Germany health care system remains essentially employer and employee sponsored, with a limited role for government.  Furthermore, the Social Code Book that defines the German health care system calls for efficiency to maximize within each disease state, which is at odds with the “priority setting” approaches (a more genteel way of referring to health care rationing) implicit in cost-effectiveness analysis. 

Having been a regular IQWiG watcher since its inception, I have to congratulate Dr. Kolominsky-Rabas for his efforts in searching for an alternative approach to cost-effectiveness analysis.  While I might not agree with the current approaches presented by Caro and colleagues, I find it refreshing that we are now entertaining alternatives. American policy makers  should not only pay attention to this robust debate in Germany, but should be active participants given that we too might find ourselves with our own version of IQWiG in the near future. 

  Read More & Comment...

Is FiercePharma Becoming Bio-Luddite

08/20/2008 08:57 PM |

The latest synoposis about Merck suggests that whoever is writing Fiece Pharma is going over to the dark side:

"This is in addition to Merck's efforts to make the vaccine mandatory for young U.S. girls, with many wondering if the rise in cervical cancer vaccines are due to increased awareness or to Merck's aggressive, award winning and highly controversial marketing schemes. "

First of all, is the above an actual sentence written by a journalist whose first language is English or was it translated from the original Vulcan?

Second, given the increasing reliance on other blogs with a bias as a primary source instead of real background, it is obvious that FiercePharma believes that arsenic causes diabetes, all marketing is a ploy and vaccines are dangerous.

Third, the argumentation of the piece is consistent with tendency of bio-Luddites to use their belief than medical innovations are just an excuse to rape the public as evidence instead of a fearful emotional response.

Note the lack of clear deductive or inductive reasoning balanced with a complete lack of empirical information. For instance there is a problem with increased used through marketing but not public awareness....is there a difference? Or are those responding to Merck marketing brainwashed and the those that received it from on high enlightened? Does evidence of adverse events mean the vaccine should NOT be marketed. What is the marketing was less aggressive? And what about the trend towards not covering by insurance companies? Obviously sales are lagging so what good is awareness is the so-called health maintenance organizations won't pay for prevention? They cover chicken pox vaccines but not cervical cancer?

Previously Fiercepharma claimed a article relying upon memos redacted and provided by tort lawyers that was published in the Archives of Interna Medicine (or was it annals? Who cares, right?) alleging the Advantage study Merck conducted was primarily for marketing "proves" that it was so because it was run in a "peer reviewed journal." It is my humble opinion that the Advantage study was designed to assauge fears, but that is just my opinion and publishing it here or even in JAMA using documents from a biased source does not make it fact.

I am supposed to be on vacation.
  Read More & Comment...

Uncommon Denominator

08/20/2008 05:34 PM |

For all you Hanover Consensus groupies out there, the November issue of the International Society for Pharmacoeconomics and Outcomes Research (ISPOR) is a must read. Here's a sneak peak.

Leading the ISPOR hit parade is "German Recommendations on Health Economic Evaluation: Third and Updated Version of the Hanover Consensus."

Consider these tidbits:

"All benefit parameters that are relevant for the study situation in question should be incorporated in the assessment. It may be that data from various sources must be taken into account, which can be acomplished with the help of models. Possible essential data sources include medical meta-analyses, randomized clinical studies, as well as epidemiological observational data on the disease or long-term impacts of the disease. Additional relevant sources are cohort studies, data from health-care services research, data on current therapy standards, and possibly also expert opinions wherever other evidence is not available." (p.540)

And:

"The comparative quantification of the effectiveness of treatment alternatives requires studies that have a scientific design comparable to the designs in randomized, controlled studies. As a prerequisite for economic considerations in a specific case, clinical studies evaluating medical efficacy are indispensible. Nevertheless, as mentioned before, clinical studies often cannot serve as the sole basis of information for a health economic assessment. A realistic estimate of the costs can be limited under study conditions, if the use of some health-care services only arises from the study plan." (pp.541-542)

In the same blockbuster (block that metaphor!) issue, Peter L. Kolominsky-Rabas ((IQWiG) and J. Jamie Caro (Department of Medicine and Epidemiology and Biostatistics, McGill University) offer a sort of minority report in the form of an editorial.

In speaking about the updated Hanover Consensus, Kolominsky-Rabas and Caro write that:

"It is a remarkable achievement to being together most of the health economics community in Germany. To reach consensus in such a large group, however, much must be left unspecified and the exercise tends to be a search for the lowest common denominator." (p. 545)

And, they conclude:

"Little seems to have been changed from the previous HCG version published almost a decade ago. Meeting the worthy goals of the HCG -- to provide standards and yet promote methodological progress and scientific innovation in health economics -- requires more than a compilation of disparate current approaches. Actual recommendations must be concrete, tailored to the German context, coherent, and carefully justified, if they are to be helpful to German decision-makers." (p.546)

Ouch.
  Read More & Comment...

Brave New Healthcare World

08/20/2008 03:44 PM |

Does it seem counter-intuitive that “universal” care results in restricted access and poor outcomes? Not when you consider the facts.

A recent report published in The Lancet was the first international analysis of cancer survival that provides comparable data across countries. Across all cancers studied, survival in the US was greater than in Europe. For example, 5-year relative survival for women with breast cancer was 84% in the US and 73% in the EU. For men with colon cancer in the US survival was 60% whereas in the EU it was 47%.

The researchers attributed the variation in survival to “differences in access to diagnostic and treatment services.”

Similarly,

Is the conventional wisdom that medicines for the very ill are healthcare budget busters? Not when you consider the facts.

A recent study published in Health Affairs found that for the severely ill, commercially-insured population, the costs of medical services account for more than 75% of health plan costs. Hospitalization costs accounted for half of this amount. In contrast, medications accounted for just over 20% of health spending for this group, whose annual costs are more than nine times higher than the overall plan population. The authors concluded that medication costs “do not seem to be the driver of health care costs for these members.”

Among the 2.5% of members with the highest spending, specialty medicines (defined in this study as "biologic-derived agents that target specific immune processes and proteins”) were used by 45% and accounted for 32% of spending on medicines and just 6.6% of total plan spending.

Pharma is not the enemy – disease is the enemy.

(But that’s not a convenient political sound-bite.)

Let’s not forget the wise words of Aldous Huxley, “Facts do not cease to exist because they are ignored.”

 

  Read More & Comment...

The Obama Veepstakes

08/19/2008 07:24 PM |

Senator Barak Obama, at a town hall appearance in Albuquerque, said:

“If I were designing a system from scratch, I would probably go ahead with a single-payer system.”

Coming on the heels of last week's announcement by Great Britain's National Health Service (NHS) that, “Patients cannot rely on the NHS to save their lives if the cost of doing so is too great," that's quite a statement.

Perhaps Senator Obama is planning on naming the Grim Reaper as his Veep selection.

"Designing from scratch?" Back to the drawing board, Senator.  Read More & Comment...

The Four Rights

08/19/2008 12:13 PM |

Yes. I read Reader’s Digest.

And I’m honored to be included in their September story, “Prescription Medicines New and Old; What to consider when your doctor prescribes a new drug.”

Here’s the teaser blurb from the Digest’s website:

All things being equal, it's prudent to take older drugs whose side effects are known instead of new drugs that have less data.

"It has always been unfortunate but unavoidable that some adverse effects may not become apparent until a drug has been in wide use," says Peter J. Pitts, president of the Center for Medicine in the Public Interest and a former associate commissioner for the FDA. Sometimes it takes years and millions of users for a pattern to emerge.

When you get a prescription for a new drug, ask your doctor why the new drug is a better choice for you than something long on the market. Also ask about any known serious side effects. And read any printouts from the pharmacy before you take a new medication.

Speak up. Trust your instincts. If you experience any new physical or mental symptoms, consult your pharmacist or physician as soon as possible. Report any adverse side effects to the FDA (www.fda.gov/medwatch or 800-332-1088) and the pharmaceutical manufacturer.

I haven’t seen the complete article yet, but during my interview I spoke at length about the importance of (1) avoiding the Precautionary Principle -- the luddite tenet that preaches that we do nothing until we know everything, and (2) moving towards personalized medicine – and why molecular diagnostics is the key to providing “the four rights” -- the right medicine in the right dose at the right time to the right patient.

So it’s exciting to hear that Medco Health Solutions (the large U.S. manager of prescription drug benefits) has agreed to work with the FDA to research the role of genetics in the safety and effectiveness of drugs.

Medco, will help the FDA assess obstacles to the use of existing genetic tests as they relate to the prescribing of medicines, as well as new opportunities for such tests.

Medco will deliver a series of reports to the FDA under the agreement, which runs until Aug. 31, 2010. Areas of study include the safety of prescription drugs, physician participation in pharmacogenomic testing, and the usefulness of such tests in prescribing.

The first projects will likely be determined this fall and that the initial areas of study may be oncology and HIV/AIDS. The company has two other research collaborations involving pharmacogenomics. One, with the Mayo Clinic, is studying the use of warfarin, a difficult to use blood thinner that can cause serious bleeding in some patients and the other with Laboratory Corp of America Holdings is studying the use of the breast cancer treatment tamoxifen.

According to Reuters, "Medco seeks to lower drug spending for its clients, which include health plans and large.employers, and sees pharmacogenomics as a potential way to control costs and improve quality of care."

That’s the way to lower costs the right way. Rather than denying care, we need to focus on the four rights. That will lead to better care more swiftly and reduce adverse events.

The complete Reuters story can be found here.

In the Reuters story, Medco Chief Medical Officer Robert Epstein said, "The big-picture goal is to facilitate the uptake of appropriate pharmacogenetic testing in the marketplace. It can't really happen if you don't have good information about both the science but also the practice of medicine."

Epstein added that a more comprehensive understanding and use of genetic testing "should take trial and error out" of prescribing and "make people feel more confidence in the drugs they're being placed on because they know for them personally that drug should work.”

And that’s something that’s important not just to us healthcare policy wonks – but to the readership of Reader’s Digest. The real America.

It's time for America to stand up and demand that our elected representatives allow the FDA to aggressively pursue a well-funded Critical Path program. It's time for America to stand up and demand its rights-- "the four rights" -- to personalized medicine.

  Read More & Comment...

The Bio-Luddites Are Losers

08/18/2008 01:59 PM |

I am in Israel enjoying time with my son who on break from the Israel Defense Forces. I am enjoying his company, the beaches of Herzliya and visiting the center of biotech innovation in the Jewish State.

From this view I see the attacks on the commercialization of biomedical knowledge quite differently. Indeed, l can lump the hypocritical attack of Marcia Angell on FDA pre-emption over the regulation and labeling, the effort to eliminate DTC, CME and private sector investment in academic research, the effort to impose administrative controls on the use of new medicines, the rants of those think that attacking CMPI's funding sources is a rational response to the question of appropriate use of medicines for mental illness into one broad category:

Neo-Luddites... described in a wiki in the following manner:

Opposition to neo-Luddites consists largely of those who believe that technology is beneficial or, at worst, neutral. This opposition has sometimes been hindered by a focus on specific issues, and on occasion by a belief that the benefits of certain new technologies are obvious when in fact many people do not understand the technology in question.

A main concern of technological proponents is to question whether it is always worth saving those things that neo-Luddites seek to protect. The actions of the Luddites are perceived to be emotion-driven and therefore irrational. One form of this objection begins by noting their defense of traditional cultures, and then pointing out culture as a static force enslaves people to its strictures, and is counterproductive to adaptation resulting in cultural if not ethnic extinction. Further arguments would state that elements (real or imagined) of certain traditional cultures that modern societies find abhorrent, such as cannibalism and slavery. Another form is to note some problem that most people would like to minimize or eliminate - such as cancer (which many people agree can eventually be reliably treated or cured), or the sometimes crippling effects of advanced age (see Geriatrics) - and argue that the main effect of neo-Luddism would be to delay or prevent solutions to these problems.http://en.wikipedia.org/wiki/Neo-Luddism

I call the whole bundle of anti-commercialization forces Bio-Luddites because the they are a subgroup of the NL. Like the Luddites efforts of old, both the thinking and the administrative apparatus furiously being erected by today's Bio-Luddites will be swept away by a river of innovation that is spreading rapidly than any entity can control. Witness the note of exasperation in this op-ed in the Times of London about how NICE is unable to keep up with the current wave of new cancer drugs. I have highlighted the remarkable last sentence in this one section:

To judge from the genuine shock of oncologists, the decision may yet be revised - as has happened for several other drugs that NICE originally rejected. Yet even if this ruling turns out to have been misguided, NICE is going to have to make more tough choices of this nature. The reason is that the increasing success of medical research will make rationing an ever- greater challenge for the NHS.

http://www.timesonline.co.uk/tol/life_and_style/health/article4539008.ece

That's right... rationing must rise to beat back the increasing success of medical research. Anyone want to be on THAT side of the argument.

This won't happen. NICE and NHS are being besieged now by advancing innovation. What will the Bio-Luddites do when the next generation of genomic based medicines come flooding through a high-speed regulatory pipeline that is biomarker based?

It will crumble as all effort to stem innovation do. Unless we or they resort to a police state, a sort of Stalinist approach to health care where the both the intellectual freedom and the scientists who thrive in it are forced to investigate only government approved projects and private companies are reduced to merely formulating the compounds for a royalty.

But that won't happen. The Bio-Luddites are not just losing. The have lost. The equate vitriol and bullying with success. But the opposite is occuring. Innovation is on the march and market forces are and will play a key role in that victory. Just as they did when the Luddites became -- after a few decades -- a bunch of cranks meeting in dusty libraries and socialist bookstores.

  Read More & Comment...

These Times Demand the (London) Times

08/18/2008 12:46 PM |

In Canada, according to the Fraser Institute, patients seeking specialized treatment had to wait 18.3 weeks in 2007. Approximately 875,000 Canadians are on waiting lists for treatment.

A 1997 study in Health Policy found that whereas the average wait time for bypass surgery in New York State was 17 days, it was 72 days in the Netherlands and 59 days in Sweden.

In Britain, the government’s cost-effectiveness agency just announced that patients can’t rely on the National Health Service to save their lives if the cost of doing so is too high.

This is the reality in government-run health care systems, as they focus more on saving money than on saving lives. That’s why citizens experience long wait times, a lack of access to certain treatments, and substandard medical care.

Consider this new op-ed from Mark Henderson, Science Editor of The (London) Times.

First consider the title: "We need cancer drug rationing."

And then some selected paragraphs:

“Rationing is never a popular exercise, and never more so than in medicine. The idea that the NHS is universal and free has become so deeply ingrained that nobody is happy when it denies treatments on grounds of expense.”

“As knowledge of the molecular and genetic mechanisms of disease increases, this situation is likely to worsen. More and more treatments will become available. Some will be personalised for a small group of patients and will thus be expensive because the market is limited. Others may extend life only for a short period and will offer poor value for money on the NICE model. Some will have to be rejected for NHS use, even though they work.”

“At present, this means in practice that most patients are refused them altogether.”

And now over to the other Times, the New York Times -- America's "newspaper of record."

In his August 11th column, Paul Krugman states that “in principle, it should be easy” for the Democrats to deliver on their promise to “provide every American access to affordable, comprehensive health care.”   

It sure hasn’t been easy for the countries that have tried.

  Read More & Comment...

Witty Response

08/15/2008 11:10 AM |

The Economist offers a timely and interesting look at GSK’s CEO Andrew Witty.

Andrew Witty of GlaxoSmithKline has a three-part prescription for the pharmaceuticals giant
by Health News,
The Economist

IT IS a rare company boss, let alone one who has just got the top job, that can get away with likening his firm’s culture to a police state. But Andrew Witty, the new boss of GlaxoSmithKline (GSK), a British pharmaceuticals giant, somehow manages to pull it off. He invokes that analogy—tentatively, to be fair—to explain the cultural transformation he wants to see at GSK: away from today’s excessively regimented, rule-based approach towards the “utopia” of a simplified, values-based culture that trusts employees to do the right thing.

Mr Witty gets away with it in part because he is amiable. He is certainly very different from his abrasive predecessor, Jean-Pierre Garnier, who retired in May after a tumultuous term as chief executive. Mr Witty has already set the tone for a more open style of management. Whereas J.P., as his predecessor was known, often seemed arrogant, Mr Witty began his tenure with a listening tour. J.P. controversially insisted on living in Philadelphia; Mr Witty is not only based at GSK’s headquarters in London, but he even plans to move his office next to the staff canteen so he can be more accessible.

The new boss can also joke about police states because his loyalty to GSK is unquestioned. Having spent nearly his entire professional career at the firm, he is the ultimate insider. By contrast, two years ago Pfizer, GSK’s American rival, picked Jeffrey Kindler, a lawyer with little pharmaceuticals experience, as its new boss. Perhaps needing to build up credibility and knowledge of his firm, Mr Kindler took his time crafting a turnaround plan. Mr Witty, however, has already announced big changes at GSK. Driving this strategic revamp is his desire to “derisk” the firm to provide reliable growth with less volatility.

His plan has three components. First, he wants to end the obsession with blockbusters, which he likens to “finding a needle in a haystack right when you need it”. The industry’s reliance on risky blockbusters, he reckons, makes it vulnerable to “sudden torpedoes” in the form of lawsuits from generics firms, or regulatory crackdowns like the one that recently hit Avandia, GSK’s big diabetes drug. Instead he wants researchers to look for many more potential drugs, both small and large, that can make up a more reliable pipeline. This, he reckons, will make GSK’s drug-discovery efforts more akin to a nimble fleet of destroyers, rather than two or three vulnerable battleships.

Second, Mr Witty wants the firm to expand its businesses beyond prescription-drug sales in the rich world, so that its revenue streams are more diversified. To this end, he has announced a big push into emerging markets, which many drugs giants had hitherto seen as mere charity cases. He is also taking the firm into the branded-generics business through a deal with Aspen of South Africa, which should help smooth out GSK’s earnings volatility.

Third, and most controversially, Mr Witty has been sitting down with his biggest customers to ask them what future products they are willing to pay for. This might seem like common sense in any other industry, but it has been heresy in the drugs trade. In the past Big Pharma innovated as it saw fit, and big payers (such as Britain’s National Health Service, or America’s “pharmacy-benefit managers” and insurers), then coughed up for its pricey pills. But now health services and insurers are refusing to reimburse fully for drugs that are deemed to provide poor value for money. Britain has even set up an official agency, the National Institute for Health and Clinical Excellence (NICE), to do explicit cost-benefit analyses of this sort.


Here's the rest of the story.   Read More & Comment...

Sorry Dennis

08/14/2008 12:36 PM |

Remember Dennis Kucinich? The former Boy Mayor of Cleveland has introduced legislation that would allow senior citizens to buy prescription medicines overseas, “from approved foreign countries where drugs are significantly cheaper,” while simultaneously doing away with the Part D non-interference clause.

With Lebron out of town, perhaps the Congressman thought he could grab some media cowbell. But all he’s done is show his, well, cavalier attitude towards healthcare reform in general and the facts in particular.

And adding to the lunacy, his “Medicare Drugs For Seniors Act” (HR 6800) would also impose limits on the prices which drugmakers would be allowed to charge for their products if the R&D which led to the drugs’ discovery had been financed “by taxpayers’ dollars.”

According to Mr. Kucinich, “Medicare beneficiaries want their prescription drugs without having to navigate complicated maze of choices and stealth loopholes.”

Really? Perhaps he’s missed the fact that seniors are very pleased with the Part D benefit – with very high satisfaction rates – and even higher usage. The Wall Street Journal Online/Harris Interactive survey of U.S. adults age 65 or older, shows 87% of those enrolled in a Medicare drug benefit plan are satisfied with their plan. Sorry Dennis.

Here’s another example of Mr. Kucinich embracing The Big Lie:

“The privatized drug plan has been given a chance and, as predicted, it has failed. There is no reason for us to keep throwing money at a bad idea when we know we can save taxpayers billions of dollars and give seniors the medication they need.”

Really?

According Kerry Weems, acting administrator at the U.S. Centers for Medicare and Medicaid Services (CMS), "Overall, costs for beneficiaries and taxpayers are considerably lower than originally projections, enrollment continues to rise and customer satisfaction remains very high.” Sorry Dennis.

The projected cost for Medicare part D is $117 billion lower over the next decade than experts estimated just last summer. This means that over the 10-year period from 2008 to 2017, the estimated $915 billion cost of Part D fell to $798 billion.

Why? Marketplace competition. Sorry Dennis.

And, according to a study published in the Annals of Internal Medicine, the Medicare drug benefit led to a 17 percent decrease in out-of-pocket expenses, or $9 a month, for seniors who enrolled in the new Medicare Part D benefit in 2006, the first full year prescription coverage became available in the federal health insurance program for the elderly and disabled. Sorry Dennis.

And the savings amounted to an extra 14 days of medicine for those who signed up, or a 19 percent increase in prescription usage. Sorry Dennis.

Can Part D be made even better? Absolutely. But this is good news worth sharing -- and not because it helps any particular partisan political agenda (sorry Dennis!) but because it means that more Americans -- tens of millions of more Americans -- are getting access to the medicines (largely chronic medicines) that will help them live healthier lives. And this, in no small measure, significantly reduces more drastic medical interventions -- which in turn reduces our overall national health care spending.

Sorry Dennis. Sorry Part D is working so well.

As to drug discovery financed by “taxpayer dollars,” based on the case histories of 35 widely prescribed drugs, researchers from the Manhattan Institute and Tufts University determined that almost all of the medicines they analyzed would not have been developed without private sector research. And in 28 cases they found that private sector research led to improvements in a drug's clinical performance or to a better way to manufacture the drug. Discovery is cool. And so is development. One without the other leads nowhere. Sorry Dennis.

Dollar for dollar, the pharmaceutical industry outspends the government in drug development. In 2007, the collective membership of PhRMA spent $44.5 billion on research and development of prescription drugs, while the industry overall spent $58.8 billion. The same year, the National Institutes of Health allocated $28.6 billion in grants, some of which went to developing new drugs. Both are important and collegiality is the way things get done. Sorry Dennis.

As for drug importation, here we go again:

(1) It won’t save any money. Let’s not forget the non-partisan CBO study that showed that such policy would reduce our nation’s spending on prescription medicines a whopping 0.1% -- and that’s not including the millions of dollars the FDA would need to set up a monitoring system.

(2) The drugs being sent to U.S. customers from Canadian internet pharmacies are not “the same drugs Canadians get.” That bit of rhetoric is just plain wrong. Canadian internet pharmacies – by their own admission – are sourcing their drugs from the European Union. And while they may say their drugs come from the United Kingdom, let’s not conveniently forget that 20% of all the medicines sold in the UK are parallel imported from other nations in the EU – like Spain, Greece, Portugal, and Lithuania.

And the important political point here is that when Americans are asked if they want drugs from nations other than Canada – the answer is a resounding “no thank you.”

(3) The state experience has been dismal and politically embarrassing. Remember the high profile “I-Save-RX”program? Over 19 months of operation, a grand total of 3,689 Illinois residents used the program -- which equals approximately .02% of the population. They don’t call him “Wrong Way” Rod Blagojevich for nothing.

And what of Minnesota and Governor Tim Pawlenty’s RxConnect program? According to its latest statistics, Minnesota RxConnect fills about 138 prescriptions a month. That's for the whole state. Minnesota population: 5,167,101.

And remember Springfield, MA and “the New Boston Tea Party?” Well the city of Springfield is now out of the drugs from Canada business.

(4) National Security concerns. According to a recent report from the federal Joint Terrorism Task Force, a global terrorist ring with ties to Hezbollah, is importing counterfeit drugs into America by way of Canada. They are doing so for profit today - but could just as easily do so for more nefarious and deadly purposes. And legalizing importation would only facilitate such actions.

These are important facts to keep repeating and repeating in the appropriate context. Because there are those who chose to manipulate the facts to tell their own version of the truth for their own selfish political purposes.

Sorry Dennis indeed.  Read More & Comment...

Mocking DTC

08/13/2008 01:53 PM |

If you’re not a regular reader of the Federal register, you might have missed the August 6^th notice that the FDA is moving forward with plans to evaluate “distractions” in consumer ads. The experimental study will analyze everything from the placement of text to competition between audio and visual elements, and the use of “major statements.” FDA has opened the proposal for comments until September 5^th.

According to the FR, "Data from this study will provide useful information for FDA as it considers whether it is appropriate to develop guidance to help improve how broadcast ads present a prescription drug's risks and benefits."

The FDA will create ads for a fictitious brand to treat high blood pressure to control for participants' prior experience and attitudes. Participants in the study would be men and women age 40 years and older. Everyone will be presented a series of ads—each with different tone, neutrality, and presentation of risk information.

As the terrific Crystal Rice (aka “FDA spokesperson”) told Pharmaceutical Executive Magazine, "We chose high blood pressure as the condition because it is chronic and under-treated, and there are few DTC ads currently running.”

And here’s what I had to say:

"Just like no two people respond the same way to a medication—everyone doesn't respond the same way to advertisements," said Peter Pitts, president of the Center for Medicine in the Public Interest. "The most important thing that DTC advertising does is drive people to their doctor's office to talk about a condition. Whether they glean three, six, or 12 contraindications from a commercial because a child is or is not running through a field of daisies is interesting, but not important."

The complete Pharmaceutical Executive story can be found here.

Okay, I overstated. It is important. Mea culpa. Fair balance and adequate provision serves a useful purpose. (Really!) But, when we consider the social science that’s been done surrounding, for example, the Brief Summary, that “purpose” requires closer examination.

Consider the peer-reviewed study that appeared in Drug Information Journal (Vol. 41, pp 111-127). It found that, when it came to print DTC, “As the number of side effects listed (4, 8, or 12) increased, more consumers recalled no side effects correctly (37%, 45%,, and 53% respectively).” The complete paper can be found here.

(Full disclosure: I am one of the authors of this paper.)

So let’s say, for matter of discussion, that we could devise a method whereby every viewer of every DTC television commercial fully understood everything detailed (you should excuse the expression) in the fair balance/adequate provision.

Is that a good thing or a bad thing?

Well, since better understanding of risk/benefit is, um, better – it should fall into the “good” category, right?

But what if this enhanced understanding results in decreased visits to physicians? Is that a good thing? (According to FDA research, about 6% or all doctors’ appointments are scheduled because a consumer saw a DTC commercial.) What about the undiagnosed conditions uncovered during these appointments. (According to FDA research, in 6% of those DTC-generated office visits, a previously undiagnosed condition was discovered.)

Will the new FDA study capture data that speaks to the increased or decreased likelihood of visiting a physician based on more or less complete recall of risk information?

That’s important context -- particularly since the results of this new study are likely to be highly (shall we say) "media worthy."

Hopefully, the research protocol for this study will be discussed at a future meeting of the agency’s Risk Communications Advisory Committee.

  Read More & Comment...

Is PhRMA Fighting New FDA Culture?

08/13/2008 12:46 PM |

  Read More & Comment...

Breaking the "Rule of Rescue"

08/12/2008 01:28 PM |

According to reports in the British media, the National Health Service (NHS) has publicly ruled that, “Patients cannot rely on the NHS to save their lives if the cost of doing so is too great.”

What happened to “universal” healthcare? Sounds more like “government” healthcare. Shocking? Not really.

The judgment overrules advice from The National Institute for Clinical Excellence’s (NICE) own citizen's council, which recommended two years ago that it should adopt a "rule of rescue" as an essential mark of a humane society.

According to the citizen’s council, individuals in "desperate and exceptional circumstances" should sometimes receive greater help than can be justified by a "purely utilitarian approach." The council, 27 members of the public chosen to be representative of lay opinion, backed the idea by 21 to 6.

The move was criticized by the British Medical Association, which said doctors had a duty to do their best for patients.

Pretty clear battle lines: cost-based care versus patient-centric care. Government dictate versus physician empowerment.

The NICE report, “Social Value Judgements,” states that treatment may also be refused to elderly patients if the benefits are deemed too low or the risks too high.

Let’s see a political candidate put that on a bumper sticker for “universal” care.

More information on these draconian policies can be found here.

At the same time that British patients are being denied approved care, thousands of terminally ill cancer patients are to be offered the chance to take experimental drugs.

Per a new report in The Guardian, “In cases where the NHS can do nothing more, cancer sufferers will be allocated places in government-backed clinical trials of unlicensed treatments that can prolong some people's lives. A major expansion of the government-funded experimental cancer medicine network will give hundreds, and eventually thousands, of patients the opportunity to join trials of novel therapies which scientists hope to develop into effective new drugs.”

So, on the one hand, no approved drugs for critically ill people – but it’s fine to let them be guinea pigs.

The full Guardian story can be found here.

Is that what they mean by “means testing?”

Is this what our political candidates and their surrogates mean by "universal" care?

SiCKO indeed.

  Read More & Comment...

A Very Special Hit Job on Gardasil in the LA Times

08/11/2008 04:25 PM |

  Read More & Comment...

NICE is an example of leadership and courage according to AHIP

08/11/2008 02:13 PM |

  Read More & Comment...

Off-Label or Off-Limits?

08/11/2008 12:05 PM |

Very comprehensive feature article in the August issue of Nature Biotechnology of the issue of off-label prescribing and off-label promotion. Jerry Avorn and Steve Nissen perform according to their usual scripts -- but once you get beyond the preening and posturing there's a lot of good information, facts and figures and perspectives from both the US and the EU.

Two issues that are touched on but not really pursued (not surprisingly considering the readership of the journal) are that of (1) the fundamental freedom of free speech and (2) the fact that if drug companies overplay their hands when it comes to off-label promotion there is no shortage of liability lawyers ready to go after them. (Although this article does contain a list of selected healthcare-related fraud cases involving off-label use.)

The complete Nature Biotechnology article can be found here.

Important and timely reading for all of you drugwonks out there as well as for folks like Mr. Waxman.  Read More & Comment...