Latest Drugwonks' Blog

Follow the Money

  • 01.14.2020
  • Peter Pitts
Nearly 50% of Brand Medicine Spending Goes to the Supply Chain and Others

Nearly half of total spending on brand medicines – the sum of all payments made at the pharmacy or paid on a claim to a health care provider – went to the supply chain and other entities in 2018, according to a new analysis from the Berkeley Research Group (BRG). This transformative research shines a spotlight on the misaligned incentives in the supply chain and underscores the need to fix the rebate system.

BRG found that hospitals, health insurers, pharmacy benefit managers, the government and others got nearly 50% of what was spent on brand medicines in 2018, up from 33% five years prior. By contrast, innovative biopharmaceutical companies that research, develop and manufacture medicines retained just 54% of total point-of-sale spending on brand medicines.

According to the analysis, the share of total spending on brand medicines that biopharmaceutical companies retain has been steadily declining as rebates and discounts have increased. Between 2015 and 2018, the amount innovative biopharmaceutical companies retained from the sale of brand medicines increased, on average, 2.6% annually, in line with inflation. In this same timeframe, companies brought nearly 200 new innovative treatments and cures to patients.

Meanwhile, nearly half of the increase in the total amount spent on brand medicines went back to payers during this same time period. And 20% of the overall increase went to hospitals, pharmacies and other health care providers, which is the same amount that went to biopharmaceutical companies that research, develop and manufacture medicines.
The amount hospitals, pharmacies and other health care providers retained on the sale of brand medicines nearly doubled between 2013 and 2018, increasing from $24.7 billion to $48.6 billion. This trend was primarily driven by unprecedented expansion in the 340B drug pricing program. In fact, the amount hospitals and other 340B entities retained from the sale of brand medicines purchased through the 340B program was 9 times larger in 2018 than in 2013.
We are committed to ensuring patients benefit from significant discounts and rebates at the pharmacy counter, and this analysis reaffirms the need to look at the entire supply chain to fix misaligned incentives. We must work to fix the broken rebate system, as well as programs like 340B, to lower out-of-pocket costs and solve patient affordability challenges.

The full study from BRG can be viewed here.
 

"Fixing" the FDA

  • 01.13.2020
  • Peter Pitts
Per, “How to Fix the Troubled FDA” (NYT, January 12, 2020)

Is the FDA approving drugs too fast or not fast enough? Are they demanding too much data or not enough? There isn’t any dearth of commentary supporting either proposition. There is, however, no evidence to support the sound bite that the FDA is approving “everything,” or that every product that requests an expedited pathway receives it, or that “all” those that do receive an expedited pathway designation get approved, or that every product that does reach the market via an expedited approval is in some way more dangerous than other medicines.

· An analysis of every product (364) requesting a Breakthrough Therapy designation (from July 2012 – June 2016) shows that CDER granted 133 (37%) of those requests, denied 182 (50%), and the sponsor withdrew their request 49 times (13%) before the agency made a decision.[i] Hardly a regulatory carte blanche.

·  In 2013, the first full year of the Breakthrough Designation, the FDA approved 3 new drugs, 14 in 2014, and 9 in 2015.[ii] Hardly an onslaught of new medicines.

· Among 22 drugs with 24 indications granted accelerated approval by the FDA in 2009-2013, efficacy was often confirmed in post-approval trials a minimum of 3 years after approval, although confirmatory trials and preapproval trials had similar design elements, including reliance on surrogate measures as outcomes.[iii]

New science and the strategies and tactics to incorporate them into regulatory thinking does not mean a free pass for bad science. The FDA must be an innovation accelerator with a recalibrated sense of regulatory velocity (Speed + Accuracy + Public Health Need). It’s the agency’s next step toward a more appropriate and entrepreneurial regulatory attitude
 
Governor Newsom’s idea to have California “white label” its own generic drugs is deeply flawed. It’s not as easy as simply finding a factory. Anyone manufacturing and selling a specific generic drug must first have approval from the FDA to do so. That’s not an inexpensive, swift or easy proposition. Also, generic prices in the United States are the lowest in the western world. Third, prices are based on volume. If the Governor of our nation’s most populous state wants to lower prices, he should follow the money. The middlemen of the pharmaceutical industry – Prescription Benefit Managers (PBMs) add tremendous costs to the system while providing little actual benefit. If the Governor can’t  disintermediate the middleman and offer generics at lower costs, he should demand that the PBMs hired by the state cut their fees so that the people of California can enjoy lower prices.
 

Glantz In, Garbage Out

  • 12.23.2019
  • Robert Goldberg



Stanton Glantz is the Distinguished Professor of Tobacco Control, and director of the Center for Tobacco Control Research and Education at the University of California, San Francisco (UCSF) School of Medicine.  Glantz is also the Andrew Wakefield of the anti-vaping movement.   In keeping with that awesome responsibility, the Distinguished Professor has come out with another retraction worthy analysis claiming non-combustible nicotine devices are more dangerous than cigarettes.  

This time his research paper in the  American Journal of Preventive Medicine is, as NBC News puts it: is "the first study on the long-term health effects of electronic cigarettes finds that the devices are linked to an increased risk of chronic lung diseases." (Chronic obstructive pulmonary disorder or COPD, emphysema, asthma, and chronic bronchitis.)

As NBC reports: "The study included 32,000 adults in the U.S. None had any signs of lung disease when the study began in 2013. By 2016, investigators found people who used e-cigarettes were 30 percent more likely to have developed chronic lung disease, including asthma, bronchitis and emphysema, than nonusers."

Having some who his healthy getting lung disease less than three years after vaping is pretty remarkable. But Glantz told the New York Post:

"E-cigarette use predicted the development of lung disease over a very short period of time. It only took three years."

In fact, Glantz asserts: "Everybody, including me, used to think e-cigarettes are like cigarettes but not as bad. If you substitute a few e-cigarettes for cigarettes, you're probably better off…It turns out you're worse off. E-cigarettes pose unique risks in terms of lung disease."

The conclusion that short term vaping causes lung disease is biologically implausible. 
COPD and other severe lung diseases often take years to develop and often escape diagnosis until they are relatively advanced.
As many as 1 out of 4 Americans with COPD never smoked cigarettes. In fact, "never smokers account for 23% of the total COPD burden. Among these obstructed never-smokers, 19% reported a prior diagnosis of asthma alone, and 12.5% reported COPD (solely or with asthma), leaving 68.5% with no prior respiratory diagnosis. "
 
And even among smokers, it takes at least a decade or longer of consistent smoking for COPD to develop. Most studies (ignored by Glantz) conclude that "prolonged tobacco use is associated with respiratory symptoms and COPD after controlling for current smoking behavior."

For example a longitudinal study examining the risk of developing COPD in a general population found that after 25 years of smoking, at least 25% of smokers without initial disease will have clinically significant COPD and 30–40% will have any COPD.

Moreover, there is no clinical evidence that COPD rapidly emerges. On the contrary, the most recent research suggests that disease severity (degree of impairment) should be distinguished from disease activity (rate of progression) since there is no one factor that triggers either. So unless Glantz has discovered a novel biological mechanism triggered by vaping, his claims are absurd.

The same goes for asthma, chronic bronchitis and emphysema. A large percentage of people have conditions and often go undiagnosed for years. Indeed, Glantz when he claims that the population studied didn't have lung disease at the outset, he is being deceptive. They didn't have a diagnosis in the past 12 months. That's different than not having it all. 

In fact, Glantz fails to compare the prevalence of these diseases in vapers vs the rest of the population. That's because adults who had asthma have an 11 times greater risk of COPD (independent of smoking) than those that don't. Glantz doesn't bother controlling for this important factor.
  
 
   
Age-specific and age-adjusted* percentage of adults aged ≥18 years with COPD,  Behavioral Risk Factor Surveillance System, 2017
Ever had asthma Current Smokers      Former Smokers
                                           Yes  19.5                             11.2
                                          No    4.1                                 1.6
 Source: Wheaton AG, Liu Y, Croft JB, et al. Chronic Obstructive Pulmonary Disease and Smoking Status — United States, 2017. MMWR Morb Mortal Wkly Rep 2019;68:533–538. http://dx.doi.org/10.15585/mmwr.mm6824a

                            
 There's more. Glantz did not control for other smoking characteristics that matter (dual users are heavier smokers). As Peter Hajek, a professor of clinical psychology and the director of the Wolfson Institute of Preventive Medicine's Tobacco Dependence Research Unit at Queen Mary University of London pointed out in a email to me: “He didn't compare the relationship of vaping with other products and approaches for reducing smoking (such as counseling, patches, and medications) on lung disease. That data is available too.”

In addition to these flawed assumptions and approaches, Glantz still refuses to show whether other variables or factors that he doesn’t analyze can explain the relationship he claims to show.  Anyone making a claim about causality has a duty to find and disclose all the relevant factors just as a district attorney is required not to hide evidence to convict a defendant.  As Chelsea Boyd at R Street wrote to me: (Glantz) “does not show a full interaction analysis, likely because it would remove the association between e-cigarettes and his disease du jour. It's also telling that some of his associations don't make any sense if you consider the larger context.” 

Indeed, his effort to discount the possibility of having lung disease might cause someone to try vaping backfires. Glantz notes, "this study assessed the possibility of reverse causality by estimating the odds of initiating e-cigarette use... combined as a function of having respiratory disease among people who had never used e-cigarettes (previously).” In fact, that analysis shows, as the article states, that "having respiratory disease at significantly predicted future e-cigarette use (p<0.001),”  Incredibly Glantz claims the opposite is true.

Finally, this is NOT the first study to look at the long-term effect of vaping on lung disease. There are others, and unlike Glantz, they actually study real people over time. 

One recent study found that e-cigarette (ECs) "use may aid smokers with COPD reduce their cigarette consumption or remain abstinent, which results in marked improvements in annual exacerbation rate as well as subjective and objective COPD outcomes." That was followed by another analysis in 2018 that concluded, "EC use may ameliorate objective and subjective COPD outcomes and that the benefits gained may persist long-term. EC use may reverse some of the harm resulting from tobacco smoking in COPD patients.

Meanwhile, as they did in using Wakefield’s bogus studies claiming the measles vaccine caused autism, the incurious media now claim that Glantz’ research "adds to a growing body of evidence that vaping can cause physical harm, whether it's chemical burns to lung tissue, toxic metals that leave lasting scars on lungs, vitamin E oil that clogs lungs or even overheated batteries that explode.

Whether any of that evidence can be used for something other than fearmongering is a different question. As the saying goes: Glantz in, garbage out. Or something like that. 

 

The Twelve days of Rxmas

  • 12.21.2019
  • Peter Pitts
The Twelve Days of Rxmas

On the first day of Rxmas
The folks at Drugwonks gave to me
An Adcomm adjourning at 3:00.

On the second day of Rxmas
The folks at Drugwonks gave to me
Two Warning Letters
And an AdComm adjourning at 3:00.

On the third Day of Rxmas
The folks at Drugwonks gave to me
Three Draft Guidances
Two Warning Letters
And an Adcomm adjourning at 3:00.

On the fourth day of Rxmas
The folks at Drugwonks gave to me
Four Calling Sponsors
Three Draft Guidances
Two Warning Letters
And an AdComm adjourning at 3:00.

On the fifth day of Rxmas
The folks at Drugwonks gave to me
Five Generic Lawsuits
Four Calling Sponsors
Three Draft Guidances
Two Warning Letters
And an AdComm adjourning at 3:00.

On the sixth day of Rxmas
The folks at Drugwonks gave to me
Six Hemp States Baying
Five Generic Lawsuits
Four Calling Sponsors
Three Draft Guidances
Two Warning Letters
And an AdComm adjourning at 3:00.

On the seventh day of Rxmas
The folks at Drugwonks gave to me
Seven Gottliebs Tweeting
Six Hemp States Baying
Five Generic Lawsuits
Four Calling Sponsors
Three Draft Guidances
Two Warning Letters
And an AdComm adjourning at 3:00.

On the eighth day of Rxmas
The folks at Drugwonks gave to me
Eight Divisions Dividing
Seven Gottliebs Tweeting
Six Hemp States Baying
Five Generic Lawsuits
Four Calling Sponsors
Three Draft Guidances
Two Warning Letters
And an AdComm adjourning at 3:00.

On the ninth day of Rxmas
The folks at Drugwonks gave to me
Nine Pharmas Dancing
Eight Divisions Dividing
Seven Gottliebs Tweeting
Six Hemp States Baying
Five Generic Lawsuits
Four Calling Sponsors
Three Draft Guidances
Two Warning Letters
And an AdComm adjourning at 3:00.

On the tenth day of Rxmas
The folks at Drugwonks gave to me
Ten reviewers bleeping
Nine Pharmas Dancing
Eight Divisions Dividing
Seven Gottliebs Tweeting
Six Hemp States Baying
Five Generic Lawsuits
Four Calling Sponsors
Three Draft Guidances
Two Warning Letters
And an AdComm adjourning at 3:00.

On the eleventh day of Rxmas
The folks at Drugwonks gave to me
Eleven Vapers Vaping
Ten reviewers bleeping
Nine Pharmas Dancing
Eight Divisions Dividing
Seven Gottliebs Tweeting
Six Hemp States Baying
Five Generic Lawsuits
Four Calling Sponsors
Three Draft Guidances
Two Warning Letters
And an AdComm adjourning at 3:00.

On the twelfth day of Rxmas
The folks at Drugwonks gave to me
Twelve hires pending
Eleven Vapers Vaping
Ten reviewers bleeping
Nine Pharmas Dancing
Eight Divisions Dividing
Seven Gottliebs Tweeting
Six Hemp States Baying
Five Generic Lawsuits
Four Calling Sponsors
Three Draft Guidances
Two Warning Letters

And an AdComm adjourning at 3:00.


 

Last week, federal prosecutors in Los Angeles arrested 53 people for raking in $150 million in Medicare and Medicaid payments for medically unnecessary compounded drugs. In cooperation with a large L.A. based compounding pharmacy --Fusion Rx  -- the doctors to bill health care providers for those compounded drugs, many of which were reimbursed at rates much higher than common medications. 
 
Doing this enabled the pharmacies to boost the reimbursement rates for the prescriptions and routinely waive patient copayment obligations.  FusionRx is one of many compounding pharmacies that are endangering patient lives by driving up the cost of prescription drugs.
 
It's no surprise that few people are familiar with compounding pharmacies, purely because the altered medications account for less than one percent of prescriptions. However, as the DOJ suit notes, the price of compounded drugs has surged by as much as 3,400 percent since 2006.  Despite legislative efforts to strengthen oversight of compounding pharmacies, their production and distribution are still mostly unregulated. This is not the time to ease up on federal oversight of compounding drugs. 
 
Compounding – the combining of two or more ingredients to produce a medicine for a patient – has been around for centuries, evolving from age-old concoctions into a service that increasingly customizes lifesaving medicines. Most drugs were compounded until large-scale development and manufacturing emerged in the 1950s, allowing companies to bolster their research and development to provide tailored treatments for patients.   
 
Over the past decade, however, there has been a substantial increase in compounding medications to address the need to customize dosing for patients who would otherwise not benefit from specific treatments. Small compounding pharmacies don't have to get Food and Drug Administration (FDA) approval for their medicines. This is because Congress exempted compounding pharmacies from FDA oversight in 1998 and handed the responsibility over to state pharmacy boards. 
 
Traditionally, the bespoke nature of compounding has allowed pharmacies to charge health plans a premium for their products. While no public estimates are available, industry experts believe that the gross margins from compounding products is between 70-87 percent. As the pharmacy benefit management market consolidated around large companies such as Express Scripts and CVS, small specialty drug firms saw their margins squeezed. Compounding provided the opportunity to make more money due to the markups involved, and as a small portion of drug spending, most PBMs and health plans paid for compounded medicines without question. 
 
Soon it became clear that in the absence of FDA regulation, a compounding pharmacy could produce large commercial quantities of medicines and ship them anywhere in the United States. Around 2010, private equity groups invested in several compounding pharmacies to increase capacity. 
 
It didn't take long for small compounding companies to become large companies, pumping out mass quantities of medicines originally meant for single patients. As noted, Medicare Part D spending skyrocketed for topical compounded drugs-such as creams, gels, and ointments to relieve pain. Most of the increase in spending is a result of expenditures for pain medications, including opioid-based medicines and steroids. 
In 2004, TRICARE – the Department of Defense's health system – spent approximately $5 million for compounded prescriptions. By 2010, the cost had risen to $23 million. In the first nine months of 2015, TRICARE paid $1.7 billion for compounded drugs. Shockingly, this is over 20 percent of TRICARE's total prescription budget. The average cost of a compounded drug is now $2,595, with some drugs costing as much as $40,000 per prescription.
 
As noted, FusionRx is just one of several criminal cases the DOJ is pursuing against compounder.  For example,  the owners of Parks and Lee compounding pharmacy are accused of paying kickbacks and bribes to physicians to get them to write prescriptions to their pharmacies. After the prescriptions were written and carried out, the defendants allegedly submitted huge claims for payment to federal health care programs – dividing the profits.
  
In 2013, The Drug Quality and Security Act (H.R. 3204) was passed by the Senate and signed into law by President Obama on November 27, 2013. Since that time, the FDA has made significant steps for heightened enforcement and site inspections of compounders, shutting some facilities down and helping others correct public health threats. The 2013 Act gave the FDA control over the quantity of compounded drugs that could be shipped or sold across state lines.  Proposed regulations for doing so were not finalized until May of this year. 
 
The proposed regulations continue to exempt compounded drug products from demonstrating to the FDA that they are safely and effectively manufactured.  However, the compounder must agree to limit intrastate distribution to 50 percent of total prescriptions or less. If not, then the amount of out of state sales drops to 5 percent. 
 
The compounding industry opposes these generous limits and declares them as anti-patient. But, as the FDA notes, Congress did not intend for compounding pharmacies to grow into conventional manufacturing operations that can make and sell large quantities of unregulated medicines. 
 
Though steps have been taken to instigate proper oversight, compounded drugs are still laced with containments and corruption. The FDA's proposed regulations increase transparency and accountability. The failure to adopt these modest requirements suggests that compounding pharmacies are more interested in their profits than in public health.

New House Drug Pricing Bill is a Joke

  • 09.10.2019
  • Peter Pitts
In my new book, “Common Sense Health Policy for Common Sense Americans (and Presidential Candidates),"  I plead for sanity and stress that it’s time to put away unworkable soundbite solutions. I sent copies to every member of Congress. Reviewing H.R. 3 (the new price negotiation bill), it’s clear that no one (at least on the majority side) has read it.

The bill is a hit parade of bad ideas.  For example:

An International Pricing Index. Patients often lose access to the best medicines when their government adopts price controls. Of the drugs launched in the last seven years, only 60% were available in Sweden. And only half made it to patients in Canada. In the United States, meanwhile, nearly 90% of those medicines were available. Americans will no longer enjoy generous access to the newest drugs if we embrace price controls. Importing the socialist pricing tactics of foreign governments is no way to stand up for Medicare patients. Bad idea when it comes from the White House, Bad idea when it comes from the People’s House.

Direct Government Negotiation. Is the direct federal negotiation of drug prices a good idea? Consider the “non-interference clause” that currently prohibits such actions in Medicare Part D — the federal program that subsidizes prescription drugs for seniors. A repeal of the non-interference clause would result in a sharp increase in Medicare drug prices and a substantial decline in patient choice. The Congressional Budget Office observed that Part D plans have “secured rebates somewhat larger than the average rebates observed in commercial health plans.” According to the CBO, to achieve any significant savings, the government would have to follow through on its threats of “not allowing [certain] drug[s] to be prescribed.” In other words, the government would drop some drugs from Medicare’s coverage to save money. That would be a raw deal for patients. The average Part D plan provides access to more than 95 percent of the top 200 Medicare Part D Drugs. (PS/ The Non-Interference Clause was written by Senators Ted Kennedy and Tom Daschle.)

Rebates to Off-Set Price Hikes. When Americans say, “My drugs are too expensive,” what they generally mean is that their co-pays at the pharmacy are too expensive. And they’re right. But co-pays aren’t tied to list prices. Consider this: payers negotiate discounts of between 30-50% of the list price – and then base the co-pay off of the list price. What happens to the discount? They pocket the difference. When payers say that higher co-pays are a result of higher list prices they are lying. Surprisingly absent from H.R. 3 is any call for pricing transparency. Shameful.

H.R. 3 is a cruel  joke. It's time to put down the political talking points and pick up Common Sense Healthcare Policy.
 
Some snippets from the Pink Sheet …

Sarepta, US FDA Offer Sparring Positions Over Release of Complete Response Letters

Following Vyondys 53 rebuff, Sarepta CEO contends it would be "disrespectful" to release the complete response letter, while FDA contends that there is nothing stopping companies from publishing the letters.

During a webinar conversation between Sarepta and Parent Project Muscular Dystrophy (PPMD) released on 22 August, company CEO Doug Ingram said multiple times that it might be "disrespectful" for Sarepta to publish the CRL.

"These complete response letters are not public," Ingram said. "They're non-public letters between the agency and sponsors. I am not comfortable making the complete response letter public for the simple reason that I think it might look disrespectful to the agency as we are working through these issues."

An FDA spokesperson, however, told the Pink Sheet that there is nothing stopping companies from making their CRLs public. "Applicants can release the CR letter it receives from FDA (or any other correspondence it gets from us)," the spokesperson said.

A former FDAer chided the company's assertion that it would be disrespectful to the FDA by releasing the CRL. "Any company that is doing business with the FDA understands what is and what is not commercial confidential," Peter Pitts, president of the Center for Medicine in the Public Interest and a former FDA associate commissioner, told the Pink Sheet. "Whether the company chooses to release a CRL is their decision. But to say it is disrespectful is just living in fantasy land. It's just another way to blame the FDA."

The full Pink Sheet article can be found here.
 

A Serious Proposal

  • 08.01.2019
  • Peter Pitts
Kudos to President Trump, HHS Secretary Alex Azar and Acting FDA Commissioner Ned Sharpless for taking the idea of drug importation from the absurd to the serious. Moving away from empty political talking points to a real regulatory agenda takes guts – especially since it has the very real possible outcome of demonstrating once and for all that this idea has no merit.

The “Safe Importation Action Plan” posits two pathways. Under the first, states, wholesalers, or pharmacists could submit plans for demonstration projects for HHS to review outlining how they would import Health-Canada approved drugs that are in compliance with section 505 of the FD&C Act. The importation would occur in a manner that adequately assures the drug is what it purports to be and that meets the cost requirements of the rulemaking. The demonstration projects would be time-limited and require regular reporting to ensure safety and cost conditions are being met. Controlled substances, biological products, infused drugs, intravenously injected drugs, drugs inhaled during surgery, and certain parenteral drugs would be excluded from this pathway. (Yes, that means no Canadian insulin.)

The NPRM would explain the requirement for demonstrating that drugs imported under this pathway must result in a significant reduction in the cost of covered drug products to the American consumer. As such, the NPRM would seek  feedback on the best way to identify the expected acquisition cost of the imported drug, the cost of assuring the drug is safely imported, and the mechanism for delivering those savings to the consumer (as opposed to the savings being absorbed by the supply chain). That’s a tough assignment. Will such a plan lower co-pays for a single patient with health insurance?

Pathway 2 would allow manufacturers of FDA-approved drug products to import versions of these FDA-approved drugs that they sell in foreign countries into the US. To use this pathway, the manufacturer or person authorized by the manufacturer would need to establish with FDA that the foreign version is the same as the U.S. version (such as through manufacturing records). If this condition is met, FDA would allow the drug to be labeled for sale in the US (potentially with labeling that identifies the product as originally manufactured for sale abroad) and imported pursuant to section 801(d) of the FD&C Act under the existing approval for the US approved version.

What’s missing from the Administration’s action plan is a bilateral meeting to discuss drug importation from Canada – with the Canadian government. “Canada does not support actions that could adversely affect the supply of prescription drugs in Canada and potentially raise costs of prescription drugs for Canadians,” reads an April briefing for Canadian officials obtained under freedom of information laws.  No plan can ever be taken seriously without this essential cross-border conversation.

Pathways 1 and 2 will both be driven by a Notice of Proposed Rulemaking (“NPRM”). It’s a detailed and lengthy process –precisely the opposite of loose political rhetoric. It’s about time we get serious and base our future discussions about drug importation on facts rather than fiction.
 
It appears that the American Hospital Association  (AHA) and the health plan lobby, America's Health Insurance Plans (AHIP) are not fans of the Trump administration's executive order to require hospitals to " publish prices that reflect what people pay for services."  According to HHS Secretary Alex Azar, the rule would "require hospitals to disclose the prices that patients and insurers actually pay in "an easy-to-read, patient-friendly format"  and "require health care providers and insurers to provide patients with information about the out-of-pocket costs they'll face before they receive health care services." 

AHA responded: (Consumers) "don’t look at price alone when it comes to seeking the highest quality care for themselves or loved ones. Moreover, consumers say they are most interested in what their out-of-pocket costs for care will be, what is covered by their health plan, which providers are in their networks and what their health plan’s cost-sharing obligations are in terms of their deductible and coinsurance. 
 Meanwhile, economists and analysts have suggested that publicly posting certain information, such as privately negotiated rates, could, in fact, undermine the competitive forces of private market dynamics with unintended consequences such as insurers coordinating to disadvantage providers and consumers."

AHIP   CEO Matt Eyles said the same thing, claiming that  "Publicly disclosing competitively negotiated, proprietary rates will reduce competition and push prices higher — not lower — for consumers, patients, and taxpayers," said in a statement. He says it will perpetuate "the old days of the American health care system paying for volume over value. We know that is a formula for higher costs and worse care for everyone."

Wow, it sounds like the Trump proposal would violate the economics equivalent of the third law of thermodynamics.  So it must apply across the board, to any industry and therefore AHIP and AHA would take a principled stand against any proposal to reveal negotiated prices.  Or maybe not:

AHIP and USA Today Agree: It’s Time for Open and Honest Drug Pricing

When it comes to out-of-control drug prices, the USA Today Editorial Board gets it right. (“How the Trump prescription for drug prices transparency could make health care well again,” May 16). Disclosing prescription drug prices in direct-to-consumer (DTC) advertising is an effective way to help patients make informed decisions about their health.
Lifesaving drugs and treatments are placed out of reach for too many Americans because of the outrageously high list prices set exclusively by Big Pharma. The Trump administration’s proposal will help consumers learn more about what their prescription costs before they access it, and will empower them to discuss cheaper alternatives with their doctor, including generics.
Americans deserve to know how high prices are fueling Big Pharma’s marketing machines and bottom lines at our expense. Direct-to-consumer advertising price disclosure is an important first step in helping us get there.

Matt Eyles
President and CEO
America’s Health Insurance Plans

Well, okay.  But maybe the AHA has a more principled position:

Committee approves AHA-supported drug price transparency bill

The House Ways and Means Committee on Tuesday approved the Prescription Drug Sunshine, Transparency, Accountability and Reporting Act (H.R. 2113), AHA-supported legislation that would increase transparency with regard to prescription drug pricing. 
  
"As it considers this legislation, we want to commend the Committee for including several policies that will better hold drug manufacturers accountable," AHA said in a letter of support for the bill. 
  
Specifically, AHA applauded the inclusion of the Reporting Accurate Drug Prices Act, which would require all manufacturers to submit pricing data to the Department of Health and Human Services.

Sp do AHA and AHIP agree with PhRma that publishing sticker prices "would potentially confuse patients who might be misled into believing the list price is the price they would pay and would potentially deter them from seeking needed medical care?"

Or more to the point: hey support it when it benefits them and oppose transparency when it hurts their industries.

The line between self-interest and hypocrisy in politics is thin.  For AHIP and AHA it is non-existent. 


  
CMPI

Center for Medicine in the Public Interest is a nonprofit, non-partisan organization promoting innovative solutions that advance medical progress, reduce health disparities, extend life and make health care more affordable, preventive and patient-centered. CMPI also provides the public, policymakers and the media a reliable source of independent scientific analysis on issues ranging from personalized medicine, food and drug safety, health care reform and comparative effectiveness.

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