QALYwood Confidential

• 03.27.2009

Okay – so just what exactly is a Quality Adjusted Life Year (QALY)?

Here’s a nice primer courtesy of a new Time Magazine interview with NICE Chairman Sir Michael Rawlins:

“A QALY scores your health on a scale from zero to one: zero if you're dead and one if you're in perfect health. You find out as a result of a treatment where a patient would move up the scale. If you do a hip replacement, the patient might start at .5 and go up to .7, improving by .2. You can assume patients live for an average of 15 years following hip replacements. And .2 times 15 equals three quality-adjusted life years. If the hip replacement costs 10,000 GBP to do [about $15,000], it's 10,000 divided by three, which equals 3,333 GBP [about $5,000]. That figure is the cost per QALY."

So, how much is a year of life worth?

"The most controversial area is where you place the dividing line between what is cost effective and what is cost ineffective. That is the "how much is life worth?" question. And there is no real empirical research to guide you. We have looked at what other government departments do. Our Department of Transport, for instance, has a cost-per-life-saved threshold for new road schemes of about about 1.5 million-pounds-per-life, or around 30,000 GBP per life year gained. The judgment of our health economists is that somewhere in the region of 20,000-30,000 GBP per Quality-Adjusted Life Year (QALY) is the [threshold], but it's not a strict limit."

That's a tough decision to make for bureaucrats, is it not?

"For many difficult questions, we capture public preferences by our citizens council, a representative sample drawn from the general public. For example we asked if should we give greater priority to children than the elderly. The group decided that a year of life was worth just as much when you are a grandparent as when you are a child. That is very culturally specific and might not apply to other countries in the world."

Thanks Sir Michael.

But, according to Dr. Frank Lichtenberg of Columbia University, for a healthcare technology assessment (HTA) scheme (such as the NICE model) to yield valid decisions in practice, it is necessary to have reliable estimates of:

ΔCOST
ΔQALY
and VSLY (Value of a Statistical Life Year)

And his main point is that the devil is in the details.

Lichtenberg believes that incorrect estimates of some or all of these key inputs are often used:

ΔCOST is frequently overestimated
ΔQALY and VSLY are frequently underestimated

And due to these estimation biases, health technologies that are truly cost-effective may often be rejected as cost-ineffective.

Per the recent debate over the utility of new cancer treatments, he makes a very interesting point -- that even though, over the past 30 years, the U.S. Mortality Age-Adjusted Rates for cancer have remained relatively constant -- (leading to such mainstream media headlines as Fortune Magazine's "Why have we made so little progress in the War on Cancer?” and NEJM articles like "The effect of new treatments for cancer on mortality has been largely disappointing” -- the often ignored reality is that 5-year relative survival rates, for all cancer sites, have increased from 50.1% in 1975 to 65.9% in 2000.

Lichtenberg cites two crucial studies, pointing out how health care economists must seriously reconsider the outdated estimates of a QALY:

Viscusi and Aldy: The value of a statistical life for prime-aged workers has a median value of about $7 million in the United States

Viscusi, W. Kip and Joseph E. Aldy, “The Value of a Statistical Life: A Critical Review of Market Estimates Throughout the World,” The Journal of Risk and Uncertainty, 27:1; 5–76, 2003.

and

Murphy and Topel: The value of a life year is $373,000.

Murphy, Kevin M., and Robert H. Topel, “The value of health and longevity,” Journal of Political Economy, 2006.

Attention must be paid. Hello NICE. Hello IQWiG. Hello Senators Baucus and Conrad.

If the devil is in the details (and it is) -- it's time for a deep dive beyond simplistic and self-serving "comparative effectiveness."

Mitt Happens

• 03.27.2009

From today's Wall Street Journal:

Praise Mitt Romney. Three years ago, the former Massachusetts Governor had the inadvertent good sense to create the "universal" health-care program that the White House and Congress now want to inflict on the entire country. It is proving to be instructive, as Mr. Romney's foresight previews what President Obama, Max Baucus, Ted Kennedy and Pete Stark are cooking up for everyone else.

In Massachusetts's latest crisis, Governor Deval Patrick and his Democratic colleagues are starting to move down the path that government health plans always follow when spending collides with reality -- i.e., price controls. As costs continue to rise, the inevitable results are coverage restrictions and waiting periods. It was only a matter of time.

They're trying to manage the huge costs of the subsidized middle-class insurance program that is gradually swallowing the state budget. The program provides low- or no-cost coverage to about 165,000 residents, or three-fifths of the newly insured, and is budgeted at $880 million for 2010, a 7.3% single-year increase that is likely to be optimistic. The state's overall costs on health programs have increased by 42% (!) since 2006.

Like gamblers doubling down on their losses, Democrats have already hiked the fines for people who don't obtain insurance under the "individual mandate," already increased business penalties, taxed insurers and hospitals, raised premiums, and pumped up the state tobacco levy. That's still not enough money.

So earlier this year, Mr. Patrick appointed a state commission to figure out how to control costs and preserve "this grand experiment." One objective is to change the incentives for preventative care and treatments for chronic disease, but everyone says that. It sometimes results in better health but always more spending. So-called "pay for performance" financing models, on the other hand, would do away with fee for service -- but they also tend to reward process, not the better results implied.

What are the alternatives? If health planners won't accept the prices set by the marketplace -- thus putting themselves out of work -- the only other choice is limiting care via politics, much as Canada and most of Europe do today. The Patrick panel is considering one option to "exclude coverage of services of low priority/low value." Another would "limit coverage to services that produce the highest value when considering both clinical effectiveness and cost." (Guess who would determine what is high or low value? Not patients or doctors.) Yet another is "a limitation on the total amount of money available for health care services," i.e., an overall spending cap.

The Institute for America's Future -- which is providing the intellectual horsepower (we use the term loosely) for reforms like those in Massachusetts -- argues that the cost overruns prove the state must cap how much insurers are allowed to charge consumers and regulate their profits. If Mr. Patrick doesn't get there first, that is. He reportedly told insurers and hospitals at a closed meeting this month that if they didn't take steps to hold down the rate of medical inflation, he would.

Even the single-payer cheerleaders at the New York Times have caught on to this rolling catastrophe. In a page-one story this month, the paper reported on the "expedient choice" that Mr. Romney and Democrats made to defer "until another day any serious effort to control the state's runaway health costs. . . . Those who led the 2006 effort said it would not have been feasible to enact universal coverage if the legislation had required heavy cost controls. The very stakeholders who were coaxed into the tent -- doctors, hospitals, insurers and consumer groups -- would probably have been driven into opposition by efforts to reduce their revenues and constrain their medical practices, they said."

Now they tell us. What really whipped along RomneyCare were claims that health care would be less expensive if everyone were covered. But reducing costs while increasing access are irreconcilable issues. Mr. Romney should have known better before signing on to this not-so-grand experiment, especially since the state's "free market" reforms that he boasts about have proven to be irrelevant when not fictional. Only 21,000 people have used the "connector" that was supposed to link individuals to private insurers.

Which brings us to Washington, where Mr. Obama and Congressional Democrats are about to try their own Bay State bait and switch: First create vast new entitlements that can never be repealed, then later take the less popular step of rationing care when it's their last hope to save the federal fisc.

The consequences of that deception will be far worse than those in Massachusetts, however, given that prior to 2006 the state already had a far smaller percentage of its population uninsured than the national average. The real lesson of Massachusetts is that reform proponents won't tell Americans the truth about what "universal" coverage really means: Runaway costs followed by price controls and bureaucratic rationing.

Physician Empowerment: No Good Deed Goes Unpunished

• 03.27.2009

Fighting Wolverines Fight Prostate Cancer

• 03.26.2009

With all the brouhaha over the relative efficacy of prostate cancer screenings, you'd think the media would be watching for some really important news -- like a biomarker that could change the whole paradigm.  Alas, the MSM seems to have missed the story entirely.  Not shocking, but nevertheless disappointing considering the play they gave to the cost-effectiveness angle just last week.

But drugwonks won't let that happen

According to researchers from the University of Michigan, a newly identified marker for prostate cancer progression may also offer a new target for treatment. Previous research has found that decreased levels of the marker galectin-3 are linked with neoplastic progression in prostate cancer. However, increased levels of galectin-3 are believed to be associated with tumorigenicity in a number of other tumor types.

The University of Michigan team believed this difference was due to the fact that galectin-3 was cleaved during prostate cancer progression. Their study found that cleaved galectin-3 is present in a late-stage prostate cancer and that reducing levels of galectin-3 inhibited development of metastatic prostate cancer.The findings suggest that cleaved galectin-3 may serve as a diagnostic marker and treatment target for prostate cancer progression.

The study shows "that galectin-3 is cleaved during the progression of prostate cancer and might be associated with metastasis, cell growth and tumorigenicity. Expression of intact versus cleaved galectin-3 thus might be used as a marker for prognosis of prostate cancer and a therapeutic target for the treatment of prostate cancer," wrote study author Avraham Raz and colleagues.

Go Wolverines!

The study appears in the April issue of The American Journal of Pathology.

BIGT Changes for Nice?

• 03.25.2009

Our Congress is confiscating bonuses and the administration is set to limit executive pay. It is launching a Medicare Part D benefit that limits access to new medicines based on price and one size fits all comparative effectiveness...

Meanwhile in the UK, the government seems to be finding a way to keep it's biotech industry and the patients who depend on it alive before it's too late:

Click Here to Read More
 
Grim Outlook For UK Biotech Industry
Mar 11, 2009
By: Sarah Houlton

One-third of publicly owned UK biotechs have less than six months’ money left in the bank, and just 0.2 percent of the London Stock Exchange is now made up of biotech companies. “A new approach to funding is needed to fill the gaps left by investors,” claims Aisling Burnand, chief executive of the BioIndustry Association.

“We are faced with a very different world than we were a few years ago,” says Bioscience Innovation and Growth Team chairman Sir David Cooksey. The BIGT just released Bioscience 2015, an industry report designed to map out the market for the next six years.

First released in 2003, the report had been written to look forward 12 years and forecast where industry would be. In this revised and refined report BIGT has have lowered its sights.

The main problem, Cooksey claimed, is that investors simply do not see enough reward to justify the risk in putting their money into the sector. “There are hurdles in the way such as NICE and the EU clinical trials directive, which has been more stringently applied in the UK than in other countries,” he says. “We have to change the balance.”

This drying up of finance for biotechs is a real problem. “Biotech companies have not given good enough returns to investors to make them want to come back. Private sector angels, venture capitalists, and public markets have all turned away. We need to make it more attractive, and then I have no doubt that as the extra funding is rolled out we will get the situation where there is more participation in terms of the public sector.”

However, Cooksey does not believe that a large investment by government is the right way ahead, in contrast to the demands made by Sir Chris Evans and a group of his fellow venture capitalists at the end of last year. “We’ve not said, ‘Let’s have $1 billion in [government] funding,’” he claims. “If you look at history, governments putting a lot of money into technology development with civil servants picking the winners has not had much success.” Rather, they are looking for regulatory help and enhancements to the existing R&D tax credit scheme to encourage pharma companies to invest in biotech.

He believes that if Big Pharma were given more confidence in the biotech sector and had a more collaborative involvement at an earlier stage, it should give investors more confidence, too. “We are looking for real support from government to put a regulatory environment in place that will be effective in the longer term,” he adds. “We need to look at how to change the drug development pathway, use modern techniques to make it cheaper, faster and safer—it’s currently unnecessarily expensive. We are in danger of it no longer being worth a company’s while [to get into drug discovery] as they will never get to be able to sell a product at the price they need and which is also acceptable [to the payers].”

However, he says, this cannot be done by the UK on its own—it will have to involve the EU and the FDA, too. “Changes in the global regulatory system will take time and effort,” says serial entrepreneur and former BIA chairman Simon Best. “In the past four or five years, the sector has fallen out of favour. If we can do more work using modern tools such as genetics and genomics, and run smaller, better focused trials, it will be a reduced ask for investors.”

There is also the suggestion of allowing patients to receive drugs for life-threatening diseases after Phase II trials on a conditional licensing basis. “Hopefully safety issues would be flagged up more quickly, and the poor uptake of innovative drugs could be addressed,” Best said. “We want to see more pivotal trials carried out in the EU, maybe allowing conditional licenses while still doing Phase III trials in the US. This would allow us to address safety issues much earlier, and identify which patient populations could most benefit—or would most likely to have problems. I’m not convinced that post-marketing surveillance is the way ahead.

The Other Sweet 16

• 03.25.2009

We’re all used to state AGs suing drug companies for inappropriate promotion of off-label indications (Neurontin comes to mind – among others).  Now there’s an interesting new wrinkle.

16 state Attorneys General (Oklahoma, Alaska, Utah, Iowa, Colorado, Kansas, Maine, Missouri, Nebraska, New Mexico, North Carolina, Rhode Island, South Dakota, Texas, West Virginia, and Wyoming) have written to Abby Black (Director, Center for Drug and Health Plan Choice at CMS) to complain that Part D participating insurance companies are requiring that their customers fail on a variety of off-label therapies before they will be reimbursed for medicines that have the more appropriate, on-label indication relevant to their particular conditions.

The AGs write, “Just as it is inappropriate for pharmaceutical companies to market drugs for off-label uses, it is equally inappropriate for health insurance companies to refuse to reimburse for physician-prescribed medications unless a patient first undergoes treatment with drugs that are off-label. … This practice of requiring treatment with an off-label drug before reimbursing a patient for using a drug approved by the FDA for that specific condition subverts the legislatively mandated approval process for drug indications by substituting the judgment of health insurance companies for that of the FDA. It undermines the doctor-patient relationship by empowering health insurance companies to make broadly applicable medical decisions best left to a physician considering the needs of a specific patient. This “one-size-fits-all” insurance-company mandate is inappropriate and dangerous.”

 

Many issues here – particularly the validity of the FDA label for anything post Wyeth v. Levine – but an equally important question is when is off-label not off-label? At present, the answer seems to be; when it's on-formulary and off-patent.

 

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.

Here’s how the Sweet 16 end their letter to CMS:

“Insurance company requirements that patients utilize off-label treatments before being reimbursed for FDA-approved treatments are dangerous and should not be permitted.  The same policy considerations that support a ban on off-label marketing by pharmaceutical companies support the prohibition of this insurance company practice.”

 

Here is the complete letter to CMS.

 

Are you paying attention Mr. Waxman?

Drug Spending Slows and Cost Sharing Climbs. Is There A Connection?

• 03.25.2009

Patient Cost-Sharing on the Rise: Results from the
Benefit Design Index
By Melinda C. Haren, RN; Kirk McConnell

The cost of employee health coverage continues to grow faster than inflation,1 putting additional economic pressure on employers ...

American Health and Drug Benefits

Cost sharing of Rx is climbing faster than premiums AND inflation....drug spending is falling.  We know that compliance falls and disease burdern increases as a result.  

Meanwhile insurers diddle about reimbursing for personalized medicine which is very cost effective and product ...

The Economic Impact of Personalized Medicine: Genetic Testing in Metastatic Colon Cancer May Save $604 Million Annually
By Caroline Helwick

So much for controlling health care costs.

To Sir, with Love

• 03.23.2009

Well, if not love then at least respect.  Significant respect.

I had lunch today with Sir Michael Rawlins (Chairman, National Institute for Health and Clinical Excellence) in his office today.  Finger sandwiches were served – but the conversation was meaty.

Rather than sharing any particulars of a private conversation (Chatham House rules, you know), I will say that we were of a mind on many things -- not the least of which is the need for better tools for clinical effectiveness research.

My only “ask” was for Sir Michael to consider traveling to the U.S. to speak at a Center for Medicine in the Public Interest conference on the future of clinical effectiveness.  He readily agreed.

Watch this space for more details.

While waiting in the NICE lobby, I picked up a brochure entitled, “How to Change Practice.”  There is much in it to debate, but one thing must be stipulated – the quote at the bottom of page 4:

“Change is not made without inconvenience, even from worse to better.”

The words (via theologian Richard Hooker, 1554-1600) are right, but it’s frightening that NICE should choose to quote from Hooker, who is (arguably) best known for his belief in the doctrine of “Justification by Faith.”

But I digress.

In the meantime, have a look at this new op-ed (from the Newark Star-Ledger), "President Obama, health care and "comparative effectiveness research."

Here are the concluding paragraphs to whet your wonkish appetite:

“Another way to make sure comparative effectiveness research is used properly is to follow the Food and Drug Administration's lead in creating a Critical Path Initiative for CER. The FDA's current Critical Path Initiative aims at using the latest scientific advancements to modernize the process through which treatments are turned from laboratory discoveries into useable medical technologies.”

“This model would be just as helpful in creating a modernized comparative effectiveness research program. By utilizing the most up-to-date scientific knowledge, treatment potency could be assessed in a manner that gives the utmost attention to the genetic, clinical, and demographic factors that affect how different patients react to different treatments.”

“President Obama is right to see the potential benefits associated with comparative effectiveness research. As he moves forward with his plan, however, it's imperative that he also be aware of the serious risks that this research poses.”

Blumenthal's Soros Connection

• 03.20.2009

Why did all the press releases about David Blumenthal, who will run the health IT shop over at HHS, ignore the following:

Blumenthal is also head of an organization called The Institute on Medicine as a Profession (IMAP) which according to it's website "aims to set forth a vision for professionalism in the 21st century and to promote that vision through research and policy initiatives. "

IMAP received a $7.5 million grant from George Soros who made his money in part from wrecking currencies. IMAP is part of a new venture called The Prescription Project, which is funded by Community Catylst, which in turn is funded by the same group that funds the liberal Families USA which also receives money from Soros. The Prescription Project is being funded by the Pew Charitable Trust to the tune of $6 million but is also linked to the Prescription Access Litigation Project through its affiliation with Community Catalyst. That project is comprised of the largest tort lawyers suing drug companies for a variety of reasons.

The Prescription Project is designed to end companies from having any contact with doctors or patients whatsoever. As the project notes: "Public and private payers spend billions of dollars a year on prescription drugs. When these payers rely on information from industry marketing campaigns rather than unbiased scientific studies, the result is higher cost and poorer quality."

Maybe we will only connect to doctors by computer using messages screened for commercial content and judge consistent with materials produced by the Federal Comparative Effectiveness Coordinating Council.

Run Jesse Run!

• 03.20.2009

Jesse Goodman, the well-respected CBER director is getting a new job.  Actually, two new jobs.  He’s been promoted to be FDA’s Chief Medical Officer and will also serve (as the agency’s only representative) on the Federal Coordinating Committee on Comparative Effectiveness – where his ability to think big, think smart, and think fast will be a tremendous asset.

Jesse is a smart guy, a nice guy, a key player in the FDA’s Critical Path Initiative – and a heck of a tennis player.

It's good news for Dr. Goodman -- and better news for the public health.

Congratulations Jesse.