Latest Drugwonks' Blog

High Science

  • 03.07.2020
  • Peter Pitts
Last week the FDA issued its most recent thinking on CBD.

Under the title, “FDA Advances Work Related to Cannabidiol Products with Focus on Protecting Public Health, Providing Market Clarity,” it was, to anyone paying attention, a regulatory finger-wag to a still-nascent industry that still just doesn’t get it. Alas, a lot of bad science doesn’t equal even a little good science. Sometimes the view from the front of the black helicopter gets boring.

The FDA statement begins, “Over the past year, the U.S. Food and Drug Administration has embarked on a comprehensive evaluation of cannabidiol (CBD) products, with a focus on educating the public about the risks and unknowns of these products, gathering the science needed to better understand both these safety concerns and potential benefits to inform our regulatory approach, as well as taking steps when necessary to address products that violate the law in ways that raise a variety of public health concerns.”

Translation: There’s no good science and we’re going to start writing enforcement letters.

The agency continues, “Today, we are providing updates on our efforts in this area, including several new steps in areas of education, research and enforcement with the ultimate goal of continuing to protect the public health and working to provide market clarity."

Translation: It’s going to be a slow process. We’re obviously going to have to help you. Ignore the need for real science at your own peril. Oh, about those claims, “… we are concerned that some people wrongly think that the myriad of CBD products on the market have been evaluated by the FDA and determined to be safe, or that using CBD ‘can’t hurt.’ Aside from one prescription drug approved to treat two rare, severe pediatric epilepsy disorders, no other CBD products have been evaluated or approved by the FDA.” Better lawyer up, bro.

Safety issues? “There may be risks that need to be considered before using CBD products outside of the monitored setting of a prescription from your health care provider.”

Translation: We think there may very well be safety issues such as:

“… potential liver injury, interactions with other drugs and male reproductive toxicity, as well as side effects such as drowsiness. In addition, there is still much we do not know about other potential risks. For example, other than the approved prescription drug, we know little about the potential effects of sustained and/or cumulative use of CBD, co-administration with other medicines, or the risks to vulnerable populations like children, pregnant and lactating women, the elderly, unborn children and certain animal populations. This does not mean that we know CBD is unsafe …”

Translation: … or if CBD is an antidote to COVID-19. But we have our suspicions.

“To address the questions and concerns we’ve already raised, we’re seeking reliable and high-quality data.”

Translation: We don’t have it because it doesn’t exist.

“This includes data on, among other things: the sedative effects of CBD; the impacts of long-term sustained or cumulative exposure to CBD; transdermal penetration and pharmacokinetics of CBD; the effect of different routes of CBD administration (e.g., oral, topical, inhaled) on its safety profile; the safety of CBD for use in pets and food-producing animals; and the processes by which “full spectrum” and “broad spectrum” hemp extracts are derived, what the content of such extracts is, and how these products may compare to CBD isolate products.”

Translation: You guys had better hire some pharmacologists.

“Given the importance of answering these questions, we’re exploring a number of ways to address the data gaps as quickly as possible. This includes encouraging, facilitating and initiating more research on CBD, providing venues for industry and researchers to share new data with the agency and identifying opportunities to further collaborate with our federal partners at Centers for Disease Control and Prevention, Substance Abuse and Mental Health Services Administration and National Institute on Drug Abuse on this important issue.”

Translation: We’re going to hold meetings!

But there is also good news:

“Importantly, the Agriculture Improvement Act of 2018 … has opened significant new opportunities for research, and as that body of research develops and grows, there will be considerably more information available. In particular, there’s been an increased interest in drug development from CBD and other compounds found in cannabis and we are working to support drug development as much as possible.”

Translation: Goodbye IPO dreams and hello CRO expenses and academic research grants that don’t care a brass farthing about marketplace needs and schedules.

Comrades, it’s going to be a long and winding road.

“In the coming days we are re-opening the public docket we established for our May 2019 public hearing. The docket provides a valuable conduit for submission of scientific data on CBD to the agency, so we have decided to extend the comment period indefinitely to allow the public to comment and to share relevant data with the agency. As the agency continues to move forward to explore viable pathways for CBD products outside the drug context, this extension will allow stakeholders to continue to provide relevant data as research in this area evolves.”

Translation: Key word, “indefinitely.”

And in conclusion:

“We recognize the significant public interest in CBD and we must work together with stakeholders and industry to develop high-quality data to close the substantial knowledge gaps about the science, safety and quality of many of these products. We are committed to working efficiently to further clarify our regulatory approach to these products – as always, using science as our guide and upholding our rigorous public health standards.”

Translation: Stop moaning and groaning, take off the tin foil hats and science-up.

At the same time the World Health Organization (WHO) was dithering about the dangers of the coronavirus, it was perpetuating another public health threat of greater magnitude. 

Specifically, WHO took to Twitter to claim, in the middle of the epidemic that it was slow to recognize, that “e-cigarettes increase the risk of heart disease and lung disorders and pose significant risks as they can damage the growing fetus”.

These claims are false. People using non-combustible sources of nicotine have better lung function and fewer attacks. Quitting reduces death from lung and heart disease. In fact, "Quitting smoking before age 40, and preferably well before 40, gives back almost all of the decade of lost life from continued smoking."

As for damaging the growing fetus, pregnant women use to nicotine patches to stop smoking. In fact, compared to infants whose mother smoked infants born to women who used nicotine patches had higher rates of 'survival without developmental impairment’. Additionally, "nicotine patch replacement therapy also decreased the risk of prematurity and small for gestational age."

Indeed, while the WHO has bungled its response to the coronavirus, SARs, Avian Flu, Ebola, and tuberculosis outbreaks, it has waged an aggressive, unscientific campaign against e-cigarettes. It regards e-cigarettes not as less lethal alternative to smoking, but as a Trojan Horse built by tobacco companies to enslave billions more to nicotine. 

The WHO's latest act of fearmongering was prompted by the Phillip Morris Inc., UnSmoke Your Mind"campaign. The effort is designed to get people to stop smoking and providing people who can't quit a technology-based solution to reduce the harms of cigarettes. 

PMI developed and markets a smoke free product called IQOS which heats the tobacco without combusting, In application to the Food and Drug Administration, (which designated the product as a modified risk tobacco product) PMI demonstrated that lower temperature and lack of combustion reduces the levels of chemicals released compared to those released in cigarette smoke. 

As part of the Unsmoke initiative, PMI wants to get 40 million people who use cigarettes but are unlikely to quit smoking to switch to a smoke-free product. In fact, the IQOS is rapidly reducing cigarette sales in Japan, at the expense of PMI cigarette brands such as Marlboro. That's consistent with US data showing that a decline in smoking was 2-4 times fast after 2014 as vaping became more prevalent.  As for claims that people are trading one addiction for another, a recent randomized trial found that 18% of those assigned to use e-cigarettes were smoke-free after a year, compared with 9.9% of using other nicotine replacement therapies such as patches and gum. 

Yet the WHO claims the Unsmoke effort, along with the e-cigarette generated decline in cigarette smoking, is part of a well-funded covert Big Tobacco strategy that has the “goal of weakening tobacco control." In addition to peddling falsehoods about smoke free products, the WHO is also planning to push for vaping bans around the world this coming year.  To help lead the fight, the WHO’s agency for developing such proposals – the Framework Convention on Tobacco Control (FCTC) -- elected Iran (who the WHO may not realize is a state sponsor of terror) as its chair. Indeed, Iran and WHO appear to take the same approach to truth in their crusade against smoking: The Iranian Anti-Tobacco Association claimed that PMI is a Zionist company smuggled Marlboro cigarettes into Iran laced with pig blood and nuclear material. 

The WHO's sluggish response to epidemics and its fearmongering against e-cigarettes reflect the values and politics of the agency as well as the fact that it functions mainly as a launching pad for the pet agendas of donors and public health technocrats.  As an article in the Independent notes: "WHO has moved from being a global health ambassador to a pernickety lifestyle watcher, campaigning on subjects like sugar taxes, obesity and (via the Framework Convention on Tobacco Control) for a global ban on e-cigarettes, for plain cigarette packaging, and against the effects of smoking in films. At an anti-tobacco conference last year, it left itself open to accusations of censorship after banning the press."

Pandemics cause hundreds of thousands of deaths each year.  Nearly 8 million people die from smoking-related diseases in same time period. Telling people e-cigarettes are as lethal as smoking is like saying that vaccines being developed to prevent the coronavirus are as dangerous as the disease itself.  The WHO war of misinformation against vaping, much like its tardy response to the coronavirus, can be deadly.


In advance of the 2020 election, AARP has launched a Stop Rx Greed campaign that is demanding elected officials and candidates “crackdown on price gouging and the greedy practices that keep prices artificially high.”

That’s a noble objective.  But if AARP wants to crack down on such behavior, it should start with its own profiteering. 

AARP is a for-profit financial juggernaut with $4 billion in assets (including $365 million in cash) that generates nearly $1 billion a year in fees and royalties from marketing Medicare Part D prescription drug and health plans for United Healthcare.
 AARP- United Healthcare Medigap plan (insurance that covers certain drugs and other expenses not covered by the traditional Medicare program) currently serves 4.9 million seniors nationwide through various Medicare Supplement products in association with AARP. With 34 percent of the market, AARP is the largest Medigap insurer in the country. That’s three times the share of its closest competitor Mutual of Omaha.

Anyone who buys Medigap insurance knows,  premiums keep climbing.  Yet AARP doesn’t use its buying power to help offset such increases. Instead, nearly 60 percent of AARP’s total revenues— $940 million - comes from a 4.95% rebate paid to them by United Health Care and other insurance companies who license the AARP name to sell Medicare supplemental plans and other insurance products.  In fact, the 4.9% rebate is the single largest expense of United’s Medigap program and more than double the 1.85% profit that UnitedHealthcare makes on the insurance product.

Next, AARP also collects premium payments for United Healthcare.  It holds the payments for 31 days. During that time, AARP invests the money in real estate, hedge funds, bonds and stocks before transferring the money to United. All told, AARP collected $11.8 billion in premium dollars in 2018. It has used that money to build a portfolio of about $4 billion in net assets that generate about $300 million a year in cash, tax-free.

AARP also gets a flat fee for sponsoring United HealthCare  Medicare part D  and Medicare Advantage plans.  Both forms of insurance have the largest share of their respective markets. Such plans get cash rebates from drug companies in exchange for covering specific medicines. Those rebates don’t reduce the out of pocket cost of drugs patients take.  Indeed the biggest portion of rebates come from expensive new drugs used by people with life-threatening conditions such as cancer, autoimmune diseases, and HIV.   Patients taking such medicines don’t get to use rebates to reduce their spending.  Indeed, AAPR plans require them to pay up to 40 percent of the retail cost of such medicines.   

And the rebates don't reduce premiums either: While the Stop Rx Greed campaign claims drug prices are skyrocketing rebates reduced net brand drug prices by 52 percent between 2014-2019   Meanwhile, AARP Medicare Part D premiums jumped by 68 percent during the same time period. 

The campaign criticizes the rising price of insulin medications.  But AARP plans do not cover Basaglar a less expensive biosimilar version of brand-name insulin’s, Lantus.  The retail price of Lantus has increased, but the net price has fallen due to rebates, which the AARP part D plans pocket.  It covered Neulasta, a drug that boosts the immune system of cancer patients, that retails for $6100 a month but not biosimilars  Udenyca and Fulphila which retail for $4100. 

Even when they cover generic versions of high-priced brand drugs,  AARP plans still have seniors pay up to a third of the retail price of medicines. AARP plans cover a brand drug for  versions hepatitis C called Epclusa as well as its generic formulation. It turns out that the post-rebate prices of these drugs are about the same.  As a result, AARP plans will maximize the spread between list and net prices even when generics are available.

You would think that AARP and its campaign support passing rebates dollars to patients.  Think again.  AARP aggressively lobbied against government regulations that would have required part D plans to use rebates to reduce out of pocket costs.  Then again, AARP makes billions from plans that profit by forcing the sickest patients to pay the most. Perhaps before campaigning against price gouging, AARP should first stop screwing the consumers they claim to represent.   


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.

 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.

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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