|Selected news articles which highlight important policy issues.||
News: Weekly Archives
News for the week of 01-10-2005
Amgen is one of America’s first biotech companies, and a case study in the power of market competition to drive innovation and medical progress. Forbes recognizes that at first glance Amgen is an unusual choice for Company of the Year. The biotech giant “hasn’t produced a big seller in a new category since 1991,” and remained focused for many years on only two categories of treatments, anemia and cancer care.
However, as a result of persistent competition and market pressures the company has diversified and restructured its development pipeline in recent years and now has “40 drugs in preclinical or patient trials, more than at any time in the company’s history and up from only 22 during the entire 1990s.”
The genius of the market is that inefficient or lazy companies are eventually driven out of business. In order to remain successful, biotech firms have to continuously joust for the best scientific talent and scarce investment dollars – ensuring that America’s pipeline for innovative new medicines never runs dry.
After all, there will always be another biotech start-up looking to become Forbes’ next Company of the Year.
In addition to new biotech drugs that target and kill cancer cells but leave healthy cells untouched, older chemotherapy treatments are being reformulated with new delivery methods that researchers hope will make them less toxic and more effective. “The first such drug won approval from the Food and Drug Administration Friday. Abraxane…is a version of the widely used breast-cancer chemotherapy Taxol, known generically as paclitaxel.”
Abraxane uses a “natural human protein called albumin” to deliver paclitaxel in the human body and “appears to sidestep some of Taxol’s more serious side effects.”
More research will be needed to discover if Abraxane also offers a survival benefit to cancer patients, but even if it doesn’t the reduced side effects and easier administration are a real boon for chemotherapy patients. “From an economic and convenience standpoint, [Abraxane] appears to have some advantages…If it turns out to be more efficacious [than Taxol], so much the better.”
Health Savings Accounts Off to Slow Start
This article reports on a survey finding that “most people are wary of [Health Savings Accounts] because they do not want to risk having to spend more on their medical bills.”
“Less than a third of workers with insurance have heard about [HSAs], according to a random survey of 1,000 people by Watson Wyatt, a benefits consulting firm based in Washington. After hearing the plans described, 66 percent said the prospect of paying the full price of prescription drugs until the coverage kicked in seemed extremely undesirable, and 57 percent said that they did not want to pay higher deductibles at all. The annual deductible for family coverage is $2,000.”
Of course, without knowing how the HSAs were “described” – or who funded the survey for that matter - it is hard to evaluate how seriously to take its findings. For instance, according to the Kaiser Family Foundation, “The typical family health insurance policy now costs $9,068 per year, with employers on average paying 73 percent and employees paying 27 percent.” For the “typical” policy, this means about $2,448 in out of pocket costs, more than the annual HSA deductible.
In other words, just having a higher deductible doesn’t mean that families would be exposed to higher overall annual costs – indeed, they are more likely to be lower. And when you add in the fact that many companies subsidize employee contributions into HSAs, it is hard to believe that the high deductible would amount to much of a hurdle.
The survey also notes that HSAs allow workers to “keep any unspent balance from year to year and take it along if they change jobs,” which 84% of the people polled said “were important features.”
Overall, the outlook for HSAs is bright, especially if additional reforms are added – such as making a national market for health insurance, requiring mandatory purchase of health insurance, and creating risk adjusted subsidies for low-income citizens.
Painkillers: The Misadventure Continues
“A new study shows that regular use of…traditional nonsteroidal anti-inflammatories drugs (NSAIDs) [like aspirin, ibuprofen, or naproxen] substantially increases risk of ulcers and bleeding in the small intestine.”
Although the study is very small, it lends weight to what we already know about older NSAIDs and the associated health risks. “David Graham, a gastroenterologist at the Michael E. DeBakey VA Medical Center in Houston, had 21 regular NSAID users and 20 people who used either [Tylenol] or nothing to treat their arthritis pain swallow endoscopic cameras. Resulting pictures showed that 71 percent of NSAID users suffered small intestine injury. Only 10 percent of the control group had such injuries, and theirs were comparatively minor. None of the participants in the study…showed or felt outward symptoms of the intestinal problems.”
The study’s findings underscore the reality that no drug – even the ones sitting in your medicine counter at home – is totally safe. It is, however, possible to maker safer drugs if we continue to invest in medical innovation. Unfortunately, we have become so inured to the risks from older medicines, and so outraged at companies producing new medicines, that we are undermining the discovery of better, safer drugs.
“A group of 10 leading drug makers yesterday unveiled a discount card for 36 million Americans who don’t have health insurance. The card will offer breaks of between 25 percent and 40 percent on the cost of prescription medicines.”
The discount card will offer reduced prices on nearly 300 medications, and is free for any non-Medicare patients with “incomes of up to $30,000 for a single person or $60,000 for a family of four.” This is the first time that pharmaceutical companies have offered discounts broadly to the uninsured, including people with incomes three times the federal poverty level.
It is also a welcome signal that the industry is thinking outside the box of federal programs like Medicare and Medicaid. Expanding access to prescription drugs for the uninsured not only improves the public reputation of the companies, it also helps to undermine the illusion that only government price controls can make prescription drugs affordable.
Eli Lilly Goes On the Offensive to Defend Prozac
An article in a recent issue of the British Medical Journal accused Eli Lilly of withholding secret data from the FDA on its antidepressant drug Prozac that linked the drug to an increased risk of suicide. However, “Lilly [has] produced and submitted to the Food and Drug Administration 16 pages of annotations and explanations for documents that the British Medical Journal [BMJ] used to make its allegations. In the annotations, the company charted out a chronology of its multiple submissions and communications with health regulators that it had been forthcoming about Prozac side effects…The BMJ said that it couldn’t comment because it hadn’t seen Lilly’s response to the documents.”
Nonetheless, early indications are that the BMJ rushed the story to print without extensively researching the authenticity of the claim that they were “secret.” Five pages of these supposedly secret charts “showing that Prozac caused suicidal thoughts and behaviors far more often than the older antidepressants in use” were actually “made by someone at the FDA,” meaning that the FDA was in possession of the data years before the BMJ uncovered it.
If corporations have a responsibility to correct data or articles that create a misleading public impression, so should the BMJ. We look forward to seeing how this issue is resolved.
CAPITAL: Conflict-of-Interest Disclosures May Not Protect the Unsophisticated
Is the disclosure that doctors may receive gifts from pharmaceutical companies enough to warn the public about the potential conflicts of interest when doctors are prescribing medicines? One economics professor at Carnegie Mellon University isn’t so sure. “Disclosure can ‘let people off the hook morally,’ Mr. Lowenstein said in a review of his research…A well intentioned doctor or stock analyst may not realize how much his advice is tainted, and the act of disclosure may offer him unjustified relief.” Mr. Lowenstein went on to “call for a ban on all gifts by drug companies to doctors and medical students, even small ones.”
This is a complicated question. However, it should be observed that in the marketplace (or in a doctor’s office) physicians have access to many different types of information from competing companies, peers, medical journals and through personal experience. Furthermore, we could also observe that physician bias is also evident in how doctors are trained. If a patient with prostate cancer sees a radiologist, he will most likely receive radiation therapy for his disease; if he solicits the opinion of a surgeon, he will most likely be counseled to undergo surgery.
How can a patient know which course of treatment is best? Answering that question requires a patient to become an active participant in the diagnostic process, i.e., consulting a variety of sources to arrive at the best decision.
Banning advertising from drug companies, or interaction between physicians and pharmaceutical sales representatives may have some benefits at the margins – but it would also reduce the volume of information flowing to physicians and rob companies of the incentives they have to perform extensive research on their products and tout that research in an open forum, where it can be examined and critiqued. The government’s job shouldn’t be to ban certain types of information or speech, but to ensure that data presented to physicians and the public is as accurate as possible.
Otherwise, the only way to protect patients from all conflicts of interest would be to exclude them from treatment entirely.
Prostate-Cancer Therapy Leaves Men Prone to Bone-Fracture Risk
“A common treatment for prostate cancer appears to increase the risk of broken bones. In a study published in today’s New England Journal of Medicine, researchers found that the risk of bone fractures is as much as 54% higher in older men undergoing certain types of androgen-deprivation therapy.”
The therapy – either surgical castration or testosterone lowering drugs – “reduces bone mineral density and increases the risk of osteoporosis,” especially when those drugs are delivered in high doses. While this might seem to be a small trade-off if it saves a life, for some patients “with less aggressive tumors confined to the prostate” the risk-benefit profile may turn out to be quite different. As side effects for older therapies become more clearly defined (like this one) doctors can tailor therapy to minimize risk and researchers can focus on developing new treatments with less serious side effects.
Savings Uncertain In Import Drug Plan: Questions Raised In Montgomery
“Montgomery County’s plans to make Canadian prescription drugs available to employees has hit a snag after an analysis by the school system concluded that the practice wouldn’t save as much money as hoped and could be more expensive than domestic sources for drugs.”
The study blamed the lack of savings on fluctuating U.S.-Canadian exchange rates, noting that the declining value of the American dollar has now made it “more expensive for Americans to purchase Canadian drugs with U.S. currency.” The analysis also faulted an earlier study advocating importation as failing to include the cost of shipping medications to the U.S. in its analysis.
Large scale importation programs depend on so many fickle variables that they are certain to run into trouble once they are closely examined. But the reasons for lower Canadian drug prices in general – government price controls and the greater purchasing power of American consumers – aren’t very attractive in and of themselves. Either U.S. policymakers will have to mandate price controls, which will reduce medical innovation, or reduce the buying power of U.S. consumers. Neither sounds like a good option.
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