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Selected news articles which highlight important policy issues.

News: Weekly Archives

News for the week of 01-17-2005

No Pain, Some Gain: New drugs aimed at specific neuron targets promise relief from chronic agony
Business Week, 1-17-05

If you needed any more evidence that the current Vioxx debacle is already slowing new drug development and hurting patients, here it is: the FDA has just approved two new drugs for treating pain that work in completely novel ways, but “both Prialt and Lyrica went through a far lengthier and costlier development process than originally expected. The struggles by Elan and Pfizer to get these two pain medicines on the market highlight the immense difficulties that beset the entire field of pain research and treatment.”

For the “50 million Americans suffering from chronic pain,” news that companies may be scared away from doing new research on pain relief medications adds insult to injury. As the FDA becomes more risk averse, drugs like Prialt and Lyrica are likely to only be approved for very narrow groups of patients, making the field substantially less lucrative for pharmaceutical and biotech companies.

Why is this a problem? “The lack of a giant payoff could be a problem for future analgesics,” given the enormous costs of drug development and potential legal liabilities. Still, said one researcher, “new drugs are desperately needed…We are not covering groups of patients with very resistant pain.” Currently, “medical studies routinely find that at least 40% to 50% of patients are undertreated for chronic pain, defined as pain that lasts more than three months.”

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Wyeth Nears Diet-Drug Settlement: Company Sets Framework With Plaintiffs' Lawyers For Most Remaining Cases
Wall Street Journal, 1-18-05

Wyeth and plaintiff’s lawyers representing nearly all of the remaining lawsuits alleging that Wyeth’s diet drugs [fen-phen] caused heart damage have reached a tentative settlement framework. “The agreement would establish two tracks for plaintiffs to follow to settle remaining cases. An expedited option would pay $20,000 on average to plaintiffs who were unable or unwilling to demonstrate that they took the company’s diet drugs for 90 days or more…People who can document they took the drugs for 90 days or longer would be paid according to a grid that weighs the severity of health damage. The proof of injury claim could be demanding and time consuming, though less uncertain than a trial. No schedule of payments contemplated by this track was available.”

Anyone who opposes creating an administrative remedy for pharmaceutical injuries (a process modeled on the federal Vaccine Injury Compensation Plan) should take a close look at this case.

If we have scientific methods available that can accurately identify people who were injured by a drug, why do we need an enormously expensive, lengthy court case to dole out compensation? (In the average tort case, less than 50 cents on the dollar actually goes to plaintiffs who win awards. The rest is consumed by the system and attorney's fees.) At the same time, large mass tort actions (asbestos, breast implants) are often laden with many dubious injuries with little if any supporting documentation. Paying these claims only inflates the fees paid to plaintiff’s lawyers and takes money away from people who are seriously injured. So why are we doing it?

As in most class actions, perverse incentives operate: defendants want to lower the average payment to very seriously injured claimants, while plaintiff’s lawyers want to inflate the number of dubious injuries because, when it comes to attorney’s fees in class action settlements, size matters.

The right solution for pharmaceutical injuries is an administrative claims system like the Vaccine Injury Compensation Plan, which uses a science-based list of injuries to award compensation to truly injured claimants in a fair and timely manner.

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Nursing Employees Back to Health: Employers Battle Ailments That Sap Productivity, With Drug Makers' Help
Wall Street Journal, 1-18-05

Have you ever gone to work in the midst of allergy season but been so miserable that you got nothing done? Many workers find their productivity – and enjoyment – of work sapped by chronic ailments that burden their everyday lives. Companies also lose millions of dollars in lost productivity every year. Now, however, “companies are analyzing the bottom line effect of conditions such as seasonal allergies, migraines and stomach troubles, particularly when employees show up for work but operate at far less than 100%.”

The productivity cost of nagging health ailments is hard to quantify, but one company, Comercia, “surveyed its employees and found that about 40% of respondents said they suffered from irritable bowel syndrome, which can involve abdominal discomfort, bloating, or diarrhea.”

The company estimated that associated productivity costs could amount to $8 million a year. As a result, the company now distributes information about irritable bowel syndrome and sponsors workshops with doctors on how employees can better cope with the condition through “living habits, diet and possible medications. The company has [also] asked insurers to explore ways too encourage employees to get medical care that could improve productivity.”

This is just one more example that targeted health care spending has bottom-line benefits that outweigh its costs, especially when market forces can be harnessed to better health outcomes.

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Gene-Based Drug Research Takes Shape at Novartis
Wall Street Journal, 1-19-05

Massive financial investments in genetic research are helping Novartis to better “determine how diseases work and how best to treat them.”

“Novartis is getting closer to breaking down the cause of diabetes. It is also dissecting several illnesses long neglected by other drug makers, including cystic fibrosis and tuberous sclerosis, a rare genetic disorder that causes tumor growth and seizures.”

However, the gains aren’t cheap or quick. Novartis is currently spending $4 billion to equip a new genetics research center in Cambridge, Massachusetts. In the long run, the company is betting that the center will revolutionize the way Novartis develops new drugs. “Traditionally, drug researchers have discovered medicines by bombarding an illness with a variety of chemicals until they hit a combination that treats it. A research strategy based on genetics, by contrast, tries to zero in on the exact gene or chain of genes that cause a disease.”

If successful, genetic research will also revolutionize how drugs are marketed, since rather than using advertising to maximize market share, companies will target drugs at patients with certain genetic disorders and the doctors who treat them. Besides providing a better medical match for patients, genetic medicine will also enable Novartis and other companies to develop drugs by testing them first in small groups of patients rather than in large, expensive clinical trials. Hopefully this strategy will not only lower overall drug development costs but market prices as well.

The shift towards genetic medicine is increasingly being driven by market forces. Although profits for industry have been good, “major drug companies in the U.S. and Europe have become increasingly reliant in recent years on a few blockbuster drugs that treat widespread ailments,” with “blockbuster” drugs accounting for more than 45% of revenue. However, as the Vioxx experience has shown, marketing drugs to large populations without the science to back it up exposes companies to far more risk than potential gain. Overall, cutting edge science and market pressures are forcing companies to usher in personalized medicines, which should pay off in safer, more effective treatments for all patients.

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Cancer Passes Heart Disease as Top Killer
The New York Times, 1-20-05

Despite the article’s alarming title, mortality rates for both cancer and heart disease have been falling thanks to the ever growing ability of doctors to treat and detect both diseases before they become fatal. Cancer may now be America’s leading killer, but only because we’ve made more progress treating heart disease than cancer.

Still, “cancer rates have declined about 1 percent each year since 1999,” and we’ve made tremendous advances in treatments for specific diseases like breast cancer and leukemia.

We also stand to gain enormously in the next few years as researchers refine new technologies that can pinpoint the specific genes and proteins involved in the development of cancer and devise powerful new targeted treatments that can annihilate cancer cells with minimal side-effects for healthy tissues.

The fly in the ointment is the FDA itself, which approves new cancer treatments. As Scott Gottlieb at the American Enterprise Institute has pointed out recently, there is growing evidence that the FDA is reacting to widespread criticism by raising the bar for cancer treatments up for accelerated approval. If this happens, the end result will be that new cancer treatments will take longer to reach market and more patients will die waiting.

All of our vaunted cancer-killing technologies will come to naught if the FDA becomes more serious about avoiding criticism than it is about curing disease.

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Pfizer Delays Cox-2 Polyp Drug Amid Safety Review in Europe
Wall Street Journal, 1-21-05

The European Medical Agency is delaying the introduction of a COX-2 drug in Europe (Onsenal) that prevents colon polyps, precancerous growths that may eventually become life-threatening colon cancer. The EMA is concerned that Onsenal (basically a higher dosage of the painkiller Celebrex) may cause excess heart attacks in some patients. This is certainly a fair enough question to ask on its face, although the data on Celebrex and heart attacks is mixed.

However, if the EMA removes Onsenal from the market altogether it would turn out to be a very troubling development. After all, shouldn’t patients at high risk of developing colon cancer decide for themselves if the relative trade-offs are worth it? Shouldn’t they be able to consult with their doctors, rather than be forced to accept the diktat of a Brussels bureaucrat?

Put another way, why is it that Europeans can smoke, eat red meat to their heart’s content, and drive absurdly fast on the Autobahn but the EMA may still prevent them from buying a life-saving drug in consultation with their own physicians?

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New Medicare Drug Rules Balance Access and Costs
The New York Times, 1-22-05

The Centers for Medicare and Medicaid Services have released new compliance rules for private insurers who will be managing the Medicare drug benefit when it takes effect in 2006. The rules appear designed to ensure all the parties with a stake in the program – pharmaceutical companies, patients, insurers – will find something to like about the program.

Since it is relatively fair, it will also draw plenty of criticism.

“On many issues, the rules strike a balance between competing interests. On the one hand, the rules say that every prescription drug plan must provide ‘adequate coverage of the types of drugs most commonly needed’ by Medicare beneficiaries….On the other hand, the rules say that a plan can establish a list of preferred drugs and can refuse to pay for other medicines.” The final word, however goes to doctors, who can prescribe any medicine they wish provided they certify that it is “medically necessary for a patient.”

Still, these rules are only a small first step in a long reform process that Dr. Mark McClellan (the Medicare Administrator) has embarked on to ensure that Medicare dollars are spent as effectively as possible. The agency is also collecting reams of information on patient outcomes for many common health conditions and treatments that will be used to set up “best practices” guidelines for Medicare providers. In the long run, better spending through information management will drive down overall costs and ensure that seniors are getting the best health care possible.

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