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Selected news articles which highlight important policy issues.

News: Weekly Archives

News for the week of 10-19-2005

Links with pharma groups blossom
Financial Times, 10-19-05

Editor’s Notes:

This article focuses on the increasing market clout and profitability of the biotech industry, both in the U.S. and abroad. It also underscores the growing number of medical innovations flowing from biotech pipelines, and the impact that the biotech industry is having on so-called “Big Pharma” companies. Ironically, as biotech companies flex their market muscle, the dividing lines between biotech and pharma companies are blurring through mergers, licensing deals, and shared technology.

As the biotechnology industry grows in confidence and maturity, it is positioning itself to feed growing demand for new drugs and develop treatments in areas of unmet need. The promise of personalized medicine remains tantalising close.
Following the tough years for technology stocks that followed 2000, confidence and new money has returned to the biotech sector. The market valuations of the biggest biotechnology companies such as Amgen and Genentech now rival some of their biggest pharmaceutical industry peers.

Research from Ernst & Young, cited in this article, notes that the U.S. remains the international leader in biotech, at least for the time being, with three-quarters of global biotech revenues. The U.S. also raises twice as much venture capital as the E.U. and approved twice as many new biotech medicines in 2004. Our global competitors in India, China and the E.U., however, are doing their best to close the gap.

More worrisome than competitors abroad, however, are trends at home. The U.S. biotech industry could lose its edge if Congress bows to increasing pressure to inflict European-style price controls on new medicines or legalize drug importation—either of which would slash industry profits and stem the flow of biotech investment capital. This would be bad news for the industry, and for the patients who depend on their life-saving products.

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Hurdles ahead for makers of gene-based medicine
The San Francisco Chronicle, 10-19-05

Editor’s Notes:

While the long-term outlook for personalized medicine technologies is bright, this article reminds readers that there are still some significant technical, regulatory, and social hurdles that will have to be managed before personalized medicine reaches its full promise.

Molecular tests using gene chips and other new diagnostic tools are on their way to revolutionizing medicine by helping doctors tailor treatments to each individual's needs. But the emerging field, sometimes known as "pharmacogenomics,'' involves significant hurdles for inventors of the diagnostics and their financial backers. ...
Regulatory agencies are still getting up to speed on the technology, doctors are slow to change their prescribing habits, health plans must be persuaded to pay for the tests, and drug companies may balk when the molecular tests find that some patients don't benefit from their products.
On top of all that, patients are wary that genetic vulnerabilities revealed by the tests might be grounds for employers or insurers to discriminate against them.

None of these hurdles are insurmountable. Congress has already addressed some health privacy concerns through legislation (HIPAA), and can address additional concerns as they evolve. FDA and industry leaders are committed to the success of personalized medicine technologies. Slowly but surely, industry stakeholders and the FDA are developing the technical standards personalized medicines and diagnostics that will spur faster technological development. Finally, it is hard to imagine that any company would welcome the flood of bad press (and litigation) sure to accompany charges of genetic discrimination. The science, of course, is incredibly complex and will evolve at its own pace.

As we mentioned in our earlier discussion of the biotech industry, price controls could radically affect the development of personalized medicine. The issue of pricing is really a struggle between optimism and pessimism. Governments in Europe and Canada have used price controls and global budgeting to cap expenditures on health care (particularly on new medicines), which has slowed the pace of medical innovation in those nations. The U.S.—to date—has bet that the benefits of medical innovation outweigh its costs. U.S. legislators continue to resist price controls, although struggles over the cost of the Medicare drug benefit have clouded the issue.

Funding, more than anything, may be the real wild-card in how the development of personalized medicine plays out.

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Warnings on SSRIs, ADHD Drug Should Not Discourage Appropriate Use
Medscape, 10-24-05

Editor’s Notes:

Psychiatrists are starting to voice some discomfort with last year’s backlash against some widely used drugs for treating depression and ADHD.

SSRI’s, for instance, came under heavy fire on the grounds that they might induce suicidal thoughts in a small fraction of patients. Prescriptions for adolescent antidepressants are down sharply and concern is growing that parents and physicians may be avoiding the drugs even when there is a real need for them.

These concerns were raised in a recent meeting American Academy of Child and Adolescent Psychiatry (AACAP) in Toronto, Canada:

"The main issues that we addressed at the meeting were how to use the medications in the treatment of children and adolescents, and how AACAP will let our practice parameters be known," said Dr. Birmaher. He stressed that the recent regulatory actions change little if anything regarding the proper use of SSRIs and ADHD medications. The updated practice parameters, which will be published later, will clarify the role of these therapies for mood and attention disorders, respectively, but the role hasn't changed, he said. The practice parameters will be distributed to members and available on the society's Web site. …
However, he stressed that close monitoring of a patient who commences a treatment for the first time is appropriate, regardless of the patient, the diagnosis, or the medication. "People are singling out the SSRIs, but all medications should be used with monitoring," Dr. Birmaher said. "When you start any treatment, for asthma or diabetes, you have to adjust the dose and watch for side effects. I don't see this as any different from the rest of medicine."

One of the lessons that the pharmaceutical industry should embrace from the backlash against SSRIs is that the American public needs a crash course in drug safety. No drug is totally safe for everyone in all circumstances. Even patients on very safe medicines, like SSRIs, should be monitored closely.

Take for instance, the case of Volvo. Volvo’s cars crash and people die in them all the time. No one expects them to be totally safe, but the company has developed a reputation for caring about safety testing and safety engineering, and people respect that reputation. But that respect begins with a recognition that driving is dangerous, and you can only minimize risks, not eliminate them.

Pharmaceutical companies conduct an enormous amount of safety testing on medicines that consumers aren’t aware of. If they had a better grasp of these efforts, consumers might think about drug adverse events the way they think about car crashes: rare but tragic accidents that are outweighed by the benefits of driving.

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Report: Rx drug sales to soar in U.S.
Associated Press Newswires, 10-25-05

Editor’s Notes:

This article looks at the growth in pharmaceutical spending with a focus on the U.S. The Associated Press reports:

Prescription drug sales are projected to soar in the United States next year, fueled in part by a $400 billion (euro333 billion) expansion of the nation's Medicare program, a pharmaceutical research company reported.
The U.S. drug market, which already accounts for 43 percent of global pharmaceutical sales, is projected to grow between 8 percent and 9 percent in 2006, according to IMS Health, a Fairfield-based pharmaceutical research company.
Worldwide market size is expected to reach $650 billion (euro541 billion), with the United States accounting for nearly $280 billion (euro233 billion). Growth in U.S. drug sales is expected to outpace global demand. Global sales are expected to increase 6 percent to 7 percent next year, a slowing of the 7 percent to 8 percent growth the industry is projecting for 2005, IMS said in its report. …
The U.S. growth concerns Jerry Avorn, a Harvard Medical School professor and author of the book "Powerful Medicines". "Certainly, drugs are one of the most useful and cost-effective things we do, but in the U.S., drug choices are driven by promotion and marketing, which pushes doctors to prescribe and patients to request them,'' Avorn said. "It's not that we should be using less medication. We need to stop going for the most expensive and most heavily promoted drug."

Most of the complaints about prescription-drug spending in the U.S. hinge on direct-to-consumer advertising or the industry’s supposedly nefarious influence on physicians. This criticism, however, is much more bark than it is bite.

By all accounts, the U.S. surge in prescription drug spending is driven much more by expanded treatment (for diseases like asthma) than it is by the price of new drugs.

It’s also far from clear that the rest of the world benefits much from its strict rationing of access to newer prescription drugs. In cancer care, for instance, the Karolinska Institute recently released a report showing that under-investment in some new cancer medicines hurt European patients.

The study found that only “5% of Europe's total healthcare expenditure goes on cancer, despite the disease being the second most common killer after cardiovascular disease, claiming 1.2 million lives in 2002 alone. And of this cancer budget, only 10% is spent on cancer drugs.” In some areas, then, governments and insurers should spend more on drugs, not less.

That’s not a message some industry critics want to hear—but it’s the right one.

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