Access to Prescription Assistance Programs Widened
The Hartford Courant, 8-16-05
There is one lesson that policymakers never seem to learn: price controls create shortages. Take for instance, the pharmaceutical industry, which is under enormous political pressure to lower drug prices to help uninsured Americans purchase prescription drugs. The implied threat is that if the industry doesn't lower prices to "acceptable" levels, Congress and/or the states should step in and mandate some form of price controls. If this happened, investment in the biopharmaceutical industry would plummet—as it did in 1993, when the Wall Street Journal noted that "the fear of price and cost controls [in the Clinton health plan] hurt the biotech business."
Industry, consequently, is trying avoid the specter of price controls by expanding access for uninsured, low-income Americans through its "Partnership for Prescription Drug Access." The program is even tailoring access for specific states, like Connecticut:
Starting today any [Connecticut] state resident who needs assistance paying for prescription drugs will be able to access information on hundreds of such programs with one toll-free telephone call or a few clicks on the computer. Nationwide, about 475 programs offer assistance with medication costs. About 180 are sponsored by pharmaceutical companies. Others are government subsidies, such as ConnPACE, or discount programs offered by chain drug stores or generic drug makers.
The programs have long been available but could be difficult to find.
"The trick is, for somebody to know about them, they would have to go in 475 different directions," said Christian Clymer of the Pharmaceutical Research and Manufacturers of America, a trade group of the nation's large drug makers.
This is a noble effort, and well worth pursuing on its own merits. But the core problem facing policymakers—lack of affordable health insurance—can't be fixed by industry alone. In the meantime, haranguing the industry over prices can only lead to less investment in this critical industry—hampering the development of tomorrow's life-saving new medicines.
Wholesale drug prices top inflation in general, AARP says
Associated Press Newswires, 8-16-05
The AARP is one of the groups lobbying for lower drug prices and for the government to use its purchasing power to "negotiate" with industry. Recently the AARP released the latest in a series of studies showing that drug prices are outstripping the inflation rate. This is a particularly odd metric to use since industries set prices to maximize profits—not target the inflation rate. The AARP study found that
Wholesale prices for the brand-name prescription drugs widely used by older Americans rose at more than twice the rate of inflation during the year that ended March 31, the AARP says. The price charged by manufacturers climbed 6.6 percent for a sample of 195 drugs. That's down from the 7.1 percent increase in the year that ended Dec. 31 but still well ahead of the 3 percent general inflation rate, the organization said in a report for release Tuesday.
"We are very disappointed that brand name manufacturers have failed to keep their price increases in line with inflation and we will continue to educate our members and the public about how best to find the most affordable prescription drugs to suit their needs," AARP chief executive William Novelli said.
The AARP's study is particularly questionable, however, because most Americans pay only a small co-pay for their prescriptions, with insurers (both public and private) and pharmacy benefit managers negotiating significant discounts from manufacturers. In other words, retail prices are only relevant for Americans without health insurance—which is, as we noted above, not a problem that can be laid at the doorstep of the pharmaceutical industry.
MEDICINE; IN THE LAB; Brain cancer in its sights; An experimental drug appears to home in on and destroy the malignant cells of deadly glioblastoma
Los Angeles Times, 8-15-05
Policymakers who think that the biopharmaceutical industry is "too profitable" and want to impose price controls should spend some time studying cutting-edge cancer research. Investors and companies sink hundreds of millions of dollars into risky but promising treatments that may never pan out. Patients with rare diseases like brain cancer are particular beneficiaries of this calculated financial risk—and would be among the first ones hurt if government policies dry up investment capital.
While enormous strides have been made using targeted, less-toxic drugs in the fight against some cancers (breast, colorectal, leukemia), brain cancer remains as deadly today as it was decades ago. In fact, treatments remain "so limited that most people don't live more than 15 months after their initial diagnosis." The Times reports, however, that researchers are experimenting with one drug candidate from NeoPharm (IL13-PE38QQR) that attacks brain cancer cells while sparing healthy tissue:
The new drug singles out and destroys the malignant cells of…glioblastoma, similar to a heat-seeking missile locating a target. The chemical "is the next step toward making significant advances in battling this disease," says Dr. John S. Yu, a neurosurgeon at Cedars-Sinai Medical Center in Los Angeles who is testing the drug. About 60% of the 17,000 people diagnosed with brain cancer each year are stricken with glioblastoma. Although medical science has made great strides in the treatment of many other cancers, survival rates for this highly aggressive brain cancer have increased by only nine months since the 1960s. …
[IL13-PE38QQR] is programmed to home in only on glioblastoma cancer cells, and is surgically infused directly into the brain to deliver high concentrations of the medicine. … Early studies on 36 terminally ill patients have been encouraging. The participants had exhausted standard treatments—surgery to remove the tumors, radiation and the chemotherapy Temodar—and had had at least one recurrence. Typically, median survival rates for these patients are four to six months, and less than 5% live past 18 months. In contrast, the median survival rate for the study participants has been 45 weeks. Of the 36 patients in the original study, nine are alive one to four years later, and eight of them are cancer free.
Companies like NeoPharm depend on investors to bankroll them through the long, enormously expensive drug development and approval process—in return for a handsome profit. Even the specter of price controls would starve companies of working capital—and deny patients hope.
South Carolina proposing to redefine Medicaid
The San Francisco Chronicle, 8-15-05
Winston Churchill is said to have observed that Americans always try to do the right thing after they've tried everything else. This is certainly the case for the federal-state Medicaid entitlement, where states like South Carolina are finally trying to bring consumer discipline to the sprawling, $329 billion dollar program after decades of tinkering at the edges and nearly unbridled spending.
South Carolina is betting that poor, uninsured citizens can take more responsibility for their own health care, thus improving the quality of care and lowering costs. These reforms, which still have to be approved by the U.S. Department of Health and Human Services, are built around personal health accounts controlled by individuals, not bureaucrats:
The account would be used to purchase private health insurance, or pay for care directly. And the amount of money allocated to each account would depend on the person's age, sex and physical condition. That's much different from the way Medicaid operates. Now, those whose incomes are low enough and who meet other eligibility requirements are entitled to receive certain approved health care services regardless of costs.
South Carolina would cap how much it will spend on a recipient, and if health care costs more than the account will pay for, then the low-income people would have to make up the difference themselves or go without. States have to get waivers from the federal government whenever they want to use federal Medicaid funds in ways not authorized in federal law. But the implications of South Carolina's waiver request, contained in a 42-page document submitted to the Centers for Medicare and Medicaid Services in June, extend far beyond the Palmetto State. If South Carolina's plan is approved, analysts believe other states will seek similar changes.
To paraphrase Churchill again, this is not the end of Medicaid reform. It is not even the end of the beginning. But South Carolina, along with other states like Florida, have taken us a long way towards a new beginning.
Pfizer will change how it markets drugs to public
Detroit Free Press, 8-12-05
Critics of the pharmaceutical industry's recently released voluntary code regulating direct to consumer advertising argue that it is merely a sop designed to head-off federal legislation. But the industry’s leading firms seem to realize that producing popular drugs is not enough—advertising that promises the world, and delivers anything less than perfection, invites a backlash from consumers and Washington.
One company, Pfizer, has not only publicly embraced the voluntary code, but is going beyond it:
Amid growing public outcry about the way the drug industry advertises prescription drugs to consumers, Pfizer Inc., the world's largest pharmaceuticals company, said it's taking voluntary steps to change before the end of the year the way it markets its drugs to the general public. Among its new guidelines, Pfizer…said it will educate doctors about a drug at least six months before it advertises to consumers and will submit consumer ads to the U.S. Food and Drug Administration for preview before running them.
Pfizer…also said it plans to make ads clearer to understand, include suggestions of alternative treatments and better relay to consumers the potential risks associated with prescription-drug use and add information about drug-assistance programs. And starting next year, Pfizer also said, it will create more disease-awareness ads that won't mention a specific product. Additionally, Pfizer said, it will make sure ads reach age-appropriate target audiences. For instance, TV ads for its Viagra erectile-dysfunction drug will air during programs that have more than 90% adult viewership.
This is a welcome sign that the industry is refocusing on building confidence amongst consumers and physicians, and not just hitting Wall Street targets. In the long run, investors stand to benefit from this approach through increased customer loyalty and less interference from federal authorities.
The doctors' chance to lead
Edwin Coffey, Victor Dirnfeld, David Gratzer, National Post, 8-16-05
Dirnfeld, Coffey and Gratzer call on the Canadian Medical Association to reverse its stance and support the availability of private health insurance for all Canadians.
This week in Edmonton, the Canadian Medical Association (CMA) holds its annual meeting. And today, physicians from across the country will consider a series of motions, including several that would reverse the CMA's policy of opposing private health insurance. As delegates weigh that issue, they must ask themselves a simple question: Are doctors going to lead the debate on health reform or will they abdicate their responsibility?
Britain allows private insurance. So do Germany, France, Australia and Sweden. In fact, no Western countryexcept oursbans a private option for core medical services. …
Let's be clear: Allowing private health insurance will not single-handedly solve Canada's woes. But it would be a small step in the right direction. The alternative is to leave this debate up to our politicians. For a decade now, the CMA has done that. And what a disaster it's been.
Prevention is still key to fighting AIDS plague
Franklin Cudjoe, Campaign for Fighting Diseases, 8-14-05
Cudjoe argues that the overriding obsession of the U.N. and many international non-governmental organizations on expanding access to anti-retroviral drugs for AIDS has led the world community to ignore the simple math driving the epidemic. He believes that better prevention is the only way to truly slow the deadly toll of the disease:
The WHO announced in 2003 that it wanted to put three million people on ARVs (anti-retrovirals) by the end of 2005 - the so-called "three by five" programme. The tragedy of this approach is that, by prioritising treatment over prevention, another five million people have since become infected with HIV. According to the best estimates, only about one million people will be on ARVs by the end of 2005, meaning that the WHO's strategy has allowed the epidemic to worsen.
Worse, there is a danger that by obsessing over treatment of HIV/Aids, other curable diseases will be ignored. This is because HIV/Aids has achieved a high political profile. In July, the Group of Eight leadersapparently suffering from the same delusions as the WHOannounced they want to ensure near-universal access to ARVs by 2010. They just do not seem to have learned. How many millions of people will have to become infected with HIV before the political cliques of the world realise that prevention must have priority?
Cudjoe's critique's is a fair one and it deserves a fair hearing. Unfortunately, the push for ARV access seems have passed beyond the point where policymakers are willing to ask if it is a cost-effective strategy, as opposed to a popular one.
Canada's 'Free' Health Care Has a High Price Tag
John Fund, Wall Street Journal, 8-12-05
This piece, by John Fund, also focuses on Canada's anguished debate over the future of its government-run health system. While the Canadian Supreme Court has legalized the sale of private health insurance in Quebec Province, Canadian politicians and the public remain extremely squeamish about private funding—perhaps because Canadian health care is a cornerstone of the national psyche, and is therefore immune to rational critique.
For many Canadians their 37-year-old universal health-care system is the symbol of their national identity. Last November, Canadian Broadcasting held a contest to pick the greatest Canadian ever. The clear winner out of 1.1 million votes cast was Tommy Douglas, a politician known as the "father" of Canada's nationalized medicine.
But last June, a majority of Canada's Supreme Court struck down a Quebec law that banned private health insurance and held that the public system inflicted cruel and unusual punishment on many of its patients. The Fraser Institute has found it takes an average of 17.9 weeks between the time a patient makes an appointment to see a general practitioner and when he can then see a specialist. …
In Canada, the ban on private insurance results in truly loopy law. Dr. Sheldon Elman, the personal physician for Liberal Prime Minister Paul Martin, says the system is "disastrously terrible" in key areas. "You can buy an MRI for your dog and you cannot buy it for your daughter," he told the Montreal Gazette.
Apparently in the Canadian system Fido gets to jump the queue while human patients must sit, and make do.
Consumerism in Health Care: Early Evidence is Positive
Grace-Marie Turner, Galen Institute, 8-11-05
The only people who love Canada's health care system more than Canadians are American policymakers who view it as a utopia. As Americans learn more about Canada's own health care woes, hopefully the luster will wear off and we can have a serious discussion of alternative solutions. Turner shows that we already have one solution at our fingertips: health savings accounts and other forms of consumer-driven insurance that can help make health care more affordable, and improve care quality, without imposing Canadian-style rationing on Americans. Turner reports that as HSA's gain market share, evidence on their initial performance has been encouraging:
America's Health Insurance Plans, which represents the country's major insurers and health plans, surveyed its members earlier this year and found that more than a million people were enrolled in HSAs as of March, 2005. The study also found that 37 percent of those purchasing individual policies were previously uninsured. While critics claim that HSAs will be attractive only to the young and healthy, studies have shown that 40 percent of HSA purchasers make less than $50,000 a year, a majority of purchasers are families with children, and about half are over age 40, showing they have broad appeal.
Consumerism in health care also has led to new incentives for people to be more engaged in managing their health. Many companies are instituting new programs to provide better coordinated care for those with chronic conditions, such as diabetes, heart disease, and asthma. One study found that patients in consumer-directed health plans were 20% more likely to comply with treatment regimens for chronic conditions.
The Free-Marketeers get up
Karen Horn, Frankfurter Allgemeine Zeitung, 8-11-05
Supporters of market-driven public policy in the U.S. must sometimes feel as if they are on a lonely vigil, beset in a world where statist solutions to public problems inevitably rule the day. Thankfully, as this article in one of Germany’s leading papers shows, market liberals are having an increasing voice in European policy-debates, thanks to a growing network of right-of-center think tanks:
In Eastern Europe they spring up like mushrooms: during the last three years the number of "free market think tanks", i.e. think tanks for free market and liberal thinking, in countries of relatively decent wealth has enormously grownexactly there where the lack of money does not make it seem likely to happen. From the Russian Hayek Foundation (founded in 2002), named after the economist and social philosopher Friedrich August von Hayek, the Albanian Liberal Institute (2003), the Bulgarian Society for Individual Liberty (2003) and the Slovakian Institute for Free Society (2003) to the Economic Policy Research Institute in Macedonia, that was founded this February: liberal research and consulting institute are spreading quickly. …
Why in Eastern Europe? "In these countries the discussion about economic policy after the collapse of socialism has liberated itself from the elites", says Sacha Kumaria from the Stockholm Network, a London-based platform for think tanks in constant dialogue. The Stockholm Network was founded in 1997 by young British journalist Helen Disney in collaboration with six institutes: the Centre for the New Europe (CNE, Brussels), the Edmund Burke Foundation (Netherlands), Timbro (Sweden), the Circulos de Empresarios (Spain), Paradigmes (France) and the Social Market Foundation (Great Britain). Today the Network includes 130 Western and Eastern European "Think tanks". Not only in Eastern Europe, but also in the West new free market institutes are founded which are devoted to educate the public and consult politicians…
Sirolimus-Eluting Stents vs Paclitaxel-Eluting Stents in Patients With Coronary Artery Disease: Meta-analysis of Randomized Trials
Adnan Kastrati, MD, Alban Dibra, MD, The Journal of the American Medical Association, 8-17-05
Better information about health outcomes should help drive funding toward better treatments—rewarding innovative companies in the process. For instance, this study uses a meta-analysis of several published studies to compare two drug-eluting stents made by competing manufacturers (Johnson & Johnson and Boston Scientific). (A New York Times article
discussing this study is also available here.)
Although the study didn't find a mortality advantage for either stent, it did show that the J&J sent was less likely to cause side-effects that could require additional surgery. Physicians and patients, therefore, will probably gravitate towards J&J's stent.
Technical proficiency, however, doesn't win market share by itself. The Times article also points out that "[Johnson & Johnson continues] to struggle with manufacturing constraints that limit the treatment's availability," and might not be able to translate a better stent into market supremacy.
Placement of sirolimus-eluting stents [made by Johnson & Johnson] or paclitaxel-eluting stents [made by Boston Scientific] has emerged as the predominant percutaneous treatment strategy in patients with coronary artery disease (CAD). Whether there are any differences in efficacy and safety between these 2 drug-eluting stents is unclear.
Six trials, including 3669 patients, met the selection criteria. No significant heterogeneity was found across trials. Target lesion revascularization, the primary outcome of interest, was less frequently performed in patients who were treated with the sirolimus-eluting stent (5.1%) vs the paclitaxel-eluting stent (7.8%)…Similarly, angiographic restenosis was less frequently observed among patients assigned to the sirolimus-eluting stent (9.3%) vs the paclitaxel-eluting stent…Event rates for sirolimus-eluting vs paclitaxel-eluting stents were 0.9% and 1.1%, respectively, for stent thrombosis…1.4% and 1.6%, respectively, for death…and 4.9% and 5.8%, respectively, for the composite of death or MI…
[The researchers concluded that] patients receiving sirolimus-eluting stents had a significantly lower risk of restenosis and target vessel revascularization compared with those receiving paclitaxel-eluting stents. Rates of death, death or MI, and stent thrombosis were similar.
Health-care competition, in other words, pays dividends as companies duel to bring the best products to market.
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