Friday, August 31, 2012
This new book by Karen Sharp, Blood Medicine: Blowing the Whistle on One of the Deadliest Prescription Drugs Ever tells the story of Mark Duxberry and Dean McClennan, two pharmaceutical reps who became concerned because they felt that their employer, Johnson & Johnson, was asking them to sell doctors a drug intended to improve the lives of patients undergoing chemotherapy and kidney dialysis but instead was apparently shortening their lives. The book is apparently deeply critical of not just the pharmaceutical company but the slowness of regulators to respond to the reports of unexpected deaths.
I haven’t read it yet, but both from my experience at the Connecticut Attorney General’s Office and the research I’ve been doing over the past five years it reflects the sad truth that for all we benefit from the courage of those insiders who bring forward information of public importance, the experience is almost uniformly bad for the whistleblower--even when like here they are ultimately vindicated and in this case even compensated. This is an important story to tell and I will be evaluating it for use in a class on pharmaceutical law I’m developing.
It comes as no surprise that presidential candidate Mitt Romney has promised to "repeal or replace" the Affordable Care Act, despite the fact that he was the architect of the Massachusetts state law upon which the ACA built its foundations. It is impossible to know if such a promise will come to fruition, especially before the election, but supporters of the law would be foolish not to take such a platform seriously. After all, the determination and money that drove the challenges to the minimum coverage provision and the Medicaid expansion seem to be, if anything, more energized after the NFIB decision. Even though the law's challengers failed to strike down the individual mandate, the five more conservative members of the Court adopted the novel constitutional arguments made against both the individual mandate and the Medicaid expansion, leaving plenty of room for future challenges. And, some of those challenges are already brewing, such as the maintenance of effort fight in Maine, the challenges to coverage of contraception with no copayment, and challenges to providing tax subsidies for private insurance through federally-run exchanges.
I've noted the issues raised by financialization in nursing homes, billing & payment systems, and hospital chains before on blogs. I wanted to present a few paragraphs from a recent book review (of Robert Shiller's Finance and the Good Society), which explore the problems raised by the finance sector's interaction with pharma:
A Ph.D. cancer researcher with ten years of experience tends to make about $110,000 to $160,000 annually; a banker specializing in mergers and acquisitions, about $2 million. Top hedge fund managers make billions of dollars annually. The disparity fails to rankle Shiller, since the “scientists are mostly living comfortably doing what they really want to do.”
Unless, of course, they’re among the thousands of drug developers laid off by pharmaceutical firms, which have been pressured by Wall Street to focus on “core competencies” and cut R&D. Last year, investment managers punished Merck for investing in research, while rewarding Pfizer for cutting it dramatically. Investors and analysts also questioned R&D levels at Lilly and Amgen. The constant pressure for quarterly earnings makes each cut to scientific investment seem rational when it occurs, but its consequences are devastating in the long run.
Shiller is eager to praise financiers for funding innovation, but barely mentions the asset-stripping and short-term thinking that have devastated many industries over the past two decades. A study from the New Economics Foundation recently estimated that leading London bankers “destroy £7 of social value for every pound in value they generate.” In the United States, the Kauffman Foundation concluded that an “expanding financial sector” is “depleting [the] pool of potential high growth company founders.” Why go to the trouble of developing a new product or service when you can take on much less risk (and probably net a far bigger return) as a financier deciding which company merits investment? Whatever one thinks of their methods, at least the NEF and Kauffman are asking tough questions about finance’s role vis-à-vis the real economy of goods and services.
Whether we are contemplating drug shortages or lack of innovation in antibiotics, we should always complement critiques of policy failures with critical examination of the methods of those at the commanding heights of the economy. Contemporary finance is agnostic to human outcomes. We should not be surprised if it generates some troubling ones in health care.
Insurance market reforms under the Affordable Care Act are designed to . . . shed the current system in which health plans have an incentive to enroll healthier people while avoiding the sick. One of the arrangements that will make the new system workable is risk adjustment—-a process by which health insurance plans will be compensated based on the underlying health status of the people they enroll, and therefore protected against losing money by covering people with highcost conditions.
But implementing risk adjustment could prove challenging. The statistical methods used in risk adjustment are technically complex. There are questions about the ability of the states, which have to carry out the risk adjustment, to collect accurate data and implement methodologies that result in fair payments to plans.Perhaps redundant Wall Street quants could step into these roles? The brief notes that "Health insurance plans having costs at least 3 percent more than target projections will receive payments that have been assessed from plans having costs at least 3 percent less than projections." The program is one more step toward a utility model for insurers--a welcome change that should be considered throughout the financial sector. [FP]
Thursday, August 30, 2012
Wednesday, August 29, 2012
Within the past two weeks, major "right to die" events have occurred in the UK. On August 16, the High Court in London issued a decision rejecting assisted suicide, Nicklinson and Ministry of Justice,  EWHC 2381 (Admin), http://www.bailii.org/cgi-bin/markup.cgi?doc=/ew/cases/EWHC/Admin/2012/2381.html&query=suicide&method=boolean (16/08/2012). Two patients, both almost completely paralyzed as a result of strokes, had sued to have assistance in suicide without risks of prosecution for those helping them.
AM's (pseudonymized initials) stroke occurred in 2008; since that time, he has been almost entirely unable to move. Now age 47, AM can communicate through small eye and head movements and can be fed orally. AM wishes to go to Dignitas in Switzerland for suicide assistance. His wife is unwilling to support AM for this purpose, as she opposes it. However, she is willing to go with him to provide comfort, if others are available to provide the service. In the litigation, AM sought clarification that anyone assisting him would not be prosecuted in England under the policy of the Director of Public Prosecutions (DPP).
Tony Nicklinson's circumstances are somewhat different. His stroke occurred in 2005; he communicates by blinking in response to letters held on a Perspex board and by using an eye blink computer. Although Nicklinson estimates that with help he could travel to Dignitas, he is unable to swallow and so would require euthanasia services rather than assisted suicide--services which Dignitas does not provide. Nicklinson, now age 58, has been a vocal advocate for euthanasia for several years. Nicklinson sought a declaration that a physician providing him with assistance in dying would not be liable for prosecution.
In the UK, it is an offense to encourage or assist the suicide of another; the punishment may be imprisonment for up to 14 years. Prosecutions for the offense of assisted suicide require the consent of the DPP. DPP current policy identifies factors tending in favor of prosecution, including that the suspect was acting in the capacity of physician, other health care provider, or professional carer. Factors tending against prosecution include the victim's voluntary, clear, settled and informed decision; compassionate motivation; and report to the police. Although an interim policy had included that the victim had a "terminal illness; or a severe and incurable physical disability; or a severe degenerative physical condition; from which there was no possibility of recovery," this factor was excluded from the final policy as a result of concerns from the disability community. The claimants sought clarification of the DPP policy so that those assisting them with dying would not face prosecution. They also sought determination of whether an adverse determination would be compatible with article 8 of the European Convention on Human Rights, respect for private and family life.
In ruling against Nicklinson and AM, the High Court determined that each sought major changes in the law. These changes, the judges wrote, were for the legislature and not for the courts to make. With respect to Article 8, the Court observed that there had been no rulings that a ban on voluntary euthanasia violated the Convention and that member states were permitted to decide whether it was for courts or the legislature to determine prosecutorial policy.
On August 22, 2012, Tony Nicklinson died. His death was attributed to pneumonia. Reportedly, he had refused all nutrition since the High Court decision as well as any treatment for the pneumonia,http://www.guardian.co.uk/uk/2012/aug/22/tony-nicklinson-right-to-die-case .
Tuesday, August 28, 2012
Profits and Kickbacks
Drug manufacturers are entitled to make a reasonable return on their investments in developing new drugs (that is the purpose of the patent monopoly, after all). But this practice definitely raises prescription drug spending unnecessarily, and is particularly trouplesome when this strategy to maintain profits takes the place of developing new drugs to replace the profits that are lost when a drug goes off-patent. The coupons are also coupled in many cases with "lifestyle" programs, such as Pfizer's "Lipitor for You" program, which includes coaching, health advice and recipes. It is illegal to give Medicare and Medicaid patients discounts to entice them to buy a particular product or use a particular service or health-care provider, under the Anti-Kickback Statute. But apparently waste in the name of maintaining private profits beyond the time the law says you are entitled to them is perfectly fine. Why?
Cross-posted on Healthy Interests
Monday, August 27, 2012
While the U.S. Court of Appeals for the Sixth Circuit upheld the Food and Drug Administration's graphic warnings for cigarette packages in March, the D.C. Circuit last week found them to be an unconstitutional infringement of the first amendment rights of tobacco companies.
The Sixth Circuit applied the Supreme Court's very deferential standard for regulation of commercial speech when the government protects consumers from being misled by companies' promotional activities by requiring the companies to disclose specific information about their products or services. The D.C. Circuit, however, concluded that the deferential standard did not apply to the graphic warnings. According to the D.C. Circuit, the warnings do not compensate for any misleading advertising by tobacco compaines. Hence, the tougher standard for restrictions of commercial speech should apply.
With the circuit split, we can expect the Supreme Court to take up the issue.
Sunday, August 26, 2012
A former director of Connecticut Department of Environmental Protection once told me that West Nile Disease would be easier to manage if the name was less exotic and people were less scared. That was ten years ago—and the problem now isn’t the name. Here in Texas we have several counties already declaring a public health emergency—and that’s during a terrible drought. For those of you interested in following the outbreak and the response to it here is a link to the non-intuitively named Texas Department of State Health Services. Here’s a map of where deaths of been reported. So far, the rate of both illness and fatality are relatively low, but the response of afflicted communities to spray pesticides from the air raises a classic public health dilemma: weighing the needs of the few v. the needs of the many.
From a public health point of view, the question is whether the cure for mosquito borne illness, spraying pesticides or even putting them on your body, is worse than disease. The science on the danger to adults varies, but the EPA has warned that children are especially vulnerable because they are growing. In regard to that, it’s instructive to remember the foundational case in public health: Jacobson v. Massachusetts. In Jacobson , the Supreme Court recognized the existence of a Police Power that enabled states to require citizens to be vaccinated against small pox even when there was a genuine difference of scientific opinion on whether the danger of the vaccine justified the risk. The Court said it would only interfere with a state’s exercise of its police power “Only if a statute purporting to have been enacted to protect the public health, the public morals, or the public safety, has no real or substantial relation to those objects, or is, beyond all question, a plain, palpable invasion of rights secured by the fundamental law.”
The problem of deadly mosquito borne diseases isn’t going away and is likely to become worse. West Nile is only one of many similar viruses causing harm across the United States. It also seems likely that we will soon be seeing U.S. acquired cases of malaria or perhaps even dengue fever along with other and until now exotic and deadly diseases. It’s a situation worth keeping an eye on—and the Department of Defense, which is responsible for implementing the National Strategy on Biosurveillance is currently ramping up to do.