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Attorney: FDA's Firm Line On Off-Label May Be Bid To Avoid Judicial Review
A controversial FDA memo released Wednesday (Jan. 18) defending the agency's oversight of off-label communication and raising concerns over the public health impact of such communication could be used as a tactic to stall potential future litigation against the agency, according to one key attorney. However, FDA argues the memo was written instead to follow up on, and further discussions, that occurred during a November 2015 public meeting on off-label communication.
The memo, issued in the final days of the Obama administration, reasserts FDA's stance against off-label communication, which has been opposed by industry and First Amendment advocates for years and which is expected to be revisited by the incoming administration.
The release of Wednesday's memo, “Public Health Interests and First Amendment Considerations Related to Manufacturer Communications Regarding Unapproved Uses of Approved or Cleared Medical Products,” prompted strong reaction from both industry and patient advocates, reminiscent of the debate during the public meeting held late last year.
Off-label communication advocate, Peter Pitts, president of the Center for Medicine in the Public Interest and former FDA associate commissioner, had harsh words for FDA.
“I wonder if this memo was written on an electric typewriter -- since it seems to represent thinking from the 1980s,” Pitts wrote to Inside Health Policy.
However, public health advocate, Diana Zuckerman, president of the National Center for Health Research, called the memo “a great summary of the issues,” which she argued “clearly explains how destructive off-label communication is to patients and to the health of all Americans.”
FDA cited discussions of First Amendment issues during its public meeting as an impetus for releasing Wednesday's memo.
“At our November 9-10, 2016, public meeting, a number of speakers addressed First Amendment considerations...To further this discussion, this section describes the different ways that courts and commentators have addressed the intersection of the FDA Authorities and the First Amendment,” FDA wrote.
However, others argued FDA had underlying motives for publishing the controversial memo.
Coleen Klasmeier, partner at Sidley Austin, told IHP that the memo was likely a litigation tactic, by which FDA could give the appearance of ongoing activity that would make it appear premature for a court to weigh in, possibly avoiding more blows against FDA's regulation of off-label communication.
FDA was recently dealt key blows over the constitutionality of its enforcement on off-label communication. Jurisprudence has shifted so significantly in recent years that one health law expert recently cautioned that restrictions on direct-to-consumer marketing of off-label uses could be loosened should the current First Amendment jurisprudence around commercial speech be taken to its logical end.
Pitts argued that the Obama administration may have put pressure on FDA to take a final stance on the issue. “What's most surprising about this memo is that it is so contrary to the spirit of what Drs. Califf and Woodcock have been saying over the past few months. My only conclusion is that the Obama HHS leadership gave the agency explicit direction as to tone, context and conclusions,” Pitts told IHP.
Lisa Dwyer, partner at King & Spalding and former senior policy advisor at FDA, also saw FDA's recent dump of documents on off label as the Obama administration’s last stand, but said the agency's arguments were not surprising.
“The series of documents that FDA issued this week related to the provision of off-label information to health care practitioners and the provision of healthcare economic information to payors are effectively the Obama’s Administration last statements defending their positions on those issues. The documents are helpful to the extent that they green light the sharing of certain information with health care practitioners and payors, which may have resided in gray areas previously. But, they do not articulate major policy shifts,” Dwyer wrote.
The agency stuck to its guns in laying out what it believes are the legal precedents protecting its current enforcement regime. Namely, FDA cites U.S. Supreme Court case Wisconsin v. Mitchell and district court case Whitaker v. Thompson to argue that FDA can use speech to establish a crime.
“Courts have held that the government’s reliance on speech as evidence of intended use under the FD&C Act does not infringe the right of free speech under the First Amendment based on Supreme Court precedent establishing that '[t]he First Amendment . . . does not prohibit the evidentiary use of speech to establish the elements of a crime or to prove motive or intent'...Under these rulings, the FDA Authorities do not directly prohibit or restrict speech by a firm about unapproved new uses of the firm’s medical products. Instead, the FDA Authorities regulate the introduction of unapproved, adulterated, or misbranded medical products into interstate commerce and the speech of firms may be relevant to establishing an element of a violation of those provisions,” the memo states.
The government had failed to convince a court of a similar argument in the high-profile case United States v. Caronia -- namely that the defendant's speech was used as evidence of intent, not that the defendant was being prosecuted for his speech. The court disagreed, vacating the conviction of the defendant and dealing a key blow to FDA's regulation of off-label speech.
“[T]he government's assertion now that it used Caronia's efforts to promote Xyrem for off-label use only as evidence of intent is simply not true. Even if the government could have used Caronia's speech as evidence of intent, the district court record clearly shows that the government did not so limit its use of that evidence. See Mitchell, 508 U.S. At 489-90,” the Caronia decision states.
Klasmeier similarly argued that Wisconsin v. Mitchell does not save FDA from their off-label woes. That case dealt with the use of speech as evidence of a crime, which does not offend the First Amendment, however, using speech as the source of illegality, rather than an element of the crime, does offend the First Amendment, explained Klasmeier.
FDA also took on the Caronia decision Wednesday -- namely the court's interpretation of a the key commercial speech case, Central Hudson Gas & Electric Corp. v. Public Service Commission, which laid out a four-part test for determining whether restrictions on commercial speech violate the First Amendment.
“There are several points worth noting regarding the Central Hudson evaluation conducted by the Second Circuit panel majority in United States v. Caronia. First, the panel majority limited its analysis to addressing the constitutionality of a specific ‘construction of the FDCA’s misbranding provisions to prohibit and criminalize off-label promotion’… rather than evaluating FDA’s implementation approach. Second, the panel majority did not consider multiple components of public health interests advanced by the FDA Authorities and FDA’s implementation approach,” the memo states.
FDA also argues that if the court had the opportunity to review a recently published study on adverse events tied to unapproved use, it may have come to a different ruling.
However, Klasmeier points out that the agency already brought up its issues with the Central Hudson interpretation in Caronia during another high-profile off-label case, Amarin v. FDA, and the judge in that case had dinged FDA for not appealing Caronia when it had a chance.
The agency also took on Wednesday what it saw as the public health risks associated with off-label use. First, FDA argued that unapproved uses increase risks to patients and lack evidence of effectiveness.
“More recent studies have similarly found that the majority of unapproved uses for which drugs are prescribed lack adequate evidence of effectiveness, and that the risk of adverse events is higher for unapproved versus approved uses, and even higher when the unapproved use is not supported by reliable scientific data,” the memo states.
FDA also disputed arguments that health care professionals can adequately discern an appropriate level of substantiation for off-label claims.
“Research has also shown that marketing of drugs toward health care providers drives prescribing practices, including prescribing for unapproved uses, and that commonly used marketing techniques can influence prescribing decisions in a manner that is not in the patient’s best interest. Studies have found that health care providers overestimate their knowledge of what uses are FDA-approved for drugs and assume that many unapproved uses are supported by sound scientific evidence when they are supported by uncertain or no evidence,” FDA continued.
Next, the agency expressed concern over protection of patients subject to off-label uses, highlighting comments made during the agency’s November public meeting.
“The same protections are not routinely provided when approved/cleared medical products are prescribed to patients for unapproved uses as part of their medical care. Several presenters at the November 9-10, 2016 public hearing who experienced adverse events associated with the unapproved use of approved or cleared medical products noted that they did not know, prior to using the product, that the use for which they were prescribed the product was unapproved,” the memo states.
Unapproved uses could also discourage clinical trial participation and programs, such as the Orphan Drug Designation and priority review programs, FDA argued.
“With regard to maintaining incentives for clinical trial participation, firms’ actions to promote widespread use of approved/cleared medical products for unapproved uses may undermine the clinical trial process, and thus ultimately impede the development of robust and reliable scientific data to better support medical decision-making,” FDA writes.
Zuckerman highlighted FDA's explanation of the potential research disincentives as a strength of the new memo.
“It makes it clear that off label communication takes away a company’s incentive to do needed research and therefore undermines the very fabric of the FDA as an agency designed to protect patients and consumers from unsafe and ineffective medical products,” Zuckerman wrote to IHP. “[I]t is a huge disincentive for companies -- why do research to see if the 'off label' use has benefits that outweigh the risks if the product can be promoted and widely sold without approval for that use? It’s not a coincidence that studies have found that off label uses are often ineffective and cause many complications,” Zuckerman continued.
However, Pitts slammed FDA for its critical view of the impact of off-label communication.
“The memo is written to show that allowing the truthful, accurate, and non-misleading of information will cause the earth to stop spinning on its access, research into new indications to cease, malpractice cases to explode, and misleading and misbranded communications to proliferate,” Pitts wrote.
FDA, however, also outlines how it believes off-label communication could advance public health, including supporting informed decision making for patient treatments and furthering scientific research, provided the information is scientifically valid and presented in a truthful, complete, balanced, transparent and objective fashion.
Some question whether FDA's newly hardened stance will survive a change of administrations.
“The FDA’s Memo on the First Amendment lays out the best case possible defending the current FDA policies on off-label. Indeed, it appears to be a statement that current policy is constitutional and FDA is prepared to continue to defend it in court. So far, that hasn’t worked. Meanwhile, we will have a new President and a new administration starting Friday. This is definitely not the last chapter in this novel,” John Kamp, executive director at Coalition for Healthcare Communication, wrote to IHP.
Pitts also told IHP that the memo runs contrary to the philosophy of the incoming administration and that he is curious to see what impacts a change in leadership will have.
Some Health Policy Experts Question FDA's New Deceptive Ad Studies
A former FDA associate commissioner and a free-speech advocate question two proposed agency studies to determine the extent to which health care professionals (HCPs) and consumers can detect and report deceptive prescription drug promotion. The experts also raise concerns about the agency's plan to create a program for consumers to directly report deceptive advertising to the agency. However, another former FDA official saw the announcement as par for the course for the agency's drug promotion office's growing research program.
FDA announced Jan. 4 its intention to conduct two studies to determine the ability of HCPs and consumers to identify deceptive advertising.
"Prescription drug promotion sometimes includes false or misleading (i.e., deceptive) claims, images, or other presentations; for instance, representations that a drug is more effective or less risky than is demonstrated by appropriate evidence. A number of empirical studies have examined the occurrence and influence of deceptive promotion, both in regard to prescription drugs…and other products...No research to our knowledge, however, has investigated the ability of consumers and healthcare professionals (HCPs) to independently identify deceptive prescription drug promotion," FDA wrote in the Jan. 4 agency notice.
The proposed project involves two studies, both of which will entail subjects viewing websites promoting fictitious drugs.
Study one will examine how the level of deception in promotion affects subjects' perceptions and behavior. The level of deception will be varied over three levels, which the agency defines as: none, fewer, and more.
The study will attempt to answer: the proportion of subjects that can identify a promotional piece as deceptive and whether the ability to identify deceptive promotion varies depending on the level of deception; whether the degree of deception affects consumers' and HCPs' actions, including reporting the advertising; and whether people who recognize information as deceptive adjust their "attitudes and intentions toward the product."
Study two will compare the impact of implicit deceptive claims, which "suggests or implies an unstated piece of information," versus explicit deceptive claims, which "fully and clearly expresses information and leaves nothing to be implied," according to the agency notice.
Subjects in study two will be shown three websites: an explicitly false web site, a factually true but implicitly misleading site and a website with no misleading information. The study will explore whether the ability to identify deception varies depending on the type of deception; if the type of deception affects subjects' behavior, including reporting to authorities; and if detection of deception impacts a person's actions.
The agency argues that people's ability to detect deception affects public health.
"The ability to identify such promotion has important public health implications. If unable to identify deceptive promotion, consumers may ask their HCPs to prescribe specific drugs that they would not otherwise request. Likewise, HCPs unable to identify deceptive promotion may prescribe specific drugs that they would not otherwise prescribe. In the case that consumers and HCPs are able to identify deceptive promotion, then they may instead be equipped to incorporate such information into their medication decisions, and perhaps even report deceptive promotion to appropriate government regulators who can take corrective action," the agency writes.
However, Peter Pitts, president of the Center for Medicine in the Public Interest and former FDA associate commissioner, questioned the usefulness of the planned studies. "I don't think the OPDP studies will make a difference to anything whatsoever," Pitts told IHP.
Pitts also told IHP he doesn't see the value in FDA studying fake ads, because actual ads already are reviewed by FDA. The agency's resources would be better spent looking at the impact direct-to-consumer ads play in patient and physician education, argued Pitts.
The former FDA official also maintained that FDA should be looking at marketing of dietary supplements, which he argued often cross the line into drug claims. "That needs to be slammed shut," Pitts told IHP.
Richard Samp, chief council at the Washington Legal Foundation, argued the new studies likely don't signal FDA will step up its enforcement of off-label communication. It's likely that FDA is instead trying to provide clearer guidance for companies to be in compliance with FDA regulations, Samp argued.
Samp, who recently urged "FDA to abandon its current, overly restrictive view of what constitutes truthful speech and to limit its speech-suppression efforts to speech that is truly false or misleading," told IHP that he applauds FDA for doing the studies. Samp maintained that the agency has recently been "[asking] a lot of very good questions."
Heather Bauelos, counsel at King & Spalding and a former associate chief counsel in the FDA's Office of the Chief Counsel, argued that the studies aligned with OPDP's ongoing research efforts.
"FDA's research on identifying deceptive drug promotion could potentially be related to these ongoing efforts, but strikes us as par for the course for OPDP. OPDP has a very active research program, which has been a growing area in recent years. The announcement and focus of this new study appears to fit neatly among other research priorities, particularly since the ability of consumers and HCPs to identify deceptive promotion is an area that OPDP has yet to investigate," Bauelos wrote to IHP.
When asked by IHP if the studies may impact FDA's regulation of off-label promotion, Bauelos argued that any enforcement activities that come out of the study would instead likely deal with issues such as risk minimization or unsubstantiated claims.
"Any use of the results of this research in enforcement activities would likely be related to misleading promotion and advertising, which might encompass off-label communications, but typically extend to issues of risk minimization, overstatements of efficacy and other unsubstantiated claims. Overall, the study results may likely provide more information about whether FDA oversight of prescription drug promotion and advertising is protecting the public health and related government interests," Bauelos wrote.
FDA also raised the possibility Jan. 4 of creating a deceptive advertising reporting program for consumers, similar to the "Bad Ad" program currently created for HCPs
"The FDA Bad Ad program, for example, encourages HCPs to report deceptive prescription drug promotion…a goal which requires that HCPs successfully identify such promotion when it appears in the course of their duties. Likewise, similar programs could be implemented for consumers to report deceptive prescription drug promotion to FDA. Reports of deceptive promotion are useful to FDA because they allow investigators to focus their efforts in an era where the amount of promotion far exceeds the resources available to monitor everything," the agency wrote.
Samp questioned whether a similar program for consumers would be worthwhile. "I suspect [consumers] are not in a position to identify so called bad ads," Samp told IHP. Samp also maintained that nothing currently prevents a consumer from contacting FDA if they feel they've been deceived.
Pitts called the original bad ad program "a complete waste of time," maintaining that FDA never really determined what was a bad ad, and that FDA should instead be focusing on regulating safety and efficacy. "FDA does not regulate creativity," Pitts added.
By ED SILVERMAN @Pharmalot
After weeks of anticipation, the FDA has issued a lengthy memo about the extent to which so-called off-label information about medicines may be disseminated to physicians, one of the most contentious issues to roil both the agency and the pharmaceutical industry. But rather than spell out possible solutions to this particularly thorny topic, the 63-page missive essentially summarized key points framing the long-running debate and carefully rebuffed many of the suggestions made by drug makers and others that support expanding pharmaceutical marketing. Meanwhile, the agency continues to seek comments while working to develop a final guidance.
Drug company “communications that are designed to cause the audience to reach safety or efficacy conclusions independent of, or not supported by, the available data are misleading, have the potential to harm patients, and lead to a waste of health care resources,” the agency declared.
The memo follows a public meeting held last November to explore off-label promotion, which refers to materials that describe unapproved uses of a drug. Doctors are allowed to prescribe a medicine for an unapproved use, but drug makers have battled restrictions on their ability to distribute such information — such as reprints of medical studies — and have lobbied Congress and the FDA to loosen regulations.
The FDA has, so far, avoided doing so.
The agency has regularly voiced concern that public health could be jeopardized if a drug maker distributes information about an unapproved use that has not been proven safe or effective. For its part, the pharmaceutical industry argues that its free speech rights are being restricted, but has won significant court rulings that say truthful and non-misleading speech is protected. These court battles have placed the agency on the defensive.
But in its memo, the FDA recounts why drug makers must provide evidence of safe and effective medicines, and why certain marketing restrictions exist. “The history of public health tragedies caused by medical products demonstrates that there have been some unscrupulous players in the marketplace who have made deceptive or unsubstantiated claims about medical products,” the memo states.
And the agency pointed to concerns that physicians are not always well positioned to discern the information they receive. “Studies have found that health care providers overestimate their knowledge of what uses are FDA-approved for drugs and assume that many unapproved uses are supported by sound scientific evidence when they are supported by uncertain or no evidence,” the agency wrote.
The FDA then reiterated its concerns about the aftermath of unapproved uses of drugs: “More recent studies have… found that the majority of unapproved uses for which drugs are prescribed lack adequate evidence of effectiveness, and that the risk of adverse events is higher for unapproved versus approved uses, and even higher when the unapproved use is not supported by reliable scientific data.”
To underscore the point, the FDA assembled two appendices replete with examples in which unapproved uses led to patient harm.
The agency also shot down several suggestions from the meeting, notably one that would permit drug companies to actively promote unapproved uses so long as disclosure is made. The FDA essentially rejected this out of hand by writing that patients may be harmed by a “return to an environment” where the public encounters claims based “conjecture or extrapolation from limited data, most of which is later found to be false or misleading.”
“They’re pulling out all the stops in pointing to the price to be paid from expanding off label use,” said Dr. Sid Wolfe of Public Citizen Health Research Group, who spoke at the meeting last November against industry efforts to widen off-label marketing.
At the same time, the FDA did acknowledge that there is virtue in sharing some off-label information.
“The reality remains at any point in time that, for some patients, approved or cleared therapies are not available or have failed,” the agency wrote, adding that reliable scientific information about unapproved uses may help further scientific research into new or existing medicines.
Nonetheless, industry supporters were miffed.
“This memo is a regulatory temper tantrum,” said Peter Pitts, a former FDA associate commissioner who heads the Center for Medicine in the Public Interest, a think tank that is funded, in part, by industry. “The memo is written to show that allowing the sharing of truthful, accurate, and non-misleading of information will cause the earth to stop spinning on its axis, research into new indications to cease, and misleading and misbranded communications to proliferate.”
Yet another observer, whose research was cited by the FDA throughout the report, praised the effort.
“It appears to be extremely well-researched and well-argued defense of the importance of the FDA in protecting patients and promoting accurate flow of information about approved medical products, among other outcomes, by maintaining its current oversight of off-label communications,” said Aaron Kesselheim, an associate professor of medicine at Harvard Medical School who also heads the regulation, therapeutics, and law program at Brigham & Women’s Hospital. “And it’s probably not a coincidence that it’s being published now, since the three names I’ve seen all be associated with a possible change in FDA leadership after Jan. 20 all have a very anti-regulatory ideology, and may look to change the FDA’s approach to regulating off-label marketing.”
Here’s the article abstract:
Question What is the nature of industry funding of patient advocacy organizations (PAOs) in the United States?
Findings This survey study found that 6 percent of a national sample of patient advocacy organizations, virtually all of which were not for profit, reported receiving funding from for-profit companies. Twelve percent received more than half of their funding from industry; a median proportion of 45 percent of industry funding was derived from the pharmaceutical, device, and/or biotechnology sectors.
Why is this fake science?
The authors skew the survey results to prove that industry contributions to patient advocacy organizations are a conflict of interest. Here’s how the survey results are presented in the article:
At first glance, the results do not reflect the assertion that “evil company” money is corrupting patient groups. In fact, less than 20 percent of groups reported receiving ANY funding from evil private companies. Here’s the survey data formatted to reflect this fact.
As the chart below shows, most of the patient advocacy organizations received less than 25 percent of their revenue from companies.
The authors then go on to conclude from this data that companies have undue influence on patient groups. Yet the survey shows that only 7.7 percent felt pressure to conform to a specific policy position (which are not provided by the survey).
From this anthill of evidence, the authors conclude:
“Such dependence on the financial support of companies whose interests may not always align with those of the organizations’ constituents has important implications for PAO.”
Nowhere do the authors identify what those interests are and how they may diverge with industry positions. Rather, the proof they provide is this claim:
Some groups have “been the focus of media investigations regarding their ties to industry and the integrity of their activities.”
“Their large numbers and credibility with policymakers and the public likely give even small PAOs extensive influence in specific disease areas. At the other end of the spectrum, large PAOs that receive considerable for-profit support and have sophisticated public relations and government affairs departments likely have a substantial effect on policies relevant to their industry sponsors.”
Again, no evidence.
For instance, the 21st Century Cures Act was developed by Fred Upton and Diane Degette. Only after the legislation was drafted did the two legislators seek out the support of a small group of patient organizations. Where is the evidence that patient groups took their lead from evil companies? And how statistically significant is that association given that more than 80 percent of funding for all groups comes from bake sales, individual contributions, etc.?
No matter. The article concludes that: “Financial relationships between PAOs and industry demand effective steps to ensure that these groups serve their constituents’ interests while minimizing risks of undue influence and bias. “
The JAMA article is fake science AND fake news. It is an exercise in confirmation bias against industry support of patient groups. It is not evidence. It is closer to libel than it is truth.
FDA has released two new documents that address off-label communications about medical products. A draft guidance outlined questions and answers regarding communication with payers about healthcare economic information, including information concerning unapproved uses of medical products. A separate memorandum described the agency's position on sharing information about off-label use of approved drugs.
In the guidance, FDA described "truthful and non-misleading" healthcare economic information that is acceptable for product sponsors to share with payers or formulary committees. The agency said it is acceptable to share information that "relates to" a product's approved indication, with some variance allowed about factors such as dosing, patient subgroups, and practice settings beyond what is included in the product's label. The guidance said certain other information, such as analyses of patient populations not included in a label, would not be acceptable. The document said economic analyses provided to payers should specify the type of analysis performed, including modeling techniques, patient populations, outcome measures, cost estimates and any underlying assumptions. The guidance said terms of value-based contracts between manufacturers and payers lie outside the scope of FDA regulation.
It said FDA "does not intend to object" to sharing certain information with payers prior to products' approval, including factual and non-misleading statements about product information, indications sought, estimated approval timelines, and clinical or preclinical results. In separate draft guidance released Tuesday, FDA recommended ways to convey truthful, non-misleading information that is "consistent with" a product's label, but not included in the label. In the memorandum, FDA outlined its concerns regarding promotion of unapproved uses of approved drugs. The agency said it must balance public health needs with First Amendment protections, and described potential approaches to doing so. The agency asked stakeholders to comment on the memorandum's proposals, as well as both draft guidances.
Per a report in BioCentury, the agency said it will "generally" require switching studies to show interchangeability between any biological products that are dosed more than once. Switching studies should evaluate pharmacokinetic and pharmacodynamic measures as primary endpoints, while also assessing immunogenicity and safety. The agency specified that the studies should include at least three switches between a reference product and proposed biosimilar; the last switch should be a transition to the proposed biosimilar from its reference product.
FDA emphasized that an imbalance in adverse events or immune responses reported at any point during a switching study will "raise concerns" as to the biologics' interchangeability, because it may be difficult to determine which product caused the event. The agency also encouraged powering studies to accommodate patient dropouts, noting that an imbalance in dropout rates may also suggest that compounds are not interchangeable. The agency encouraged companies to first seek a candidate's approval as a non-interchangeable biosimilar if there is "residual uncertainty regarding interchangeability" based on adverse events. The sponsor could then conduct postmarketing studies to show interchangeability.
FDA suggested a two-part study design for sponsors seeking evidence of both biosimilarity and interchangeability. The agency said that after an appropriate measure of clinically meaningful differences between two biologics, a second stage of an integrated study could re-randomize patients into a switching study. The study should be powered to adequately measure both PK and PD, as well as clinical effectiveness.
The guidance said sponsors seeking to extrapolate data supporting interchangeability to additional indications "need to provide sufficient scientific justification" that addresses factors such as immunogenicity risk, PK and mechanism of action.
FDA will accept comments on the draft guidance through March 19. In a Federal Register notice accompanying the guidance, FDA asked stakeholders to address how the agency should consider additional indications approved for a reference product after approval of its interchangeable product, and if the agency should change or add to its comparability assessments for post-approval manufacturing changes of interchangeable products.
Price controls would kill innovation, which would kill people just as rent controls in New York City hurt development. What Trump wrote in The Art of the Deal about rent control applies to government limits on drug prices. (Rent control) forced landlords to subsidize tenants. The costs of fuel, labor, and maintenance rose steadily, but the city refused to let landlords raise their rents to keep pace with inflation, much less the market itself. When landlords simply couldn’t make ends meet anymore, they began abandoning—or torching—their buildings. Between 1960 and 1976, approximately 300,000 housing units in New York were abandoned. Whole neighborhoods in the South Bronx and Brooklyn turned into ghost towns. The city, in turn, lost hundreds of millions of dollars in real-estate taxes.
Price controls would create a similar wasteland in our healthcare system. And contrary to claims that drug companies can charge the government whatever they want, Medicare, Medicaid (including ACA enrollment), VA, the Public Health Service have negotiated an average reduction in list drug prices by up to 60 percent. Unfortunately, for the most part, these discounts are not passed onto consumers.
However, it is possible to reduce what Americans pay for medicines now and in the future by changing the way new drugs are created and financed.
First, cash rebates that drug companies give to discount products are now pocketed by insurance companies or used to subsidize other line items should go directly to patients. Rebates now make up 30 percent ($115 billion) of total drug spending. Indeed, 77 percent of the retail price increase in drugs since 2006 goes to rebates.
When auto companies offer new car rebates, the cash is applied to reduce the price of the car in the dealership. In our health care system, the cash rebates go to the insurance companies and pharmacy benefit management firms. And when we pay for our prescription at the drug store, we are charged the list price.
That’s because PBMs and insurance companies use their control over our drug choices to maximize rebates and discounts. Most of the rebates are generated by medicines for about 5 percent of Americans (including seniors fighting cancer, multiple sclerosis, Parkinson’s and other complex diseases). Most, if not all, Obamacare and Medicare drug plans place most or all drugs that treat such patients on the highest cost formulary tier. So the sickest patients wind up paying up to 50 percent of the retail price of the drugs they depend on even as billions of rebate dollars are being racked in. This targeting is profitable, but it is also discriminatory.
President Trump could sign an executive order banning such discrimination and allow companies to directly pass through rebates and out of pocket assistance to patients for any drug doctors prescribe as part of a broader. The goal should be to eliminate cost sharing completely and encourage health plans to compete on the quality of care. The over $100 billion in rebates and discounts could be used to make this possible.
Second, he can encourage different ways to pay for medicines. Many new medicines generate value and reduce spending over a long period of time. Yet much of the cost is either upfront or recurring. To address this problem drugs could be financed as are cars, college education, homes and construction projects, etc. Drug companies could use cash flow to set up such long-term financing or create financial instruments backed by profits and savings generated by medicines to increase liquidity.
Third, drug discounts the government negotiates on behalf of hospitals in poor communities are pocketed by the institutions instead of going directly to those in need. These discounts (called 340 B discounts for the section of the law creating the program) are as high as 60 percent. Hospitals now receive these 340B discounts on almost half of their drug purchases. In turn these institutions markup drug prices and pocket the profit. The 340B statute doesn’t require that the discounts go directly to their customers. That must change.
Finally, Mr. Trump should remove reduce barriers that limit competition between companies. During his press conference, Trump noted “We have to get our drug industry coming back. Our drug industry has been disastrous. They're leaving left and right. They supply our drugs, but they don't make them here, to a large extent. “Nearly $350 billion in biopharma profits are held overseas because the 35 percent US corporate tax rate can be five times higher than elsewhere.
That’s in part because pharmaceutical research and development efficiency, measured by the number of new drugs brought to market, has declined compared to the amount of money invested. Thanks to regulation, the cost and time needed to developed new medicines have climbed to $1.5 billion over a decade. And a Deloitte study concludes that the pharmaceutical industry's return on its current portfolio of approved products has declined from 10.1 percent in 2010 to 3.7 percent in 2016. The industry's cost of capital is about 8.4 percent. That is not sustainable.
Fracking reduced the time and cost of discovering and safely producing new sources of energy. New biomedical tools and technologies can yield the same benefits in biomedical innovation. He can encourage the return of profits and investment with regulatory reforms of the Food and Drug Administration needed to unleash such potential.
Without new medicines, our lives would be shorter, more painful, less productive. Our economy would be smaller, and health care would be less efficient and more expensive. We need to produce more medical innovations more quickly and at a lower cost. Price controls won’t make it happen. Instead, the way medicines are developed and paid for has to be changed.
The question for companies is not whether they must do so, but when and how. The rebate system is rigged against consumers. The FDA cannot keep up with the geometric pace of change. Failure to address these challenges will, I'm afraid, will lead to the kind of regulation that will undermine innovation.
We've called for this from the start and now it's reality. In final guidance released Thursday on naming of biologic drugs, FDA reiterated that each biologic should receive a non-proprietary "core name" plus a unique four-letter suffix that is devoid of meaning. Each biologic and biosimilar would receive a hyphenated "proper name" joining the core name with the suffix.
The convention is designed to differentiate among non-interchangeable reference products and biosimilars. The agency said it is also still considering the suffix format for interchangeable products.
In an agenda released Wednesday, FDA said it plans to publish guidance this year addressing "considerations in demonstrating interchangeability with a reference product." FDA said it intends to apply the naming system prospectively, and will "communicate with companies that have pending applications to discuss implementation."
In the final guidance, FDA said it is "continuing to consider" how to implement the naming convention for existing biologics, and "in the near term, intends to assign distinguishing suffixes to a limited group of these products."
FDA said the unique suffixes should prevent "inadvertent substitution" among biologics and clarify adverse event reporting. The agency encouraged "routine use" of designated suffixes in ordering, prescribing, dispensing and pharmacovigilance of biologics, independent of a product's approval pathway or time of approval.
Well done FDA.
Trump is not the only celebrity who buys into the vaccine-autism link. But he is also going to be President. Asking Kennedy to chair a panel to ‘study’ the issue who claims drug companies are covering up what he called a vaccine holocaust for the sake of profits is troubling.
But Trump is not alone in his unscientific anti-vaccination views. Dozens of celebrities and politicians have continued to promote unfounded assertions about vaccine safety for years. And we can thank the same media outlets that now are condemning the president elect for vaccine denialism for promoting fake science peddled by what infectious disease expert Paul Offit calls autism’s false prophets.
From 2005 to 2011 CBS aired nearly a dozen stories that included extremist views of vaccines and autism. In 2015 Kennedy cited a CBS Atlanta segment that reinforced the claim that the government was covering up the truth about vaccine dangers. The Huffington Post, which pontificated about Trump’s anti-science views yesterday has been the soapbox of anti-vaccine types – Kennedy included -- for several years.
But the irony does not end there. Recently, Kennedy has been claiming that recent research links industrial exposures of lead, mercury and arsenic to the prevalence of autism spectrum disorder (ASD). But he is not alone, dozens of mainstream outlets have published these claims –– as settled fact.
For instance the Fox News website published uncritical article about the connection headlined: “Number of chemicals linked to autism and other disorders doubled in past 7 years, study shows.”
The piece quotes Dr. Philip Landrigan, of the Icahn School of Medicine at Mount Sinai in New York City the co-author of the study: “the increase of later diagnoses of these disorders tracks very nicely with increased production and release into environment of synthetic chemicals over last 40 or 50 years,” Landrigan said.
Except that, the amount of heavy metals, fertilizers and air pollution in our food, water, air, consumer goods have been falling for 20 years. Moreover, as Emily Willingham, the co-author of "The Informed Parent: A Science-Based Resource for Your Child's First 4 Years notes about claims air pollution cause autism: “ You can see an overall decline, sometimes steep, something that doesn’t fit with the increased autism prevalence over the same period, whether you consider the mounting numbers an “epidemic” or a more accurate reflection of primarily stable values over time. Turn to some of the world’s most air-polluted cities, and you will fail to find autism rates that correlate.” The same goes for chemicals alleged to cause autism.
Why is claiming vaccines (or how we administer them) cause autism anti-science but asserting that climate change and pollution have the same impact is unchallenged?
Asking if the president-elect’s views on vaccines and autism are based on fake science is more than fair. But the same questions should be raised when media outlets run uncritical stories claiming (declining) pollution levels damages infant brains.
We all choose the information that confirms our view of the world. Science is shaped by the exact opposite impulse.
The media did not report on the science of vaccines decades ago and it isn’t doing so now. Removing preservatives from vaccines was intended to calm fears, but it only led to more concern and less immunization.
Our children have been endangered by this hijacking of science. In 2013, 87 percent of pediatricians surveyed said they encountered vaccine refusals from parents of their patients, up from 75 percent of pediatricians who said the same in 2006.
After Andrew Wakefield’s claims about vaccines causing autism were finally retracted: The British Medical Journal observed: “The damage to public health continues, fueled by unbalanced media reporting and an ineffective response from government, researchers, journals and the medical profession.”
Mr. Trump’s trust in Robert F. Kennedy Jr. is a product of this fake science.
Sometimes PBMs and health insurers don't even bother with step therapy or high cost-sharing to limit access to drugs that give them the biggest rebates.
Now they are just switching what drugs they cover without telling consumers.
Swapping drugs to save money is unsafe and unhealthy:
Patients who were switched to another SSRI for non-medical reasons after being stabilized on escitalopram used more resources and had higher health care costs within 3 months of switching than patients who did not switch.
Non-medical switching of drugs for patients treated for heart conditions, diabetes, rheumatoid arthritis, ulcers, menopause, and pain "was more often associated with negative or neutral effects than positive effects on an array of important outcomes. Among patients with stable/well-controlled disease, non-medical switching was associated with mostly negative effects."
Switching may expose heart patients to a higher risk of therapy discontinuation or substitution.
This isn't just a case of switching from a brand to generic or from one brand to another. Switching from one generic to another can cause problems:
After switching their generic phenytoin, 33 out of 80 patients with epilepsy (41%) suffered from increasing seizure events. The number of medical visits for acute seizure significantly increased in the post-interchange period.
These are just a few of the studies that associate when insurers and PBMs switch drugs to save money, they can hurt patients.
Incredibly, the Medicare part B study was going to non-medically switch the cancer drugs seniors gets without telling them. Proponents failed to acknowledge the risks of such a study. In this content, it should be pointed out that ICER's decision to limit access to new drugs based on how it affects the bottom line of health plans is non medical drug switching writ large.
It's not enough to be against step therapy. All that will do is increase the amount of dangerous non-medical drug switching taking place in the dead of night, without notifying patients or worrying about whether such a switch will do more harm than good.