Latest Drugwonks' Blog

I don't mean to pick on the WSJ, but with regard to the recent article  "U.S. Health-Spending Growth Jumped to 5.5% in 2014," how difficult is it to put drug spending in context by looking at projected changes in totals, per capita and percent of Medicare spending??    LOUISE RADNOFSKY manages to find out that Medicare Rx spending increased 15.1 from 2014-2015, but couldn't seem to find the out years even through there were on the same chart in the Medicare Trustees Report.   So for those of you who care.. here's the rest of the story.  It took me a whole 15 minutes to put this together.  All by myself.

CMPI is proud to be part of this new effort to turn the phrase patient-centered drug development into reality.

Transforming Medicine: The Elizabeth Kauffman Institute Launched to Match People with Life-Threatening Illnesses to the Best Treatments in Real Time
--Founded by Biotech Pioneers and Health Data Innovators--

--Will Use Big Data and Artificial Intelligence to Match Patients with Best Treatment Options—

July 27, 2015 08:07 AM Eastern Daylight Time
NEW YORK & CAMBRIDGE, Mass.--(BUSINESS WIRE)--Transforming Medicine: The Elizabeth Kauffman Institute or “TMed,” was officially launched to match people with life-threatening illnesses to the best treatments for their specific condition. To accomplish this, the experts, leaders and innovators who founded “TMed” plan to create a knowledge base that evaluates individual patient characteristics, including genetic and molecular profiles, to determine the most effective marketed and research-stage therapy for each patient. “TMed” is a non-profit (501c3) organization.

“When big data analysis ‘turns the lights on’ to reveal which treatments will work for specific patients, babies are saved from premature birth, cancer patients live longer, chronic conditions are managed better, and billions of dollars are saved by avoiding treatments that do not work for given patients.”

“We formed this institute because over half the medicines used today do not work for half the patients. This is particularly true for people fighting the most complex and fatal diseases,” said “TMed” Co-Founder Lee Hood, M.D., Ph.D., President of the Institute for Systems Biology. “Our aim is to change the practice of medicine in a fundamental way.”

Stuart Kauffman, M.D., systems biology pioneer and “TMed” Chairman, added, “Our goal is to arm patients, caregivers and doctors with our tools and knowledge so they can transition to individualized treatments in real time.”

The institution is named for Dr. Kauffman’s late wife Elizabeth who succumbed to pancreatic cancer.

Other co-founders include Colin Hill, CEO of GNS Healthcare, a pioneer in computational healthcare analysis; Robert Goldberg, Ph.D., Vice President and Co-founder of the Center for Medicine in the Public Interest; and Kathleen O’Connell, an award winning journalist and patient advocate.

Colin Hill said, “When big data analysis ‘turns the lights on’ to reveal which treatments will work for specific patients, babies are saved from premature birth, cancer patients live longer, chronic conditions are managed better, and billions of dollars are saved by avoiding treatments that do not work for given patients.”

This group of pioneers and innovators will now combine their expertise to develop unique algorithms to predict the best combination of treatments for pancreatic cancer, brain cancer, sickle cell anemia and other difficult to treat diseases, based on evidence-based analytics and systems biology. When the data base is ready, “TMed” will work closely with providers, health insurers, patient groups and other stakeholders.

One of the “TMed” scientific advisers, Nicholas Schork, Ph.D., concluded “We have the ability to save lives now. Let’s get started.”

To learn more about Transforming Medicine, go to the institute’s website at

Kathleen O’Connell, 917-270-3279
Initiate PR
Stephen Gendel, 424-371-9600
Hank Campbell at the Science 2.0 blog does a great job of picking apart the most recent attempt by cancer doctors to make economic policy.

A group of academics have channeled their inner Bernie Sanders and written a wonderfully naïve op-ed about how to lower drug prices: Destroy the industry that made America the world leader in biotechnology.

It's simple. Let government control drug prices and then corporations will just do what they always do, but it will be a lot cheaper. It is so simplistic it could have been written by Paul Krugman in the New York Times. It is also in defiance of how science, creativity and medical advancement works, and would lead to a mass exodus of science jobs from America.

Writing about the piece in Mayo Clinic Proceedings, lead author Ayalew Tefferi, M.D., a hematologist at Mayo Clinic, says, "The average gross household income in the U.S. is about $52,000 per year. For an insured patient with cancer who needs a drug that costs $120,000 per year, the out-of-pocket expenses could be as much as $25,000 to $30,000 - more than half their average household income."

He and colleagues cite a 2015 study by D.H. Howard and colleagues in the Journal of Economic Perspectives, which found that cancer drug prices have risen by an average of $8,500 per year over the past 15 years. What has risen markedly in that time? Cancer survival rates.

They claim that by controlling the market, the free market will work better. If you are a California resident enjoying paying 50 percent higher utility rates compared to the rest of the country, you see how in the real world more government control does not make the free market more efficient. If you can do math, it is better to be skeptical. 

Here's my take:  

In fact, new cancer drugs not only save and extend lives; they reduce the cost of treating cancer.  Cancer spending has increased in 1995 from $42 billion to about $130 billion today.  (Most of that is on doctors and hospitals, the cost of which the authors ignore.) Between 1995 and 2012 the share of cancer spending devoted to drugs increased from 3.7 percent to 9.3 percent while hospital spending declined from 62.4 percent of cancer costs to 41. 3 percent in 2012.   Meanwhile, cancer death rates declined by 30 percent and the number of people surviving cancer increased by 40 percent (9.8 million to 14 million).  Cancer costs as a share of total health spending declined from 4.7 percent to 4.4 percent.   Meanwhile new cancer drugs have remained at around 0.7 percent of total health care spending.

Further, the authors imply that out of pocket costs for cancer drugs are increasing because health insurers are being forced to because of higher prices.  This is inaccurate.  Studies conducted by health actuary Milliman, Inc., found that capping cost sharing at $100 a month would only increase premiums by an average of $2 a month.

The authors claim that most new medicines don’t improve average survival of the average cancer patient. But new drugs target much smaller groups of patients for whom other medicines do not work.   Averages don’t capture the benefit such small groups receive. Cumulatively, these new medicines are in fact, saving money and saving lives.

Meanwhile, the European style price controls the doctors prescribe are associated with faster increases in cancer costs and higher death rates compare to America.  While they allude to the fact that price controls on generic cancer drugs have caused persistent shortages,  they somehow believe that the development of new medicines which require substantially more money and entail significantly greater risk, would be immune to this outcome.  They also apply to cancer doctors who are also paid much more in Europe than here. If the oncologists who wrote the letter believe price controls are the right prescription, perhaps they should lead by example. 

As John Adams quipped, "Facts are pesky things."

First the story – and then the rest of the story.


Insurer Uses Clout to Negotiate Drug Prices; Critics Challenge Medicare Brand name Pricing

Jul. 27, 2015, Drug Industry Daily

UnitedHealth Group plans to use its market strength to negotiate prices to help consumers purchase expensive specialty drugs, adding to a growing press from doctors, patient advocates and lawmakers to rein in costs.

According to UnitedHealth, the acquisition of rival Catamaran by its Optum-Rx pharmacy-benefits business will give the insurer a new competitive edge in seeking payments or refunds based on whether drugs help patients.

The announcement — which underscores payers’ growing use of patient outcomes to determine drug pricing — comes on the heels of a report claiming Medicare pays 73 percent more than Medicaid and 80 percent more than the Veterans Administration for brand name drugs.

The report, by Public Citizen and Carleton University, claims $69.3 billion was spent on prescription drugs through Medicare Part D in 2013. The report points to research from Avalere Health showing roughly 58 percent of Part D spending in 2011 went to brand name manufacturers.

The report urges Congress to pass legislation allowing Medicare to reduce brand name drug prices to at least the level of Medicaid or the Veterans Health Administration and to introduce mandatory generic substitution for all plans under Part D. Currently, the federal government is prohibited from leveraging its Part D purchasing power even though private plans obtain substantial rebates from drug makers and pharmacies.

Critics of high drug costs have singled out the price of Gilead Sciences’ hepatitis C drug Sovaldi (sofosbuvir) as being particularly egregious. At $1,000 a day, the Veterans Administration has already exceeded the more than $400 million budgeted for hep C treatment in fiscal 2015, according to Sen. Bernie Sanders (I-Vt.), who recently called for wartime powers to break the patents on the drug (DID, May 15).

But it’s unclear whether the anger over drug prices is sufficient to fuel real change in the form of legislation.

Peter Pitts, president of the Center for Medicine in the Public Interest, says it’s artificial to compare drug prices with what the VA pays, since the agency gets the lowest possible prices by law. He also points to a 2014 Congressional Budget Office study that showed drug prices would be higher if the government negotiated Part D pricing.

Separately, more than 100 oncology doctors called for cutting the prices of cancer drugs. All new cancer drugs approved by the FDA in 2014 were priced above $120,000 per year of use, according to their article in Thursday’s Mayo Clinic Proceedings.

PhRMA was quick to respond to both reports, saying proposals to fundamentally alter the structure of the Medicare Part D program would hurt taxpayers and beneficiaries.

Read the Public Citizen, Carleton University report here — Jonathon Shacat


Let’s start with Sovaldi. The Public Citizen and Carleton University do not mention in their report that one pre-Sovaldi “best practice” treatment for Hepatitis C, the drug Pegasys, requires one injection a week for 48 weeks — and very few patients see the treatment through to completion, so much of that treatment, both physician time and drug cost, is wasted. Nor is it that much cheaper: At about $7,000/month, the full course of treatment is over $70,000 — barely less than cost of the three months needed for Sovaldi to work a cure. And the price of not using Sovaldi is very high. One in three patients with the Hepatitis C virus eventually develops liver cirrhosis, and managing these patients is costly. A “routine” liver transplant (where the liver is from a cadaver) costs close to $300,000; a “living donor” transplant is even more expensive. But why let the facts get in the way.

Data recently published by the PwC Health Research Institute suggests the reverse. The study shows that the use of Sovaldi will actually drive down overall spending within a decade.

Also, is anyone really paying “$1000 per pill?” Certainly nobody with insurance. And for those without coverage there are generous programs supplied by the manufacturer. What rates have large payers negotiated?  They won’t say. Hm.

Let’s tackle the VA next. The Veterans Administration’s national formulary covers 59 percent of the 200 most popular drugs in the country. (Medicare covers 85 percent of those drugs.) And a study from Columbia University found that just 19 percent of all new drugs approved since 2000 were covered by the VA and just 38 percent since 1990. Media reporting missed these facts too.

Per “negotiating prices” for Medicare Part D, allowing the Federal government to negotiate drug prices would result in prices going up and patient choice going down. That’s why the Non-Interference Clause, the legislation that prohibits Federal price negotiation was created in the first place. It’s interesting and important to note that the legislative language was drafted by Senators Ted Kennedy and Tom Daschle.

The Congressional Budget Office found that between 2004 and 2013, Part D cost an extraordinary 45 percent less than what was initially estimated and premiums for the program are roughly half of the government’s original projections. These unprecedented results are largely due to Part D’s market-based structure. Beneficiaries are free to choose from a slate of private drug coverage plans, forcing insurers to compete to offer the best options to American seniors. It’s hardly surprising that the program has led to low prices and satisfied customers. Through their own negotiations with drug makers, private insurance plans that operate under Part D have already had great success in keeping pharmaceutical prices down. In fact, the CBO has observed that Part D plans have “secured rebates somewhat larger than the average rebates observed in commercial health plans.” What’s more, the CBO has said that doing away with the non-interference clause “would have a negligible effect on federal spending.” In a report from 2009, they reiterated this view, explaining that such a reform would “have little, if any, effect on [drug] prices.” In fact, allowing the feds to negotiate drug prices under Part D would likely have a negative effect on the program. The CBO predicts that when HHS forces pharmaceutical firms to lower the cost of a particular drug, this tactic brings with it “the threat of not allowing that drug to be prescribed.”

And as far as Senator Sanders’ call for “wartime powers to break patents,” there is no such thing as a free lunch – let alone “free” innovation. While opaque and seemingly arbitrary drug pricing deserves immediate attention, the value of innovation must not be ignored. Innovation is hard. Today it takes about 10,000 new molecules to produce one FDA-approved medicine. This observation itself is disconcerting, but, further, only 3 out of 10 new medicines earn back their R&D costs. Moreover, unlike other R&D-intensive industries, biopharmaceutical investments generally must be sustained for over two decades before the few that make it can generate any profit. Innovation is slow. As any medical scientist will tell you, there are few “Eureka!” moments in health research. Progress comes step by step, one incremental innovation at a time.

As Abraham Lincoln said, “Patents add the fuel of interest to the passion of genius.”

But don’t all these wonderful innovations come from government-funded research? Nope. A study in Health Affairs by Bhaven N. Sampat and Frank R. Lichtenberg (What Are The Respective Roles Of The Public And Private Sectors In Pharmaceutical Innovation?) puts the issue in a data-driven perspective that gives the NIH its due – but in the proper frame of reference.

For example, according to Sampat and Lichtenberg, fewer than 10 percent of drugs had a public sector patent, and drugs with public-sector patents accounted for 2.5 percent of sales, but that the indirect impact was higher for drugs granted priority review by the FDA. (Priority review is “given to drugs that offer major advances in treatment, or provide a treatment where no adequate therapy exists.)

478 drugs in our sample were associated with $132.7 billion in prescription drug sales in 2006. Drugs with public-sector patents accounted for 2.5 percent of these sales, while drugs whose applications cited federally funded research and development or government publications accounted for 27 percent.

As Harvard University health economist David Cutler has noted, “Virtually every study of medical innovation suggests that changes in the nature of medical care over time are clearly worth the cost." When it comes to drug pricing it's important to look at the whole picture.

Per Drug Prices Soar, Prompting Calls for Justification (NYT, July 23, 2015), while opaque and seemingly arbitrary drug pricing deserves immediate attention, the value of innovation must not be ignored. Innovation is hard. Today it takes about 10,000 new molecules to produce one FDA-approved medicine. This observation itself is disconcerting, but, further, only 3 out of 10 new medicines earn back their R&D costs. Moreover, unlike other R&D-intensive industries, biopharmaceutical investments generally must be sustained for over 2 decades before the few that make it can generate any profit. Innovation is slow. As any medical scientist will tell you, there are few “Eureka!” moments in health research. Progress comes step by step, one incremental innovation at a time.

Biopharmaceutical companies more often profit by improving existing molecules and making processes more efficient than by revolutionizing the whole field with new miracle products. Discontinuous innovation (such as the recent breakthroughs in Hepatitis C) is a wonderful exception to the rule. As Harvard University health economist David Cutler has noted, “Virtually every study of medical innovation suggests that changes in the nature of medical care over time are clearly worth the cost." When it comes to drug pricing it's important to look at the whole picture.

More and more medical journals are running articles by doctors on the cost of developing and using new drugs.

I have no idea if and how these articles are peer-reviewed.   My guess is that they are not, otherwise the journals would not allow articles to be published that rely on discredited economic papers or authors or use a framework to measure cost and value that is questionable at best, shoddy at worst. 

In my opinion such articles are written with a very clear agenda: attack drug prices as being too high because the cost of developing new drugs is in fact quite low and 2)  because they offer very little clinical benefit compared to older medicines.   I have no problem with articles that make that case.   I do have a problem when the articles are intellectually and methodologically suspect.   People trust medical doctors more than most other professionals.  But that trust is abused when doctors pose as economists to further a political agenda. 

There are four hallmarks of such pseudo-economic analysis.  I will discuss each on in detail in separate blogs.  Any article published in a peer-reviewed journal that contains these elements should be rejected if submitted, retracted if published.   There is little difference between authors relying upon these methods or analyses and Andrew Wakefield who used similar approaches to conclude that a measles vaccine can cause autism.   

1.   Relying upon the one discredited source to make your case.

Best example is Hagop Kantarjian use of Donald LIght's assertion that it only costs 4 percent of what most studies have estimated as the cost of bringing a new chemical entity to market.   Kantarjian claims it is only $25 million.  That's based on an earlier estimate of drug development costs by Joseph DiMasi of $802 million per new chemical entity.  Kantarjian has also co-authored articles with Light.  

But Light's claim has been rejected by several studies that have shown studies asserting the cost of drug development is much lower than $2-6 billion are all flawed: " they inappropriately mix median values reported for individual drugs with what are mean values for the costs of clinical failures and preclinical fixed costs, and for which the concept of a median has no meaning; they misconstrue the nature of the corporate income tax and incorrectly consider manufacturing tax credits; they use discount rates that are meant for other contexts but that are inappropriate here; they treat line extension approvals as separate and independent units of observation alongside their original approvals; and they grossly misstate the meaning of and misuse figures in our paper on industry-reported data on expenditures on self-originated drugs, licensed-in drugs, and already-approved drugs.

In short, every one of Light and Warbuton's adjustments are invalid. Furthermore, two peer-reviewed papers by current and former FTC economists, also not cited by Light and Warburton, validate our work using other methods and public data (Adams and Brantner, 2006, 2010). They find that R&D costs are likely as high or higher than (DiMasi's) estimates."  (See DiMasi JA, Hansen RW, Grabowski HG. Reply: Extraordinary claims require extraordinary evidence. Journal of Health Economics 2005;24(5):1034-1044. and DiMasi JA, Hansen RW, Grabowski HG. Reply: Setting the record straight on setting the record straight: response to the Light and Warburton rejoinder. Journal of Health Economics 2005;24(5):1049-1053.)

A prima facie analysis of Kantarjian's assertion suggests how absurd it is without having to waste time refuting it.   If it only cost $25 million to bring a new drug to market why aren't hundreds of companies developing them.  It costs up to $140 million to develop a hot new video game for XBox360 or P3 Playstation platforms.    Yet the medical journals such as Blood  publish these claims as if they were reliable.  Why not continue to publish articles citing Andrew Wakefield's article claiming vaccines caused changes in the gut that caused autism???   Kantarjian uses Light like anti-vaxxers use Wakefield.  The only difference is, Kantarjian gets published and Wakefield is discredited. 

Tomorrow I will discuss the misuse and abuse of the assertion that cancer drug prices defy market forces because prices only go up, not down.  


  • 07.16.2015

The pharmacenti were gathered. Policy experts, provider organizations and patient groups, industry, academics and FDA brass. The clock in the White Oak Great Room struck 9AM. The room fell silent. Smart phones were (mostly) on silent mode.

Welcome to PDUFA VI.

The first public meeting on reauthorization of the Prescription Drug User Fee Act (PDUFA) held few surprises but made it clear that this time around there will be more creative tension.

First up was Acting FDA Commissioner Stephen Ostroff. He began with a nod to NASA’s wondrous New Horizons’ space probe.  He offered this alliterative flourish, “Just as with the recent success of NASA’s space probe, PDUFA delivers on its promise because of planning, precision, and predictable performance.” He then called on all present to “aim for the stars” in the forthcoming PDUFA process.

Ostroffian p-values aside, whether or not all parties concerned in PDUFA (those noted above as well as legislators and the White House) can embrace such a Plutonic relationship remains to be seen.

Next up was FDA Deputy Commissioner Rob Califf who said, “an increase in predictability creates a better environment for innovators.” This comment set the meeting’s major theme – that PDUFA VI isn’t just about the founding principle of the user fee concept, ensuring predictability in the review process, but must now also help to facilitate the advancement of regulatory science.

Theresa Mullin, the Director of Strategic Programs within the Center for Drug Evaluation and Research (CDER) then made a point to establish a key FDA talking point – that PDUFA isn’t about policy but rather process. And while that is an accurate statement, it belies the fact that process drives policy. That’s more than semantics. Think about it as the power of the pen – another key PDUFA p-value.

The majority of the day was given over to panels representing the consumer, patient, healthcare professional, industry, and academic perspectives on what should matter most in constructing a thoughtful and forward-looking reauthorization package.

Some highlights:

Allan Coukell (Pew Charitable Trusts) urged that PDUFA VI incorporate funding that would help reduce both the time and expense it takes to design 21st century clinical trials – and that a good start would be funding programs that address clinical trial methodologies. All heads nodded – particularly that of Rob Califf.

Sally Greenberg (National Consumers League) suggested that there should be user-fees for marketing material review – particularly television ads. She also wants DTC review to be mandatory. She commented that, on this point, she “sounds like a broken record.” Possibly, but what is for certain is (in the Age of Caronia and Amarin) its her message that’s broken. In any event, that’s policy – not process.

Paul Melmeyer (National Organization for Rare Diseases) stressed the urgency of thoughtful and aggressive next steps per the FDA’s Patient-Focused Drug Development (PFDD) program. Indeed, almost every speaker spoke about PFDD as the Jewel in the Crown of PDUFA V – but that more needs to happen.

Jeff Allen (Friends of Cancer Research) spoke to the need for the FDA to collect and share best practices per various expedited review pathways. He also pointed to the need for the agency to more progressively consider real world evidence in its design of post-marketing commitments.

Cynthia Bens (Alliance for Aging Research) observed that, “PFDD meetings have led to a cultural shift across the FDA elevating the way in which regulators view the value of patient input in the drug development process,” but “there is no one-size-fits-all solution to gathering and employing patient input effectively.” And on the Patient-Reported Outcomes (PRO) front, “We would encourage the dedication of resources in PDUFA VI to support additional workshops aimed at feasibility and reliability of incorporating PROs in trials for complex diseases.” Specifically, “We would support the addition of user fee funds in PDUFA VI to allow for new guidance on performance outcome measures, observer reported outcome measures, and clinician reported outcome measures.” Bravo.

Maureen Japha (Milken Institute/Faster Cures) asked that the patient voice (no longer “an honorary voice”) be heard earlier and more regularly in the review process, not just at the end per benefit/risk considerations. The call for a more comprehensive and integrated patient voice was loud and clear during the entire course of the meeting. Process or policy? Where you stand depends on where you sit.

Representatives from healthcare professional organizations (the American Pharmacists Association, the American Academy of Pediatrics, and the American College of Cardiology) focused their comments on the need for more global collaboration (sharing rather than stipulating best practices), continuing to modernize the agency’s drug safety system, and the importance of advancing regulatory science – the red thread of this early PDUFA dialogue.

Industry association presentations (BIO and PhRMA) tended to applaud the successes of PDUFA V and pointing to the need for all parties concerned to make further progress across the broad spectrum of both predictability and regulatory science. The key phrase from industry is that they, “fully support timely reauthorization.” And there was much sharing of success metrics – particularly the approval of new medicines (NMEs – a love story). But all is not smooth sailing. Kay Holcombe (BIO) addressed the specter of budgetary sequestration as something that must be addressed. Kay also addressed the need for enhanced scientific communications that do not require an “official” FDA meeting. Michael Werner (the Alliance for Regenerative Medicine) called for PDUFA to empower the FDA to work with outside bodies to help develop development and review standards– an idea that has resonance beyond regenerative medicine (biomarkers, functional endpoints, etc.)

The academic panel added robust ideas to the more general discussion of advancing regulatory science.

Greg Daniel (Brookings Institution) called for a PDUFA strategy that would drive agency coordination of pre-competitive biomarker development as well as a common biomarker lexicon.

Daniel Carpenter and Aaron Kesselheim (Harvard University and Harvard Medical School) questioned whether various expedited approval pathways were focused on medicines they considered “non-transformative,” what they referred to as “designation creep.” Policy vs. process.

Ernst Berndt (Massachusetts Institute of Technology) broached the topic of “adaptive licensing,” pointing to EMA programs and their progress under the Innovative Medicines Initiative.  To-date, the concept of conditional approvals has found very little support or enthusiasm from either developers or the FDA. Whether or not Dr. Berndt’s suggestion gets traction will depend on how it resonates with any of the various PDUFA constituencies. The last time I spoke with senior members of the FDA, I heard comments like, “What does that even mean?” And, then again, do drug developers really want conditional approval? You invest a lot of time and money to get a conditional approval and then the agency decides to take the product off the market? Is that something to roll the dice on? Unless and until the FDA can ramp up its pharmacovigilance prowess, any kind of provisional approvals will remain problematic. At the moment, the FDA doesn’t have an eye in the sky.

Rena Conti (University of Chicago) raised the topic of drug sourcing. Is there, she asked, an unintended PDUFA incentive to outsource manufacturing – and what are the consequences? She called for greater transparency in who manufactures what – and where.

The final presentation of the day was by Dr. Janet Woodcock (Director, Center for Drug Evaluation and Research). The items on her short list mirrored many of the day’s presentations and themes. Specifically she mentioned the need to advance the agency’s Sentinel program, continue to develop a more advanced view of benefit/risk – and one that includes a more dynamic inclusion of the patient voice, next steps on Patient-Focused Drug Development, better and more regular communications with developers, biomarker development (“still a tremendous amount to be done”), the need for the agency to recruit and retain the best and the brightest, and, of course, advancing regulatory science writ large.

She also warned of getting off the process track – a clear warning shot across the bow to those ready to hang multiple ornaments on the PDUFA Christmas tree.

At the conclusion of the day’s session I was pleased to be able to offer some advice during the open public comment period. Here’s how I concluded my remarks:

“PDUFA VI must continue to provide predictability in the review process and advance regulatory science over a variety of initiatives. But most importantly, PDUFA VI must answer the question of “What next?” for many of the agency’s existing initiatives (biomarkers, risk/benefit evaluation, patient-focused drug development, 21st century clinical trial design).  PDUFA VI must redefine what “success” looks like. Dr. Ostroff asked us to aim for the stars, but let’s not settle for an easy, clean, comfortable, and low-altitude orbit.

Per aspera ad astra – Through hardships to the stars. We’ve had FDAMA. We’ve had FDASIA. Now we need FDAMN – FDA Momentum Now.

Nobody said it was going to be easy.

"J" is for Janus

  • 07.10.2015

The Biosimilars Forum represents many of the leading voices against differential nomenclature -- except when it comes to Medicare coding.

Yesterday this group expressed “grave concern” over the proposed biosimilar payment rule issued by CMS. (CMS is proposing that multiple biosimilars to the same reference product be grouped and issued the same J-code for Medicare reimbursement purposes.)

According to Biosimilars Forum policy advisor Michael Werne, the biosimilars statute, and its legislative history “make clear that each biosimilar product — including multiple biosimilar products associated with the same originally marketed product — should be assigned a unique HCPCS code.”

According to Werne, “The lawmakers who passed the Biologics Price Competition and Innovation Act of 2009 (BPCIA) understood that biosimilars are not the same as generic drugs and should not be treated that way in policy making.”

Per the groups press release, “Furthermore, the statute makes it clear that an interchangeability determination only applies to a specific biosimilar and the reference product, and does not apply between or among multiple biosimilars approved to a single reference product. Issuing unique HCPCS codes is essential to avoid confusion among healthcare professionals, to ensure that the proper products are dispensed to patients, and to allow a fair and predictable reimbursement to purchasers of biosimilars.”

But wait – there’s more. “The law, legislative history, and biosimilar science support the requirement that CMS assign each biosimilar biological product a unique HCPCS code and not consider biologics and biosimilars in the same fashion as generic drugs.”

And yet some members of this group are against differential nomenclature. Go figure.

(The full Biosimilars Forum press release can be found here.)

Hypocrisy is the Vaseline of political intercourse. – Billy Connolly

Let it be said that the spark that ignited the flame was when FDA leadership asked, “Do we know enough about the quality of drugs that are sold in the United States.”

So said, CDER Director Dr. Janet Woodcock during yesterday’s webinar, Understanding CDER’s “Super” Office Of Pharmaceutical Quality and Its Effect on You.”  Dr. Woodcock was joined by Dr. Lawrence Yu. I was honored to moderate the FDA News-sponsored session.

(Janet is the acting director of the OPQ and Lawrence is the acting deputy.)

Let’s put the new OPQ into some historical context.

In 2009, the FDA announced its Safe Use of Drugs Initiative.  The theory being that one way to make drugs safer is to ensure that they are used as directed. The main strategy was education and the agency’s efforts were (and are) aimed at physicians, nurses, pharmacists, and patients.

Earlier this year, the agency announced not just an office, but a Super Office of Pharmaceutical Quality, further underscoring that the FDA operates not under a two-dimensional system of safety and efficacy, but a three-dimensional approach that includes quality … with a capital (indeed a “super”) Q.

Since there is no such thing as a safe substandard product, the agency is putting time, resources, and the use of the bully pulpit to go beyond cGMPs, API and excipient sourcing to develop a risk-based approach that includes data gathered from a variety of sources including manufacturing inspections, adverse event reporting, and substandard pharmaceutical events as evidenced in the agency’s bioequivalence- driven actions with bupropion in 2012, metoprolol in 2014, and methylphenidate in 2015.

So, in many respects, pharmaceutical quality is both a pre and post-licensure endeavor and, like Safe Use, a scientific and educational enterprise that requires close coordination with many stakeholders. And it won’t come easily or inexpensively.

Aristotle said that, “Quality is not an act, it is a habit.”

I began the interview by asking Dr. Woodcock, “how is the FDA going to make pharmaceutical quality a habit?” She responded by sharing her belief that industry must “own” quality – and must be able to measure it. As the saying goes, that which gets measured gets done.

The OPQ philosophy is more than just about NDA/ANDA parity. It’s not just a “promotion” for quality – it’s a quality revolution that goes from top to bottom. But, as Audre Lorde reminds us, “Revolution is not a onetime event.” This adage should be inscribed on the wall at OPQ.

Dr. Woodcock stressed the need for the FDA to treat the issue of quality from a much more senior-level perspective. The immediate result will be the creation of a separate policy function for quality issues within OPQ.

(She was wisely noncommittal on whether or not the agency would be requesting additional funding for OPQ via PDUFA VI.)

One of the pillars of quality, of course, is inspection. Dr. Yu made it clear that, in the new OPQ era, the FDA would be going “beyond documentation.” In other words (to borrow a phrase from the arms control lexicon), “trust but verify.”

An immediate result is a new paradigm for inspections and reports that will advance pharmaceutical quality. The new standardized approach to inspection will include:

·      Data gathering to inform “quality intelligence” of sites and products

·      Risk-based and rule-based process, using expert questions

·      Semi-quantitative scoring to allow for comparisons within and between sites

·      More common inspection report structure

·      Positive behaviors recognized and rewarded where facilities exceed basic compliance

OPQ is, as both Janet and Lawrence said, about having the agency speak with “One Quality Voice.” Specifically:

Put patients first by balancing risk and availability

·      Ensure clinically relevant quality standards

·      Integrate review and inspection across product lifecycle

·      Maximize efficiency by applying risk-based approaches

·      Strengthen lifecycle management by using team-based processes

·      Effectively apply staff expertise to enhance quality regulation

·      Encourage innovation by advancing new technology and manufacturing science

·      Enhance cross-disciplinary interaction, shared accountability, and joint problem solving

·      Build collaborative relationships by communicating openly, honestly, and directly

And the major foundation is product quality informatics. In the “knowledge is power” category OPQ recognizes that enabling an efficient science-driven assessment requires significant transformation in how they collect, evaluate, and learn from the product quality data. Specifically:

·      Core areas of Product Quality Informatics: Structured data submission and collection

·      Knowledge management and communication Established conditions

·      Risk mitigation

·      Post-market surveillance and quality monitoring

·      Intelligent data analysis

Both Janet and Lawrence underscored the importance of cross-office cooperation  (via “program alignment agreements”) and specifically mentioned working with the Office of Surveillance and Epidemiology to better understand how pharmacovigilance signals can inform the agency’s actions on quality problems.

The FDA's powerpoint presentation can be found here.

Drs. Woodcock and Yu also spoke to the urgency of a more regular and risk-based approach to changes in API and excipient sourcing, as well as more systematic monitoring of bioequivalence. Both she and Dr. Yu agreed that the agency’s new respect for quality would influence their views on both the review and post-marketing surveillance of both biosimilars and non-biologic complex drugs (NBCDs).

Make no mistake -- the Office of Pharmaceutical Quality is a regulatory revolution, Drs. Woodcock and Yu are regulatory revolutionaries and (as Abbie Hoffman quipped), “the first duty of a revolutionary is to get away with it."

From The ASCO Value in Cancer Care Task Force Framework

Use of new drugs is being driven by “sometimes unrealistic patient and family expectations that lead clinicians to offer or recommend some of these services, despite the lack of supporting evidence of utility or benefit.”  

Cancer patients “overestimate the benefits of treatments that sometimes extend life by only weeks or months or not at all. 

From Lowell Schnipper, Chair of the Task Force:

Three months of added life “is not a large enough benefit to trump the greater benefits to many that would have to be foregone to provide it.”

Now watch what Zach Sobrieth, who died of sarcoma, thinks of three months of life.


Center for Medicine in the Public Interest is a nonprofit, non-partisan organization promoting innovative solutions that advance medical progress, reduce health disparities, extend life and make health care more affordable, preventive and patient-centered. CMPI also provides the public, policymakers and the media a reliable source of independent scientific analysis on issues ranging from personalized medicine, food and drug safety, health care reform and comparative effectiveness.

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