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I’ve just finished three fascinating days in Sharm El Sheikh at the Second Arab Conference on Food & Drugs. It was all business – and I didn’t even mind not getting any time to enjoy the Red Sea beaches.
Delegates from the Levant to Morocco had a lot to say and share. The fundamental take-away was that the Arab world is serious about coordinating their efforts in healthcare in general and in regulatory affairs specifically. “Convergence” and “harmonization” were the two key words of the event.
(The Middle East/North Africa Region – MENA – consists of 22 nations – but just 2% of global pharmaceutical sales.)
I was honored to present a plenary address on “Advancing Medicines Quality via New Strategies in Bioequivalence Regulations, Pharmacovigilance Practices, and the Identification and Management of Substandard Pharmaceutical Events,” as well as chair the event’s panel on pharmacovigilance, sharing the panel with governmental thought leaders such as Dr. Amina Tebba (Morocco), Dr. Amr Saad (Egypt), Dr. Emad Munsour (Qatar), and leading global policy experts Dr. Hisham Aljadhey (King Saud University), and Michael Deats (WHO). I also participated on a panel discussing the urgency of IP, as well as another on biosimilars – specifically calling out the vexing debate over nomenclature, physician notification, and therapeutic substitution.
With healthcare policy (as with life in general) – wherever you go, there you are.
Not surprisingly, much of the conversation centered on controlling costs – specifically pharmaceutical costs, without (alas) the appropriate balance of time spent on the pennywise/pound foolish consequences of many of these policies. The IP panel tried to add balance to that debate by strongly presenting the facts on the value of innovation.
Dr. Rasha Ziada (Egyptian Ministry of Health) made the important point that if a pricing authority doesn’t take outcomes into consideration, it will lead to overall price distortions. Amen. And Dr. Ola Ghaleb (Ministry of Health, United Arab Emirates), spoke about the UAE’s strategy of performance-based risk-sharing arrangements – but also how politics can derail any decision-making process. Her honesty was refreshing. Net/Net -- Outcomes is now capitalized and bolded in the international lexicon of healthcare policy.
While many of the presenters discussed the value of sharing pharmaceutical economic data across borders, there was not an equal counterbalancing discussion of the value of sharing clinical data for approvals and outcomes-based decision-making processes. But there was certainly an effort (both on many of the panels as well as during the breaks and after hours) to stress the urgency of this agenda. The good news is that many, many speakers (sometimes in passing and other times passionately) made the point that it mustn’t just be about “getting the lowest price,” but also appropriately pricing the most clinically effective treatments. Bravo.
Many of the delegates said (from the floor as well as in conversation) that the conference was useful – but that action is required. In short – talk is cheap. My feeling (speaking privately with senior government officials from many of these nations) is that there is serious momentum for change (and even reinvention). But only time will tell.
As Deming said, “Change is not required. Survival is not mandatory.”
Or as the Egyptian saying goes
كلنا فى نفس القارب
We are all in the same boat.
A new article in Nature Medicine challenges one of the biggest myths of the global healthcare debate. The title says it all:
Questions raised about whether compulsory licenses get best prices
For those who follow the facts rather than the rhetoric, the findings are not surprising -- he use of compulsory licenses by developing countries to obtain cheaper drugs for HIV and AIDS by circumventing patents has not been the best strategy for achieving the lowest prices over the past decade. Instead, the best prices were regularly obtained by countries that procured their drugs through voluntary negotiations, often facilitated by third parties such as UNICEF or the Global Fund to Fight AIDS, Tuberculosis and Malaria.
The facts are indisputable.
Amir Attaran, who studies law and population health at the University of Ottawa in Canada, compared the prices of antiretroviral medications obtained through compulsory licenses in several countries with the median price achieved by peer countries for the same drugs through international procurements in the same year. Compulsory licensing did result in lower drug prices compared with the price on offer before the license was issued, but of the 30 cases of compulsory licensing from 2003 to 2012 for which reliable data was available, the median price achieved through international procurement was lower for 19 of them—in the majority of cases by more than 25% (Health Aff., 34, 493–501, 2015). The effect was strongest in the poorest countries, where in six out of seven cases the procurement price was more than 25% lower than the compulsory license price.
Attaran says the results suggest that countries should not rush into using compulsory licenses until they have exhausted all other options. “Countries can save money using compulsory licenses, but they can save more by negotiating and using international procurement channels,” he says. “If saving money is paramount, then compulsory licenses may not be the optimal strategy.”
Myth: Technology transfer as sound healthcare policy
The price differential was highest when countries issued a compulsory license to manufacture the drug locally. The largest disparity was seen in 2012, when Ecuador licensed the production of a combination treatment of the drugs abacavir and lamivudine. The median price achieved by other countries for that drug combination was ten times cheaper. This is because to produce the drug locally a country may need to build up a manufacturing base from scratch, and economies of scale are lost. Attaran says there are valid reasons a country may want to do this, for example to ensure a secure supply or to address concerns about manufacturing processes, but then price can no longer be the driving force for the decision. “If they want local production, it's going to cost them,” he says.
According to Attaran “This is not an indictment of compulsory licenses, but a question of judgment,” he says. “It's not in anyone's interest to advocate for something that is not supported by evidence.”
The complete article, worthy of careful examination, can be found here.
The Wall Street Journal writes, “A well-known hedge-fund manager is taking a novel approach to making money: filing and publicizing patent challenges against pharmaceutical companies while also betting against their shares.”
That person is Kyle Bass.
It’s an important read and should call attention to an issue that, unless firmly and expeditiously addressed, could lead to a serious reduction in innovation.
Mr. Kyle’s strategy is akin to buying gasoline and matches and then advising arsonists to invest in fire insurance. Far from his claim of being an advocate for affordable medicines, Mr. Kyle is just another scam artist qua patent troll. Patents, according to Abraham Lincoln, “add the fuel of interest to the passion of genius.” Mr. Kyle’s proposition just adds fuel to the fire of greed. He is nothing but a healthcare arsonist.
In light of the recent court decision that Roche adequately warned of Accutane risks (based on labeling and warning literature issued to physicians), it is timely to remind those in the public health community that the FDA’s most potent weapon in the battle for accurate, timely, “rational” prescribing is clear, approved labeling.
And yet the debate over who should make decisions about safety and efficacy – and on what evidence those choices should be made is still blazing. Today, the FDA has the responsibility to determine approvals and labeling language based on a scientific review of the evidence. Should this authority be ceded to the tort bar?
The dedicated members of our legal profession have always provided, and continue to provide, vital protection against those who would prey on consumers or intentionally try to pass off harmful products. The threat of litigation can be an important disincentive to many predatory behaviors.
The problem is that the current liability system doesn’t reward lawyers who focus on these real public health concerns. Instead, the most experienced and well-financed law firms know that the biggest payouts regularly go to those who take advantage of the FDA’s best efforts to promote the safe and effective use of medications.
More and more often, these “mass tort” firms specialize in taking a new product-warning label or withdrawal decision by the FDA and viewing it as a signal to go forward with all guns blazing. Their bullets, unfortunately but not unpredictably, hit multiple innocent targets.
Have a look at this new paper from the Journal of Commercial Biotechnology – and weigh in on this important issue. Maybe when our elected officials understand that it’s the health of their constituents versus the pocketbooks of lawyers, our public servants will finally get serious on tort reform.
Accutane’s Warning Labels Sufficient, Judge Rules
Drug Industry Daily
Roche adequately warned of the risks of ingesting acne drug Accutane after April 10, 2002, a New Jersey judge ruled last week, resolving lawsuits filed by people in the state who used the product since that date.
The manufacturer’s labeling and warning literature issued to physicians accurately disclosed the potential risk of inflammatory bowel disease, says Superior Court of New Jersey Judge Nelson Johnson in his summary judgment.
Last week’s ruling is limited to cases involving New Jersey plaintiffs who took Accutane since the most recent warnings were issued. The court intends to determine the effect on cases in other states which could involve up to 800 plaintiffs who are being given a chance to convince the court that some other states’ law with more lenient standards could be applicable.
Counsel from both sides will submit legal briefs regarding which jurisdictions permit decisions on label adequacy based on law, and which ones have a heavier burden of proof than New Jersey. A hearing is set for May 11 to finalize a list of all lawsuits impacted by the ruling.
Roche has for many years provided strong warnings of the potential relationship between Accutane and IBD, although the emerging science has largely ruled out any connection, spokeswoman Tara Iannuccillo tells DID.
The ruling should act as a teaching moment for patients and doctors that labeling is important, that all drugs have risks and that those risks need to be carefully explained to patients, says Peter Pitts, president of the Center for Medicine in the Public Interest.
“This ruling reinforces the need for significant tort reform. These ultimately come down to the category of being frivolous lawsuits. Obviously, people took the drug and had negative effects, but that is completely predictable and it’s part of the proposition of taking any drug,” he tells DID.
The plaintiffs did not respond to a request for comment by press time.
A federal advisory group has released a draft version of its National Pain Strategy, which seeks to redefine the way pain is perceived and treated in the U.S.
The report was written by the Interagency Pain Research Coordinating Committee (IPRCC), which is comprised of representation from the FDA, the NIH, the CDC, the Agency for Healthcare Research and Quality (AHRQ), the Department of Defense, and the Department of Veterans Affairs.
It involved six working groups that tackled various aspects of pain care: population research, prevention and care, disparities, service delivery and reimbursement, professional education and training, and public awareness. The strategy is the result of a mandate in the 2010 Affordable Care Act, which asked the Department of Health and Human Services to "increase the recognition of pain as a significant public health problem."
According to strategy co-chair Sean Mackey, MD, PhD of Stanford, "It's not meant to dive into the weeds and recommend specific therapies. It's meant to offer recommendations on how we can change the way we care for patients and incentivize that treatment."
The report discusses gaps in primary care physicians' understanding of pain and how to treat it, since these professionals are often on the front lines of care, and emphasizes that patients need to be more involved in decision-making about their care.
The report acknowledges that more liberal prescribing of the drug class has led to a rise in addiction, abuse, and overdose, but it maintains that the drugs are considered medically appropriate for acute and intractable pain that doesn't respond to other therapies.
Still, it notes that there aren't enough data to help tell which patients are candidates for opioid therapy, on appropriate dosing strategies, or on risk mitigation, and there's a need for further research on the safety and efficacy of long-term opioids for chronic pain.
It’s time to put the Hamburg Manifesto (former FDA Commissioner’s Peggy Hamburg’s pain policy legacy) – which calls for a more robust and regular focus on physician education to the front the pain agenda. It’s also an opportunity for the members of the pain policy ecosystem (manufacturers, physicians, medical schools, CME organizations, social scientists, patient organizations, and regulators) to work together to develop validated methodologies for determining which opioid-appropriate patients are at risk for addictive behavior.
Further, it's time to understand that for differing pain mechanisms there are appropriate non-opioid treatments which most often are bypassed due to cost and access barriers from payers or a need for a quick fix by an overwhelmed physician. Attention must be paid.
In a world driven by social media and ever-more sophisticated e-tools such as mobile apps, it’s time to make smart education a priority. Forewarned is Forearmed.
From the sharp mind of Dr. Sally Satel…
People Who Get Paid By Big Tobacco Should Be Able To Advise The FDA
A few weeks ago the FDA was forced to remove four researchers from its influential Tobacco Products Scientific Advisory Committee (TPSAC). The committee plays a crucial role in providing advice, information and recommendations to the FDA commissioner on the science of tobacco and its implications for regulation.
The TPSAC shake-up came at the order of federal judge Richard J. Leon of the United States District Court for the District of Columbia. Judge Leon concluded that select committee members, including the chairman, were so heavily beset by conflicts of interest that they could not be trusted to deploy sound scientific judgment.
The judge’s decision stemmed from a 2010 complaint filed by tobacco companies Lorillard American and Reynolds American. The complaint was aimed partly at unseating specific TPSAC members who, the companies argued, had “conflicts of interest” by virtue of the millions of dollars in grant money, consulting fees, and expert witness work they collectively received over the years from pharmaceutical companies, also called sponsors.
Because those pharmaceutical companies make and market anti-smoking aids such as nicotine patches, gum, and an anti-smoking medication, Chantix, the plaintiffs reasoned that any advisor who accepts their funding will likely be biased against tobacco interests.
Lorillard and Reynolds prevailed last July when Judge Leon ruled that four members’ financial conflicts of interest represented a violation of federal ethics law. He also ruled that a report on menthol cigarettes by TPSAC (which was the actual focus of the lawsuit) could not be relied upon by FDA. The members’ financial ties, according to the judge, “irrevocably tainted [the Advisory Committee’s] very composition and its work product [is] at a minimum, suspect, and, at worst, untrustworthy.”
While I agree that the membership of TPSAC was problematic, my reason is entirely different from Judge Leon’s. In my view, the real problem with the committee make-up was not, as the Judge indicated, that members receiving support from pharmaceutical companies were reflexively conflicted. But rather that TPSAC had initially welcomed the service of those members while barring entry to any investigator who accepted support from tobacco interests (or who did so within the 18-month period prior to applying for membership.)
The assumption behind the FDA’s inconsistent policy, of course, is based on the misconception that merely accepting financial support from tobacco interests – but never from pharmaceutical interests, mind you –automatically disables one’s capacity to make sound, evidence-based decisions surrounding tobacco regulation.
This is an indefensible double standard on the part of a federal agency. I think it derives from the misbegotten conceit that anyone who accept funding from tobacco sponsors is somehow pro-smoking. In reality, most researchers who accept grants from tobacco interests are working just as hard to reduce smoking. It’s just that their topic of study is smokeless tobacco (and, I hope soon, e-cigarettes whose nicotine comes from tobacco) as a route to smoking cessation. In this context, being “pro-tobacco” is perfectly consistent with advancing public health.
Of particular interest is Swedish snus, a style of smokeless tobacco available in the U.S. Smokeless tobacco is estimated to be 99% less harmful than smoking. The Swedish version, which is conveniently available in spit-less teabag-like pouches, has been the subject of over two decades of epidemiological data. (less is available about the American versions, though it shows similar results). Thanks to its use Sweden now has the lowest rate of smoking-related diseases in Europe, the world’s lowest rate of lung cancer in males, and one of the lowest mouth cancer rates in the EU.
Research on smokeless tobacco is an important public health contribution. Consider examples of the investigations made possible by grants from tobacco manufacturers to researchers’ universities or to the scientists themselves: the danger of misinformation that might convince smokeless tobacco users to switch to smoking conducted by an oral pathologist at the University of Louisville and a researcher at the University of Alberta; the value of tobacco harm reduction by workers at the University of Texas, Houston; the use of smokeless (“snus”) as an effective method to quit smoking; the relationship of smokeless tobacco to lung cancer by investigators at the University of Surrey, UK; among others.
Conflict of interest is a vexing subject. Policies are generally borne of much soul-searching, hand-wringing and hair-splitting and often have unintended consequences. To be sure, all agencies want to insulate their advisors from personal and professional loyalties or other factors that might erode a neutral stance toward the data.
But it is easy to go too far in the pursuit of purity. In fact, many have urged a zero-tolerance policy for advisory committee members and commercial ties. This would be a disaster.
A no-ties rule would force the FDA to recruit its outside s from a far smaller pool of experts.“You’d be getting the second best and the almost brightest,” says Peter Pitts, former Associate Commissioner for External Relations at the FDA and policy adviser to the Commissioner. A 2007 study involving 124 members participating in 16 FDA advisory meetings, found that members who received high levels of support from pharmaceutical companies had more years of experience in their fields and more contributions to peer-reviewed literature compared to members who were funding-free.
Evidence suggesting that funding increases risk of bias in members’ decision-making is mixed. A 2006 paper in the Journal of the American Medical Association (JAMA), meanwhile, found that excluding advisory committee members and voting consultants with conflicts would not have altered the overall vote outcome at any meeting studied.The FDA re-analyzed the JAMA data and found that members with financial ties to companies actually tend to vote against the financial interest of those companies.
Another 2014 study, which looked at over 15,000 FDA advisory committee members’ votes between 1997 and 2011, painted a more complex picture. With about half of all meetings had at least one participant with such a financial interest, the data showed that members with connections to one company, or sponsor, are somewhat more likely to vote for approval (63 percent) than members with no attachments to a sponsor (a 52 percent chance). This modest preference rose to 84 percent if the member served on the company’s board or steering committee.
More intriguing was the observation that the voting behavior of members with links to more than one company, including board membership, was comparable to colleagues without any ties. This suggests that support from multiple sources cancels out preferences for a given sponsor. It also suggests that perhaps the FDA should require sole-sponsored members or, at the very least, sponsor board members to recuse themselves from voting (but not from group deliberation) when that company’s product is under consideration.
As for TPSAC, it must follow Judge Leon’s order. But a longer view of conflict of interest and advisory practices should lead to a more inclusive scenario wherein TPSAC welcomes any talented investigator who is wedded to norms of scientific fair play and is mature enough to suppress bias. This extends to investigators with financial relationships of all kinds – including tobacco interests. (Yes, there should be some exceptions: See here for conflicts with “direct and predictable effects.”)
The emphasis on members’ capacities to adopt a neutral stance is imperative. It highlights the fact that an advisor’s judgment is just as prone to collapse, if not more prone to falter, under the weight of a strong normative bias, that is, how one thinks health policy should work. I refer here, specifically, to members’ views on “tobacco harm reduction.”
Advocates of harm reduction advance a pragmatic stance that tolerates the use of nicotine in the form of smokeless tobacco or electronic cigarettes because doing so greatly minimizes the harm of smoking.
It’s worth special mention here that the investigators who pioneered the study of tobacco harm reduction, such as those working on smokeless tobacco, were consistently refused research support from government agencies. Thus, they were compelled to ask the industry for funding. Investigating innovative methods to reduce the toll of smoking has thus far mainly relied on industry funding.
Anti-harm reductionists, also called tobacco prohibitionists, see no virtue in making nicotine use less harmful; only complete abstinence is acceptable to them. “Given the long history of tobacco industry deception, such advocates assert that there can be no room for compromise when it comes to a product in which Big Tobacco has any interest,” wrote Amy Friedman and Ronald Bayer, both of Columbia University’s School of Public Health, in Science last January. A strong anti-harm reduction mind-set could easily sway members’ assessment of the risk of smokeless tobacco and e-cigarettes.
If TPSAC were to have pro- and anti-harm reductionists among its members, the advisory committees would have to function as a “team of rivals.” And it would be open for anyone to see. Thanks to federal sunshine laws, commercial ties are made public and FDA advisory meetings are open to the public; anyone can observe the proceedings. Members of the media, financial analysts, patient groups, individuals, and politicians can attend TPSAC meetings which are recorded and transcribed for the public. Sources of funding are public too.
The public’s confidence in the recommendations of federal advisory committees is vital to the functioning of governmental institutions. Judge Leon was right to conclude that the committee was poorly composed, but that was because it was exclusionary, not because members accepting support from pharmaceutical companies were necessarily conflicted. Instead, both the judge and the FDA subscribed to the myth that commercial ties are inevitably corrupting. By operating under this facile conclusion, the FDA sealed itself off from a group of scientists whose knowledge and perspectives are critical to the development of wise tobacco regulation.
Dr. Satel has served as an expert witness in tobacco litigation.
The FDA gets it exactly right -- and the key word is "evolving."
FDA issues final guidance on the evaluation and labeling of abuse-deterrent opioids
The U.S. Food and Drug Administration today issued a final guidance to assist industry in developing opioid drug products with potentially abuse-deterrent properties.
Opioid drugs provide significant benefit for patients when used properly; however opioids also carry a risk of misuse, abuse and death. To combat opioid misuse and abuse, the FDA is encouraging manufacturers to develop abuse-deterrent drugs that work correctly when taken as prescribed, but, for example, may be formulated in such a way that deters misuse and abuse, including making it difficult to snort or inject the drug for a more intense high. While drugs with abuse-deterrent properties are not “abuse-proof,” the FDA sees this guidance as an important step toward balancing appropriate access to opioids for patients with pain with the importance of reducing opioid misuse and abuse.
The document “Guidance for Industry: Abuse-Deterrent Opioids – Evaluation and Labeling” explains the FDA’s current thinking about the studies that should be conducted to demonstrate that a given formulation has abuse-deterrent properties. It also makes recommendations about how those studies should be performed and evaluated, and discusses what labeling claims may be approved based on the results of those studies.
“The science of abuse-deterrent medication is rapidly evolving, and the FDA is eager to engage with manufacturers to help make these medications available to patients who need them,” said FDA Commissioner Margaret A. Hamburg, M.D. “We feel this is a key part of combating opioid abuse. We have to work hard with industry to support the development of new formulations that are difficult to abuse but are effective and available when needed.”
The science of abuse-deterrent technology is still relatively new and evolving. The final guidance is intended to assist drug makers who wish to develop opioid drug products with potentially abuse-deterrent properties. The FDA is working with many drug makers to support advancements in this area and help drug makers navigate the regulatory path to market as quickly as possible. In working with industry, the FDA will take a flexible, adaptive approach to the evaluation and labeling of potentially abuse-deterrent products.
“Development of abuse-deterrent products is a priority for the FDA, and we hope this guidance will lead to more approved drugs with meaningful abuse-deterrent properties,” said Janet Woodcock, M.D., director of the FDA’s Center for Drug Evaluation and Research. “While abuse-deterrent formulations do not make an opioid impossible to abuse and cannot wholly prevent overdose and death, they are an important part of the effort to reduce opioid misuse and abuse.”
While this final guidance does not address generic opioid products, the agency understands the importance of available generic options to ensure appropriate access to effective opioid drugs for patients who need them. The FDA is committed to supporting the development and use of generic drugs that have abuse-deterrent properties and is working on draft guidance in this area.
To help support the safe use of all opioid products, the FDA is working in many other ways to help prescribers and patients make the best possible choices about how to use these powerful drugs. The agency’s goal is to find the balance between appropriate access to opioids for patients with pain and the need to reduce opioid misuse and abuse.
Senator David Vitter (R, LA) is, once again, trying to fool his colleagues (and the American public) about drug importation. Let’s go, once again, into the abyss and set the facts straight.
Brand-name pharmaceuticals found abroad tend to be significantly cheaper than they are in the States, largely because foreign governments impose stringent price controls on most drug sales.
Advocates claim that “re-importation” will allow American patients to benefit from this price disparity.
But “re-importation” doesn’t actually describe what will happen if foreign drug importation is legalized. Using the term is an act of linguistic misdirection — or outright chicanery, if you’ve got a cynical streak. It’s not “re-importation,” it’s importation. This isn’t about medicines that have ever been inside US borders.
Nor is this about denigrating the Canadian medicines regulatory system -- it’s about reality.
Importing drugs from Canada is exceedingly dangerous for a number of reasons. For starters, many Internet pharmacies based up North are stocked with drugs from the European Union. And while many wouldn’t hesitate to take medicines purchased from countries like France and Great Britain, there’s plenty of risk involved.
The EU currently operates under a system of “parallel trade,” which allows products to be freely imported between member countries. This means that any drugs exported from the U.K. to Canada could have originated in an EU country with significantly less rigorous safety regulations, like Greece, Portugal, Latvia, or Malta.
Just last year, EU officials seized over 34 million fake pills in just two months. And in May, Irish drug enforcers confiscated over 1.7 million pounds of counterfeit and illegal drug packages. So if American customers start buying drugs over the Internet from Canadian pharmacies, they could easily wind up with tainted medicines of unknown European origin.
It’s also important to note that drugs from anywhere in Europe aren’t even legal for sale in Canada. So, when politicians say we can get “the same drugs” that Canadians get, they’re just plain wrong.
Even more worrisome is outright fraud — many “Canadian” pharmacies are actually headquartered somewhere else.
A 2005 investigation by the Food and Drug Administration looked at 4,000 drug shipments coming into the United States. Almost half of them claimed to be from Canada. Of those, a full 85 percent were actually from countries such as India, Vanuatu, and Costa Rica.
As part of another investigation, FDA officials bought three popular drugs from two Internet pharmacies claiming to be “located in, and operated out of, Canada.” Both websites had Canadian flags on their websites. Yet neither the pharmacies nor the drugs were actually from Canada.
As an FDA official told Congress, “We determined there is no evidence that the dispensers of the drugs or the drugs themselves are Canadian. The registrants, technical contacts, and billing contacts for both web sites have addresses in China. The reordering website for both purchases and its registrant, technical contact, and billing contact have addresses in Belize. The drugs were shipped from Texas, with a customer service and return address in Florida.”
And in laboratory analysis, every pill failed basic purity and potency tests.
The on-the-ground reality of s tate and local importation schemes have been dismal and politically embarrassing. Remember Illinois' high profile "I-Save-RX" program? Over 19 months of operation, a grand total of 3,689 Illinois residents used the program—which equals approximately .02 percent of the population.
And what of Minnesota's RxConnect? According to its latest statistics, Minnesota RxConnect fills about 138 prescriptions a month. That's for the whole state. Minnesota population: 5,167,101.
Remember Springfield, Massachusetts and “the New Boston Tea Party?” Well the city of Springfield has been out of the “drugs from Canada business” since August 2006.
And, speaking of tea parties, according to a story in the Boston Globe, “Four years after Mayor Thomas M. Menino bucked federal regulators and made Boston the biggest city in the nation to offer low-cost Canadian prescription drugs to employees and retirees, the program has fizzled, never having attracted more than a few dozen participants.”
The Canadian supplier for the program, Winnipeg-based Total Care Pharmacy, sent a letter to city officials saying the firm was terminating its agreement because there were so few participants. In 2006, Boston saved $4,300 on a total of 73 prescriptions. When Total Care decided to end its relationship with the city, only 16 Boston retirees were still participating.
And such programs won't do any better on a national basis. A study by the non-partisan federal Congressional Budget Office showed that importation would reduce our nation's spending on prescription medicines a whopping 0.1 percent—and that's not including the tens of millions of dollars the FDA would need to oversee drug safety for the dozen or so nations generally mentioned in foreign drug importation schemes.
Calling foreign drug importation “re-importation” is a clever way to sell the idea to the American people. But the term simply doesn’t fit with the facts. In reality, Americans would end up jeopardizing their health by purchasing unsafe drugs made in foreign countries – while not saving money.
Think again, Senator Vitter.
Senator Jack Reed (D, RI) wants to repeal the Non-Interference Clause. He thinks it will lower the government’s prescription drug bill. He’s wrong. Let’s look at the record.
While Medicare as a whole is a fiscal basket case -- due to run out of money in 2024 -- Part D has been the very model of a well functioning federal program since its implementation.
The Congressional Budget Office (CBO) found that, between 2004 and 2013, Part D will cost an extraordinary 45 percent below what was initially estimated. Premiums for the program, meanwhile, are roughly half of the government’s original projections. Part D enrollees pay, on average, $30 a month -- a rate that has remained essentially unchanged for years.
It’s no wonder that beneficiaries are so pleased with the program. In fact, 96 percent of those enrolled in Part D say that their coverage works well.
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 drugmakers, 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 time and again 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.”
Senator Reed is lost in the wilderness.