Latest Drugwonks' Blog

While Congress waits to see what happens if the Supreme Court rules Obamacare subsidies are unconstitutional,  patients still need protection against the increase in out of pocket drug costs initiated by many health plans.  Thank goodness for federalism:

"Some states are taking action against insurers’ use of high-cost sharing for specialty medicines. Specialty medicines are typically used by patients with severe or rare health conditions, generally less than 5 percent of patients in the U.S., but are often subject to greater cost sharing and utilization management techniques. Policymakers in several states have passed legislation to limit the amount that patients pay for specialty medicines.

For example, Delaware, Maryland and Louisiana have passed laws that cap copays at $150 per month for a 30-day supply of a specialty medicine. New York State passed a law that prohibits insurers from requiring higher cost sharing for specialty medicines, which treat diseases like cancer and HIV, than they do for other brand name medications. Several more states are considering legislation this year."

Here's a list of states that have limited cost discrimination: 

And to find out what is going on in your state go to the National Patient Advocacy Foundation website or click here:

Los Angeles Business Journal

Shopping Site Looks to Bottle Up Prescriptions INTERNET: GoodRx teams with 4D to reach corporate customers, health plans.


People routinely look around for the best deal on a car, a TV or a nice pair of jeans. But they likely won’t shop at all for their monthly refill of Lipitor.

GoodRx Inc. has been trying to change that. The Santa Monica company runs a website allowing consumers to comparison shop for the best price on prescriptions at local pharmacies or by mail order.

The company, co-founded in 2011 by former Facebook Inc. and Yahoo Inc. employees, makes money from ads, referral fees from links to websites like for over-the-counter drugs, and minor administrative fees when consumers print coupons and present them at pharmacies.

But as of the first of the year, GoodRx took on a larger market, partnering with 4D Pharmacy Management Systems Inc., an established pharmacy benefits manager, to bring its shopping platform to health plans and corporate clients.

Rather than charge an annual contracted fee like other benefits managers, 4D and GoodRx are paid an administrative fee for each claim paid. The partnership has already signed San Antonio’s iHeartMedia Inc. as a client, allowing its employees to find the cheapest place to fill a prescription online, through an app or by calling an 800 number.

“Traditional pharmacy benefits managers are mysterious,” said Doug Hirsch, co-chief executive of GoodRx. “We’re going to pass through, show you exactly how much a drug costs. We’ll take a small administrative fee and show your employee exactly how much it costs.”

Jeff Polter, a 4D vice president for business development and account management, credits GoodRx co-founders and their tech background with improving the user experience.

“We are not technologists. ... They’re not (benefits) people,” he said. “You put the two together and we challenge each other.”


Hirsch, 44, was inspired to take on the prescription market as a result of his own experience trying to fill an order for medication. He said he shopped around and found a prescription he needed that cost $250 at one drugstore and $300 at a supermarket, where the pharmacist chased him into the parking lot and offered to negotiate down the price.

“There’s all kinds of crazy discounts people can have with and without insurance,” Hirsch said, noting charges can vary wildly from pharmacy to pharmacy depending on dose, quantity and whether one is getting a capsule or tablet.

Hirsch, a veteran tech executive, used his experience to take on the new challenge.

His career started at Yahoo, which he joined in 1996 as one of the then-two-year-old company’s first product managers. Working at its Sunnyvale headquarters, he helped build such products as Yahoo Mail; Message Boards; and Yahooligans, a content site for kids. He later moved his family to Los Angeles, his hometown, and helped build out Yahoo Entertainment as its general manager.

He left in 2005 for a short stint as head of product at Facebook, leaving after six months to found DailyStrength, a health-focused social network where people could upload photos, write journals, support each other and share information about their treatments.

The company raised $4 million in venture capital and had 3 million visitors a month at its peak. Hirsch sold the company in 2008 to HSW International Inc. for $3.13 million in cash, with the opportunity to earn an additional $3.53 million if certain benchmarks were met, according to regulatory filings.

Hirsch worked on incubating startups until 2011, when he reconnected with Scott Marlette, a Georgia Institute of Technology-trained programmer with whom he worked at Facebook, and Trevor Bezdek, a programmer from Stanford University. Together, they co-founded GoodRx.

The company now has 27 employees and is profitable, said Hirsch, though he declined to disclose revenue. He did say that after an initial $1.5 million fundraise in 2011 from a combination of venture capital and angel investors, including Santa Monica’s UpFront Ventures, the company hasn’t had to go back for another round.

New approach

Hirsch said his team explored getting into pharmacy benefits management after being contacted by companies whose employees asked for the system to be integrated into their own prescription drug program.

The market is dominated by companies such as Express Scripts Inc., which racked up net income of $2 billion on revenue of $100 billion last year, and CVS/caremark, which acts as a benefits manager and has a nationwide network of pharmacies.

GoodRx ultimately went with 4D, a Troy, Mich., company with revenue in the “hundreds of millions,” according to Polter, that serves clients throughout the country, including government programs, commercial groups, cities and states.

Polter said clients must opt in to the program, which started serving clients Jan. 1 and has so far enrolled more than 100,000 users. The venture has about a dozen clients, including media company iHeartMedia, formerly Clear Channel Communications.

He said the platform is popular with clients whose employees are on high-deductible health insurance plans and must pay a lot out of pocket before greater reimbursements kick in.

That makes sense to Peter J. Pitts, a former associate commissioner of the Food and Drug Administration who is now president of Center for Medicine in the Public Interest, a New York think tank.

“It’s a great thing to know you can (comparison shop), especially for high-deductible plans,” Pitts said, provided consumers have transportation to get to the less expensive pharmacy.

He said that while pharmacy benefits managers are supposed to reduce costs for employers, their interests aren’t always aligned with those of consumers because many tack on a fee that’s a percentage of a drug’s price.

“A lot of times, kind of perversely, a pharmacy benefits manager will prefer a more expensive medicine because their markup will be more,” Pitts said. “The tightrope pharmacy benefits managers walk is weighing corporate profitability versus the best interest of the patient. And sometimes that goes hand in glove, other times there’s a conflict.”

He noted that pharmacy prices don’t just represent the manufacturer’s charge, but also how people all up and down the line make their money.

From a consumer’s perspective, the more transparent, the better, he said.

Hirsch doesn’t see his company walking such a fine line.

“We’re capturing profitability on a per-claim basis, not getting more on drug X versus drug Y,” he said. “Many pharmacy benefits managers have in-house mail order and are not only adjudicating claims but picking up money as an actual seller of drugs, maximizing profitability by sending people to themselves. We don’t offer that because we think that’s a conflict.”

Payer's Pity Party

  • 03.09.2015
From today's edition of The Morning Consult:

The Payers Pity Party

AHIP (America’s Health Insurance Plans – the trade organization for the insurance industry) is holding it’s annual conference this week in Washington, DC. This year one of the issues they’ll be highlighting  (not necessarily “debating”) is “high-priced” pharmaceuticals. Well, it’s their party – and they can cry if they want to.

It’s an interesting point of departure to note that the word “innovation” appears exactly once in the conference program. Since this is an event for payers it isn’t surprising but it is disappointing. Sins of omission are seldom fun – especially when those sins weigh the profits of payers over the needs of patients.

The only panel to discuss the value of innovation does so in a more than slightly slanted manner. Consider the title of the session, “Can We Afford New Advances in Biomedical Innovation?”  And if the title doesn’t give you a clue as to the position of the organizers, consider the balance of the speakers – an EVP from CVS, a lobbyist from AARP, a thought leader who believes that “innovation “is too expensive,” and a representative from the biopharmaceutical industry, the industry that actually is primarily responsible for discovering, developing and funding innovation in US and across the globe.

Ignoring the value of innovation may be convenient, but it’s neither honest nor helpful to the broader public policy debate. Karen Ignagni, the President of AHIP, recently lead the charge against Sovaldi (an innovative medicine for Hepatitis C), accusing the drug’s developer — Gilead Sciences Inc. — of exploitative pricing. “The company in this case is asking for a blank check,” she said. “It will blow up family budgets, state Medicaid budgets, employer costs and wreak havoc on the federal debt” – a good and oft-repeated sound bite that is now widely acknowledged to be 100% wrong.

New, better medications are actually the best and swiftest way for this country to cut down on our health-care expenses. By more effectively combating disease and improving patients’ lives, drugs reduce long-term medical costs and bolster the overall economy.

Consider one pre-Sovaldi “best practice” treatment for Hepatitis C, the drug Pegasys. This 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.

It’s easy to point to “high-priced” drugs. It’s a savvy media strategy when your memberships’ focus is on short term savings and quarterly profits versus long-term patient outcomes (data recently published by the PwC Health Research Institute shows that the use of Sovaldi will actually drive down overall spending within a decade).  It’s “savvy” because AHIP plays to an easy to articulate argument that the media and the general public is ready to accept, “healthcare costs are driven expensive drugs.” But facts are stubborn things. Consider that pharmaceuticals represent only 11.5% of our national healthcare costs – with on-patent “innovative” medicines representing only 8.5% of our healthcare resources. And their benefits are manifold, returning many times their cost via patient value.

Yet these and many other facts backing pharmaceuticals as a sound healthcare investment have been twisted to suit the agendas of politicians, pundits, and other competing stakeholders. It goes relatively unreported that insurance companies continue to increase their monthly premiums without really explaining why. The industry claims its costs are increasing because prescription drug costs are busting their budgets. But prescription drugs account for only a small part of monthly insurance-premium hikes. From 1998 to 2003, insurance companies increased premiums by an average of $104.62 per person. During that same period, drug costs rose by $22.48.

According to CMS-published data, patients pay less out-of-pocket for pharmaceuticals today than at any time in the past 40 years. This is the result of the proliferation of generic drugs following a strong period of innovation in the 2000’s. However, this is probably news to those patients who are seriously ill and require therapies that do not have a generic alternative. In those cases, patients are often asked to pay a significant amount of their own money for their medicines. If they find that they eventually can’t afford those out-of-pocket costs, they don’t take their medicine, leading to higher health costs elsewhere in the system. But treatment for a severe illness is exactly what should be covered as an insured benefit. Part of the solution to the out-of-pocket cost dilemma may be a more rational insurance design where patient cost sharing for various health services is based on the value of the intervention rather than price, as formularies should help patients and doctors make the best treatment choices, not forgo treatment all together.

Should we blame “Big Insurance”? Out-of-control out-of-pocket expenses cause many patients to stop using prescription drugs for controllable chronic conditions. The unfortunate result is that visits to the ER have jumped by 17 percent and hospital stays have risen 10 percent. And a new Integrated Benefits Institute study shows that when employers shift too much of their healthcare costs to employees, the companies lose more than they save, through absenteeism and lost productivity.

Having one person defend the value of innovation at a high profile event such as the annual AHIP event is stacking the deck against the pharmaceutical industry to be sure – but what’s worse (and far less forgivable) is the disservice it does to patients.

As Harvard University health economist (and health care advisor to President Obama) David Cutler has noted: “The average person aged 45 will live three years longer than he used to solely because medical care for cardiovascular disease has improved. Virtually every study of medical innovation suggests that changes in the nature of medical care over time are clearly worth the cost.”

Healthcare innovation saves lives, saves money, promotes economic growth, and provides hope for hundreds of millions of people (both patients and care-givers) in the United States and around the world. But innovation isn’t easy – and the task of defending it against a cognitively closed audience is certainly a challenging one.

Pharmaceutical innovation faces many roadblocks. Beyond the daunting scientific and regulatory hurdles, the complicated and conflicting dynamics of politics, perspectives on healthcare economics, of friction between payers, providers, and politicians, the battle for better patient education, and the need for a more forceful and factual debate over the value of innovation all create the need for a more balanced and robust debate.

Alas, the AHIP conference will not advance this agenda.

Peter J. Pitts, a former FDA Associate Commissioner, is President of the Center for Medicine in the Public Interest

Suffix is in

  • 03.06.2015
And wither the issue of biosimialr nomenclature? What will Zarxio be called? The door remains ajar -- but the wind is blowing in the right direction.

Instead of calling Zarxio simply filgrastim -- the desire of those who believe differential nomenclature is the devil incarnate, the FDA has dubbed the new product filgrastim-sndz, the suffix standing for Sandoz.

According to Dr. John Jenkins, director of FDA's Office of New Drugs the naming of this particular drug does not necessarily mean this will become the general policy for naming biosimilars.

Stay tuned and attuned.

Welcome Zarxio, the Sandoz version of filgrastim. While nothing is “easy” when it comes to drug development, many view this initial Sandoz experience as forecasting clear skies and fair winds for every biosimilar put in front of the agency for consideration.

If you believe that, there’s a bridge in Brooklyn you might find of interest.

The filgrastim example is an n of 1 and shouldn’t be viewed as predictive of anything other than the FDA approval for one product.

As surely anyone inside the agency or at Sandoz will tell you, the pathway to approval has been anything but easy. But that hasn’t stopped the sale of rose-colored glasses to many. So be it.

More important to consider is how the agency will continue to study global biosimilar experiences – and especially in the EU.

Case in point: Remicaide (infliximab), certainly a product on the radar screens of many as the next big biosimilar marketing opportunity – and regulatory challenge.

The Remicaide road has been a rocky one in the EU. A new poster presentation at the European Crohn’s and Colitis Organisation, titled, “Biosimilar but not the same,” offers some timely and important real-world data on the differences between originator biologics and their biosimilar cousins.

The study, from Mercy University Hospital, University College Cork, Centre for Gastroenterology, Mercy University Hospital, Cork, Ireland, studied the clinical impact of both the innovator product (Remicade) and it’s EMA-approved biosimilar (Inflectra). The findings are important. Specifically, the rates of surgery in Infliximab and Inflectra groups were significantly different.

80% of the Inflectra group required hospital readmission versus 5% of the infliximab (Remicade) group. (p=0.00004). 60% of patients in the Inflectra group needed steroid augmentation of standard steroid tapering protocol with 50% requiring multiple increases in steroid dose versus 8% of patients in the Infliximab (p-value = 0.0007). Over the course of 8 weeks, 93% of patients in the Inflectra group had an increase in CRP with 7% remaining unchanged whereas 100% of patients in the infliximab group had a decrease in CRP (p=<0.001).

The conclusion is not ambiguous, “Our results suggest that biosimilars may not be as efficacious as the reference medicine. The results found reflect the ECCO statement position that the use of most biosimilars in IBD will require testing in this particular patient population and cannot be extrapolated from other disease populations."

And now the British Society of Rheumatology (BSR) is calling for clinicians to register patients with its biologics registers to track the efficacy and long-term safety of new biosimilar products coming on to the UK market.

The BSR – the professional association for health professionals involved in rheumatology and muscular skeletal disease – maintains two biologics patient registers. One is for people being treated for rheumatoid arthritis, the other for patients with ankylosing spondylitis.

The BSR has released a position statement on biosimilars and says that it supports their introduction but wants to make sure that a system is in place to monitor their safety and efficacy in order to reassure health professionals and the public.

“Widening the range of treatments available to our patients at a lower cost to the NHS is clearly a positive step, but there are still a few gaps in the evidence for the safety and efficacy of these products, which will need to be explored further,” says Alex MacGregor, chair of BSR Biologics Registers.

“For example, the clinical trials of these drugs for people of rheumatological or autoimmune diseases were with new users only, and no trials have explored the effects of substitution from a reference drug.”

The release of the BSR’s position statement comes as biosimilar versions of Janssen Biologics’s Remicade — a medicine that contains the monoclonal antibody infliximab and is used for a variety of inflammatory conditions including rheumatoid arthritis — are being launched in the UK.

These First World data points about a product from a respected manufacturer (Hospira) cannot be ignored and must be used to inform the policy debate over nomenclature, interchangeability, label extrapolations, and overall pharmacovigilance practices. Surprising? Not if you understand that the decision tree for biosimilars is quite different from the Hatch-Waxman pathway. And that for the foreseeable future, each biosimilar application is going to be an important learning experience for FDA reviewers and senior division staff.

FDA has Appy Feet

  • 03.05.2015

In case you missed ...

The Food and Drug Administration has finalized its guidance clarifying the agency’s hands-off approach to regulating mobile devices and apps. The agency has issued two documents outlining its position on medical device data systems and mobile medical applications, including those on smart phones. The documents reiterate the agency’s position that it won’t oversee low-risk medical devices, or will regulate them under a lower-risk classification.  “Through smart regulation we can better facilitate innovation and at the same time protect patients,” the agency said.

The agency will, however, regulate mobile apps or devices intended to detect life-threatening conditions.  “FDA’s oversight approach to mobile apps is focused on their functionality, just as we focus on the functionality of conventional devices,” the agency said. “Our oversight is not determined by the platform.”

(The documents are largely unchanged from draft versions.)

From this morning's Morning Consult ...

In The New Health Economy, Collaboration Between FDA, Industry, And Consumers Will Be Key

Communication is the key to any relationship – that’s what all the self-help gurus tell us.  In which case, the relationship between the Food and Drug Administration (FDA) and the pharma and life sciences industry should be in for profound, positive change.

In a recent survey, top industry executives told PwC’s Health Research Institute (HRI) that they believe the FDA has become a more communicative and open partner.  Seventy-eight percent of those execs told HRI that the FDA has improved the quality and frequency of its communications in the past two years.  These execs also overwhelmingly agreed that the agency provides actionable feedback and offers more applicable guidance, rules and regulations. These and other findings are reported in depth in HRI’s new report, “The FDA and industry: A recipe for collaborating in the New Health Economy.

If communications, feedback and guidance are improving, can the relationship be far behind? Both in our survey, and in a series of related interviews, it was clear that most company executives believe that their overall relationships with the FDA have improved over the past two years.

It’s certainly a critical time for industry and the FDA to collaborate more effectively.  Both the FDA and manufacturers face mounting pressures from an evolving health sector that places a premium on speedy access to breakthrough, cost-effective and safe medical products.

This is all part of the emerging New Health Economy – a phenomenon driven in part by increased consumer involvement in healthcare decisions and payment.  The $347 billion-a-year pharma and life sciences industry now answers to a new class of consumers who shoulder more of their treatment costs and who demand a greater role in product development.

Some of that pressure comes directly from consumers and their advocacy organizations. Insurers and pharmacy benefit managers are also pressuring drug and device manufacturers as they face rising costs.  Either way, the end result is that companies working to invent novel therapies and win regulatory approval must increasingly demonstrate the value those products bring rather than solely their medical benefits.

Consistent with the New Health Economy’s pressures and incentives, executives’ attitudes have shifted dramatically when it comes to determinations of value.  Forty-three percent now support the FDA evaluating a drug based on both clinical and economic effectiveness. This represents a major swing in sentiment over the past five years; the support for including economic effectiveness was only 14% in 2010.

Our research also showed the executives understand that balancing innovation and risk requires tradeoffs.  To improve access to new treatments, the industry is willing to consider regulatory reforms such as stricter post-market safety requirements and restrictions on promotional activities.  Seventy-one percent of survey respondents agreed that accelerated approval programs should be balanced by stricter post-market surveillance.  Indeed, additional protections once a drug goes to market might help allay fears that patients could be placed at risk by the acceleration of the drug-review process.

But what about those newly-empowered healthcare consumers?  HRI surveyed them as well, and consumers told us they want the FDA and industry to take their views into greater account.  Only slightly more than one-third of consumers (39%) believe the FDA currently incorporates their views in the agency’s review process, and 38% percent say that drug and device manufacturers adequately consider them.

PwC has been periodically surveying the pharma life sciences sector since 1995, and looking back at all that data, it is clear that the relationship between the industry, its chief regulator   and consumers has been one of continuous growth. But it must evolve even further to meet 21st century demands.

A new framework for this complex relationship is needed to ensure America’s perch as a global leader in medical innovation and to focus investment where it will produce the most value.

A closer, more collaborative bond among all stakeholders may create a more efficient development and regulatory process that leads to the next generation of treatments and cures.  As in any relationship, improving communication is step one.



Mike Swanick is Global Pharmaceuticals and Life Sciences Leader at PwC

Bobby Clark is Senior Manager at PwC’s Health Research Institute


  • 02.27.2015

The FDA has decided to postpone the March 17th meeting of the Arthritis Advisory Committee. The adcomm was supposed to discuss Celltrion’s infliximab biosimilar application. The Pink Sheet proclaimed this a “Biosimilar Bummer.”

What does the cancellation mean? Lots of potential tea leaves to read and no shortage of regulatory mediums. Bottom line – not a good thing for Celltrion. As to why, one thing to consider is the recent revelation that Hospira’s EMA-approved infliximab biosimilar (Inflectra) has shown some significant clinical differences from innovator and reference product Remicade.

For more on this issue see, “Interchangeability: When Irish Eyes Aren’t Smiling.”

A bummer for Celltrion to be sure, but the lesson to be learned is that the filgrastim adcomm, viewed by many as a FDA love-fest should not be viewed as a broader predictive regulatory response to every biosimilar application. Many saw it as such because they wanted it to be true.

(Infliximib is considerably more difficult to characterize than filgrastim – and characterization data was very important at the filgrastim adcomm.)

Bummer? Not if you understand that the decision tree for biosimilars is quite different from the Hatch-Waxman pathway. And that for the foreseeable future, each biosimilar application is going to be an important learning experience for FDA reviewers and senior division staff.

Repeat after me – there are no such things as generic biologics.

But it’s human nature to believe what you want to be true. No doubt those who are disappointed out will “blame the FDA.” A “bummer” is in the eyes of the beholder.

As Oscar Wilde said, “The truth is rarely pure and never simple.”

On a related note, yesterday I was honored to share my thoughts on the issue of biosimilar naming at the World Congress on Biosimilars Market Access. An important part of the discussion focused on the fact that biosimilar approvals are based on similarity – but in the real world success will be measured by patient outcomes. Real world data capture will be crucial to understanding the true clinical impact of biosimilars and for 21st century pharmacovigilance – which is why differential nomenclature is so important

Focusing on issues such as price and market share are important. But minus a concentrated strategy to measure patient outcomes and address pharmacovigilance issues as they arise -- it’s putting profits before patients.

And that’s not the spirit of the Biologics Price Competition and Innovation Act.

California State Assemblyman David Chiu (D-San Francisco) has introduced a bill in that would require the manufacturer of any drug priced higher than $10,000 per year to report operational costs and profits associated with the product. 

The bill would require drugmakers to report profits attributed to drugs as well as expenses for R&D, clinical trials, acquisition, manufacturing, marketing, advertising and patient prescription assistance programs.

Companies would also have to report grants associated with high-priced drugs.
The Office of Statewide Health Planning and Development (OSHPD) would collect the information into an annual report, submit the report to the state legislature and post it online

Chiu said the bill is meant to provide transparency as drug prices rise.

Really? What about the cost of failure – which represents the lion’s share of pharmaceutical spending? Perhaps Mr. Chiu hasn’t been properly informed of the basic tenets of drug discovery. And maybe it’s time that was corrected.

Or maybe he’s just looking for an easy headline.

Hagap Kantarjian wants lower drug prices and he's willing to let people die to get them. 

In a conversation with Ed Silverman who runs Pharmalot, Kantarjian noted he is launching a online crusade to get 1 million people to support  his plan to lower cancer drug prices.  

Here's the 5 point plan he shared with Ed:

"First, allow Medicare to negotiate drug prices. Two, allow the Patient-Centered Outcomes Research Institute [which was created as part of the Affordable Care Act to assess treatments] to put the prices of drugs in their evaluations of benefits. Three, allow importation of drugs across borders. Prices in Canada are half of what they are in the U.S., so insurance companies would save money, patients would save on out-of-pocket costs and drug companies would make money because the patient who can’t afford the drug here would then make a purchase. Fourth, we should prevent drug companies from making deals to protect patents, like pay for delay, and prevent patent evergreening [which allegedly involves tweaking a patent to extend its life]. And fifth, we should encourage organizations that represent patients with cancer to develop treatment pathways that incorporate drug prices – what they call drug value or treatment value.

If we put these in place, it will allow market forces to work in a more favorable way."

In fact, under Obamacare, health plans are already doing much of what Kantarjian desires.  Recently HHS issued a final rule on drug coverage to address "benefit designs that we believe would discourage enrollment by individuals based on age or based on health conditions, in effect making those plan designs discriminatory, thus violating this prohibition. " The final rule goes on to cite “placing most or all drugs that
treat a specific condition on the highest cost tiers” as an example of discrimination." 

A review of these plans found that many patients have no affordable or low cost options. “Even if they are willing to switch drugs, many of the drugs have a high coinsurance cost…”

It should be noted that this redlining of sick people is based on the evaluation of drug prices and the pathways Kantarjian endorses.  PBMs say they are cutting drug prices but in fact they are just extorting rebates from innovator companies and pocketing the cash.  But I guess that's ok too as long as the drug companies are screwed to Kantarjian's satisfaction.  

Not suprsingly,  AHIP is claiming it wouldn't have to ration drugs if the prices weren't so damn high.  That's what Kantarjian claims too.   

That's just a lie, which since it is repeated often enough, passes as fact in Beltway discourse.  

In fact,  innovative cancer medicines represent 0.6% of total healthcare spend.  If every new medicine prevented or controlled disease, theeby eliminating hospitalization and physician visits and increasing healthy life span, spending three times what we currently spend on drugs would be a great bargain.   More immediately, a Milliman study has shown it would cost health plans less than $1 a month per health plan member to cover the cost of new oral cancer drugs.   

So what if we acheived Kantarjian's dream, not allowing any new cancer drug to the market until it the price was cut in half and stayed there.  America would save a grand total of $15 billion a year out of the $2.8 trillion spent on health care.  That's about 50 cents a day per cancer survivor.  That's something close to what the United Kingdom and Canada do with regard to prices.  

The UK, despite spending about the same amount on cancer drugs as the US, has the worst 5 year survival rates and mortality rates for many cancers.   The same with Canada.  Mortality from cancer is declining and has been declining more quickly here.  The reason?  Faster access to new medicines.   Just the time it takes to review new medicines is deadly.  A Frasier Institute report concludes that delaying access to just five new cancer drugs to get the price down cost the total federal and estimated would cost 1696 life years with estimated value of extended survival of between between $339.2 and $559.6 million.   There are many other studies confirming the connection between the Kantarjian cure for drug prices, increased health care spending and more people dying sooner. 

Kantarjian's silence on this disparity exposes him as nothing more than a second rate publicity hound.    (Similarly,  Kantarjian has said nothing about the fact that MD Anderson, where he works, increased what it charged for cancer surgery by 400 percent or marks up the price of cancer drugs discounted for the poor by 700 percent.   )

He and other critics of drug prices fail to support policies that reduce the time and cost of bringing new medicines to market and refuse to discuss ways to change how new therapies are paid for.  Amortizing the cost of a medicine over a period of years and providing patients and providers 'upgrades' as new technologies emerge would help frame the value of innovation.  

But these are serious proposals.  Kantarjian is not serious.  He is a demagogue who distorts the facts, ducks debates and hides the truth.  


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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