How Japan’s Unlikely Shareholder Rebellion Could Lead to Profit Plays for Western Investors

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Is George Soros Long or Wrong on the Global Rebound?

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Will Week of Controversy Undermine Financial System Overhaul That Calls for Broad Expansion of Central Bank’s Power?

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Obama’s Financial System Overhaul Would Give the Fed Broad Powers Over Wall Street

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New drug assessment body created in Germany

Submitted by THE HEALTH ECONOMICS BLOG

In early June, EVITA (evaluation of pharmaceutical innovations with regard to therapeutic advantage) started to operate in Germany. The body, funded by the German association of statutory health insurance funds (GKV Spitzenverband), intends to focus on delivering risk-benefit analysis based on an assessment of new drugs against existing treatments. It plans to perform such analysis in a period of time shorter than that currently needed by IQWiG (German drug assessment body).

The new body received criticism from the VFA and individual companies who questioned the methodology used and the need for a supplementary assessment body.

The Price of life

Submitted by THE HEALTH ECONOMICS BLOG

from The Telegraph

Hi All,

there was a TV report on BBC about the work of NICE.. it has triggerd a huge debate in the UK and throughout Europe as this documentary reached first time people who had never paid attention to NICE.. unfortunately I wasn`t able to post the video link as it seems to works only in the UK if you want to download from BBC. Below a short review from The Telgraph..

TV review: The Price of Life (BBC Two)

Andrew Pettie reviews Adam Wishart’s documentary on Nice, the NHS body that decides what the health service can and can’t afford, plus Sky1’s new glossy drama series The Take.

Published: 6:17PM BST 17 Jun 2009

The Price of Life: ‘Is it wise to spend £30,000 to get two extra months of life for one [cancer sufferer], or to have a health visitor working with some very disadvantaged families preventing the next Baby P?” It’s a tough question. Sophia Christie, the woman asking it, is the Chief Executive of NHS Birmingham East and North. Each year she has around £630 million to spend on “birth to death universal healthcare” for 440,000 people. Her daily quandary – which treatments will prove the most cost-effective? Whose lives most deserve saving? – was the controversial nub of The Price of Life (BBC Two).

To tackle a question as complex and emotive as how the NHS should best deploy its resources, it was important the film retained an open mind and a clinical grasp of the issues at hand. At first, the signs were promising. The documentary-maker, Adam Wishart, is a science writer and film-maker with experience in this field. His father died from cancer six years ago and the book Wishart wrote about the history and science of the disease as a result, One in Three, was nominated in 2007 for the Royal Society Prize for Science Books.

What’s more, Wishart had pulled off something of a coup: his documentary was the first to gain access to the National Institute for Health and Clinical Excellence, the controversial NHS rationing body known as Nice. Watching Nice at work – eavesdropping on its deliberations as a committee of doctors and lay people debated the cost and efficacy of new treatments – was fascinating. And listening to the compassionate yet clear-eyed insights of Professor David Barnett, a heart specialist and the chairman of the Nice appraisal committee, made a nonsense of the notion that Nice was little more than a panel of uncaring bureaucrats.

“If it was me, if it was my family, I’d feel the same way [as those people lobbying Nice to approve a specific drug],” said Professor Barnett. “But Nice has to stand outside that and look at everybody, not just at the individual.”

To help the committee to weigh the cost-effectiveness of expensive new treatments, Nice has put, in Wishart’s phrase, a “price on our heads”. That price is £30,000 per annum. If it costs more than £30,000 for each year a drug will add to a patient’s life (according to the available clinical projections), then Nice will not approve it to be prescribed on the NHS. This may sound callous but the committee, as Prof Barnett patiently explained, is financially compelled to see the bigger picture.

It was therefore extremely frustrating that for long periods Wishart’s film was unable to do the same. Instead of spending more time with Professor Barnett and NHS managers such as Sophia Christie, The Price of Life focused too heavily on a group of patients campaigning for Nice to approve the cancer drug Revlimid. Of course, these patients’ stories were affecting and their frustrations with Nice understandable.

But Wishart was guilty of some wishy-washy journalism in allowing the patients to voice their complaints against Nice (“They do not care. We’re just numbers to them”) without once asking them to consider the counter argument: that if Nice approved Revlimid other, perhaps equally needy areas of the NHS would necessarily go without.

At other times Wishart’s contributions were infuriatingly facile. “Surely,” he said to Prof Barnett, “decisions about life and death shouldn’t be about money.” In a world of finite resources – ie the real one – that sort of woolly platitude only confused the issue.

Thankfully, after a year of filming, Wishart had “come to realise… that if a drug costs too much money for too little benefit then the NHS must be allowed to deny it to patients.” To any intelligent viewer, though, this hard-won conclusion appeared self-evident. Despite Wishart’s courage in tackling a provocative issue, The Price of Life was primarily an opportunity missed.

Five Semiconductor stocks that will thrive after 2009. Part II.

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Among the companies that we looked at in the prior article, many can be eliminated with ease. So, let’s get the job done systematically.
a. Applied Materials. With pristine financials and the enviable position as the #1 purveyor of machines that the semiconductor industry needs to make their chips, Applied flies through the initial screen.
b. [...]

Five Semiconductor Stocks that will thrive after 2009. Part I.

Submitted by Bapcha’s Stocks

Semiconductor sales for 2009 will be down anywhere up to 25% from about $250 Billion in 2008, and with sales exceeding 2008 levels only in 2012 or 2013. ASP’s [average selling price] for all memory makers is in the trash, and for high-margin companies like Linear (LLTC), Maxim (MXIM), Analog Devices (ADI); their sales to [...]

Drug Deals Tie Prices to How Well Patients Do

Submitted by THE HEALTH ECONOMICS BLOG

one more interesting article from the NY times…

ANDREW POLLACK
Published: April 22, 2009
Think of it as product guarantees by the drug industry.

Merck, via Bloomberg News
Januvia, by Merck, is part of a cost-control deal with Cigna.
Pressed by insurance companies, some drug makers are beginning to adjust what they charge for their drugs, based on how well the medicines improve patients’ health.
In a deal expected to be announced Thursday, Merck has agreed to peg what the insurer Cigna pays for the diabetes drugs Januvia and Janumet to how well Type 2 diabetes patients are able to control their blood sugar.
And last week, the two companies that jointly sell the osteoporosis drug Actonel agreed to reimburse the insurer Health Alliance for the costs of treating fractures suffered by patients taking that medicine.
“We’re standing behind our product,” said Dan Hecht, general manager of the North American pharmaceutical business of Procter & Gamble, which sells Actonel with Sanofi-Aventis. “We’re willing to put our money where our mouth is.”
Some experts hail such arrangements as a welcome step toward health care that rewards good outcomes for patients.
“We’re going to see a growth in outcomes guarantees for pharmaceuticals, and it’s very healthy,” said Robert Seidman, a consultant who was formerly the chief pharmacy officer for WellPoint, an insurance company.
Traditionally, discounts and rebates that drug companies offer insurers have been based on how much drug is used, not how well patients do. But the emerging, outcomes-based contracts would — in theory — better align the incentives of insurers, drug companies and the employers that provide health coverage toward improving people’s health.
Such pay-for-performance contracts started to take hold a few years ago in countries with national health systems, in which the government could effectively block a drug from being used if it was too costly.
Johnson & Johnson set what is considered the prototype deal in 2007 with Britain’s national health system, which had tentatively decided not to pay for the cancer drug Velcade. To avert that decision, the company offered essentially a money-back guarantee. If Velcade did not shrink a patient’s tumors after a trial treatment, the company would reimburse the health system for the cost of that patient’s drug.
In the United States, where insurance companies do not have national monopolies — and where Medicare, by law, is precluded from negotiating drug prices — insurers have less leverage with drug makers. Even so, they can give favorable treatment to certain drugs, by reducing the required co-payments, for example.
Under the Actonel deal, if a patient insured by Health Alliance suffers a nonspinal fracture despite faithfully taking Actonel, the drug makers will help pay for the medical care — spending $30,000 for a hip fracture, for instance, and $6,000 for a wrist fracture.
This clearly lowers the cost of the drug to Health Alliance, a small insurer in Illinois and Iowa. But Procter & Gamble and Sanofi-Aventis might benefit as well. The deal could reduce the pressure on the insurance company to move patients off Actonel, which costs about $100 a month, to less-expensive generic versions of Fosamax. And the insurer has kept Actonel in a tier of its drug list that requires a smaller co-payment than for a competing brand-name drug, Boniva.

The deal between Cigna and Merck is more complex.

Rather than getting paid more for good results, Merck will actually give Cigna bigger discounts on Januvia and Janumet. Some discounts will be granted if more people diligently take the drugs as prescribed. This helps both Cigna, because people who take their pills are likely to have fewer complications from the disease, and Merck, because it sells more pills. The assumption is that Cigna will push for patient-compliance programs that urge people to take their medicine at the right times and in the proper doses.
Moreover, in an unusual move, Merck will offer even greater discounts to Cigna on Januvia and Janumet if patients’ blood sugar is better controlled — regardless of whether the improvement comes through Merck’s drugs or other medications.
In effect, though, Merck is betting not only that its drugs prove superior but that Cigna’s incentives to reap the benefits of the deeper Januvia and Janumet discounts will prompt the insurer to try to keep patients on those drugs.
As part of the agreement, too, Merck will get better placement for Januvia and Janumet on Cigna’s formulary, meaning a lower co-payment for patients than for some other branded drugs. The deal was made with the pharmacy benefit management division of Cigna, which manages prescriptions for 7.1 million people.
Merck declined a request for an interview. In a statement the company said it was “committed to finding new approaches to demonstrate the value of our products to patients, physicians and payers.”
Januvia, approved in 2006, costs about $150 a month. Janumet, approved a year later, is a combination of Januvia and metformin, a widely used generic drug.
Eric Elliott, the president of Cigna Pharmacy Management, said his company was negotiating similar contracts with other drug makers.

“We wanted a contract that drives performance,” he said. “Getting this one out will provide more momentum.”

My day at Intuitive Surgicals

Submitted by Bapcha’s Stocks

Today - April 22nd 2009 was Intuitive Surgicals’ investors’ day. Apart from a rehash of numbers from Q1 2009, and a predictable slate of votes, there was much to be impressed, and I learned a lot more than I thought I would from the meeting. My notes outline my impression of ISRG’s products and management.

Payers view on risk sharing and outcomes based agreements…?

Submitted by THE HEALTH ECONOMICS BLOG

Latest edition of Spanish Journal for health economics online

Submitted by THE HEALTH ECONOMICS BLOG

Hello everyone,

the latest edition of the Spanish journal for health economics is out. The journal is enjoying increasing readership within the Spanish speaking community although there are also publications in English. I contributed en editorial “The Pharmaevolution” speculating a little on the latest developments - consolidation is increasing again and new business and organizational models are being tested and deployed. Would be interesting to hear your thoughts on the sectors’ evolution…?

Cheers
Ulf

UK allows private top-ups, privately

Submitted by THE HEALTH ECONOMICS BLOG

Scrip

The UK department of health has published guidance for the national health service on
how to handle patients who want to pay out-of-pocket for licensed drugs that are not
funded by their local health authorities.
Private top-ups to publicly funded healthcare became the subject of heated political
debate after the health technology assessment agency for England and Wales, NICE,
refused to recommend several expensive anticancers for routine use in the NHS on the
grounds of cost.
Patients in some hospitals were allowed to purchase drugs privately and have them
administered at public expense, but other hospitals refused to combine public and private
treatments, insisting that patients choose one system or the other for all of their care.
Some public figures objected to these uneven policies - a postcode lottery, they said -
while others denounced top-ups as the beginning of a two-tier healthcare system. Still
others called for NICE to be abolished, arguing that no patient should be denied
treatment on the grounds of cost.
Professor Mike Richards, the national cancer director, studied the problem and
recommended last year that private payments should be allowed within the health
service. After a consultation period, the government accepted his proposals; the new
policy took effect on March 23rd.
The main principles of the department’s guidance are that NHS care should not be
withdrawn from patients who choose to buy additional private care, and that the NHS
should continue to provide free of charge all care that the patient would have been
entitled to had he or she not chosen to have additional private care. But it says the NHS
should never subsidise private care with public money.
It calls for a strict separation of private and public healthcare. “Private care should be
carried out in a different place to NHS care, as separate from other NHS patients as
possible,” it advises. By “a different place”, it means private facilities or part of an NHS
organisation that has been “permanently or temporarily designated for private care, such
as a private wing, amenity beds or a private room.”
Among several illustrations, the department’s guidance describes a cataract patient who
wants to pay for a multifocal replacement lens rather than have the NHS standard single
focus lens inserted during surgery. The patient should be informed “that it is not possible
to pay for the multifocal lens while carrying out the surgery on the NHS as it is not
possible to separate the private element from the NHS element of care”. SCRIP - World
Pharmaceutical News - www.scrippharma.com FILED 26 March 2009 COPYRIGHT
PHIND: Pharma & Healthcare Ind News - today only (PHID)
Page 23
Informa UK Ltd 2009
COPYRIGHT BY T&F Informa UK Ltd

Drug-Industry Shakeout Hits Small Firms Hard

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Another Wave of Acquisitions Is Likely as Companies Worry About Their Drug Pipelines and Health-Care Change – March 10, 2009

By AVERY JOHNSON and RON WINSLOW
Drug makers have begun a frenzied consolidation drive that is redrawing the industry landscape.
Merck & Co.’s $41.1 billion agreement to acquire Schering-Plough Corp., announced Monday, follows Pfizer Inc.’s $68 billion January takeover deal for Wyeth. Roche Holding AG’s seven-month pursuit of Genentech Inc. was also nearing an agreement Monday, according to people familiar with the situation.
The push to consolidate is being driven by the knowledge that the big companies’ pipelines aren’t producing enough new moneymakers to keep growth going when major products lose patent protection over the next couple of years. As a result, the drug giants are looking to consolidations that will cut costs by combining research and sales efforts and eliminating other overlaps.
What will be left is an industry dominated by behemoths, raising questions about the fates of smaller drug companies, as well as the countless small biotechs hungry for suitors. Even though their labs aren’t what they used to be, the major pharmaceutical companies have product lineups that still command fat margins, giving most of them the cash to pursue deals.
“There are too many companies chasing smaller revenue opportunities, so there’s got to be a shakeout,” says analyst Tim Anderson at Sanford C. Bernstein & Co. “If you’ve got cash and the value of the companies you want to buy is lower, it’s the perfect setup.”
Johnson & Johnson seems most likely to be involved in the next wave of consolidation in the drug industry, analysts say.
There could also be pressure tied to moves in Washington, where health-care reform could eat into margins. Bigger drug companies might be in a better position to bundle their products and negotiate with the government, analysts say.
The wreckage on Wall Street is also a factor: The health-care sector is traditionally viewed as a relatively safe bet, making it easier for drug companies to get financing than other industries.
But megadeals haven’t cured industry problems in the past. Pfizer paid $116 billion for Warner-Lambert in 2000 and an additional $54 billion for Pharmacia in 2003, yet still needed to acquire Wyeth this year to help replenish an anemic pipeline.
As the dust settles, Eli Lilly & Co., Bristol-Myers Squibb Co., AstraZeneca PLC, Sanofi-Aventis SA and Johnson & Johnson seem most likely to be involved in the next wave of consolidation, analysts say. Factors including existing partnerships, the timing of patent expirations and how well drug makers can absorb multiple acquisitions could affect who will be a buyer and who will be a seller.
“Bristol and Lilly stand out in terms of size versus the rest of the industry,” says Les Funtleyder, an industry analyst at Miller Tabak. “They’ll have to do something, because it’s a consolidating industry.”
Lilly, based in Indianapolis with a market capitalization of $32 billion, will lose patent protection on its bestselling antipsychotic Zyprexa in 2011. It just bought ImClone for $6.5 billion. Mr. Anderson suggests it could merge with Bristol-Myers, whose chief executive, James Cornelius, came from Lilly.
Lilly, which has strong ties to Indiana and an undesirable series of patent losses coming up, would be more likely to buy than sell. “There’s no way Lilly’s a takeout,” says Mr. Anderson.
Mark Taylor, a Lilly spokesman, says, “We’re not interested in large-scale M&A activity in pharma and believe small and medium scale acquisitions, licensing and internal development” are the best way forward for Lilly.
Bristol-Myers faces a similar dilemma, because Plavix, the bloodthinner it sells with Sanofi-Aventis, faces generic competition in 2011. A merger with Lilly could face antitrust hurdles because both companies have clotting drugs and antipsychotics. A tie-up with Sanofi-Aventis is frequently rumored because of Plavix.
Bristol-Myers sold its ConvaTec wound-care business last May for $4.1 billion and offered a $720 million partial initial public offering for its nutritional business last month — divestitures that could either add to its war chest for deals or make it a more attractive takeover target. Bristol-Myers declined to comment.
Sanofi-Aventis’s new chief executive, Christopher Viehbacher, said in an interview last week that he isn’t seeking a megamerger but would consider deals of under $19 billion. Some analysts say that could leave Sanofi-Aventis open to buying the U.S. biotech company Biogen Idec Inc., which has a market value of $13.3 billion. Both companies have declined to comment.
Another possibility for Bristol-Myers could be a deal with Britain’s AstraZeneca because the companies are co-developing a drug for diabetes called saxagliptin. One rationale for the combination of Merck and Schering-Plough is to run the companies’ joint venture selling the cholesterol medicines Vytorin and Zetia under one roof. AstraZeneca declined to comment, but has said in the past it’s not interested in big deals.
Catherine Arnold, a drug-industry analyst at Credit Suisse, says that hasn’t stopped companies in the past. “Sanofi, Glaxo and Novartis have said they’re not interested in big deals, but Jeff Kindler said that nine months ago,” she said, referring to a statement in March 2008 by Pfizer’s chief executive that he did not see a megamerger on the horizon.
Meantime, 180, or 45%, of publicly traded biotech companies have less than a year of cash on hand, and about half are trading below $1 a share, according to BIO, the trade group for the biotechnology industry based in Washington.
But biotech acquisitions aren’t a panacea. One reason is that small companies offer little opportunity for cost savings. Another is the worry that founders and scientists will leave if their companies are taken over.
In the interview last week, Mr. Viehbacher indicated his preferred strategy would be to enter partnerships with biotech companies rather than acquire them. “You don’t want to bring them in to the mother ship because then you ruin it,” he said.
The severe funding crunch facing small biotech companies is prompting worries that important new drugs won’t make it to market, impeding the progress of medicine. “Innovation has been on the biotech side, but now the money is gone,” says Edward Saltzman, president of industry consultant DefinedHealth. “We’re in a pickle.”
Meanwhile, the next target could actually be Schering-Plough. Johnson & Johnson, an historically acquisitive company, could throw a wrench in Merck’s plan by making a more attractive offer for Schering. J&J sells Remicade, an anti-inflammatory drug, with Schering-Plough, and a deal for the company could give it full rights to the drug.
–Jeanne Whalen contributed to this article.
Write to Avery Johnson at avery.johnson@WSJ.com and Ron Winslow at ron.winslow@wsj.com
Printed in The Wall Street Journal, page A12

Previously…Why so many smart investors bought into Madoff.

Submitted by Bapcha’s Stocks

Bernard Madoff, Bernie Madoff, Hooked by Madoff, Madoff, Types of Investors who were hooked by Madoff, Uncategorized Bernard Madoff, Bernie Madoff, Hooked by Madoff, Madoff, Types of Investors who were hooked by Madoff

Madoff hooked a whole bunch of investors. Here, we “categorize” these investors into seven types and highlight what their “investing mistake” was. Hopefully, this piece is both educational and entertaining.

More on this topic (What’s this?)

A Glimpse At Madoff’s Tenure At The MCC (Zero Hedge, 3/12/09)

An Insider’s Look At White Collar Crime (Zero Hedge, 3/19/09)

Bernie Madoff’s Twitter Page via Prison (Fund my Mutual Fund, 3/19/09)

Read more on Bernard Madoff at Wikinvest

Drugs to be approved for NHS use within six months, ministers announce

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Obama aims big with healthcare drive

Submitted by THE HEALTH ECONOMICS BLOG

President Barack Obama Monday launched a high-stakes drive to remake US healthcare, in his latest attempt to ensure his sweeping agenda is an antidote to and not a victim of the economic crisis.
The president unveiled Kansas Governor Kathleen Sebelius as his new pick to be secretary for health and human services (HHS) ahead of a bi-partisan White House healthcare summit on Thursday.
He also picked health expert Nancy-Ann DeParle as his counselor to coordinate White House efforts to achieve healthcare reform.

“If we are going to help families, save businesses, and improve the long-term economic health of our nation, we must realize that fixing what’s wrong with our health care system is no longer just a moral imperative, but a fiscal imperative,” Obama said in a written statement.
“Healthcare reform that reduces costs while expanding coverage is no longer just a dream we hope to achieve — it’s a necessity we have to achieve.”
Both appointments replaced that of former senator Tom Daschle, originally nominated to simultaneously serve as HHS secretary and White House health czar but who was forced to pull out over a storm over unpaid taxes.
Obama shone a spotlight on healthcare after he placed the issue, a political gamble which has dogged previous Democratic presidents, at the center of his budget last week.
The president asked Congress for 634 billion dollars over 10 years as a “down payment” on refashioning a largely private system which offers some of the world’s best care, but leaves nearly 46 million Americans uninsured, according to the National Coalition on Healthcare, an umbrella reform group.
His insistence on pushing the legislation confounds critics who warn Obama must curtail his political wish list because of the economic turmoil and Republicans who charge his plans are too expensive.
Sebelius, 60, who will require Senate confirmation and was once said to be in the running to be Obama’s Democratic vice presidential nominee, is serving in her second term as governor of her heartland state.
News of her nomination was welcomed by Democratic Senator Max Baucus, who with ailing Democratic legend Senator Edward Kennedy, plans to pilot healthcare reform through Congress.
“Passing comprehensive health care reform is an absolute imperative this year, and as a former insurance commissioner Governor Sebelius really gets what needs to be done,” Baucus said.
But the arrival of Sebelius in Washington was heralded by newspaper stories delving into the questionable success of her past efforts to reform healthcare in Kansas and Republican criticisms.
The Republican National Committee distributed research accusing the president of plotting billions of dollars of new taxes on Americans to pay for healthcare.
It accused Sebelius of being “in the pocket” of labor unions and of also being a prophet of high taxation.
White House officials have already warned Republicans would try to derail the president’s healthcare plan and force a victory which would severely diminish his political clout.
Former president Bill Clinton’s failed healthcare reform drive, under the direction of his wife Hillary Clinton, still sends shudders down the spines of leading Democrats.
But Obama’s budget chief Peter Orszag warned on Sunday that there was no alternative to reforming healthcare — a priority he said could end up being one of the primary drivers of economic recovery.
“We’re going to get health care reform done this year. I think this proposal will get enacted,” he said.
The plans are guaranteed a rough ride in Congress where attempts to cover all Americans are often derided by minority Republicans as European-style “socialized medicine.”
Obama plans to finance the reforms by letting tax breaks for the rich expire in 2011, and to streamline other healthcare programs.
One of Obama’s first actions after taking office in January was signing into law expanded healthcare coverage for low-income children — a measure vetoed by former president George W. Bush.
With the US economic recession deepening, there are fears that millions more could be added to the ranks of the uninsured, since many rely on employers or their own wage checks to pay for coverage.

Five issues that will survive the semiconductor industry’s nuclear winter - Part-I.

Submitted by Bapcha’s Stocks

Previously…

Submitted by Bapcha’s Stocks

AXP, American Express, Banking Collapse, Banking Collapse of 1933, Bernard Madoff, Bernie Madoff, FDIC, G-S, GLB, GLB Act, GS, Glass-Steagall, Goldman-Sachs, Gramm-Leach-Bliley, MS, Madoff, Morgan-Stanley, Reinstate Glass-Steagall, TARP, Uncategorized American Express, AXP, Banking Collapse, Banking Collapse of 1933, Bernard Madoff, Bernie Madoff, FDIC, G-S, Glass-Steagall, GLB, GLB Act, Goldman-Sachs, Gramm-Leach-Bliley, GS, Madoff, Morgan-Stanley, MS, Reinstate Glass-Steagall, TARP

The Gramm-Leach-Bliley [GLB] act repealed Glass-Steagall [G-S] - which was the law of the land here in the USA from 1933 to 1999. G-S created the FDIC, and prohibited large private banks - whose primary business is the investment business - from receiving deposits from the public. My Rx for America involves a dose of bitter medicine, and no money for bankers….

More on this topic (What’s this?)

“An Open Letter to the Western Banking Establishment” (naked capitalism, 1/30/09)

Paulson Overpaid by $78 Billion for TARP Bank Equity (naked capitalism, 2/5/09)

Martin Wolf shreds TARP 2 (Option ARMageddon, 2/10/09)

Read more on Troubled Assets Relief Program (TARP), Banking at Wikinvest

Drug Makers Fight Stimulus Provision

Submitted by THE HEALTH ECONOMICS BLOG

By ALICIA MUNDY

WASHINGTON — The drug and medical-device industries are mobilizing to gut a provision in the stimulus bill that would spend $1.1 billion on research comparing medical treatments, portraying it as the first step to government rationing.

The fight over the provision is highlighting the tensions behind President Barack Obama’s plan to overhaul the health-care system. The administration hopes to expand coverage while limiting use of treatments that don’t work well, but any efforts that might reduce coverage are politically sensitive.

The House version of the stimulus package sent shudders through the drug and medical-device industry. In a staff report describing the bill, the House said treatments found to be less effective and in some cases more expensive “will no longer be prescribed.”

A Senate version backed by Finance Committee Chairman Max Baucus (D., Mont.) doesn’t mention cost as a subject to be studied. And the industry won a battle to add the word “clinical” in describing the research — adding to the implication that the comparison studies won’t look at bang for the buck. The final language is likely to be hammered out later this week in a House-Senate conference committee.

Mr. Obama is under pressure to find long-run health-cost savings as projections show that Medicare spending is on track to severely deplete the federal budget. “Without question, we’re headed for more of a public and private push for which medicines work best at the lowest cost in particular patients,” said Mark McClellan, former Medicare and Medicaid chief under President George W. Bush.

The $1.1 billion in research funding would be doled out to the National Institutes of Health and other government bodies. “We should focus on producing the best unbiased science possible,” said Rep. Henry Waxman (D., Calif.), a strong proponent of the House language.

Mr. Obama supported research into comparative effectiveness during his campaign. Administration officials and leading Democrats in Congress say the idea will help government programs direct their dollars to treatments that are worth the money.

Officially, drug and device makers don’t object to that sentiment. But they warn of a slippery slope where the government ends up axing useful treatments just because they cost too much. They have lined up patient groups that get industry funding to lobby Capitol Hill.

A coalition called the Partnership to Improve Patient Care includes the lobbying arms of the drug, device and biotechnology industries as well as patient-advocacy groups and medical-professional societies. Coalition spokesman David Di Martino says the research envisioned in the House bill may be used “in an inappropriate manner that may limit treatment options for patients.”

A public-relations firm that is part of one of Washington’s most influential lobby shops, Barbour Griffith Rogers, is representing the coalition. A major goal is to give industry a seat at the table when federal officials decide what to research with the $1.1 billion.

Companies “want to control the data, how it is reviewed, evaluated, and whether the public and government find out about it and use it,” said Harry Selker, a Tufts University professor who directs its clinical-research program.

That also worries Jerry Avorn of Harvard Medical School, a frequent drug-industry critic. Comparative research “has the potential to tell us which drugs and treatments are safe, and which ones work,” he said. “This is not information that the private sector will generate on its own, or that the industry wants to share.”

Michael Cannon of the libertarian Cato Institute said comparative effectiveness research “isn’t going to do any good because the industry will defund it as soon as it presents a threat.”

When the government’s Agency for Health Research Quality suggested in 1995 that there were too many unnecessary back surgeries, doctors and industry groups attacked the conclusion. Mr. Cannon noted that Congress at the time slashed the agency’s budget and stripped its authority to make medicare-payment recommendations.

“They almost killed AHRQ,” said Dr. Avorn. “The memory of their near-death experience hasn’t been forgotten.”

Dr. McClellan, the former Medicare chief, said effectiveness research can be useful but shouldn’t assume pricey medicines are automatically bad. “The goal isn’t to avoid expensive drugs, it’s to get more value for our health-care spending,” he said.

—Jacob Goldstein contributed to this article.
Write to Alicia Mundy at alicia.mundy@wsj.com

Health Economics Position - Grapevinerecruiters

Submitted by THE HEALTH ECONOMICS BLOG

Folks,
this just came in, please contact Darren (see below)
best
Ulf

Associate Director of Health Economics and Outcomes

REPORTS TO: Strategic Affairs

LOCATION: Markham

OVERALL PURPOSE/MAJOR FUNCTION
• Develop timely, appropriate health economic data to support reimbursement initiatives for all products
• Manage economic and outcomes research projects in support of international and local pricing and reimbursement programs
• Provide interpretative expertise for economic/outcomes research data as needed by internal/external customers
• Mentor junior associates to improve skill sets
• MINIMUM REQUIREMENTS
• In-depth understanding of outcomes research and epidemiological study design.
• Working knowledge of biostatistics and data analysis
• Capabilities in health economic modeling
• Advanced communication capabilities
• Experience in government and patient advocacy lobbying
• Masters Degree in epidemiology, health economics, health policy
• 10 years work experience in health industry

RESPONSIBILITIES
• Implement local health economic and outcomes research strategies that support the overall reimbursement strategies
• Design health economic and outcomes research studies that are scientifically sound and timely
• Collaborate with International medical affairs to incorporate health economic measures into clinical trials
• Analyze and report results from health economics outcomes research studies, including publication and presentation of data
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NICE splits renal cancer drugs assessment - “yes” for Pfizer’s Sutent, “no” for Roche, Bayer, Wyeth

Submitted by THE HEALTH ECONOMICS BLOG

by Nick Smith

LONDON, Feb 4 (APM) - NICE on Wednesday split its controversial review of renal cancer drugs into two, saying ‘yes’ to Pfizer’s Sutent (sunitinib) but rejecting three others - Wyeth’s Torisel (temsirolimus), Bayer’s Nexavar (sorafenib) and Roche’s Avastin (bevacizumab).

In effect NICE has all but guaranteed that one product will reach patients, while pushing problematic appeals back down the appraisal process.

In a statement issued late on Tuesday for Wednesday release, NICE said in an attempt to get guidance out the NHS as quickly as possible it had published later-stage guidance recommending sunitinib as a first-line treatment option in advanced and/or metastatic renal cell carcinoma.

In a second set of guidance, bevacizumab, sorafenib and temsirolimus were not recommended as first-line treatment options for advanced and/or metastatic renal cell carcinoma.

Also in the second set of guidance, the two drugs also licensed for second-line treatment of advanced or metastatic renal cell carcinoma, sorafenib and sunitinib, are not recommended for this indication.

A spokeswoman for NICE told APM the sunitinib document was a so-called Final Appraisal Determination (FAD), which in the absence of an appeal will become guidance to the NHS. The second is a first draft which is now out for public consultation ahead of a later FAD.

RIGHT TO APPEAL?

Initially all four cancer drugs were assessed and rejected together, leading to a huge public outcry that dying people were being denied life-extending drugs.

Following this, new flexibilities for NICE’s appraisal committees were announced by the government.

This gave them a more formal freedom to exceed NICE’s generally understood maximum cost per quality-adjusted life year of 30,000 pounds (33,000 euros) under certain conditions, including low incidence and end-of-life cases.

In its statement, NICE says the approval of sunitinib comes under these new flexibilities and stresses its desire to get this treatment to patients as soon as possible.

NICE said: “Having decided that one of these treatments should be recommended for use in the NHS, we felt that it was in the interests of patients to get that advice out as quickly as possible.

Although this final recommendation is subject to appeal we very much hope it will form the basis of our guidance to the NHS.”

The approval for sunitinib is specifically in patients with renal cell carcinoma (RCC) who are suitable for immunotherapy with an Eastern Cooperative Oncology Group performance status of 0 or 1.

Despite the mention of an appeal it was not clear what grounds companies with rejected drugs might use. It is unusual for patient organisations to appeal an approval from NICE.

The spokeswoman confirmed that after NICE split the assessment, the sunitinib FAD only deals with the Pfizer drug. Although she insisted all consultees - which would include Wyeth, Bayer and Roche - had the right to appeal regardless of whether their product was included or not, she could not say how they might benefit from an appeal.

In the absence of a rejection of their own drugs, it seems any appealing company could only succeed in slowing down access or stopping patients accessing any drug at all.

Pfizer is one of two companies which offered “patient access schemes” - incentives to the National Health Service that in some way reduce the price paid by the service - in order to gain NICE approval in cases which would otherwise have led to rejection.

Pfizer offered the NHS the first cycle of sunitinib in renal cell carcinoma free. “The independent advisory committee concluded that sunitinib does represent a cost effective use of NHS resources when used as a first-line treatment for advanced and/or metastatic RCC,” NICE said in the statement without giving its estimated cost per QALY.

NICE also noted the Department of Health said the Pfizer scheme, “does not constitute an excessive administrative burden on the NHS”.

Bayer also agreed a patient access scheme with the Department of Health, in which the first pack of sorafenib is free to the NHS, NICE said.

NICE splits renal cancer drugs assessment - “yes” for Pfizer’s Sutent, “no” for Roche, Bayer, Wyeth

Submitted by THE HEALTH ECONOMICS BLOG

by Nick Smith

LONDON, Feb 4 (APM) - NICE on Wednesday split its controversial review of renal cancer drugs into two, saying ‘yes’ to Pfizer’s Sutent (sunitinib) but rejecting three others - Wyeth’s Torisel (temsirolimus), Bayer’s Nexavar (sorafenib) and Roche’s Avastin (bevacizumab).

In effect NICE has all but guaranteed that one product will reach patients, while pushing problematic appeals back down the appraisal process.

In a statement issued late on Tuesday for Wednesday release, NICE said in an attempt to get guidance out the NHS as quickly as possible it had published later-stage guidance recommending sunitinib as a first-line treatment option in advanced and/or metastatic renal cell carcinoma.

In a second set of guidance, bevacizumab, sorafenib and temsirolimus were not recommended as first-line treatment options for advanced and/or metastatic renal cell carcinoma.

Also in the second set of guidance, the two drugs also licensed for second-line treatment of advanced or metastatic renal cell carcinoma, sorafenib and sunitinib, are not recommended for this indication.

A spokeswoman for NICE told APM the sunitinib document was a so-called Final Appraisal Determination (FAD), which in the absence of an appeal will become guidance to the NHS. The second is a first draft which is now out for public consultation ahead of a later FAD.

RIGHT TO APPEAL?

Initially all four cancer drugs were assessed and rejected together, leading to a huge public outcry that dying people were being denied life-extending drugs.

Following this, new flexibilities for NICE’s appraisal committees were announced by the government.

This gave them a more formal freedom to exceed NICE’s generally understood maximum cost per quality-adjusted life year of 30,000 pounds (33,000 euros) under certain conditions, including low incidence and end-of-life cases.

In its statement, NICE says the approval of sunitinib comes under these new flexibilities and stresses its desire to get this treatment to patients as soon as possible.

NICE said: “Having decided that one of these treatments should be recommended for use in the NHS, we felt that it was in the interests of patients to get that advice out as quickly as possible.

Although this final recommendation is subject to appeal we very much hope it will form the basis of our guidance to the NHS.”

The approval for sunitinib is specifically in patients with renal cell carcinoma (RCC) who are suitable for immunotherapy with an Eastern Cooperative Oncology Group performance status of 0 or 1.

Despite the mention of an appeal it was not clear what grounds companies with rejected drugs might use. It is unusual for patient organisations to appeal an approval from NICE.

The spokeswoman confirmed that after NICE split the assessment, the sunitinib FAD only deals with the Pfizer drug. Although she insisted all consultees - which would include Wyeth, Bayer and Roche - had the right to appeal regardless of whether their product was included or not, she could not say how they might benefit from an appeal.

In the absence of a rejection of their own drugs, it seems any appealing company could only succeed in slowing down access or stopping patients accessing any drug at all.

Pfizer is one of two companies which offered “patient access schemes” - incentives to the National Health Service that in some way reduce the price paid by the service - in order to gain NICE approval in cases which would otherwise have led to rejection.

Pfizer offered the NHS the first cycle of sunitinib in renal cell carcinoma free. “The independent advisory committee concluded that sunitinib does represent a cost effective use of NHS resources when used as a first-line treatment for advanced and/or metastatic RCC,” NICE said in the statement without giving its estimated cost per QALY.

NICE also noted the Department of Health said the Pfizer scheme, “does not constitute an excessive administrative burden on the NHS”.

Bayer also agreed a patient access scheme with the Department of Health, in which the first pack of sorafenib is free to the NHS, NICE said.

More Velcade-Style Risk-Sharing in the UK?

Submitted by THE HEALTH ECONOMICS BLOG

NICE to put QALY under examination

Submitted by THE HEALTH ECONOMICS BLOG