Saturday, August 23, 2008

So it's Biden -- That Ought to give Big Pharma pause. . . .


The online version of the Wall Street Journal is reporting that Sen. Joe Biden (D., DE) will be Sen. Obama's running mate. Buckle-up, as "fundamental, meaningful and deep" U.S. health care reform just became a far-more likely scenario in 2009 or 2010 -- from Sen. Biden's 2007 presidential campaign site:

. . . .Joe Biden’s highest priorities -– along with ending the war in Iraq – are universal health care and education. He will work bring together key health care stakeholders from labor, business, health care and government to seize the historic opportunity created by the recognition from organizations ranging from Fortune 500 companies, the Business Roundtable and the AMA to the labor movement that the time has come for universal, affordable health care. . . .

Negotiating For Prescription Drugs

The Medicare Part D prescription drug program was created in the Medicare Modernization Act of 2003. Medicare covers more than 40 million seniors and disabled Americans who are projected to consume $1.8 trillion worth of prescription drugs over the next decade. However, instead of using the purchasing power of 40 million Americans to get the best prices possible for prescription drugs, the Medicare and Modernization Act of 2003 expressly forbids the federal government from interfering in drug negotiations between pharmaceutical companies and the numerous private insurers spread out across the country that offer Part D coverage. Simply put, this “non-interference clause” dilutes Medicare’s bargaining position. The federal government successfully uses its bulk purchasing power to keep costs low in the Veterans Administration health system — why not allow it to do the same for our nation’s seniors who rely on Medicare?

In order lower prescription drug prices in the Medicare Part D program, Joe Biden will work to remove the prohibition against the federal government negotiating prices for prescription drugs for enrollees in Medicare Part D to allow the federal government to use its bulk purchasing power to reduce costs for Medicare beneficiaries. . . .

We can afford to provide universal health care in this country – and we can help pay for it with a national agenda of sensible steps to get skyrocketing health care costs under control.

The U.S. spends over $2 trillion on medical care every year – approximately $6,697 perperson. Health care is 16 percent of the gross domestic product (GDP). Health insurance expenses are the fastest growing cost component for employers. Premiums have gone up 78 percent since 2001 –- almost four times the rate of wages. In 2007, the average annual premium increased by 6.1 percent. Unless something changes dramatically, health insurance costs will overtake profits for many businesses by 2012. Yet we have no national agenda to address the affordable health care crisis. . . .

To reduce ever-increasing health care costs Joe Biden will create a panel to compare the effectiveness of medical treatments and technologies. This could be housed in an existing federal agency like AHRQ, NIH or HRSA, or it can be an independent, public-private partnership receiving funding from both the federal government and private industry. Many other countries — including Australia,Canada, England, and Germany — already require clinical and economic assessments of medical services as a condition for reimbursement. . . .

Indeed.

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Now, just to be sure we're clear -- even in the increasingly-unlikely event that Sen. McCain were to win the White House, he too is keenly interested in significant cost-reforms -- disease treatment capitation, and increased price competition for drugs -- from his website:
. . . .Lowering Drug Prices. John McCain will look to bring greater competition to our drug markets through safe re-importation of drugs and faster introduction of generic drugs.

Providing Quality, Cheaper Care For Chronic Disease. Chronic conditions account for three-quarters of the nation's annual health care bill. By emphasizing prevention, early intervention, healthy habits, new treatment models, new public health infrastructure and the use of information technology, we can reduce health care costs. We should dedicate more federal research to caring and curing chronic disease.

Promoting Coordinated Care. Coordinated care - with providers collaborating to produce the best health care - offers better outcomes at lower cost. We should pay a single bill for high-quality disease care which will make every single provider accountable and responsive to the patients' needs. . . .

Yes, Mr. Hassan -- perhaps you should start preparing for federal government effectiveness panels setting mandatory best practice, lowest cost disease treatment protocols (for reimbursement), expanded drug price caps, remimportation from Canada, expanded generic-fostering legislation in the U.S., and possibly requiring clearly favorable "outcomes" data -- for new FDA drug approvals.

3 comments:

Anonymous said...

Condor,

I'm not so certain about Senators Biden, Obama, or McCain at this point. I think that there's a lack of information to judge any of them on how they will address Big Pharma.

First, Senator Biden. While you are correct about him he has also been conspicuously quiet on many other issues with regards to FDA and Big Pharma. I found a good commentary on his lack of disclosure on where he stands on Big Pharma at Mark Senak's Blog Eye on FDA. I'm reprinting his comments here:

October 30, 2007

Joe Biden - Where the Candidates Stand, Part I in a Series

There are 65 days left to the Iowa Caucus. As I mentioned last week, I intend to profile the healthcare positions of each of the candidates as those positions might affect the workings of the FDA and the pharmaceutical market. While I originally was only going to consider candidates I considered top-tier, I am going to toss in the entire spectrum after some feedback by readers. The categories I am looking at are (1) importation of drugs, (2) Medicare Part D reform, (3) Pharmaceutical Marketing Restrictions, (4) Follow-on-Biologic regulation, and (5) Generic Promotion.

Senator Joseph R. Biden, Jr. (D-Del) is the first candidate to be considered. His plan for healthcare is listed at his Web site - www.joebiden.com and the name of the Biden plan is "Four Practical Steps Toward Health Care for All" and as the title implies, his plan is primarily focused on the issue of insurance reform. These four steps include covering all children, expanding access for adults, reinsurance for catastrophic cases and encouragement of prevention and modernization. Looking to the five categories:

Importation of Drugs - not mentioned in his plan, however, in the past, he has voted in favor of importation from Canada.
Medicare Part D Reform - In the last category of his Four Practical Steps - encouragement of prevention and modernization - a category that seems to be a collection of things that didn't fit elsewhere, Senator Biden does include a provision for Medicare Part D reform. In this section of the plan, he states that the current law "dilutes" Medicare's bargaining position and he uses the Veteran's Administration health system as an example. The Senator would remove the provision of law that forbids the U.S. from negotiating.
Pharmaceutical Marketing Restrictions - not mentioned.
Follow-on-Biologic Regulation - not mentioned.
Generic Promotion - not mentioned.
Analysis: In primarily focusing on insurance, this plan fails to address many of the issues of primary concern in healthcare, particularly those affecting development and innovation- and is not nearly as comprehensive as many others in the race. During the year, his votes indicate support for stricter oversight of industry with respect to post-marketing studies and other recommendations for reform made by the Institute of Medicine. Also in May, he failed to vote on an amendment to PDUFA legislation that would have allowed for the importation of prescription drugs nor did he vote on the issue of striking some provisions related to market exclusivity. His plan does not mention stem cell research, but he has voted in favor of amending the Public Health Service Act to provide for human stem cell research.

In his program's fourth step - Encouraging Prevention and Modernization, it would be ideal if he would expand his thoughts on matters related to these issues, particularly as affecting the future development of medicines, filling in some of the blanks that his voting record does not clearly establish.

It is worth noting that Senator Biden the candidate also has a blog, but noticeably absent from the categories are the terms "prescription drugs", "drugs", "pharmaceuticals" or "healthcare".

Next candidate to be considered, taking them in alphabetical order, and with Sam Brownback (R-KS) having bowed out next - Senator Hillary Clinton (D-NY).

NOTE: THIS POSTING WAS UPDATED ON 12/10/07 TO REFLECT JOE BIDEN'S VOTING RECORD ON IMPORATION.

Posted at 12:01 AM

Consequently, when compared to the others who were previously running to be the Democratic candidate. Biden may actually have been the running mate least likely to tick off Big Pharma

With regards to Senator Obama he too has been notoriously close lipped. What unnerves me about him is not only his lack of specifics but how close he is to Ted Kennedy and how when Kennedy initially supported him Obama said now he could tap into Kennedy's funding sources.

What's that supposed to mean? Novartis from Boston and the rest of Big Pharma.

Kennedy sponsored the 2007 FDA Amendments Act (FDAAA) which is a complete gimme to the drug companies. On face it appears reasonable but when you look at it closely the loopholes are almost 100% of what Pharma wanted. In fact there were VPs from Novartis and FDA officials working with Kennedy's Office on the original drafts. Even Senator Kennedy's son Red Jr. runs a consulting business to the pharmaceutical industry. Now what could he possibly provide consulting services about that he has special expertise on?

As for Senator McCain even though he's been supported by Senator Grassley. This may not be significant since who else was Senator Grassley going to support. Personally I was troubled by a statement Senator McCain made where he said he didn't win the nomination last time because he didn't have the party's big supporters behind him. What big supporters is he referring to?

I'll be waiting to see what each candidate actually proposes to commit to during the campaign.

Salmon

Condor said...

Thanks, Salmon --

As ever, deeply insightful commentary!

You are certainly correct that they are all politicians first, and true statesmen, in some cases (think McCain, and to a lesser extent, Biden here), a distant second -- so we will all have to "wait and see".

That said, I do think there will be tremendous pressure to fence-in (that is -- legislate against) the recent near-gouging price-levels of some legacy monopoly drugs. And I think that will be true, regardless of whether the White House is "officially" blue -- or red -- in January 2009.

Anonymous said...

I think you're right that Pharma will be fenced in.

As for price gouging. I also fear you're correct. I had been somewhat sympathetic to big pharma with 10% losses that to generics that had to be replaced in addition to other new growth, and would have liked to see a more gradual loss of income via regulation. But then I found a quote from the early 1960's from either Senator Keifauer or Estes (The senators behind the response to thalidomide) where one of the Senator's complained about Pharma's price gouging during the 50's and early 60's.

I don't know what a reasonable answer is but I do know you have to be very careful about whatever pharma or politicians say.

However, with the elections coming up I'll be willing to bet that there's a number of politicians who will be willing to hang Fred and others out to dry in order to save their own necks. But it's going to take is a scandal that's big enough, and reading between the lines at Thoreau-fda.com I think one or many may be coming.

Salmon