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Neil Minkoff MD's blog

Contributing Voices
Neil Minkoff, MD
Neil Minkoff, MD

Multiple news outlets are reporting that a letter signed by Representatives Henry Waxman, Frank Pallone Jr., and Diana DeGette was sent last week to the CEO of Gilead asking for justification for the high price set on its new Hepatitis C medication, Sovaldi. (See this story.) The lawmakers also stressed that they expect Gilead to explain how the drug will get to patients in government funded programs, like Medicaid and Medicare.

Contributing Voices
Neil Minkoff, MD

Germany is the third biggest drug market in the world, with $42 billion spent on pharma products in 2012. Germany allows its insurers to work together to negotiate with pharmaceutical companies to create one price for all Germans. There’s the official list price, which is made public, and the proprietary discounted price. The German public price list is used widely in Europe and Japan for drug pricing and negotiations.

The German government is looking to make the discounts public knowledge as well. This is designed to reduce margins for suppliers and pharmacies, so that they base their margins off of the true prices, rather than list. The pharmaceutical companies are concerned that the release of the discounts will eat into their revenue from the other countries that use the current public list, which seems to me to be tacit admission that the discounts offered elsewhere aren’t as aggressive as the ones Germany’s pooled insurers can get.

This comes after the aggressive actions of Germany’s Institute for Quality and Efficiency in Healthcare, which is the equivalent of Britain's National Institute for Health and Care Excellence (NICE). They’ve been aggressive about looking for deeper value before allowing products access to the German market, which seems largely cost driven.

My concern is how this affects the U. S. market.

It is widely believed that the American health care system subsidizes the markets where access is more limited and prices are set. For example, Britain just worked with pharms to hold the NHS spend on brand drugs flat over the next two years, so growth in that market is limited. The pharma companies' need for growth means that they will be raising prices elsewhere to support flat trend in the UK.

That why it seem inevitable to me that the US government will step in. The global pharma market is far from free. It is a messy amalgam of single-payer, third party payers, supplemental plans, private insurers and the U.S. Centers for Medicare & Medicaid Services. As health care costs continue to rise in the U.S. a convenient target will be drugs that are available in other countries for a fraction of the American price.

Neil Minkoff, MD, is medical director of MediMedia Managed Markets and also an independent health care consultant

Contributing Voices
Neil Minkoff, MD

One thing is clear from the decision the Supreme Court rendered Monday: There’s going to be more litigation. The Supreme Court ruled 5–3 that the Federal Trade Commission (FTC) has the right to examine “pay for delay” deals between brand and generic manufacturers on antitrust grounds. It did not support the FTC’s contention that pay-for-delay deals are inherently illegal.

Pay-for-delay is the term coined to describe settlements reached between brand manufacturers and generic manufacturers where the brand manufacturer pays the generic manufacturer not to challenge a patent.

Contributing Voices
Neil Minkoff, MD

A survey released at HIMSS by the American College of Physicians shows that there is growing serious dissatisfaction by practicing doctors with their EMRs. The type of practice doesn’t matter and neither does the brand of EMR.

It appears as if the doctors surveyed feel that the technology was oversold and does not live up to expectations. The results were compiled over by AmericanEHR Partners, an organization started by ACP and Cientis to help implement EMRs and focus on ways to use them to improve quality of care.

Contributing Voices
Neil Minkoff, MD

The title is part of a quotation from Henry Chao, a CMS official who is involved with building and launching the health care exchanges. The federal government is running or co-managing 33 exchanges. They are expected to be functional by October 1 to enroll patients for coverage starting on January 1.

Contributing Voices
Neil Minkoff, MD

Amgen is making a huge bet on biosimilars and helping to define the market.

The company announced that it is targeting 6 biotech blockbusters and will start selling them as  biosimilars in 2017. The initial targets: Avastin, Herceptin, Rituxan, Erbitux, Humira and Remicade. That’s over $40 billion in product. Even a small savings, like 15% to 20%, would result in a huge change in premiums.

It is still unclear what hurdles will need to be cleared from the FDA and/or other regulatory bodies, but a few other things have become very clear:

Contributing Voices
Neil Minkoff, MD

Neil Minkoff, MDResearchers in Britain recently published a paper in Pediatrics showing a dramatic swing in admissions for childhood asthma after indoor smoking was banned by the British in 2007. A hospitalization trend that had been steadily around 2% fell to minus 9%. The trend was sustained.  10.1542/peds.2012-2592