VW's diesel scandal and Shkreli's drug price-gouging

More of the same - this week was not exactly ethical capitalism's (if such a thing exists) finest hour:

VW may have to pay fines in the billions for deceiving pollution monitors and violating the Clean Air Act with their TDI "clean diesel" vehicles (stock plunged 20% in response). Apparently it's not so easy for a diesel engine to be both clean burning AND great mileage.

There is a new (and sick) trend in biopharma (link1, link2) where shell companies buy up the rights to "below market price" drugs and then jack up the prices by orders of magnitude to make a ROI. Well, at least those firms aren't deluding themselves that they're trying to help patients - they're explicit in their pure pursuit of profit, and it doesn't matter if needy patients are priced out.

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Following up on VW and drug prices:

How an academic lab at UWV (an ironically similar acronym) detected VW's diesel cheating: http://www.vox.com/2015/9/23/9383663/vw-emissions-scandal-photo. I just wonder why VW's diesel rivals didn't question how VW could get superior mileage/torque while still keeping pollution low (the diesel engine is kind of zero-sum for these performance metrics). Like wouldn't they say, "Wow, in our lab we can only get 25 mpg if we stay under the NOx limit - I wonder how VW gets 40 mpg?" (numbers are fictional) Other auto makers are professing that their vehicles don't cheat, but we'll see. Even though very few light cars in the US are diesel, we of course have plenty of semi-trucks and heavier vehicles spewing particulates and carcinogens every day (but at least in CA, these vehicles now have to adhere to tighter limits). Not sure how big the impact will be in Europe, where ~half their light cars are diesel (but they have fewer cars per capita and drive fewer miles per capita vs. the US).

This article has an interesting viewpoint on the Shkreli drug prices scandal: http://www.vox.com/policy-and-politics/2015/9/23/9383899/martin-shkreli-daraprim-price. He's been such an a-hole and unapologetic capitalist re: his company's actions that he's garnered a ton of negative publicity. That actually helps to shed light on the drug price-gouging issue that Big Pharma has been engaging in for decades (BS loopholes to extend patents, buying the rights to generics or cheaper rival drugs to keep them off the market, etc.). Hopefully the increased attention and outrage will motivate lawmakers to consider new rules for the industry, but I'm not holding my breath.

Comments on the pharma industry

I think the problem in pharma is similar to "Moneyball" - people are pursuing the wrong goals and measuring success incorrectly. Health care should be a holistic, systemic effort. It's about measuring quality of life enhancements, longevity, and other social goods vs. opportunity costs. I guess that is similar to the NHS but of course their system has flaws too. But if we really measured health care properly, and priced drugs and services based on that, the industry would look radically different. Now we just have fragmented players each pursuing their own narrow profit motives, and the invisible hand breaks down (well that theory was never meant to characterize our complex, computerized, global, accountability-lacking modern economy anyway). Academics just want to publish so they can get grants (that are getting harder to come by due to austerity). Drug and device makers just want to develop positive NPV projects and milk monopoly rents. Physicians just want to prescribe more high-margin treatments. Insurers just want to place the right bets. So of course we have inefficiencies. Though drugs are not the biggest culprit for our current healthcare mess, and it's probably more due to unnecessary diagnostics, procedures (esp. end-of-life), and implanted devices. We have a treatment-based, consumption system when it should be a prevention-based one.

I know gov-sponsored enterprises don't have a great track record, but I would propose something like that - not that I know anything about health policy. But like how the gov mandates that vaccine and antiviral makers have a sufficient stock of affordable product in case of an outbreak, they could take it a bit further and manage their own drug development org. Otherwise the market doesn't price healthcare properly and you get shortages. It's kind of obscene for the US that spends so much on health to have to ration, and we're not talking about Viagra here: http://www.npr.org/blogs/health/2011/10/04/140958404/shortages-lead-doctors-to-ration-critical-drugs. So like how the FDIC backs up commercial banks, maybe a nonprofit federal drug org could back up the pharma industry by producing sufficient quantities of generics. I know Asian firms are doing that now, but might as well consolidate into a single point of sale and keep jobs here if it's affordable? It's also a national security issue. Then this org could reinvest its excess cash into research to compete with the big pharmas and put price pressure on them too. But of course the conservatives would never allow such a "threat to the free market."

I would also hold academics more accountable, as the "Inside Job" documentary implicated academic economists for pumping up optimism during the credit bubble. For academics and MDs who have relationships with pharmas, if their published research is used in drug dev't and the drug turns out to fail later (esp. during expensive clinical trials), then those researchers should have to surrender some of their grant $ or other compensation. I know this is also impractical and fraught with issues, the general idea I'm getting at is to hold the upstream guys accountable for downstream results. I know research on paper may look great but then fail in practice through no fault of their own. But there can't be this total detachment. That's why some universities are even building their own drug dev't infrastructure. They discover the IP, they know it the best, so why not keep the dev in-house? Plus it keeps the research team focused on practical issues. I am not sure how to do this best, but basically there has to be some way to punish researchers for "bad projects", otherwise the current incentive structure just encourages them to pump out all sorts of pie-in-the-sky, diarrhea-of-the-brain, quantity-over-quality findings. This is exacerbated by the glut of bioscience PhD's getting pumped out of schools (esp. from Asia) - and often they are uncreative and under-qualified, but the school just needs to get rid of them after 6 years (so many of them can't get PI jobs and end up taking the jobs of BS and MS level people, thereby blunting the career dev of people like me). They are permitted to publish crap, since there is also a glut of stupid journals out there who are happy to fill their pages with something and make some money (you probably have seen the same in your field?). Then they over-sell them as the next wonder drug, and we end up wasting billions on a stupid idea. It's better and cheaper to kill bad projects early, and punish bad researchers so they really have to stake their careers on only the best projects. Of course you can tell that I'm a little (or a lot) jaded from R&D, but I think I have a point. And I haven't even gotten into the data fraud issue...

http://wenchwisdom.blogspot.com/2011/12/this-just-in-scientists-elusive-goal-to.html 

I think the patent system needs to be reformed too. Monopolies are rarely ever in the public's best interest. Yeah pharma bitches that if they don't get exclusivity, it's not "cost effective" for them to research new drugs, you know the usual blackmail shit. Even if we threw out our generous IP laws tomorrow, I guarantee you that it would still be profitable for someone to develop a diabetes or Alzheimer's drug, because like we see in semiconductors and other products, there is still value in being first-to-market and leading the learning curve. I do agree though that the FDA clinical approval process can be reformed and probably simplified (though how can we do that when the GOP cuts funding to the agency? I think they just want to gut regulators and let the industry "self monitor"). But like other industries, there is a big established infrastructure of paper pushers who stand to lose from reforms, so they will fight for the status quo. It's not an easy fix by any stretch. I can identify some problems, but I am not sure how to fit all the pieces together to make a better solution. Well if I did know, I would be set for life. :)

A pharma marketing tactic you probably didn't know about

http://www.npr.org/2011/04/26/135703500/supreme-court-weighs-whether-to-limit-data-mining

Apparently the Supreme Court is hearing a case about using physicians' Rx habits to target drug marketing efforts. Retail pharmacies are legally required to keep records of every Rx filled, and then they turn around and sell that info to data mining firms, who in turn sell it to pharmas. This helps pharma sales forces see which doctors need the most persuasion and which products are the biggest threats to theirs. Of course patient info is confidential, but doctor Rx habits are fair game, even if it is very upsetting to some. So recently Vermont outlawed this practice (unless the doctor gives consent), though a pharma trade group sued on First Amendment free access to info grounds, and the case has reached the high court.

Depending on how the case plays out, there could be implications for all the other data mining industries out there (Google, Facebook, etc.).

Sunlight Foundation exposes the Obama-PhRMA deal of 2009

http://www.npr.org/templates/story/story.php?storyId=123889454

http://blog.sunlightfoundation.com/2010/02/12/the-legacy-of-billy-tauzin-the-white-house-phrma-deal/

We know that part of Obama's 2009 health care strategy was to avoid the Clinton mistakes (the private sector wasn't sufficiently included and greased, so it spent big bucks on ads to dissuade the public and pressure Congress against Hillarycare). So instead, the "transparent administration" made secret deals with various groups to preempt dissent and get them on board for health care reform. Hospitals, doctors, and the AARP won enough concessions and guarantees, so they signed on. The pharma industry (and its PhRMA lobbying group) was a key piece of the puzzle and needed to be assuaged. PhRMA is one of the biggest lobby groups in DC and responsible for the famous "Harry and Louise" ads during the Clinton years, so Obama wanted to avoid a repeat.

The deal leaked (we'll get into the reasons for this soon), and we soon discovered what a scam it was for consumers:
http://worldaffairs-manwnoname.blogspot.com/2009/08/health-care-overhaul.html

So in order to appease PhRMA and appear to be a victory for the people, Obama touted $80B in cost savings over 10 years. But in actuality, the other concessions in favor of pharma would total much more (Sunlight estimates $220B). Some have described it as a "windfall", since the millions of new customers required to purchase individual insurance (subsidized by the government or not) under Obamacare would invariably purchase more drugs. In addition, PhRMA got guarantees that Washington wouldn't tighten Medicare drug reimbursements (and would in fact expand them by closing a loophole), or permit re-importation of the exact same damn drugs from other developed, trustworthy nations at lower cost (e.g. the same pill in Canada may cost 30% less than in the US because their government actually cares about its citizens, so why can't Canada sell it back to Americans? Isn't that just market economics?). I find this shocking because as a Senator, Obama voted twice to amend Medicare drug laws to permit the very price negotiation and foreign drug re-importation components that he agreed to exclude from Obamacare! Maybe his Senate votes were just out of principle (since he knew Bush would veto any changes anyway), and as president he primarily wants to get some sort of bill passed that will cover the uninsured, not necessarily fix our expensive, broken system. But it's not good leadership to cover the uninsured at ludicrous cost to the rest of us through excessive industry concessions.

http://worldaffairs-manwnoname.blogspot.com/2009/12/importing-foreign-drugs.html

One condition that Obama's people insisted on was that PhRMA spend $100-150M on pro-health-care advertising. So not only would that powerful body refrain from attacking Obamacare, they would actually help sell it. Ironically, they brought back the same Harry and Louise actors to do a pro-reform commercial, I guess now that they are older and poorer from lost 401(k) value and soaring health costs vs. 1994 (http://www.youtube.com/watch?v=yz7iMJpQ2FQ). The company that PhRMA used to produce the ads is run by Obama's head campaign adviser David Axelrod's son (and Axelrod has major financial interests there). Change we can believe in? Of course they'd say that there was no quid-pro-quo, and they picked the company because it's one of the best. But Obama should know that even if it was all ethical and legit, it looks fishy. It's almost as bad as Anthem Blue Cross' horrible, callous timing to announce an up to 39% premium increase on some CA customers, during heated health care reform discussions last fall.  

So what happened to the deal and how do we even know about it? Obama and PhRMA agreed that health care negotiations would go through Max Baucus and his Senate committee, since Baucus was a pharma guy who could maintain control. But Henry Waxman (who has a much chillier relationship with pharma) was working on a rival bill to Baucus', without all the lucrative pharma concessions. PhRMA got concerned that Washington would pull a fast one, so PhRMA's head Billy Tauzin, a cancer survivor and former Louisiana Congressman (who flipped from the Dem to GOP side), snitched to the LA Times (maybe to get back at the White House), and later Obama's people had to admit that the deal existed. PhRMA and the CEOs of major drug companies still want health reform to pass (because it will be great for them in present form), so it's ironic that Tauzin's paranoia possibly compromised the entire reform effort.

Tauzin's background: he helped Bush's Medicare Modernization Act narrowly pass in 2003, which was the biggest change to Medicare in the program's history and more expensive than our Middle East wars (the GOP really cares about deficits and the size of government). It was a huge boon to pharma because it permitted drugs to be partially covered by Medicare (under "part D", as in DUMB), and prohibited government negotiation of cheaper drug prices with companies (which is what the government is supposed to do, and actually does for vets through the VA health system!). Don't get me wrong, I do think truly needy seniors deserve assistance with their prescriptions (if the drugs are really necessary for reasonable quality of life), but it should be through price negotiations and not corrupt subsidies that hurt taxpayers. Otherwise the bargaining power of Medicare is wasted. And for his effort, Tauzin became the new CEO of PhRMA with a $2.5M salary. Anyway, now that the health bill looks doomed and PhRMA wasted $100M plus on ads, Tauzin looks like a goat and recently decided to step down. Hollywood couldn't make this stuff up.

Other details: PhRMA spent $28M on lobbying in 2009 (and spent $390 over 3 years), and the whole industry spent $100M. PhRMA pays 165 lobbyists and outside consultants, of which 137 of them used to work in government.

Got Merck? A day in the life of Big Pharma

Move over milk... Merck is so determined to help your grandma maintain strong bones that you won't believe the lengths they've gone.

With our female family members nearing retirement age, I am sure you've seen a bottle of calcium supplements or other bone-promoting medications on their kitchen table. Clearly osteoporosis is a health concern (especially for women, who lose bone more rapidly than men due to hormone changes after menopause), and we all know of a senior citizen whose quality of life was really impacted by broken bones from a fall (even 1 in 5 elderly women will die a year after a broken hip, due to other health complications associated with their disability). In the last decade or two, new specialty drugs have emerged that proactively reduce the chance of osteoporosis, and have blossomed into a multi-billion-dollar industry (since the trick with preventative drugs is you never know if you'll truly be at risk, so you better take them for the rest of your life to be safe).

Obviously osteoporosis doesn't occur overnight; there is a gradual loss of bone tissue, like how mild senility precedes dementia and Alzheimer's. So the "onset" of osteoporosis is named osteopenia, or bone thinning. But like senility, humans lose bone mass normally with age. So when is bone loss pathological? When do women reach the osteopenia zone (I'll refer to it as OP from now on)? Well, the cutoff point was literally decided arbitrarily by a room of bone experts at a WHO summit (they drew a line on a graph and that settled it). Unfortunately, many human diseases are not understood and merely classified by a set of symptoms that reach an arbitrary degree of severity, with clinical depression being an obvious example. Getting back to OP, the "disease" was decided to apply to people who were hovering near the osteoporosis cutoff.

Merck happened to have a bisphosphonate drug (later marketed as Fosamax) that inhibits the cells that digest bone. So without those cells' normal or pathological activity, osteoporotic people will lose bone slower. The problem is that bone is like a highway. It needs to be maintained and repaved occasionally from all the wear and tear. Those cells don't eat bone to be mean. They clear out old or weakened bone so other cells can lay down new, stronger bone. The renewing miracle of life. And the bone-laying cells do so very messily, like a kid with paint. The bone-eating cells are critical to remodel the bone, repair micro-cracks, and make it more structurally sound. Addition by subtraction. So actually a femur with more bone mass may be weaker than a thinner femur that is remodeled correctly by the bone-eating cells. So it's good that Fosamax stops over-active bone-eating cells from making a person's bones dangerously thin, but then over time the patient also loses some ability to maintain the strength in their bones through normal remodeling. In addition, Fosamax-type drugs are implicated in dozens of side-effects, and over 400 lawsuits were filed against Merck for the disease ONJ (in brief, wasting away of the jaw due to inability of that bone to heal after dental work, etc.).

But no bother, Merck wanted to sell Fosamax to the droves of aging people who were living longer, and would need to pop these pills for decades. Their major problem was people weren't using Fosamax, because they weren't getting diagnosed with osteoporosis until after they'd had an accident and doctors could examine their bones. Old people get more frail and reduce their activities. No one thinks that could be the sign of disease. Whole-body DEXA bone scans did exist in the 1990s, but they were costly ($200-300, and not covered by insurance) and there weren't many clinics that had the bulky pool-table-sized devices (~200 in the entire US). So Merck hired a team of consultants to fix the dismal situation. Bone scanners would be in every town, and older people would get scanned often (if they were successful).

So Merck set up a shell nonprofit called the Bone Measurement Institute (that employed an entire one person), and some top orthopedists became affiliated. They pushed doctors to use a peripheral, portable bone scanner that measured forearm or heel bone density, in order to extrapolate that to spine and hip bones (the bones that, if broken, would cause the most trouble for an osteoporotic patient). But doctors were hesitant: bone is highly dynamic and responds to the specific local loads upon it, and a vertebra is a lot different than a mandible (so you can't know the weather in London by looking out your window in Paris). The manufacturers of the traditional bone scanners were irate about this new competition in their niche market. Since they sold few traditional scanners per year, they needed to make them very expensive to recover costs. When Merck's portable scanner project didn't pan out, they decided to buy a traditional bone scanning company instead. Merck then slashed the cost of traditional scanners, forcing competitors to do the same or go out of business (and some did). So Merck won two-fold: they got revenge on the scanner companies who obstructed them, and cut the cost of scanners to facilitate their dissemination across the country (and reduce the scan costs to patients, making it more likely that they would seek one). They closed their scanner company soon afterward.

Merck funded clinical trials and submissions to the FDA to also get the peripheral scanners approved as diagnostic tools. They literally went door-to-door and even organized leases with doctors. Such measures to get more patients on their drug. Just imagine if they invested all that effort and resources into science, to actually understand human diseases better and design drugs more intelligently. But they're not a charity after all. Though of course better drugs will sell themselves and cost the company less in failed multi-million-dollar clinical trials and litigation. Anyway, Merck didn't stop there. They funded some third-party org's to lobby Congress to pass the Bone Mass Measurement Act in 1997, which made bone scans eligible for Medicare reimbursement (and some private insurance did the same). Now pay-for-service physicians could make good money on simple-to-perform bone scans. But for all its inefficiencies, Medicare conducts periodic cost effectiveness analyses, and they have wizened up to the game. In 2007 they decided to cut bone scan reimbursement from $140 to $60, based on expectations that the scanners should get cheaper with scale, and the procedure was much less laborious to doctors than previously assumed.

Of course those groups and the bone-related medical community were outraged, and the decision may get overturned. They want every woman over 65 to get scanned yearly, and maybe some men too. But mass screening is a double-edged sword. They help identify truly needy patients, but also flag many false-positives. That is why the NIH recently changed its mammogram guidelines for women, raising the recommended starting age from 40 to 50. This decision is controversial, but their complex data suggested that the scans don't improve public health enough to justify their costs (worrisome specks on a scan require the patient to get a biopsy, which ends up causing stress and revealing nothing).

Merck also won approval for a low-dose version of Fosamax targeted for potential OP patients. So even though their risk of a debilitating bone break was no different than their general demographic, they could be put on a daily regimen just because a bone scanner reported that they were in the vague OP risk zone. Even some athletic, pre-menopausal women were classified as osteopenic (though that is no guarantee they will be osteoporotic later in life). "Mild bone thinning" isn't so bad, like graying hair or wrinkles. It's part of aging. But "osteopenia" sounds scary, right? Gradually wasting away, and maybe losing your freedom and mobility from a sudden fall. No one wants to die like a zombie in a hospice facility. So take this magical pill every day and rest easy. And of course Merck blitzed the media with direct-to-consumer advertising, and word spread among seniors. From 1994-1999, the number of bone scans performed in the US increased from 77K to 1.5M (yet still only 13% of women over 65 get the scan, so Merck has more work to do), and orders for scanners went up 500%.

This is great news, right? There are several positive Fosamax papers published, but a recent study from the Univ. of Washington concluded that Fosamax was only effective in reducing the risk of spinal fractures (especially for patients who have already had a break), which is only a tiny subset of total fractures for the elderly. That makes sense, since your bones respond to a fracture by dumping a bunch of new, low-quality bone on the injury site (like a quick and dirty spot-weld), so Fosamax's mechanism of action should preserve that from deterioration. Though the injury site may never recover to original strength with impaired bone-eating cells. For the prevention of more common hip or leg breaks, the drug was no better than placebo. So even though it results in denser bones biologically, if that doesn't translate into better clinical outcomes, then what's the point? If grandma falls on her driveway, probably 2% more bone density won't save her. Unfortunately no studies are planned to examine the long-term effects of Fosamax, which bewilders me because I thought the FDA requires that. But researchers are concerned that the drug may actually increase fracture risk over time, since it impairs micro-damage healing. If you just dump a bunch of steel onto an already craggy bridge, you may be doing more harm than good (as we in the SF area know).

In closing, the Fosamax story mirrors many drugs out there in your parents' medicine cabinet. Fosamax sales doubled from 2001-2004, and are now over $3B/year. It is on the top-10 list of all-time blockbuster drugs. Although Merck's patent recently expired, brand-name Fosamax costs $90/month, which translates to $16.2K for a patient taking it from age 70 to 85 (excluding medical labor costs). Yes it's true that the drug does help a subset of patients who really need it, and has allowed some seniors to enjoy life longer. But the caveat with preventative drugs is we'll never know if the patient would have been relatively okay without them. The drug has also sickened and killed others. Eating right, weight-bearing exercise, and vitamins also promote bone strength (and don't have side-effects). And to be clear, Fosamax doesn't generate more bone for seniors, it just slows normal or pathological bone loss (so it can't "reverse" OP). But don't worry, the industry took notice and next-generation bone drugs are in development. The "business of medicine" is not so altruistic. Sometimes pharma will persuade doctors, device makers, and the government to tailor diagnoses (or even invent diseases) to fit their drug. And if demand isn't high, they will make it so with marketing campaigns, lobbying, and low-dose or "preventative" formulations for people who "could be at risk". Too bad nothing exists in the 2009 health reform bill to expose or regulate this.

http://www.npr.org/templates/story/story.php?storyId=121609815
http://en.wikipedia.org/wiki/Fosamax

Importing foreign drugs?

Here's another disappointment that isn't totally surprising: there was an amendment under vote in the Senate yesterday on whether to allow cheaper foreign drug imports to the market to keep US drug pricing more honest. But the measure failed 48-51. Sponsored by Sen. Dorgan, he estimates that the provision would save $10B and also includes some rigorous safeguards. A similar measure is already in the House health bill that passed. As you would expect, the Senators who voted nay to block cheaper imports received on average 70% more funding from pharma-related sources than the yay votes (see list in first link at the end). But maybe the vote is a moot point anyway, since the Obama administration already cut a boneheaded deal with PhRMA that I previously emailed about (http://worldaffairs-manwnoname.blogspot.com/2009/08/health-care-overhaul.html), and the Dorgan amendment would violate that agreement.

I know there are safety and quality issues associated with drugs from any origin, but we currently allow imported food, vehicles, toys, building materials, and such - all of which can and have sickened and killed Americans. European laws enabled drugs to cross their borders to different markets for the last 20 years, and their safety record is no worse than ours. Even according to Pfizer's (biggest pharma in the world after merging with Wyeth) former marketing VP Dr. Peter Rost, drugs that are made at the same plant and have the exact same safety profile are sold in the US for prices up to 10X higher. Why? He was fired from Pfizer soon after he made these claims on "60 Minutes". I find this issue ironic because those "socialist Europeans and Canadians" actually maintain a mostly free market for drugs and private insurance, while capitalistic, laissez-faire America practices protectionism and monopoly. And then they play the "safety" card any time their profits are challenged.

Safety huh? Foreign-made stuff is always worse than American (tell that to Detroit). Let's not forget that some "American" drugs are already manufactured overseas for cost savings and tax evasion (but still are FDA-approved as if the plants were on US soil). Pfizer alone has plants in Belgium, France, Germany, Ireland, Japan, and Puerto Rico. In fact they may not have any US manufacturing, or due to the Wyeth merger it will be heavily downsized. Plus plenty of American-made and FDA-inspected drugs have hurt people too (Vioxx, Yaz, Celebrex, heparin, and most recently a recall of H1N1 youth vaccine that isn't toxic but sub-potent).

If the laws are written intelligently and regulators and manufacturers cooperate on due dilligence, then threats to public health should be minimal, or at least not much worse than at present. 6% of the world's people live in North America, yet our region accounted for 43% of global drug sales in 2007. And I don't think most of those drugs went to people in Chiapas or Winnipeg. We are the drug maker's cash cow, so obviously they will do everything they can to preserve the status quo.

http://maplight.org/dems_senate_pharma_prescription_drugs
http://www.seniormag.com/canadianpharmacy/articles/safe-medications.htm
http://www.tmcnet.com/usubmit/2009/11/13/4479586.htm
http://www.cbsnews.com/stories/2005/06/03/60minutes/main699606_page3.shtml
http://www.drugrecalls.com/

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Unfortunately, this is all about what you describe as 'the boneheaded deal with PhRMA.' For some reason, and maybe he was right, Obama felt he had to cut the deal (caveat: I don't think this has ever been officially admitted to) in order to get national health care reform. The deal was apparently intended to get PhRMA on the side of "reform" and not use its vast resources to lobby and advertise against it. A deal with the devil, perhaps, but there's nothing pure or angelic about politics.

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But that's what worries me. Obama stated that he would make the health bill negiotations transparent and even broadcast the Congressional discussion on C-SPAN. That hasn't really happened. I think it's unrealistic to expect lawmakers to go on camera with their various proposals and deals anyway. But there shouldn't be such secrecy with the industry reps either. You're right that the White House initially denied any PhRMA deal, but the Huffington Post obtained a leaked memo, and later the WH eventually admitted to it, as reported by the LA and NY Times.

http://www.nytimes.com/2009/08/06/health/policy/06insure.html?_r=1

It shows disrespect for the public when he claims to shun lobbyists and keep the people first, yet he practices politics as usual (well, not as bad as Cheney and the oil companies at least). Who knows what deals are going on with doctors and insurers now? As you said, Obama needed to get PhRMA on his side of the health debate (or at least not fighting him tool & nail), but that hush-money comes at a huge price. He claims $80B in drug savings over 10 years (meager vs. the total cost of the health bill), but he's also protecting PhRMA's $1 trillion/year (and rising) bloated revenues. Like loan sharking, getting a little now, but paying a lot later. And obviously no business would agree to a deal unless it was a net gain for them (AOL-Time Warner notwithstanding haha). PhRMA's financial analysts are a lot better, and better paid, than Obama's.

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"The FDA has stated that it does not have the funds nor bear the responsibility to inspect on a regular basis overseas manufacturers of active pharmaceutical ingredients such as heparin."

Currently the FDA expects companies to inspect their foreign subcontractors or facilities, and report findings to them. The FDA only has the resources to inspect US sites like once every 1-2 years anyway.

The Chinese case was just plain counterfeiting. They usually sell heparin derived from pig blood, but in the case of Baxter's subcontractor, they diluted the heparin with cheaper, heparain-mimicking chondroitin sulfate from shellfish. So there were allergic reactions and deaths of patients who can't handle shellfish proteins or chondroitin.

http://www.cbsnews.com/stories/2008/03/01/eveningnews/main3896578.shtml
http://www.drugrecalls.com/heparin.html

Doctors prescribing drugs

In my experience, primary care physicians are very responsible in providing their patients with the correct medications and education. Being a news article, it is easy to cite a few examples of patients that are unaware to skew towards a general opinion rather than an official study supported by lots of data from a balanced group of subjects. The majority of my patients that are taking medications are mostly aware of their drug names and why they are taking them, and some also know the exact dosages. It is true that the majority are for high cholesterol, blood pressure, anti-coagulants, diabetic medication, etc. There are many drugs that can be prescribed, however there are fine differences in the mechanisms of the drugs, so the physicians may prescribe a drug, but then change the prescription due to the medication's effects of that patient's blood chemistry, exam, etc to titrate them for the best effect on their patient. I feel that they are putting the patient's best interest first, especially since there is no tort reform. The rise in pharm sales can be attributed to patients asking for a specific drug by name, but it will not be prescribed unless it is the right drug for them. In the case where many drugs can work, if a patient feels more satisfaction for a certain drug name, it will probably be prescribed. Otherwise, it is just new technological advancements that are helping patients live longer than the had in the past and a new generation in which Prevention is the mode of operation.

It used to be that a patient would have a heart attack before medication was prescribed. Now, we have many indicators to help prevent heart attacks. So instead of a patient having a heart attack/stroke and living 10 years longer the previous generation after the attack and dealing with the repercussions of that heart attack, we are moving towards a generation of patients living 20 years longer than the previous generation, but not having that heart attack and living a normal life. With the baby boomer generation taking bp/cholesterol/anticoagulants/diabetic meds younger than the current older generation, we can expect them to live even longer with less ailments. When patients live longer than they are supposed to, new ailments arise however, that never had before been seen because they would be dead in the past. So, new medications will need to be prescribed/developed.

It's true that American's are also not healthy and they do rely are on multiple drugs to live longer, but not because they are hypochondriacs (its malpractice to prescribe drugs that pts don't need, plus insurance won't cover it without a diagnosis backed with exam information), but because they would be dead otherwise or living miserably having survived a medical emergency.
In general, most doctors do try to prescribe generics when they can. On prescription forms you check a box that says "Generic Substitute" which is checked 99% of the time unless the patient feels better with a prescription name, i.e Hydrocodone 5/500 vs. Vicodin.

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Plenty of drugs are prescribed that have nothing to do with extending life, yet are quite expensive: antihistamines or other immunomodulators, digestive medications, sleeping pills, penis pills, PMS pills, behavioral drugs, and anti-depressants (unless for severe suicide risk, though teens taking anti-depressants may actually increase their risk of suicide, but of course patients who are prescribed anti-depressants are more likely to attempt suicide anyway: http://www.redorbit.com/news/health/731343/new_look_at_antidepressant_suicide_risk/index.html). Yes those drugs may improve a patient's quality of life (either marginally or significantly), but they are not a matter of life and death.

Drugs are one of several factors contributing to the huge drop in cardiovascular-related mortality. Fewer Americans smoke (I also believe alcohol consumption is down) and there is more education about healthful living and eating vs. the previous generation. Our diagnostic technologies have improved, so hypertension can be detected and addressed earlier. It's not just these wonder drugs that are making Americans live into their 80s. And if the drugs were so great, why is it that America is the most pill-popping nation per capita, yet our overall life expectancy is ranked 24th worldwide (see my previous email "Health care overhaul potpourri")?

It's naive to think that drugs are only prescribed out of critical medical necessity. Plenty of doctors prescribe drugs off-label (as in, for indications not officially approved by the FDA), because some data shows the drug could help, but in that case the prescribing doc is responsible for any adverse effects (since thorough safety/efficacy tests have not been conducted). Maybe they help the patients by doing so, and maybe it's excessive. Not all doctors are greedy con men, and not all doctors are saints. There's a mix of the two and plenty in between. Insurance and Medicare don't have the time and resources to scrutinize every Rx. The CDC said that 14M Americans misused their Rx's in 2004, resulting in 20,000 deaths. So obviously they were using the wrong drug, or not taking it properly, so either they are junkies or their physicians/pharmacists did not properly Rx or educate them on the risks.

The Centers for Medicare & Medicaid Services reported that 30% of the nursing home population is receiving an antipsychotic, yet 21% of those cases do not suffer from psychosis. In 2007 doctors filled more than 45 million prescriptions for an antipsychotic, according to IMS Health. Yet there are only 2.4 million schizophrenic patients (for whom the drugs were originally intended), according to the National Institute of Mental Health.

http://www.businessweek.com/debateroom/archives/2008/06/stop_casual_rx.html

Yes it is malpractice to Rx a drug that the patient doesn't need, and guess what - malpractice occurs a lot in America (~14K settlements paid out each year, either valid or frivolous, though few are drug-related). The attached report (I can't vouch for the data since I haven't read it all and am unfamiliar with the org, but just food for thought) suggests that malpractice settlements are not the bogeyman that physicians make them out to be. Before federal anti-kickback laws were enacted in 1972 & 1989 (42 CFR Part 1001), pharma companies were routinely paying for doctor's gifts, posh meals, and junkets to conferences in Hawaii (and some of it persists today). Why would they do that? They have a business to run and can't afford to throw money away as goodwill. They are investing in quid pro quo obviously. This is from the New England Journal of Medicine (scary stuff actually), written by doctors:

Interactions between drug companies and doctors are pervasive. Relationships begin in medical school, continue during residency training, and persist throughout physicians' careers. The pervasiveness of these interactions results in part from a huge investment by the pharmaceutical industry in marketing. In 2002, the industry expended 33 percent of its revenues on "selling and administration."12 In 2001, one company, Novartis, reported spending 36 percent of its revenues on marketing alone.2 The marketing expenditures of the drug industry have been estimated variously at $12 billion to $15 billion yearly, or $8,000 to $15,000 per physician.7,8,13 In 2001, the industry's sales force of drug detailers, whose job is to meet individually with physicians and promote company products, numbered nearly 90,000 in the United States2,8 — 1 salesperson for every 4.7 office-based physicians.8

Moynihan14 catalogued 16 different ways in which drug companies relate directly or indirectly with doctors. These range from the seemingly trivial (e.g., the ubiquitous dispensing of gifts such as pens and pads with drug names inscribed) to the much more troubling (e.g., the ghostwriting of articles for academic physicians, the payment of large honoraria and consulting fees to prominent physicians who extol the virtues of company products, and the support of lavish trips and entertainment for physicians who commonly prescribe company products).
Surveys of residents indicate that they receive an average of six gifts from pharmaceutical companies annually.15 In a survey of 106 directors of emergency-department programs in 2002, 41 percent responded that their programs allowed residents to be taught by representatives of drug companies, 35 percent reported that residents received free industry samples at work, and 29 percent said that residents' travel to meetings was sometimes dependent on the availability of company support.16 According to another report, residents in a psychiatry program in Toronto attended up to 70 lunches that had been sponsored by drug companies and received 75 promotional items over the course of one year.17

... As many as 59 percent of the authors of clinical guidelines endorsed by many professional associations have had financial relationships with companies whose drugs might be affected by those guidelines.23

... In a very thorough review of the literature on the effects of interactions with drug companies on physician behavior, Wazana15 identified 16 relevant studies. These studies found that a wide variety of interactions — meetings with company representatives; the receipt of gifts, free drug samples, and free meals; company support for travel to and lodging at educational events; attendance at lectures by representatives of pharmaceutical companies; acceptance of honoraria; and other relationships — were associated with changes in physicians' use of medications. Involved physicians were more likely to request the inclusion of the company's drugs on hospital or health maintenance organization formularies, more likely to prescribe the company's products, and less likely to prescribe generic medications. The resulting changes in the use of medication were often costly and "nonrational" in that the newly prescribed or requested drugs had no therapeutic advantage over the alternatives. Interestingly, several studies have found that the larger the number of gifts that physicians received, the more likely they were to believe that gifts did not affect their prescribing behavior.15,28

http://content.nejm.org/cgi/content/full/351/18/1885?ijkey=8tzMb5l1u.Np2&keytype=ref&siteid=nejm

So if doctors can enjoy millions of dollars of gifts/assistance/what-have-you from pharma companies and still prescribe their products ethically and scientifically, then medical school is really worth the $40k/year.

Health care overhaul

1) The compensation that the White House negotiated with Big Pharma ($80B in cost savings over a decade) may not be actual savings for us at all:

http://www.huffingtonpost.com/2009/08/13/internal-memo-confirms-bi_n_258285.html

A memo leaked describing a deal that if the Pharmaceutical Researchers and Manufacturers Association (PhRMA) made $80B in concessions over 10 years for Medicare drug reimbursements, Uncle Sam won't try to drive a harder bargain for future drug prices, won't import cheaper Canadian drugs, and won't move some drugs from Medicare Part B to Part D (thereby reducing reimbursements). But wasn't the whole point to save patients and the government money on exorbitant drug costs? Obviously an industry trade group wouldn't agree to a cost restructuring deal unless it benefited them in the long run. While they may have to give up $80B now to help make Obamacare appear to be paid for, that is a drop in the bucket considering the windfall sales they will reap as the pill-popping Baby Boomers get older. Just for perspective, the 2 biggest pharmas in terms of revenue are Novartis and Pfizer, who combined cleared $100B in revenue in just a single year, 2008. When the memo first broke, both the White House and PhRMA denied it's authenticity, but later probes by the LA and NY Times quoted administration officials confirming that such a deal occurred. Some in Congress were irate that the White House would cut a secret deal without their involvement, and wanted to tighten the screws on Big Pharma to get more for the taxpayers. Not surprisingly, the White House opposed them and said that generous PhRMA has promised enough. Well, according to OpenSecrets, Obama received over $19M in campaign contributions from the health care sector (over double what McCain got, despite Obama having tougher rhetoric on health care reform and reducing drug prices), of which pharma is a big chunk.

2) Is the "outrage" at health care town halls actually a manifestation of blue collar white America lashing out at their impotence in a changing American cultural and economic landscape?

http://www.npr.org/templates/story/story.php?storyId=111922780&ft=1&f=2
http://www.theroot.com/views/birthers-and-jim-crow-20

And of course right-wing radio and the GOP (the stupid wing of the GOP led by Palin at least) are stoking the fires, claiming ridiculous things like Obama's reforms are actually reparations in disguise, Obama is not actually a US citizen (everyone knows he's secretly a Muslim of course), and you and your relatives may have to justify their existence to "death panels" that determine whether you deserve to receive medical care - if the Dems get what they want. And moderate Republican Congressmen are scared stiff of angering the demagogues and populist mob if they make health care reform concessions too. I guess poor white America doesn't feel like America is theirs anymore (as if it ever was), and their "values" are being trampled on with change after change for the worse. What is their place in this unstable, changing world? I am sure current events are scaring college-educated, connected people like us, so one can only imagine how the anger and frustration is boiling over in the Rust Belt or Appalachians. Immigration, gay marriage, bailouts, soft power foreign policy, reforms, climate change, and such fly in the face of what they want America to be - even though the fantasy America they envision for themselves where everyone is free to prosper, no big government meddling in your life, and we are never wrong, has never and will never exist.

One of the Dems major political weaknesses since the Bush years is an inability to reach rural, white, lower income voters (the Dixiecrat voters and such from the JFK/LBJ years that they took for granted). They have tried with outreach by humble-roots white politicians like Biden and Webb, but haven't really had much success. Obama's white support mostly came from educated and higher-income people (UC System, Stanford, Harvard, and Columbia were all top-20 donors to his campaign). It's sad and ironic, because many of the Dems' social initiatives would really benefit poor whites, but conservative media and dogma have persuaded those people to hate the Dems who they think are selling this country down the river. And yet the GOP policies of deregulation, deficit spending, and low taxes contributed to their jobs being outsourced, cost of living rising well ahead of wages, and defaulting on their ARM. Remember the Howard Dean comment that his party has to connect with the voters who drive pickups with the Confederate flag bumper stickers? He got a lot of heat for that (especially from his rivals like Southerner John Edwards), and maybe it cost him the Dem nomination, but his underlying argument was sound, if very awkwardly worded. Though Obama and the Dems seem more scared to tackle the poor white issue than the black-white issue. If the Dems can successfully reach out to that demographic (I highly doubt it after so many years and a widening political gulf), then they would deplete the GOP to what it really is - a party for extremist Christians and rich champions of the military-industrial complex.

3) So much for a public insurance option:

http://news.yahoo.com/s/ap/us_health_care_overhaul

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Thought this was amusing and on-topic:

http://www.hulu.com/watch/89817/the-daily-show-with-jon-stewart-glenn-becks-operation

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LOL thanks M! He just has to be outraged about someting, even both sides of the same issue. I didn't realize Beck changed networks (not that I watch either). I would love to see a Battle Royale between Beck, Hannity, Rush, Savage, and Poppa Bear to see who is the biggest conservative propagandist prick alive. Oh, almost forgot to include Malkin vs. Coulter for the undercard.... jello wrestling.


If Beck thinks we have the "best health care" in the world, he must be taking too much oxycontin after his ass surgery (it was a complex procedure to make him an even bigger asshole).

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The WHO last ranked national health systems in 2000, and probably won't again because the metrics are getting too complex, but here were the rankings for those who haven't seen:

http://www.photius.com/rankings/who_world_health_ranks.html

1 France
2 Italy
3 San Marino
4 Andorra
5 Malta
6 Singapore
7 Spain
8 Oman
9 Austria
10 Japan
11 Norway
12 Portugal
13 Monaco
14 Greece
15 Iceland
16 Luxembourg
17 Netherlands
18 United Kingdom
19 Ireland
20 Switzerland
21 Belgium
22 Colombia
23 Sweden
24 Cyprus
25 Germany
26 Saudi Arabia
27 United Arab Emirates
28 Israel
29 Morocco
30 Canada
31 Finland
32 Australia
33 Chile
34 Denmark
35 Dominica
36 Costa Rica
37 United States of America
38 Slovenia
39 Cuba
40 Brunei


Life expectancy from 1997-99 (and it's much lower for African-Americans and the poor):

Rank Overall life expectancy

1 Japan 74.5
2 Australia 73.2
3 France 73.1
4 Sweden 73.0
5 Spain 72.8
6 Italy 72.7
7 Greece 72.5
8 Switzerland 72.5
9 Monaco 72.4
10 Andorra 72.3
11 San Marino 72.3
12 Canada 72.0
13 Netherlands 72.0
14 United Kingdom 71.7
15 Norway 71.7
16 Belgium 71.6
17 Austria 71.6
18 Luxembourg 71.1
19 Iceland 70.8
20 Finland 70.5
21 Malta 70.5
22 Germany 70.4
23 Israel 70.4
24 United States 70.0

Rank Country or territory Infant mortality rate
(deaths/1,000 live births) Under-five mortality rate
(deaths/1,000 live births)
1 Iceland2.93.9
2 Singapore3.04.1
3 Japan3.24.2
4 Sweden3.24.0
5 Norway3.34.4
6 Hong Kong3.74.7
7 Finland3.74.7
8 Czech Republic3.84.8
9 Switzerland4.15.1
10 South Korea4.14.8
11 Belgium4.25.3
12 France4.25.2
13 Spain4.25.3
14 Germany4.35.4
15 Denmark4.45.8
16 Austria4.45.4
17 Australia4.45.6
18 Luxembourg4.56.6
19 Netherlands4.75.9
20 Israel4.75.7
21 Slovenia4.86.4
22 United Kingdom4.86.0
23 Canada4.85.9
24 Ireland4.96.2
25 Italy5.06.1
26 Portugal5.06.6
27 New Zealand5.06.4
28 Cuba5.16.5
29Channel Islands ( Jersey and Guernsey)5.26.2
30 Brunei5.56.7
31 Cyprus5.96.9
32 New Caledonia6.18.7
33 United States6.37.8


Total health expenditures as %GDP, 2000-05:

Rank Location 2000 2001 2002 2003 2004 2005

1 Marshall Islands 22 19.1 18.4 16.3 13.2 15.4
2 United States of America 13.2 13.9 14.7 15.1 15.2 15.2
3 Niue 8 38.1 11.1 12.5 15.5 14.5
4 Timor-Leste 8.8 8.6 8.5 9.2 10.3 13.7
5 Micronesia (Fed. States of) 9 9.8 9.1 10.7 11.7 13.5
6 Kiribati 11.6 12.3 12.6 13.7 13.7 12.7
7 Maldives 6.8 6.8 6.6 7.2 7.8 12.4
8 Malawi 6.1 7.8 10 12.8 12.8 12.2
9 Switzerland 10.3 10.7 11 11.4 11.4 11.4
10 France 9.6 9.7 10 10.9 11 11.2
11 Germany 10.3 10.4 10.6 10.8 10.6 10.7
12 Jordan 9.4 9.6 9.3 9.3 10.1 10.5
13 Nauru 11 10.8 10.6 10.3 10.4 10.3
14 Argentina 8.9 9.5 8.9 8.3 9.6 10.2
15 Austria 10 10 10.1 10.2 10.3 10.2
16 Portugal 8.8 8.8 9 9.7 10 10.2
17 Greece 9.3 9.8 9.7 10 9.6 10.1
18 Canada 8.8 9.3 9.6 9.8 9.8 9.8
19 Sao Tome and Principe 6.3 9.1 8.6 11.9 12.1 9.8
20 Belgium 9.1 9.3 9.5 9.5 9.7 9.6

Health expenditures per capita, OECD nations 2000:

Rank Countries Amount
# 1 United States:$4,631.00 per capita
# 2 Switzerland:$3,222.00 per capita
# 3 Germany:$2,748.00 per capita
# 4 Iceland:$2,608.00 per capita
# 5 Canada:$2,535.00 per capita
# 6 Denmark:$2,420.00 per capita
# 7 France:$2,349.00 per capita
= 8 Belgium:$2,268.00 per capita
= 8 Norway:$2,268.00 per capita
# 10 Netherlands:$2,246.00 per capita
# 11 Australia:$2,211.00 per capita
# 12 Austria:$2,162.00 per capita
# 13 Italy:$2,032.00 per capita
# 14 Japan:$2,011.00 per capita
# 15 Ireland:$1,953.00 per capita
# 16 United Kingdom:$1,764.00 per capita
# 17 Finland:$1,664.00 per capita
# 18 New Zealand:$1,623.00 per capita
# 19 Spain:$1,556.00 per capita
# 20 Portugal:$1,439.00 per capita
# 21 Greece:$1,399.00 per capita
# 22 Czech Republic:$1,031.00 per capita
# 23 Hungary:$842.00 per capita
# 24 Slovakia:$690.00 per capita
# 25 Mexico:$491.00 per capita


Putting that all together, we see that we are paying a ton for health care and health outcomes that far lag behind those evil socialized medicine nations in Western Europe, Asia, and Canada. Maybe one can argue that America's lower life expectancy is also due to lifestyle (overeating, stress) and culture (guns, car accidents), not just health care. While that may be true, our smoking and binge drinking rates are much lower than most of Europe, yet many of those nations outlive us. But the biggest, most shameful metric is infant mortality. That is pretty much an even playing field to judge. Unless American mothers are prone to pregnancy complications and unhealthy parenting (no strong data to support that), it's the responsibility of the health care providers to monitor fetuses, birth those children, and make sure they have a good chance to reach adulthood. Our I.M. rate is 50% higher than France and double Japan's. Unacceptable. Especially when you consider that we commit 15% GDP to health care vs. 11% for France, or $4.6k per capita vs. France's $2.4k. Maybe that's not fair since France is ranked #1 by the WHO. But still, look at the other nations that devote >12% GDP to health care. They're either small or poor, which means they don't have much GDP to spread around anyway. We have the largest GDP, so we're wasting incredible amounts of money on sub-prime care.

Critics of Obamacare are not allowed to say that he is tampering with a great system, because the evidence is just not there. They can criticize Obama reform for cost, scale, rules, and planning, but even Mitch McConnell said that the GOP knows our health system needs some sort of reform too, it just depends on what shape it takes. So only a cretin (no offense to Greeks from Crete) would think that we're doing fine on the national level. Sure Ted Kennedy and Patrick Swayze are getting the "best health care in the world", and best care will still be available (even under a single-payer system) to those who can pay for it out of pocket, but on average the US has a long way to go before we can crown our asses (Dennis Green-ism).