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Monday, February 08 2010
Super Bowl Sunday brought a few surprises, including a nationally televised invitation from President Obama for Republicans to join Democrats for a health care summit later this month.
Obama invited Republicans to a half-day health care summit on Feb. 25 during an interview with Katie Couric on CBS. You can watch the full interview by clicking here.
The President says he wants Republicans to bring their “best ideas” on how to improve access and quality while lowering costs in the US health care system. And he’s going to put the whole event on TV.
Is the White House going to start over on health reform? No, according to Obama.
Is the focus for 2010 going to be jobs or health care? Jobs, says Obama.
Will a half-day summit on health reform cause Democrats and Republicans to come together and pass major bi-partisan legislation in Congress? Unlikely.
So why is the White House putting together a bipartisan summit on the one issue where Republicans have been remarkably successful in their opposition?
In short, it could be a trap.
It wouldn’t be the first time Obama and his team of advisors have used political theater to create a strategic advantage. In fact, Obama’s team could draw on past experience during the Presidential campaign in 2008 during the bank bailout.
In an excerpt from Henry Paulson’s book “On the Brink” published in the Wall Street Journal, the former Treasury Secretary detailed how the Obama campaign deftly managed a surprise move by Republican nominee John McCain to suspend his campaign and come back to Washington in late-September to deal with the $700 billion Troubled Asset Relief Program (TARP) and the financial crisis.
Paulson writes: “We'd devised TARP to save the financial system. Now it had become all about politics—presidential politics. I wondered what McCain could have been thinking. Calling a meeting like this when we didn't have a deal was playing with dynamite.”
McCain’s decision precipitated a meeting with then-President George W. Bush, Obama, McCain and leadership from both sides of the aisle at the White House.
Bush, according to Paulson, called for bipartisanship and the need to act quickly on the TARP legislation. Then the President called on the Speaker of the House Nancy Pelosi. “When Nancy Pelosi spoke, it was clear the Democrats had done their homework and had planned a skillful response for McCain,” according to Paulson.
Pelosi turned to Obama and said the Democratic nominee would represent the Democrats, Paulson writes. Obama proceeded to give a broad outline of the party’s strategy and emphasized that action needed to be made rapidly, while noting Democrats had been working with Paulson on a plan, including restrictions on executive compensation as a priority.
“Then he sprang the trap that the Democrats had set: ‘Yesterday, Senator McCain and I issued a joint statement, saying in one voice that this is no time to be playing politics. And on the way here, we were on the brink of a deal. Now, there are those who think we should start from scratch. ... If we are indeed starting over, the consequences could well be severe.’”
But, of course, there was no deal yet. [Rep. Spencer] Bachus [R., Ala.] had been maneuvered into giving credibility to the appearance of one. But he, [House Minority Leader John] Boehner and [Senate Minority Leader Mitch] McConnell had since issued statements disclaiming the idea that there ever had been a deal. Now Obama and the Democrats were skillfully setting up the story line that McCain's intervention had polarized the situation and that Republicans were walking away from an agreement. It was brilliant political theater that was about to degenerate into farce. Skipping protocol, the president turned to McCain to offer him a chance to respond: ‘I think it's fair that I give you the chance to speak next.’
But McCain demurred. ‘I'll wait my turn,’ he said. It was an incredible moment, in every sense. This was supposed to be McCain's meeting—he'd called it, not the president, who had simply accommodated the Republican candidate's wishes. Now it looked as if McCain had no plan at all—his idea had been to suspend his campaign and summon us all to this meeting.
Obama may be trying to repeat the TARP theatrics with the health care summit. For Obama the summit has little downside: (1) It forces Republicans to deliver a serious health reform plan; (2) It takes the health care focus off Democrats and puts it squarely on Republicans; and (3) It presents the danger to Republicans as being portrayed as obstructionists.
For Democrats, the negative impact of health care reform has already been felt. The coming health care summit likely represents the beginning of a final strategy for Democrats to take one last shot at passing comprehensive legislation this year and almost certainly not a genuine attempt at a bipartisan compromise. The chances of passage remain, however, hit or miss.
Comments? Email the author at windhover-dc@windhover.com
Monday, February 08 2010
Past import compliance violations by manufacturers will serve as a key factor in determining inspection priorities under a new program being spearheaded by FDA to ensure safety of the food and drug supply entering the country.
In addition to repeat violators, the system also flags higher-risk products coming into the country. FDA Commissioner Margaret Hamburg cited counterfeit drugs a key piece being targeted by the initiative.
The new program is rooted in an information technology system called PREDICT (Predictive Risk-based Evaluation for Dynamic Import Compliance Targeting); the technology was developed by NTELX.
PREDICT uses a variety of assessments to rank import shipments. It considers everything from whether a product is intrinsically risky to information acquired from previous examinations of shippers or producers, including past violations. PREDICT will also use information on market conditions and weather, which might suggest products that are tainted in some way. All factors add up to a risk score, and imports with the highest scores will be prioritized first.
“We expect PREDICT to offer two major benefits to FDA inspectors, to importers and to the public,” Hamburg said on February 4 at the Center for Strategic and International Studies meeting where the new program was unveiled. “First, the system will automatically flag potentially risky shipments. Second, the system will give lower risk scores to more innocuous materials, which can then be cleared through FDA inspection rapidly. This allows FDA inspectors to spend their time looking at the highest risk items. It also means that carefully labeled products with good histories will be held for shorter periods, and that is better for everyone.”
Drug counterfeiting is an important issue for large brand manufacturers as evidenced by industry stakeholders who attended the CSIS meeting.
Hamburg emphasized that drug counterfeiting requires constant vigilance by agency inspectors and the problem is greatest where drugs are coming in from developing countries where regulatory oversight is weakest. “Studies in some countries suggest that between 30 and 50
percent of certain available drugs are counterfeit,” Hamburg said.
“Needless to say, this is devastating to health and safety.”
Hamburg noted that FDA has roughly 500 inspectors for the approximately 20 mil. shipments of products that come into the US. She added that only about 8% of foreign drug facilities have been inspected by an FDA official.
PREDICT was successfully piloted in Los Angeles and is currently being rolled out in New York. The program is planned to be used in the rest of the country this spring.
Comments? Email the author at windhover-dc@windhover.com
Monday, February 08 2010
The Agency for Health Care Research & Quality (the US government's de facto comparative effectiveness research center) is slowly but surely funneling out its portion of the $1.1 billion in stimulus money set aside for comparative effectiveness research last year.
Remember the stimulus money? It is supposed to be a down payment on health care reform--though lately it looks more and more like it may BE health care reform, for now at least.
Among the recent announcements, this one caught our eye: a request for bids to create a "horizon scanning system" for the agency.
No, this isn't some fancy pair of binoculars. AHRQ defines horizon scanning as "(1) the identification and monitoring of new and evolving healthcare interventions that are purported to or may hold potential to diagnose, treat or otherwise manage a particular condition; and (2) an analysis of the relevant healthcare context and landscape in which these new and evolving interventions exist in order to understand their potential impact on clinical care, the healthcare system, patient outcomes and costs."
The goal of the project is to "provide AHRQ with a systematic process to identify and monitor healthcare technologies that are likely to have a high clinical, system and cost impact in the US."
In other words, what is in the pipeline that we need to know about today to make sure that our comparative effectiveness research anticipates innovative technology.
This is a pretty big deal, if AHRQ can pull it off. The agency's director, Carolyn Clancy, explained the idea during The RPM Report's FDA/CMS Summit in December. "What I find amazing is that no developed country has figured out how to do this well, so we are going to try to build a science in this area."
The goal of horizon scanning is not "academic navel gazing," she stressed. Rather, the agency wants "to anticipate what is on the horizon in the next three to five years and what kinds of questions might we be working to understand, even before the product is on the market, which patients are likely to benefit."
That may sound scary to some: Will the federal government be working to restrain uptake of new technology? It may also sound like an opportunity: if you have a breakthrough that truly transforms a treatment paradigm, maybe the feds will become champions for early adoption. For Clancy, it is the latter: This is "not intended in any way to discourage innovation," she told the FDA/CMS Summit. "Quite the reverse."
Whether horizon scanning is a threat, an opportunity, neither or both, we can't say for sure yet. But this we do know: if you aren't building comparative effectiveness research into your drug development plan, the federal government will try to do it for you.
Comments? Email the author at windhover-dc@windhover.com
Saturday, January 30 2010
We said we had a sense of deja vu going into the State of the Union, but this is ridiculous.
Last night, President Barack Obama devoted 516 words to his call to finish work on health care reform, about five minutes of the talk. That is about 7.2% of the total 7, 127 State of the Union address he delivered. Remarkably, it is exactly the same portion of the speech that he devoted to health care in his first address to Congress 11 months ago (427 out of 5,923 words, if you are keeping score.)
And it is about half the percentage that health care represents of the economy.
Stirring though the words may have been, their relative dearth suggests health care is hardly a make-or-break issue for 2010.
All of which means, Big Pharma has to think seriously about the consequences if Obamacare goes away.
Yes, it has reached the point where the US brandname pharmaceutical industry is hoping against hope that it can get someone to take $80 billion.
The famous deal between the Pharmaceutical Research & Manufacturers of America and the White House, which we dubbed "dollars for donuts," is up in the air, just like everything else related to health care reform.
AstraZeneca CEO and PhRMA board Chairman David Brennan made that clear at a press conference today tied to the company's year-end financial report. To Brennan's credit, he has said all along that the prospects for reform are uncertain, and today he underscored that things are more uncertain than ever.
And, in case there is any doubt, the collapse of health care reform would be a bad thing for Big Pharma. It is not just what won't happen--no bolus of newly insured customers, no filling in of the donut hole, no reduction in cost-sharing for existing insured, no new IP protection for biological therapies.
It is also what will happen. It is not like Pharma will just get to keep its $80 billion.
To us, the most important words for industry in the entire address weren't in the health care section at all, but earlier--when Obama called on Congress to tax overseas earnings. A year ago, Obama wanted to use that idea as a way to pay for health care reform, and that--maybe more than anything else--explains the deal PhRMA struck with the Administration. Industry came to the table, and the tax deferral on overseas earnings was taken off of it.
Not any more.
"To encourage these and other businesses to stay within our borders," Obama said last night, "it's time to finally slash the tax breaks for companies that ship our jobs overseas and give those tax breaks to companies that create jobs in the United States of America."
It took just 42 words to express that thought. But those are the words that could really count.
Comments? Email the author at windhover-dc@windhover.com
Saturday, January 30 2010
Approval at last! But there are a few caveats. First, a black box warning for the once-daily GLP-1 analog which includes a potential increased risk of thyroid cancer (despite Novo Nordisk's repeated claims that this applies only to rodents, not monkeys or humans). Second, no first-line usage allowed. Third, significant post-approval requirements, including a CV safety study, a 5-year epidemiological study to evaluate thyroid cancer risks, a 15-year cancer registry to monitor thyroid cancer cases, and a REMS.
As such, "it's a worst case label for the product," concluded Sam Fazeli, an analyst at Piper Jaffray in London. "Bittersweet" was how Jefferies' Jeffrey Holford put it, while Citigroup simply cut to the chase with "Commercial success far from certain."
Things could have been still bleaker, though. At least the US approval has finally happened (the drug was filed in May 2008). It might have been pushed out significantly further, given the regulators' apparent problem with the thyroid cancer risk. And on the up-side, there's no need for calcitonin monitoring during Victoza therapy (calcitonin is the marker used in humans for thyroid cancer) and there are no broad contra-indications for the drug. Only patients with a family history of medullary thyroid cancer, or multiple endocrine neoplasia syndrome, aren't allowed Victoza--and both those indications are very rare.
As such, Novo's management was upbeat during the analyst call announcing the news. The REMS is very remiscent of that recently imposed on Lilly/Amylin's twice-daily GLP-1 analog Byetta, said EVP & CSO Mads Thomsen, and certainly manageable. He added that many diabetes drugs (metformin, the sulphonylureas) have black box warnings, and most new products aren't awarded first-line treatment at their first pass at FDA. Thus, "we're perfectly happy with our monotherapy label," he said. (The product was denied approval as a monotherapy in Europe).
There a big 'but', though--and it's Byetta. That product has not only a five-year head start, but also hasn't got a black box, hasn't got a thyroid cancer risk warning, can be used as an initial therapy, and thus remains "first choice" treatment in this class, according to Fazeli, despite its more frequent administration.
This explains the generally (although not exclusively) down-beat analyst reaction to the news; "we see more room for disappointment than surprise on Victoza," writes Citigroup's Mark Dainty. Never mind the fact that Victoza outperformed Byetta in blood sugar lowering in a recent Phase III head-to-head trial.
Novo's management still thinks it can surprise, however. (They're a confident lot.) They re-iterated their forecasts that Victoza will reach sales of over $1 billion by 2015 (Byetta's currently at about $700 million and it has been on the US market since 2005).
Much will depend on whether follow-on GLP-1 analogs including long-acting Byetta (EQW) and Roche/Ipsen's taspoglutide are stamped with the same thyroid cancer warnings as Victoza. (Amylin's epidemiological study of Byetta is due March 31). Novo's Thomsen is adamant that the thyroid cancer signal seen among rodents is a class-effect among the long-acting GLP-1 analogs, and points to a forthcoming peer-reviewed scientific paper outlining what he claims is a similar pre-clinical effect on thyroid c-cells for Victoza, long-acting Byetta and taspoglutide. "We'll have to live with the notion that long-acting GLP-1 analogs cause c-cell proliferation in rodents," he told The In Vivo Blog. "But there's no reason to believe that these findings have any relevance to higher species," he added.
Whether or not the other long-acting GLP-1s get the same treatment, FDA is unlikely to remove Victoza's black box for several years at least, likely until the 5-year follow-up cancer study data is available.
Meanwhile, though, with its already-expanded US sales force and pricing in line with Byetta at about $8/day for the 1.2mg dose, Novo will be pushing Victoza with all its might and leveraging its wider diabetes franchise where possible. And let's not forget the fundamentals: Victoza is once-daily, can be taken anytime, prompts some weight loss, isn't associated with hypoglycemia or significant nausea, and is relatively easy to titrate.
Those elements may yet trump the worries about cancer in rats.
Comments? Email the author at windhover-dc@windhover.com
Monday, January 25 2010
It is a funny thing: it feels like everything has changed in health care reform, and yet we can’t help but have this crazy sense of déjà vu on the ever of President Obama’s State of the Union Address.
The questions about health care reform today aren’t so different than they were eleven months ago, when President Obama made his first address to a joint session of Congress Feb. 24. (That address was not, technically, a State of the Union address, but—with apologies to constitutional scholar—that is a distinction without a difference).
A year ago, the big question was: how aggressively would Obama pitch health care reform on his agenda? Where would it fall amid other priorities, most pressingly job creation and the reeling economy? And would he say enough to bring Congress with him for the heavy lifting reform would entail?
That pretty much sounds like what we will be listening for now.
Yeah, the circumstances look very different. Then, Obama was the newly elected President riding high on an unprecedented wave of hope if not hype. Today, he is still personally popular, but his policy agenda is bloody and bruised.
On health care, sweeping legislation passed both the House and the Senate, but the election of Republican Scott Brown as the new Massachusetts Senator makes final enactment seem like an insurmountable challenge.
But things really aren’t so different than they were a year ago. In 2009, Obama addressed Congress without a filibuster-proof majority. At the time, in fact, the Democratic caucus had only 58 members: it wasn’t until Arlen Specter switched parties and Al Franken was finally certified as the winner in Minnesota that the Dems had 60.
And Obama was fresh off an embarrassing setback then too: the withdrawal of Tom Daschle from consideration as HHS Secretary and health care reform czar.
A year ago, the question was how far and how fast should Obama push for reform? Would it be comprehensive reform or bust? Or would there be a more measured, scaled down plan, with jobs, energy and other priorities defining the agenda?
Those are the same questions Democrats and health care reform advocates are asking today.
And it is interesting to remember the answer a year ago. Then, Obama announced a “down payment” on health care reform, but declined to define comprehensive reform as the priority—instead saying that a robust, sustainable economic recovery depended on reforming health care, clean energy and education reform.
We will see if maybe Obama decides he was right all along…
Comments? Email the author at windhover-dc@windhover.com
Friday, January 22 2010
Our understanding is that Geisinger CEO Glenn Steele will be nominated as the next Administrator of the Centers for Medicare and Medicaid Services.
Last year, Steele was considered a top candidate for the job considering how he has shepherded the Pennsylvania-based health system using innovative payment models to lower costs and improve quality.
The Administration did not move forward with any nomination in 2009, hoping to complete work on health care reform before subjecting a nominee to the confirmation process. The final vetting of a nominee at this time would be logical.
Steele is reportedly going through the vetting process at present, and his name could be forwarded to Congress at any time.
However, it’s important to note that because of the unpredictability of health reform, the situation and Steele’s nomination, could change at any time.
Comments? Email the author at windhover-dc@windhover.com
Thursday, January 21 2010
The one thing everyone agreed on when this round of health care reform began is that the status quo is no longer an option.
Remember when Pharmaceutical Research & Manufacturers of America CEO Billy Tauzin stood side-by-side with Families USA head Ron Pollack to declare that, past differences between the two groups notwithstanding, they would join forces to urge the Obama Administration to press on with health care reform?
Or America’s Health Insurance Plans CEO Karen Ignagni standing up during the White House health care summit, being called on personally by the president, to say that insurer’s would not repeat their role in blocking reform this time around?
Time and time again, we heard the same theme: in 1993-94, everyone supporting health care reform viewed the status quo as their preference if they couldn’t have reform just their way. This time it was different. The status quo was no longer an acceptable fallback.
The status quo is suddenly very much on the table.
Such is the impact of the unbelievable, unthinkable victory by Republican Scott Brown in the race for the Massachusetts Senate Seat formerly held by the late Ted Kennedy.
Sure, there are plenty of non-healthcare explanations for that outcome. Plenty of folks blame the Democratic candidate, Martha Coakley, for a less than stellar performance. And special elections are always unpredictable (we drew a comparison before between this one and the kind-of-the-same-but –exactly-the-opposite election of Harris Wofford in Pennsylvania almost 20 years ago). And Massachusetts already has universal coverage (or as close to it as any federal health care legislation would deliver).
But this is politics and symbols matter. Ted Kennedy passed the mantle to Barack Obama and made health care his legacy issue. There can be no more potent symbol of repudiation for the current reform path than the election of an avowed health care reform opponent from the opposition party to fill his seat.
That silence you hear is the stunned contemplation of all parties to the health care reform debate that the status quo might just be what they end up with after all. All those lobbyists. All those hours. All those hearings, and mark-ups, and legislative drafts, and drafts of drafts. All for nothing?
Now, as President Obama likes to say, let me be clear. As of today, less than 48 hours after it really happened, no one can say for sure what the strategy on health care reform will be. Or, indeed, whether there will even be a strategy—since it is entirely possible that the Obama Administration, House Democrats and Senate Democrats will end up pursuing different ones.
And, as we point out in “The Pink Sheet” DAILY today, there are viable options to move forward, once the dust settles—many of which still seem attractive for biopharma companies.
But whatever happens next, we expect a key element will hinge on whether the stakeholders in the debate really meant what they said a year ago. Is the status quo really not a good outcome? Because it is suddenly very much an option.
Comments? Email the author at windhover-dc@windhover.com
Saturday, January 23 2010
King will have input from an FDA advisory committee before resubmitting its immediate release oxycodone formulation Acurox¸ and the company hopes that will translate into a relatively rapid approval.
“We are anticipating an FDA advisory committee for Acurox sometime in spring, but the date has yet to be announced,” CEO Brian Markison said during an interview at the JP Morgan Health Care conference in San Francisco Jan. 13. “We think that having a successful advisory committee meeting, will help us be able to quickly resubmit the NDA.”
Acurox, which combines oxycodone with a subtherapeutic dose of niacin, is intended to discourage abuse by triggering an aversion among users who take excessive numbers of pills; someone who takes multiple doses of Acurox at once is likely to experience the unpleasant flushing reaction associated with niacin.
However, like most therapies in the opioid class, the regulatory process hasn’t been smooth. King and its development partner Acura received a “complete response” letter in July (“The Pink Sheet” July 6, 2009).
King met with FDA in September to discuss the complete response letter, and the decision to take it to an advisory committee followed. However, it does not appear that King is formally appealing the complete response letter.
FDA has tentatively scheduled a meeting of the Anesthetic and Life Support Drugs Advisory Committee April 22-23; that is the likely target date to discuss Acurox.
King expects an up-or-down vote on the approvability of the application, even though it is not technically pending for approval. The discussion is likely to focus on standards for “aversive” formulations in general: reaching agreement on how to determine whether the Acurox formulation does in fact trigger aversion, and if it does, whether it is sufficient to suggest a reduced abuse liability.
“FDA is looking for its advisors to help the agency interpret the data that will be in the resubmission,” Chief Science Officer Eric Carter explained. “Given that the science of abuse liability studies is still emerging, the division director determined that an advisory committee was the appropriate venue to review the Acurox data.”
“The expectation is that FDA will ask the advisory committee whether Acurox should be approved or not, and if the committee votes in favor of approval then the resubmission is quite honestly a relatively simple resubmission. There’s not much, and hopefully they will review it relatively quickly.”
A Big Year for King at FDA
The Acurox resubmission is only one of several important FDA-related milestones King anticipates in 2010.
The first will be approval of its launch materials for the long-acting opioid formulation Embeda, which combines morphine sulfate with naltrexone (the latter ingredient intended to block the effect of the morphine if the sustained-release pill is crushed).
Embeda was approved by FDA in August, but the company received a warning letter from the agency in response to video news releases announcing the launch. That in turn has meant a delay in rolling out a full launch campaign (“The Pink Sheet” Nov. 6, 2009).
“We met with [FDA’s Division of Drug Marketing Advertising & Communication] just before Christmas, and I think both sides fully understand each other and are taking the appropriate steps to address the issues,” Carter said.
The letter followed “a mistake on our part,” Carter added. “We let video news releases go through that we should never have approved. The materials cited…were not a deliberate attempt to mislead, and were nothing other than the result of inadvertent internal errors that we made.”
And, Markison says, the launch of Embeda is proceeding nicely, all things considered. “Despite limited materials for our field team initially, including an annotated package insert for the first two months post-approval, we have seen that the physician receptivity has been terrific, and that managed care acceptance has been quite positive. We believe now that we are in the New Year that we will see a steady build of prescription growth week over week.”
King is also planning to resubmit its application for a long-acting, abuse-resistant form of oxycodone (Remoxy), which also received a “complete response” letter at the end of 2008 (“The Pink Sheet” DAILY, July 7, 2009).
“The Remoxy resubmission is going to be a bit more voluminous than Acurox,” Markison noted. “We are excited about the way those plans are coming together. Everything remains on track. And we think that the business case for Remoxy and the value proposition remains every bit as strong as it did when we first licensed the product.”
King expects Remoxy will also go before an advisory committee in 2010.
Last but not least, King’s Carter is working on behalf of all long-acting opioid manufacturers as FDA works on developing a class-wide REMS. FDA plans another meeting on that project this spring (“The Pink Sheet” DAILY, Dec. 4, 2009).
Comments? Email the author at windhover-dc@windhover.com