Biologics: Extended Exclusivity?

Posted on: July 23, 2009  |   Author: Asha
Filed Under: Access to Care, Bioethics, Drug & Device, Life Sciences, Other, Technology   |   Leave a Comment

A pressing issue is how long pharmaceutical makers of biologics (drugs comprised of complex proteins that are extracted from living cells) can keep their drug recipes from generic drug companies. Biologics are costly drugs that are used to combat fatal diseases such as multiple sclerosis, cancer, and other rare diseases. Biologics makers argue that their innovation and financial incentives will be displaced if their exclusivity period is not extended. However, in addition to the already granted patent protection, the House and Senate have provided these types of companies with twelve years of exclusivity, free of generic drug market competition.

Biologics makers’ wishes cannot capriciously be granted because consumers and the health care industry in general could save billions of dollars over a period of years if no exclusivity extension were given. Another interesting aspect of biologics is that they are hard to copy. This is meaningful because even when the generic market opens for biologics, many generic companies may not bother investing due to this impenetrability.

An example of lengthy patent protection includes some of the most useful drugs, like Herceptin that is used to treat breast cancer, and is under patent protection until 2019. Though savings from the rejection of exclusivity extension for biologics makers would only be about $10 billion, with such a costly health reform in place, that could be a significant amount put towards a more meaningful channel rather than mere competition protection. The positive effects of not granting an exclusivity extension may be latent until years down the road.

Additionally, biologics copycats would be required to undergo brief drug trials because an identical copy of the original biologics is nearly impossible. An effect like the generic biologics in Germany had is possible here as well. There, “biosimilars” or biologic generics occupied thirty-percent of the market and forced brand-name manufacturers to lower their steep prices. Biologics do not require any more time or money to bring onto pharmacy shelves than do regular small-molecule drugs. Therefore, it is likely that biologic makers do not require any longer than the general five-year exclusivity protection that small-molecule pharmaceutical companies enjoy.

Commentary: Pharmaceuticals are extremely profitable companies. Extending the competitive market protection is unnecessary. If their incentives for innovation and drug research are exclusively founded in profit, perhaps it is time that a sector in charge of curing diseases rethinks its principles. Patents already grant considerable competition deterrence to pharmaceuticals. Additionally, through extensive lobbying, the House and Senate have offered even more protection to the already monopolizing pharmaceutical companies. Therefore, in the words of the executive director of the Coalition for a Competitive Pharmaceutical Market, “If your parents are strong, let them stand for themselves. That’s what every other industry has to do.”

The New York Times, July 22, 2009

Discussing the HIV Immigration Ban

Posted on: July 21, 2009  |   Author: David
Filed Under: Health Information, Other, Public Health Policy   |   Leave a Comment

Foreign citizens with human immunodeficiency virus (HIV) may soon be able to travel and immigrate to the United States.  Officials at the Centers for Disease Control and Prevention (CDC) and the Department of Health and Human Services (HHS) are hearing public comment on a recent proposal to lift the 22-year ban on infected foreign nationals.

Currently, several diseases such as HIV, active tuberculosis, and infectious leprosy require those infected to be excluded from travel and immigration to the United States.  Congress enacted the ban in 1987 and upheld it in 1993 under the belief HIV could spread through common interactions such as kissing and sharing towels.  Further research over the past 22 years has displaced most of those fears.  In fact, it is widely understood that HIV is a condition that can be managed with the use of drugs, and those infected are able to live a normal lifespan.  In 2008 Congress voted to repeal the legal restrictions upon HIV-infected immigrants; however, HHS continued the restriction and ultimately has the final say in the matter.

The proposal has been applauded and criticized in early discussion.  Infectious disease experts and AIDS advocates are cheering the plan to remove the HIV ban.  Dr. Michael Saag of the HIV Medicine Association stated, “There is no scientific or public health rationale for excluding people with HIV infection,” and characterized the ban as “an embarrassment.”  As of today, the United States is among only 12 other countries to bar entry.  The list includes Armenia, Brunei, Iraq, Libya, Moldova, Oman, Qatar, the Russian Federation, Saudi Arabia, South Korea, and Sudan.  Still, critics worry about the costs of lifting the ban and continue to worry about the possibility of transmission. The CDC estimates lifting the ban would allow an average of 4,275 HIV-infected people into the United States annually at a cost of $94 million for those admitted during the first year. Critics point out American taxpayers would bear this cost. Other critics continue to emphasize the possibility of transmission.  John Vinson, president of the American Immigration Control Foundation said, “People have desires and they’ll act on those desires and spread it to other people. Why bring on a problem on yourself when you don’t have to?”  Presently, more than 1.1 million people in the U.S. are infected with HIV, with 56,000 people becoming newly infected every year.

Commentary: Regardless of one’s political ideology towards immigration control and border security, Americans should embrace the discussion.  HIV and AIDS-related research has come a long way in the past 22 years.  This “blogger” is torn on the issue.  On one hand, American taxpayers would bear the economic burden of allowing HIV-infected immigrants into our communities.  With a national debt seeming to add another zero each year, maybe these additional costs compiling with the already present fear of transmission is enough to continue the ban.  Yet, this country is one somewhat driven by fear… fear of the unknown, of “the different,” of change.  This past November, Americans embraced the idea of “change.”  Maybe it is the right time to take a second look at policies enacted out of fear and hysteria, and discontinue the discriminatory and unwarranted practices of yesteryear.  Either way, we should embrace the idea that our political system is taking a second look at a dated policy.  More information and the ability to voice your opinion is available at the CDC’s website.

Msnbc.com, July 17, 2009.

Public Health Care: Is it the right choice?

Posted on: July 10, 2009  |   Author: Carmen
Filed Under: Access to Care, HMOs & Health Plans, Healthcare Reform, Other   |   Leave a Comment

A recent NY Times article explored the ongoing debate over the creation of a government-run health care plan to compete with private health care insurers. Private insurance companies contend they would not be able to compete with the federal government’s market power. Other detractors claim a government-run plan would create yet another unwieldy bureaucratic agency. Proponents of a public plan, on the other hand, contend the government must step in as the current system has failed to provide affordable coverage for an estimated 50 million Americans.

The federally run Medicare program, which provides coverage to more than 45 million elderly and disabled persons, is examined for any insights it may provide into a public health care program. One of the benefits of the Medicare program is its impact on cost containment. Large private insurers can spend up to 17 percent on administrative expenses, while Medicare spends only 2 to 3 percent. Because of its market leverage, it can purchase medical services more cheaply than private insurers can and uses this leverage to control costs. Medicare’s market dominance has also changed the way medical care is paid for. One example of this was the implementation of a reimbursement structure based on a fixed sum for a hospital stays rather than the actual cost of care. This resulted in decreases in hospital stays as well as a decrease in overall costs.

However, it is precisely this dominance in the market place that has private insurers worried. Dr. Mark B. McClellan, a physician and economist who ran Medicare during the Bush administration, said if congress uses Medicare as a model for a public plan, “its lower costs will tend to drive people into the plan.” This could result in private insurers being driven out of the market and consumers ultimately left with no or little choices in health care plans. Critics also point to the slowness of the government-run Medicare program to innovate. For example, a prescription drug benefit was not added to Medicare until 2003, years after private insurers began offering such coverage. Another problem with the public model may exist in the way physicians are compensated. The current Medicare system encourages physicians to see a high volume of patients rather than provide the most cost-effective treatment to each individual. Finally, critics point to congress’s micromanagement of Medicare as a hindrance to its ability to innovate and experiment.

In the end a public plan, because of its size and influence, will impact the direction of the American health care system. Whether that impact is positive or negative remains to be seen.

The New York Times, July 4, 2009.

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