RUISLIP, England — When Bruce Hardy’s kidney cancer spread to his lung, his doctor recommended an expensive new pill from Pfizer. But Mr. Hardy is British, and the British health authorities refused to buy the medicine. His wife has been distraught.
If the Hardys lived in the United States or just about any European country other than Britain, Mr. Hardy would most likely get the drug, although he might have to pay part of the cost. A clinical trial showed that the pill, called Sutent, delays cancer progression for six months at an estimated treatment cost of $54,000.
But at that price, Mr. Hardy’s life is not worth prolonging, according to a British government agency, the National Institute for Health and Clinical Excellence. The institute, known as NICE, has decided that Britain, except in rare cases, can afford only £15,000, or about $22,750, to save six months of a citizen’s life.
British authorities, after a storm of protest, are reconsidering their decision on the cancer drug and others.
For years, Britain was almost alone in using evidence of cost-effectiveness to decide what to pay for. But skyrocketing prices for drugs and medical devices have led a growing number of countries to ask the hardest of questions: How much is life worth? For many, NICE has the answer.
Top health officials in Austria, Brazil, Colombia and Thailand said in interviews that NICE now strongly influences their policies.
“All the middle-income countries — in Eastern Europe, Central and South America, the Middle East and all over Asia — are aware of NICE and are thinking about setting up something similar,” said Dr. Andreas Seiter, a senior health specialist at the World Bank.
Even in the United States, rising costs have led some in Congress to propose an institute that would compare the effectiveness of new medical technologies, although the proposals so far would not allow for price considerations. At the present rate of growth, medical costs will increase to 25 percent of the nation’s gross domestic product in 2025 from 16 percent, with half of the increase coming from new drugs and devices, according to the Congressional Budget Office.
To arrest this trend, the United States needs to adopt at least some of NICE’s methods, said Dr. Mark McClellan and Dr. Sean Tunis, who served earlier in the Bush administration as, respectively, administrator and chief medical officer of the Center for Medicare and Medicaid Services. Dr. Tunis said he spent a lot of time in government “learning about NICE and trying to adopt the processes and mechanisms they used, and we just couldn’t.”
That’s because the idea of using price to determine which drugs or devices Medicare or Medicaid provides has provoked fierce protests. But Dr. McClellan said the American government would soon have no choice.
Drug and device makers, which once routinely denounced the British for questioning product prices, have begun quietly slashing prices in Britain to gain NICE’s coveted approval, especially because other nations are following the institute’s lead. Companies have said that they will consult with NICE to help determine which experimental compounds enter the final stage of clinical trials, so the British agency’s officials will soon influence which drugs enter the market in the United States.
The British government created NICE a decade ago to ensure that every pound spent buys as many years of good-quality life as possible, but the agency is increasingly rejecting expensive treatments. The denials have led to debate over what is to blame: company prices or the health institute’s math.
Dr. Michael Rawlins, chairman of NICE, blames the industry, saying that some companies raise prices “to get profits up so their executives can get better bonuses.”
More
If the Hardys lived in the United States or just about any European country other than Britain, Mr. Hardy would most likely get the drug, although he might have to pay part of the cost. A clinical trial showed that the pill, called Sutent, delays cancer progression for six months at an estimated treatment cost of $54,000.
But at that price, Mr. Hardy’s life is not worth prolonging, according to a British government agency, the National Institute for Health and Clinical Excellence. The institute, known as NICE, has decided that Britain, except in rare cases, can afford only £15,000, or about $22,750, to save six months of a citizen’s life.
British authorities, after a storm of protest, are reconsidering their decision on the cancer drug and others.
For years, Britain was almost alone in using evidence of cost-effectiveness to decide what to pay for. But skyrocketing prices for drugs and medical devices have led a growing number of countries to ask the hardest of questions: How much is life worth? For many, NICE has the answer.
Top health officials in Austria, Brazil, Colombia and Thailand said in interviews that NICE now strongly influences their policies.
“All the middle-income countries — in Eastern Europe, Central and South America, the Middle East and all over Asia — are aware of NICE and are thinking about setting up something similar,” said Dr. Andreas Seiter, a senior health specialist at the World Bank.
Even in the United States, rising costs have led some in Congress to propose an institute that would compare the effectiveness of new medical technologies, although the proposals so far would not allow for price considerations. At the present rate of growth, medical costs will increase to 25 percent of the nation’s gross domestic product in 2025 from 16 percent, with half of the increase coming from new drugs and devices, according to the Congressional Budget Office.
To arrest this trend, the United States needs to adopt at least some of NICE’s methods, said Dr. Mark McClellan and Dr. Sean Tunis, who served earlier in the Bush administration as, respectively, administrator and chief medical officer of the Center for Medicare and Medicaid Services. Dr. Tunis said he spent a lot of time in government “learning about NICE and trying to adopt the processes and mechanisms they used, and we just couldn’t.”
That’s because the idea of using price to determine which drugs or devices Medicare or Medicaid provides has provoked fierce protests. But Dr. McClellan said the American government would soon have no choice.
Drug and device makers, which once routinely denounced the British for questioning product prices, have begun quietly slashing prices in Britain to gain NICE’s coveted approval, especially because other nations are following the institute’s lead. Companies have said that they will consult with NICE to help determine which experimental compounds enter the final stage of clinical trials, so the British agency’s officials will soon influence which drugs enter the market in the United States.
The British government created NICE a decade ago to ensure that every pound spent buys as many years of good-quality life as possible, but the agency is increasingly rejecting expensive treatments. The denials have led to debate over what is to blame: company prices or the health institute’s math.
Dr. Michael Rawlins, chairman of NICE, blames the industry, saying that some companies raise prices “to get profits up so their executives can get better bonuses.”
More
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The Innovation of Biologics: How Is Value Defined Regarding Their Use?
Beginning in the late 1970s, biopharmaceuticals were being researched conceptually for potential creation in at that time in some academic institutions. And it was here that actual researchers in fact conducted basic research to identify new product candidates as they applied a great amount of time and effort fueled by their curiosity of what may be possible. This same protocol and passion is applied with biopharmaceuticals and the companies that create them today as it was then.
Known also as Red Biotechnology, it is believed that the first biopharmaceutical therapy ever was synthetic insulin called Humulin, which was made by Genetech in 1982, that utilized what is called rDNA technology, which also is used to produce human growth hormones. Later, the rights were sold to Eli Lilly for this insulin product. Yet Genetech was the catalyst and apex of biopharmaceutical growth then as it is now to a large degree. And such companies are truly research-driven. Today, they employ around 1000 scientists to continue their drive to research potential biologics. And with Genentech remains independent, although Roche owns a large portion of this company.
Biopharmaceuticals are distant and covert and distant relatives of big pharmaceuticals, whose medications are formed by synthetic small molecules, and are carbon based in their design. Due to the lack of innovation and creation of truly unique products in recent years utilizing this method, possibly, large pharmaceutical corporations in particular have become intimate with the innovative biopharmaceutical companies more often now than ever. In fact, large pharmaceutical companies often acquire biopharmaceutical companies that usually are comparatively very small start-up companies often. These large pharmaceutical corporations do this because, along with other reasons, biologics are in fact monopolies due to the undeveloped protocols for biosimiliars, which are the possible copy of what are the generic forms of typical branded pharmaceutical drugs. In addition, biopharmaceutical companies have historically experienced accelerated growth that has proven to be quite lucrative for them. Presently, this biologic industry is an 80 billion or so dollar per year franchise- with roughly 15 percent growth each year with this particular market, it is believed.
How do these drugs differ from typical drugs that have been made before this advent of biopharmaceuticals? Unlike the small molecule, synthetic, carbon based pharmaceuticals of yesterday, biopharmaceuticals essentially are larger and very complex modified proteins derived from living biological materials, such as manipulated cell cultures, that vary depending on what medication will be manufactured and for what disease state. In fact, it is difficult to identify the clinically active component of a biopharmaceutical drug, which is why there is no pathway for generic copies of such drugs, as it would require expensive and meticulous clinical trial processes.
One method of these creations is that a transformed host cell is developed to synthesize this protein that is altered and then inserted into a selected cell line. The master cell banks, like fingerprints, are each unique and cannot be accurately duplicated, which is why there are no generic biopharmaceuticals as of yet, as there is no known process to create them. So the altered molecules are then cultured to produce the desired protein for the eventual biopharmaceutical product. These proteins are very complex and are manufactured from living organisms and material chosen for whatever biopharmaceutical that may be desired to be created. It is difficult to identify the clinically active component of biopharmaceutical drugs. So manufacturing biopharmaceuticals clearly is a different and innovative process, and a small manufacturing change could and has raised safety issues of a particular biopharmaceutical in the developing process. Also, it takes about 5 years to manufacture a biopharmaceutical. And each class has a different method of production and alteration of life forms to create what the company intends to develop. Yet overall, their development methods are rather effective, and cost over a billion dollars to bring to market.
Over 20 biopharmaceutical drugs were approved in 2005, it has been reported, and their growth has tripled compared with what the large pharmaceuticals experienced then. Presently, over 20 biopharmaceutical products are blockbusters by definition, according to others. They are overall very effective treatments for what are viewed as very difficult diseases to manage and treat. This is due to the fact that some biologics target specific etiologies of these diseases, while limiting side effects because of the specific way in which such products work.
Unlike traditional medications that have been created in the same way for decades, biopharmaceutical companies seek through their research specific disease targets by genetic analysis and then search for a way to manipulate this target in a very specific way to provide superior treatment for such patients. Furthermore, these products are biologically synthesized and manipulated to maximize their efficacy while not crossing into a patient’s bloodstream.
There are about a dozen different classes or mechanisms of action of biopharmaceuticals that have about a half of dozen different types of uses today. Label alterations for additional disease states occur often as well due to the progressive and novel effectiveness of biopharmaceuticals. Some of these drugs are catalysts for apoptosis of tumor cells. Others may cause angiogenesis to occur to block blood supply to the tumors of cancer patients. Then some biopharmaceuticals have multiple modes of action that benefit certain patient types and their diseases greatly, as with most biopharmaceutical products, the safety and efficacy is evident and reinforced with clinical data and eventual experience with the biopharmaceutical that is chosen to be utilized. And this clinical data is of a different method as well in comparison with what are traditional medications. For example, patients in the clinical trial involving a pharmaceutical are profiled, which allows better interpretation of this clinical data on their products.
The country of Belgium provides the most biotech products to the biopharmaceutical companies in the United States, and the U.S. leads the world in regards to biopharmaceutical product creation- with more than 70 percent of both revenues and research and development expenditures in this country. Canada is ranked number two in this area, others have said.
And with the government health care programs who are the largest U.S. payers for pharmaceuticals, Medicare pays 80 percent of the cost of biopharmaceuticals, as many are administered in the doctor’s office, and Medicare part B covers the cost in large part for biologics.
One issue with biologics is overuse or inappropriate utilization of these therapies, and biopharmaceutical companies are not exempt from federal prescription regulation that exists presently. Amgen, who makes an anemia biologic called Neupogen, recently had to pay a settlement as well as JNJ, who makes an identical drug called Procrit, for rebates and incentives both companies were giving to the users of their products, which were very lucrative benefits, and this resulted in some cases intentional overdosing their patients with these biologics at unreasonable and unnecessary levels, it has been reported. The doctors targeted with these biologics by the makers of these agents are nephrologists and oncologists, as anemia is often seen in their practices for various reasons.
Another controversy involving biopharmaceuticals is that, while they overall are efficacious and safe, the typical cost of biopharmaceuticals is rather unbelievable, as this cost may approach tens of thousands of dollars per month for some of these biologics. Furthermore, with cancer drugs, they are used together with chemotherapy for their treatment regimens in many treatment centers, so the quality of life comes into question if one considers the devastating side effects of chemo treatment. Another criticism of biopharmaceuticals is that, with cancer patients in particular, they normally provide an extension of their life of only a few months. So there is a debate as to whether the value of biologics justifies their cost.
Several years ago, I heard a presentation from Roy Vagelos, former CEO of Merck Pharmaceuticals, and heard him as he spoke to others at Washington University in St. Louis about his views on both the pharmaceutical and biologic industries. And during his presentation, he stated something similar regarding the cost of biopharmaceuticals and asked as well about whether or not the value related to the cost of biopharmaceuticals is truly clinically beneficial for such a brief life extension of cancer patients in particular, for the most part. I happen to concur with his premise.
So there are apparent controversies associated with these unique paradigms and innovations. Yet there are only a few biopharmaceuticals out of many available with debatable benefits with the high price tag. It ends up being what the market will bear for what their makers charge others. Yet the real question is the clinical evidence behind biopharmaceuticals: If a biopharmaceutical stops tumor progression without harming such patients and really extends their lifespan with efficacy that is obvious, then the benefit of such a biological is rather clear.
Another difference with biopharmaceuticals is that they are also are additionally regulated by what is called The Public Service Act, and are involved in authorizing the marketing of biopharmaceuticals.
With many biopharmaceuticals, such as those used to treat cancer, between 70and 80 percent of them are believed to be prescribed off-label, so it will be interesting on how these drugs will be used in such disease states now and in the future, and how they will be regulated as well.
So the future looks good for this industry, as biologics have tremendous marketing power along with superior therapeutic value with some of the products available, but not all of them.
Regardless of the challenges and flaws that exist with biopharmaceuticals and their makers, I’m pleased to see the results and realization of true innovation in pharmacology by taking a different path of drug development. Furthermore, I believe others should behave in a similar manner and be inspired by the biopharmaceutical companies and what they have done and continue to do for the benefit of patients regarding the issue of innovation.
“The progressive development of man is vitally dependent on invention.” --- N. Tesla
Dan Abshear (what has been written is based upon information and belief)
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