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NICE garners new fans–and new critics
The U.K.’s National Institute for Health and Clinical Excellence may be the healthcare business’s favorite love-to-hate-it institution. The agency analyzes drugs and other treatments for their cost-effectiveness, and sometimes it makes decisions that patients find cold-blooded, to say the least.
And pharma often agrees, often for its own cold-blooded reasons: If NICE rules against a medication, then the National Health Service doesn’t pay for it, and a huge potential market is lost. Not to mention the fact that other governments often watch NICE’s decisions and tailor their own drug reimbursements accordingly.
As the U.S. looks to be mulling a version of this cost-effectiveness analysis, in an attempt to rein in wildly out-of-control healthcare costs, NICE is getting an entirely new group of critics. But it’s also getting a fair number of admirers as well. Jim Edwards at BNet scoffs at all the hand-wringing over NICE’s initial rejection of costly kidney cancer treatments, saying that the refusal actually did what it was supposed to: the makers of those treatments now are cutting their prices.
Meanwhile, the New York Times boils down NICE’s role–and the role of any imitators–to one question: How much is life worth? That’s not the sort of question Americans are accustomed to asking. So what do you think? Is NICE a cold-hearted bean counter? Or the sort of gatekeeper today’s healthcare requires?
- read the post at BNet
- check out the WSJ Health Blog’s take
- see the article in the NYT
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Roche stalls; Genentech soldiers on
A Genentech official tells the WSJ Health Blog that the company’s morale hasn’t been affected by the still-treading-water Roche buyout. Nor have employees begun to head for the doors. But In the Pipeline is skeptical, both of the supposed unchanged morale and of the eventual deal itself. Report | Report
Cleveland Clinic puts pharma payments online
The prestigious Cleveland Clinic says it’s started airing business relationships that its 1,800 staff doctors and scientists have with drug and device makers. A database of payments of $5,000 and above will be maintained on the clinic’s website as part of an overall revamp of its conflicts of interest policies, which has been underway for the past couple of years. With this new move, the Cleveland Clinic steps to the forefront of medical facilities’ efforts to bring transparency to their relationships with industry.
The clinic didn’t embark on the conflicts-of-interest overhaul completely voluntarily, the New York Times notes. Several years ago, several of its prominent doctors were criticized for their financial ties to the industry. Since then, the clinic has created ways to monitor those ties and established a committee to review any relationships that are considered “significant.”
With this new step toward public disclosure, the clinic is right in tune with the times. As you know, disclosure has been a hot topic all year, with Congress investigating ties between doctors and researchers on one side and pharma on the other. At the same time, lawmakers have drafted legislation that would mandate disclosure of pharma and device companies’ payments to doctors. And some drugmakers, such as Merck and Eli Lilly, have pledged to start disclosing those payments next year, with or without legislation.
- check out the clinic’s release
- read the New York Times story
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Merck’s 2009 estimates disappoint Street
Analysts were disappointed with Merck’s 2009 earnings estimates–and when analysts aren’t happy, nobody’s happy. The drugmaker’s stock is already suffering on the news that it predicts revenue to fall off by about 3 percent and profits to drop 6 percent. That leaves earnings at $3.15 to $3.30 a share, excluding restructuring costs, which, given the company’s layoff program, should be considerable. Analysts had expected earnings of $3.52 per share on 3 percent revenue growth.
The company is hanging onto its pledge of increasing shareholder value, saying its strong balance sheet will help prop up dividends at their current levels. Plus, the company says it will be able to repurchase some stock–to shore up the share price–and “take advantage of strategic opportunities,” which we read to be “pipeline-boosting biotech deals.”
- see the Merck release
- read the Wall Street Journal story
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Cigna cuts patients’ costs for Lipitor
Cigna is giving patients and Pfizer a break today. The insurance giant bumped Lipitor up to preferred status on its formulary, cutting copays at a time when the economy is slowing. That’s likely to help patients stay on Lipitor, rather than switch to a cheaper generic to save money.
And it helps Pfizer, of course, because the drugmaker is trying to milk as much cash as it can out of the Lipitor franchise before the drug goes off patient in 2011. The more patients it can persuade to keep taking Lipitor–or to switch to the med, as it’s been lobbying for–the more money it can reap from the cholesterol powerhouse.
As you know, Lipitor lost a big chunk of scrips when Merck’s Zocor went generic and patients switched to that less expensive option. Pfizer has been running studies in an attempt to show Lipitor’s superiority to alternative cholesterol meds, hoping to hang onto as many patients as it can. And no wonder: Lipitor brought in more than $12 billion in sales last year for Pfizer, more than a quarter of the company’s overall revenues.
- read the Cigna release
- check out the story in the Star-Ledger
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FDA: Pancreatic enzyme medically necessary
Pancreatic enzyme replacement products have been around for a long time, but have largely existed as nutritional supplements. Yesterday, an FDA official said the products are medically necessary, which might mean an approval is in store for Solvay’s Creon. Creon and similar products aim to help patients with chronic pancreatitis, cystic fibrosis and other conditions that require replacement of pancreatic enzymes essential for digestion. Report
More suffering at Merck ahead
Merck has seen its share of ups and downs (mostly downs) over the last few years, but it seemed like things were finally turning around for the company–despite myriad lawsuits over (need we say it again?) Vioxx.
Under the guidance of Richard Clark (photo), however, the company had eight drugs approved in just two years, a feat that no doubt helped raise its standing in the eyes of investors. In efforts to weather the storm, Clark led a restructuring effort that resulted in thousands of job cuts.
Now Merck stock is down 50 percent compared to about a year ago and the stock has performed worse than that of any other major pharma company. Tomorrow, Clark will try to impress investors with some smooth moves, but he had better have a trick up his sleeve if he wants to impress Wall Street, writers at Forbes say. Wall Street investors won’t settle for anything less than some remarkable research or news of a smart and strategic acquisition.
- read the Forbes story
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Antidepressants prescribed to children, babies
According to The Australian, almost 4,000 Australian children under the age of 10 received a prescription for antidepressant drugs in the last year, despite the fact that Australia has not approved the use of antidepressants in children or adolescents.
Of these, 553 of the children were under the age of five and 48 were babies. ”At first pass, it is beyond comprehension that more than 500 Australian children–aged one to five years–have received an antidepressant drug,” said Gordon Parker, executive director of the Black Dog Institute, a non-profit devoted to education about depression and bipolar disorder. He raised concerns about side effects and efficacy, and suggested having physicians justify the prescriptions.
The data came from the Pharmaceutical Benefits Schedule, which provides information on patients who receive subsidized medications. In fact, physicians prescribe most antidepressant medications privately.
Most of the drugs are not for children or adolescents less than the age of 18 years and it even says so on the label. However, some physicians ignore the label and prescribe the medications freely, either for intended or off-label uses. For example, physicians wrote 3,347 prescriptions for Wyeth’s Effexor last year, which clearly says it is not for anyone less than 18 years of age. Eight of the prescription recipients were less than two years old.
- see the Pharmalot blog post
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Big Pharma: Not recession-proof
It is true that humans will need healthcare regardless of how short on cash they are, but David Brennan (photo), CEO of AstraZeneca, says that if you believed healthcare was recession proof, you are wrong.
While speaking at a Financial Times conference in London, he said the recession will be “deep and long,” indeed affecting healthcare, including the pharmaceutical industry. That’s likely no surprise to FiercePharma readers, who have witnessed a variety of layoffs, cutbacks and other restructuring efforts aimed at cost-cutting within the industry.
As a recap, in 2008, Merck cut 8,400 jobs, but we saw major cuts at Abbot, AstraZeneca, Schering-Plough, UCB Pharma, Wyeth and at many smaller drug companies as well. The industry is likely to see more layoffs as we enter 2009.
- more in the Wall Street Journal blog
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Roche exec: DTC ads hurt big pharma
We can blame the tarnished reputation of the pharmaceutical industry on its decision to participate in direct-to-consumer advertising according to William Burns, head of Roche’s pharmaceuticals group.
Are TV ads a fair scapegoat for pharma’s problems? We’re not sure, but Burns’ revelation is ironic since it is clear is that Roche has dropped a hefty pile of cash on having Sally Field (video) peddle its osteoporosis drug, Boniva, on television lately–and we’re betting that Roche will won’t stop commercial ads aimed at consumers.
Burns says that direct-to-consumer ads undermine pharma’s reputation in the eyes of patients. “DTC advertising has been the worst decision for the drug industry,” he said. “When industry says we’re spending all the money on R&D, but actually it’s spending it on TV advertising to preserve margins, it doesn’t get much credibility.”
Only New Zealand and the U.S. allow direct-to-consumer advertising, but its prevalence has skyrocketed in the U.S., increasing 330 percent between 1996 and 2005.
- read the Pharmalot blog post
- see the Wall Street Journal blog entry
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Are brand name heart drugs superior?
According to a new review of randomized controlled trials, editorials and commentaries published in today’s issue of the Journal of the American Medical Association (JAMA), patients who spend extra cash on brand name heart meds do no better than patients who go the generic route. Interestingly, the reviewers found significant discrepancies between the randomized controlled trials and the editorials and commentaries published in the literature.
Aaron S. Kesselheim, M.D., J.D., M.P.H., of Brigham and Women’s Hospital and Harvard Medical School, Boston, and colleagues looked at studies published between 1984 and August of 2008 and identified 47 data-driven articles and 43 editorials and commentaries.
The researchers looked at angiotensin converting enzyme (ACE) inhibitors, anti-platelet medications, alpha- and beta-blockers, calcium-channel blockers, diuretics, statins, narrow therapeutic index (NTI) anti-arrhythmic meds and warfarin, and found no evidence that expensive brand name heart medications are better than generic equivalents.
Of the 47 research articles, 81 percent were randomized controlled trials. The studies found clinical equivalence in 100 percent of studies looking at beta-blockers (seven trials), antiplatelet agents (three trials), statins (two trials), ACE inhibitors (one trial), alpha-blockers (one trial), and for the NTI drugs - class I anti-arrhythmics (one trial) and warfarin (one trial). They found clinical equivalence in 71 percent of calcium-channel blockers (five of seven trials) and in 91 percent of diuretics (10 of 11 trials).
According to the FDA, “A generic drug is identical, or bioequivalent to a brand name drug in dosage form, safety, strength, route of administration, quality, performance characteristics and intended use,” but patients and clinicians alike have had doubts about their equivalency and safety.
In fact, the reviewers found 43 editorials and commentaries that met their criteria and over half of those expressed negativity about switching to generics from brand name products, less than 30 percent were positive about substituting with generics and the rest did not reach a conclusion on the topic. When it came to the NTI meds in particular, about two-thirds of the articles discouraged generic substitution and less than one-fourth supported making the switch.
The discrepancies between the randomized controlled trials and the editorials and commentaries could be due to the authors’ personal experiences or due to undisclosed financial ties with the industry, which about half of the former–and none of the latter–disclosed.
- read the Washington Post story
- see more at WebMD
- find the LA Times blog post
- here’s another blog entry at Pharmalot
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Novartis, Medicis cut generics deals
The march of the authorized generic deal continues with two new pacts between brand-name drugmakers and their copycats. In both cases, the generics makers will be able launch their versions of the branded drugs before they officially go off patent.
First, there’s Novartis and Mylan, which have inked an agreement on the breast cancer treatment Femara. Mylan will be able to sell versions of the drug before the patents begin to expire in 2011. Mylan says it was the first to ask the FDA to OK its copy of Femara, which would give it 180 days of marketing exclusivity on the generic form. That’s worth a substantial amount of moolah, because that first generic usually carries a higher price tag than the copies do once several companies are competing. Femara brought in about $470 million in U.S. sales over the 12 months ended Sept. 30, Mylan said.
Next, there’s Medicis Pharmaceutical and Impax Laboratories, which have cut a deal on a generic version of the acne drug Solodyn. Impax had filed for FDA approval on a copycat version, prompting a patent fight, but under this settlement, Impax gets the right to sell a copycat drug by November 2011. Impax will pay royalties to Medicis on Solodyn sales. Plus–and this is the innovative part of the deal–Medicis and Impax will work together to develop five dermatology products, including a new-and-improved Solodyn. Impax will get $40 million up front and $23 million in milestone pay6ments, plus royalties on Solodyn II.
- check out Mylan’s release
- see Medicis’ statement
- see the Femara story at RTT News
- read the Medicis article from the Associated Press
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Study links Depakote use with autism
While a new study that suggests pregnant women who take the epilepsy drug Depakote may increase their babies’ risk of developing autism, experts say the usefulness of the drug and the high risk of seizures during pregnancy may outweigh the threat of autism. Report
GSK, Sanofi lobby Irish for HPV shots
Drugmakers are dispatching experts to the Emerald Isle to lobby for their human papillomavirus vaccines. That’s because the Irish government has opted out of a comprehensive program to vaccinate young women against HPV, which can cause cervical cancer and genital warts. Instead, Ireland plans a screening program for cervical cancer in hopes of catching the disease early–and saving money in the process.
GlaxoSmithKline, which makes the Cervarix HPV shot, and Sanofi Pasteur, which markets Merck’s Gardasil in Europe, say screening isn’t enough. They’re sending cervical cancer experts to speak to consultants and healthcare types about the benefits of vaccination. For instance, Sanofi dispatched Margaret Stanley of Cambridge University last week, and GSK is hoping to get Dr. Anne Szarewski, a clinical consultant at the Wolfson Institute of Preventive Medicine, in front of Ireland’s health minister later this week.
A spokesperson for Minister Mary Harney told the London Times that an HPV vaccine program would play a role in Ireland’s overall response to cervical cancer, but that vaccinating all young women isn’t practical right now. “The decision not to proceed… is not based on the scientific evidence,” the spokesperson said, “but is related to the need to prioritize scarce resources given the current state of the public finances.”
But GSK takes issue with the Minister’s cost estimates for a vaccine program, too. Claire Taaffe, a GSK spokeswoman, told the Times that the company thinks the cost would be lower than the 10 million euros government is quoting. Competitive bidding would cut that cost considerably, she said.
- read the story in The Times
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Insurers’ drug-switching push prompts warning
Big Pharma may have found some unexpected allies in its battle against generic competition: consumer groups. Two advocacy organizations in Florida are warning consumers about “therapeutic switching,” which goes one step beyond straight generic substitution. Insurers are urging their members to try cheaper generic forms of their meds, and sometimes this means moving not to a generic equivalent, but to a generic drug in the same class, the groups warn. For instance, a patient using Pfizer’s cholesterol-fighter Lipitor might be encouraged to switch to simvastatin, a generic version of Merck’s Zocor.
As you know, simvastatin and Lipitor are not necessarily created equal. In fact, many drug classes contain meds that, while therapeutically similar, work differently in different patients. Antidepressants in the SSRI class, for instance, don’t work exactly the same in a particular patient, so moving from one to another can not only cause side effects, but differences in efficacy.
Consumer Federation of the Southeast and the Florida Public Interest Research Group are trying to get the word out about this type of switching, and are encouraging patients whose insurers are lobbying for a generic drug to discuss the switch with their doctors first.
“There are certain drug classes where it may be safe to switch from one drug to another, and there are others where switching can be dangerous–and the person deciding that should be the patient’s physician,” Dr. Bruce Rubin, assistant professor of clinical neurology at the University of Miami’s Miller School of Medicine, told the Tallahassee Democrat.
- read the story in the Democrat
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Caution: 2009 prediction lists ahead
Brace yourselves for the onslaught of pharma predictions for the new year (including ours). Today brings the first, at least the first we’ve seen, and at Dec. 2, it’s a tad early. But maybe CNBC’s Mike Huckman wanted to beat the rush. Mike Huckman offers nine prognostications for 2009 (nine in 09, get it?); here are a few to whet your appetite.
- M&A of all kinds: Pharma buying out pharma, pharma buying out big biotech, pharma buying out little biotech. Some of this is just common sense; as the economy contracts, industries tend to consolidate. Plus, with biotech companies facing capital shortages–and stock prices on the decline–they become motivated sellers at a price that can really motivate buyers. “Schering-Plough CEO Fred Hassan (photo) told me in a recent interview that biotech is cheap and compelling,” Huckman writes. And Hassan is far from alone.
- Pricing pressure: The big news may be the new U.S. administration and its vows to negotiate drug prices, but the same sort of downward push on prices is going on all over the globe. U.K.’s National Institute for Health and Clinical Excellence is the poster child of this movement. Look for lots of countries to play pharma hardball.
- Continued generic ascendance: About two-thirds of scrips are now generics, Deutsche Bank analyst Barbara Ryan told CNBC. That’s up from about one-half not so long ago. Don’t expect the trend to reverse.
- More vaccines: This burgeoning market will continue to grow. GlaxoSmithKline may actually get approval for Cervarix, its HPV vaccine this year, pitting it against Merck’s Gardasil. But Gardasil could be one step ahead with a new indication for young men as well as young women. And this is only one vaccine space.
You’ll have to check out the rest for yourself. Are there any additional ones you’d like to see in our 2009 preview? Let us know.
- read the story at Seeking Alpha
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NICE to green-light costly kidney meds
A much-lamented ban on new kidney cancer drugs in the U.K. will soon be lifted, the Guardian reports. Of four meds that the National Institute for Health and Clinical Excellence called too expensive for National Health Service use, at least half will be approved–and perhaps all four, the paper writes.
As you know, NICE recently ruled that Pfizer’s Sutent, Bayer’s Nexavar, Wyeth’s Torisel, and Roche’s Avastin didn’t ace the cost-benefit analysis all NHS drugs are expected to pass. According to NICE’s calculations, the drugs were too costly for the additional survival time kidney cancer patients tended to experience when using them. Patient advocates immediately pounced, and a public outcry ensued.
Now, however, sources are telling the Guardian that NICE will OK Sutent next month, when a committee meets to discuss the drugs again. Either Avastin or Nexavar is likely to get the nod, too, the sources said.
This turnabout by NICE follows some pricing negotiations between the agency and drugmakers. The companies have offered some new pricing schemes for the meds, including discounts and risk-sharing.
- read the Guardian story
- see the post at Pharmalot
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What will Viehbacher bring to Sanofi?
Does Chris Viehbacher’s (photo) advent as CEO of Sanofi-Aventis signal that buyout deals may soon be in the works? Analysts say yes. For instance, the idea of a merger with Bristol-Myers Squibb, often mentioned as a possible target for Sanofi, has again raised its head, this time in an investor note from UBS analyst Gbola Amusa. Such a deal “may be more likely now,” the Wall Street Journal quotes Amusa as saying. Bristol-Myers declined comment.
Analysts also expect Viehbacher to cut costs as his colleagues at other Big Pharma firms have done. Sanofi has instituted some layoffs already, but investors appear to be lobbying for the company to shutter some production facilities and cut more jobs. “They have quite a high cost base when you compare them to the pharmaceutical average,” one analyst told the WSJ.
Whatever Viehbacher does, his stepping into the CEO role is a sea change for the French firm, which has been run by a cadre of mostly French executives. So some changes are inevitable.
- read the WSJ story
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J&J to pay $1B for implant maker Mentor
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Cheaper drugs don’t always drive out brands
We’ve heard a lot about insurers and other payers pushing patients to use generics rather than brand-name meds, and how that pressure hampers Big Pharma. But there’s a flip side to that coin. Sometimes, getting patients and doctors to switch is well nigh impossible.
Take a federally funded study pitting old blood pressure meds–the diuretics–against newer, more expensive drugs such as beta blockers. Published in the Journal of the American Medical Association in 2002, the study clearly showed that patients with high blood pressure and other heart risks did better on the older, cheaper drugs. And the researchers mounted an all-out effort to promote those findings.
But, according to the New York Times, that research created only a tiny ripple in the drug market. Diuretic use increased initially, but then it leveled off. Researchers said drugmakers fought back against their publicity efforts, trying to discredit the study. Plus, pharma continued to roll out new meds, which weren’t available for the comparative effectiveness study, robbing diuretics of their head-to-head advantage.
So, if Congress actually goes through with setting up a comparative effectiveness bureau of some kind, will that really end up reining in healthcare costs? We’ll have to wait and see. But if this study is any indication, the WSJ Health Blog notes, skepticism could be in order. Particularly if that bureau produces FYI-type data, rather than info that government payers, such as Medicare and Medicaid, are required to act upon.
- read the Health Blog post
- see the article in the NYT
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