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Purdue Offers Up $10 – 12 Billion to Settle All Lawsuits – MedPage Update

Just revealed:

The opioid/OxyContin maker Purdue and members of the billionaire Sackler family owning the company have offered to settle thousands of lawsuits against the company for $10 to $12 billion. according to people briefed on the offer. More than 2,000 states, cities, and counties across America are pursuing the OxyContin maker over the large bills for cleaning up the opioid crisis — and are deciding whether to accept the offer by Friday. The Financial Times is reporting on this offer from the Sacklers and Purdue.

On August 26, Purdue paid $270 million to Oklahoma and Teva Pharmaceuticals paid $75 million also to Oklahoma.

From the Financial Times: “Purdue said it believes a ‘constructive global resolution is the best way forward’ and is working with state attorneys-general and other plaintiffs to achieve it. While Purdue Pharma is prepared to defend itself vigorously in the opioid litigation, the company has made clear that it sees little good coming from years of wasteful litigation and appeals”.

For all the harm done to this nation due to purposeful deceit and lies on the use of opioids claiming it was not addictive, someone needs to go to prison from the Sackler family.

Purdue Exposed

Medpage Today, Kristina Fiore, August 28,2019

I suspect with the new information being available, Purdue finally threw in the towel and offered a settlement. I also suspect this will impact other companies decisions to appeal as J & J is doing.

STAT News Wins Legal Fight Over Purdue Documents

A trove of documents detailing Purdue Pharma’s role in the opioid epidemic will be made public, STAT News reported, as the Kentucky Supreme Court denied the company’s request to review lower courts’ decisions to release them.

STAT waged a 3.5-year legal battle to make those records public. While some remain under seal, the outlet posted a sought-after video deposition of Richard Sackler. It had obtained a transcript of that deposition in February, which gained further attention when comedian John Oliver hired famous actors including Bryan Cranston and Michael Keaton to re-enact it.

The documents promise new information on how Purdue promoted its oxycodone product OxyContin and what, exactly, its executives knew about its risk of addiction. Among those documents are depositions of other Purdue executives; physician testimony; emails and memos about marketing strategies; internal reports on clinical trials; and communications about earlier legal cases.

All of the documents were part of Kentucky’s lawsuit against Purdue over its alleged illegal marketing of OxyContin. That suit was settled in 2015, with Purdue shelling out $24 million.

Purdue may soon be paying a far higher bill, with media including NBC News reporting that the company has pitched a $10 to $12-billion settlement in the consolidated cases set to go to trial before a federal judge in Ohio in October.

This does not bode well for Purdue, its settlement, or threat of years of litigation. The smoking gun was always there and pieces of it can be found in previous posts of mine. Relating the US Senate Joint Committee numbers to when Oxycontin was introduced after 1995 and the incremental increase in deaths from opioids, the use of a part of the Porter and Jink letter to the NEJM which said opioids were not addictive “minus the part where it said when used in a hospital setting,” the abuse of the Porter and Jink letter in the number of citations, the millions spent in lobbying state legislatures to block new laws, etc.

John Oliver uses Keaton and Cranston to portray Richard Sackler in this 20 minute Clip. It is worth watching. “the launch (Oxycontin) would be followed by a blizzard of prescriptions that will bury the competition. The blizzard will be so deep, dense, and white,.”

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J & J and It’s Subsidiary Janssen’s Actions “Created a Public Nuisance”

“The court found that Johnson & Johnson’s actions had created a “public nuisance,” which Oklahoma law defines to mean an act (or failure to act) that ‘annoys, injures or endangers’ the health and safety of an ‘entire community.’

In a 42-page opinion, Oklahoma State Judge Thad Balkman details how Johnson & Johnson’s sales and marketing assured doctors the appearance of addiction in patients due to the use of J & J opioid products was actually evidence of ‘under-treated pain’ and required the prescribing of more opioids. Sales representatives used these aggressive marketing tactics to target prescription-happy doctors referred to as ‘Key Customers’ in internal correspondence.”

I can not help but feel there comes a time when one must look at the continuing misuse of opioids under a doctor’s care and wonder what the doctors were thinking.

Multiple times I have written on the deadliness of opioids. To market and promote the use of opioids, the pharmaceutical industry deliberately took one sentence of a letter written by Doctors Porter and Jink to the NEJM in 1980 and claimed the use of opioids as safe in all environments and not mentioning Porters and Jink’s study was done in a hospital setting.

Addition Rare in Patients Treated with Narcotics, NEJM 1980: “Recently, we examined our current files to determine the incidence of narcotic addiction in 39,946 hospitalized medical patients who were monitored consecutively. Although there were 11,882 patients who received at least one narcotic preparation, there were only four cases of reasonably well documented addiction in patients who had no history of addiction. The addiction was considered major in only one instance. The drugs implicated were meperidine in two patients, Percodan in one, and hydromorphone in one. We conclude that despite widespread use of narcotic drugs in hospitals, the development of addiction is rare in medical patients with no history of addiction.” Boston Collaborative Surveillance Drug Program, Boston University Medical Center, Waltham NA 02154

From 1980 till 2015 the letter was cited 491 of 608 times affirming the use of opioids does not cause addiction. There was a significant increase in citation after the introduction of OxyContin in 1995. The “median number” of citations of a NEJM letter was 11 times in total. The citation of one sentence in whole or partially was many times more.

In Prescription Painkiller Addiction: A Gateway to Heroin Addiction,” Recall Report documents the start of the explosion in opioid use tying it to the introduction of OxyContin by Purdue Pharma in 1995/96.

The United States Congress Joint Economic Committee provides two charts detailing the total “number” of deaths per year from overdoses solely from opioids and Overdoses from all drugs during the time period of 1968 to 2015. The bar chart on the right represents the “numbers” of deaths per 100,000 (rate) of population from Overdoses solely from opioids and Overdoses from all drugs during the time period of 1968 to 2015. There has been arguments made there is no discernable evidence showing the impact of prescription opioids on the numbers of deaths. These two charts certainly points in a direction of the impact of prescribed opioids on the death rate.

Up till seeing the Joint Committee data, I had not seen earlier data. In these charts can be seen the additional yearly data predating 1980 when the Jick and Porter letter had been written to the NEJM going back as 1968. This data is important to see the magnitude of the introduction of prescribed opioids such as Oxycontin and the influence of them and the pharmaceutical industry on the usage of opioids said to be a safe drug to use outside of supervision.

State Judge Thad Balkman’s verdict will be appealed in higher state courts. If upheld, it will go to the federal courts. J & J is not a company without financial resource and they will contest this verdict as far as they can take it. The importance of the verdict is in holding a company, a citizen amongst us as declared by SCOTUS responsible for the abuse of opioids as shown in the numbers presented in this post, in earlier posts, and in the related documentation presented in all of my posts on opioids.

Reference Data

What the Oklahoma Johnson & Johnson Verdict Means for the Future of Opioid Litigation, Jay Willis, Microsoft News, August 27, 2019

Opioid Use since 1968 and Why It’s Abuse Increased, run75441 (Bill H), April 7, 2019

The Rise in Opioid Overdose Deaths, US Senate Joint Economic Committee, August 01 2017

Prescription Painkiller Addiction: A Gateway to Heroin Addiction, Recall Report

run75441 (Bill H)

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“pruning the tree when spring starts”

End of month July and Pfizer is spinning off Upjohn to generic drug/device company Mylan NV. Pfizer bought 57% of the unnamed (mid – 2020) new company. This move comes under Pfizer CEO Albert Bourla who took over the reins from Ian Read in January, 2019. Bourla has been with Pfizer for 25 years. Before becoming the CEO, Bourla was the Chief Operating Officer (COO) overseeing the company’s commercial strategy, manufacturing, and global product development functions.

CEO Bourla has been making strategic moves following what he has called a “pruning the tree when spring starts and Pfizer is in the spring of high growth” strategy. What caught my eye is this one comment in the Wall Street Journal about remaking Pfizer into a company focused on patent-protected prescription medicines with the potential for significant sales growth from a more diversified but slower-growing player. To me, this translate into a; “hey the Mylan EpiPen strategy worked, lets do the same with other products” strategy.

To date, he has overseen a restructuring at the company and made smaller deals to boost Pfizer’s pipeline of cancer and other drugs under development. Still not the biggest deal which would make Pfizer a giant. He has been guiding the combining of a division selling Advil, vitamins, bathroom found meds with GlaxoSmithKline PLC’s own consumer-health business to be spun off in a joint venture. Nothing earth-shattering there.

CEO Bourla focus for Pfizer on higher profit, exclusive, prescription drugs while moving the rest of its lower profit operations into other ventures. Off-patent drugs such as Lipitor and Viagra having lower profit margins would be targeted for joint ventures and Pfizer would still retain sizeable amounts of cash flow from these drugs to fund R&D. Pfizer is shifting the declining brands to Upjohn. The intent is to consolidate this business with Upjohn and merge Upjohn with the EpiPen company Mylan and rename the two.

The new Pittsburgh – based unnamed company is expected to be among the world’s largest sellers of generic and off-patent medicines with more than $19 billion in yearly sales. Pfizer Shareholders will own 57% of the new company and Mylan shareholders would the rest. Pfizer would be paid $12 billion raised from new debt acquired from the joint venture. Upjohn would return to the US from its corporate base in Shanghai, a reversal of its earlier inversion.

To me, this is a strategic move along the lines of Pfizer selling off the marketing of EpiPen to Mylan and keeping the manufacturing of it. Pfizer owned Meridian Medical Technologies manufactured EpiPen for Mylan and it will now be a part of the sale to Mylan. EpiPen was a huge success story for Mylan. A quadrant strategy of milking of a cash cow to fund new ventures.

Including EpiPen, “Mylan’s operating profit for its Specialty segment grew from about 35% in 2012 to roughly 60% in the second quarter of 2016.” Most of this can be traced back to the change in design of the EpiPen (cap) , exclusivity of it due to design changes which was covered by patents, and the rejection of Teva’s generic by the FDA due to a difference in application.

Add to this strategy story, Eli Lilly’s Alex Azar’s success profiteering off of the decades old diabetes drug Humalog and one can begin is imagine what the new “unnamed” company’s role will be under CEO Albert Bourla’s direction . . . more of the same.

In its analysis, World Health Organization determined the expenditure of one dollar in R&D being covered by $14.50 profit for cancer pharmaceuticals or more than enough to recoup expenditures for R&D and provide a healthy return for investors. The generics Upjohn will acquire have more than paid back the costs of R&D and are more than likely to be in a decline in producing profits. The question then becomes how to enhance the return on these generics.

Mylan changed Pfizer’s EpiPen design to achieve patented exclusivity. Teva could not duplicate it as a generic because patients could not use the Mylan instructions in applying the Teva generic. According to FDA’a rules, the Teva product could not be cast as a generic for the Mylan EpiPen in the marketplace as it could “not” be used in the same manner..

EIi Lilly’s Humalog, same formulation as what was made decades ago. The list price for one vial of Humalog has nearly tripled over the last decade. No new and improved or patent changes. Lilly appears to be taking increased profits from the price changes and passing on a larger slice to Pharmaceutical Benefit Managers to gain preference by healthcare insurance plans represented by the PBMs.

The same at the other diabetes med manufacturers Sanofi and Novo. Sanofi, a diabetes drug manufacturer and competitor to Eli Lilly gave insurers and pharmacy benefit managers rebates totaling more than half of its gross sales in the U.S. last year, resulting in net price declines across its portfolio despite list price hikes taken on dozens of its prescription products.

What is occurring is “shadow pricing” increases where one company raises pricing and the others follow.

A lawsuit filed in 2017 alleged three companies (Eli Lilly, Novo Nordisk, and Sanofi) intentionally raised the list prices on their drugs to gain favorable treatment from pharmacy benefit managers, who work with health insurers and drug makers and help decide how a drug will be covered on a list of approved drugs. Insurance companies do not pay manufacturer list pricing. The PBMs negotiate a rebate to the insurance companies from which they take a portion of it for themselves. The insured gets the net price after Rebates are paid to insurance company minus the PBM bonus for negotiated price.

It is in this circus of net profits after rebates and bonuses, I believe the Upjohn/Mylan “nameless” new company battle will be fought to increase Pfizer’s profit. This is not like the EpiPen medical device where a change in design of the pen can be made and a new patent secured. Some drugs may be changed which would result in a new patent. I suspect much of Upjohn/Mylan product profit improvement will be fought by getting preference from Pharmacy Benefit Managers.

CEO Albert Bourla will be watching the new company to see how successful they are in creating preference with PBMs and the resulting profit.

Why are our drugs so Costly? Watch the YouTube Presentation to Understand why Drugs are so Expensive to You.

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Science Backed Home Healthcare Remedies

From treehuggers, “Home Remedies,” Melissa Breyer, August 12, 2019

treehugger publication was also a part of Slate’s “Green Challenge” which Slate started publishing in conjunction with treehugger.org. a decade plus few years or so ago.

Chicken Soup for a Cold?

Toronto-based dietitian and Director of Food and Nutrition at Medcan, Leslie Beck:

“There is no evidence to prove that eating chicken soup is effective at treating the common cold. However, it’s not a total bust.” She continues;

“A 2000 University of Nebraska study found homemade chicken soup containing chicken, lots of vegetables, parsley, salt and pepper inhibits the activity of inflammation-causing white blood cells in blood samples taken from volunteers. It was thought this could reduce the flow of mucus and ease a stuffy nose. An earlier 1978 study found sipping hot chicken soup increased the velocity of nasal secretions in 15 healthy volunteers, an outcome possibly helping clear a stuffed-up nose. It was also found the effect lasted only 30 minutes and drinking hot water had the same effect.”

Another conclusion found in the same 1978 study was “Hot chicken soup, either through the aroma sensed at the posterior nares or through a mechanism related to taste, appears to possess an additional substance for increasing nasal mucus velocity.”

A 1998 UCLA report Coping with Allergies and Asthma notes, “chicken soup may improve the ability of the tiny hairline projections in the nose (called cilia) to prevent infectious particles from afflicting the body.”

It does lessen the sniffles . . .

Honey for Coughs

In “What works best for kids’ colds? Not medicine,” the author Melissa Breyer writes about a study showing honey outperforms the popular cough suppressant dextromethorphan (DM) in treating cough symptoms in children.

Dr. Shonna Yin from the N.Y.U. School of Medicine says that comfort for sick kids can come in the form of “plenty of fluids to keep children well hydrated, and honey for a cough in children over a year old.”

Prunes?

Science backs up the efficacy of prunes in helping improve regularity and better than psyllium. A half a cup of prunes has around 6 grams of fiber for around 200 calories. They also have the natural sugar, sorbitol, which can act as a laxative for some people.

Ginger for Nausea

Ginger is commonly used for medicinal purposes in Asian, Indian, and Arabic herbal traditions. In China, ginger has been used to aid all types of digestion disorders for more than 2,000 years. Health care professionals recommend ginger to help prevent or treat nausea and vomiting and as a digestive aid for mild stomach upset. Germany’s Commission E has approved ginger as a treatment for indigestion and motion sickness.

Hot or cold ginger tea can be made by grating or slicing fresh ginger and letting it steep in boiled water for 10 minutes or longer if you like it spicy. Hot, spicy, ginger tea with lemon and honey also does wonders for a stuffy nose as well.

How to Make Ginger Ale using Ginger.

Lavender to induce Sleep

Sleep expert Richard Shane, PhD ; “Research shows that smelling lavender decreases heart rate and blood pressure the key elements of relaxation (Reader’s Digest). The two main chemicals in lavender have been shown to have sedative and pain-relieving effects.”

2005 study found an exposure to lavender essential oil increased the percentage of deep or slow-wave sleep (SWS) in men and women. The study’s subjects reported “increased vigor the morning after exposure to lavender exposure corroborating the restorative SWS increase. Lavender serves as a mild sedative and has practical applications as a novel, nonphotic method for promoting deep sleep in young men and women and for producing gender-dependent sleep effects.”

Some truth in what mom and grandmother thought for their children and grand children. Maybe they did know best?

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“4 out of 5 mass Shooters Were Not Diagnosed with Mental Iillness,

half showed no signs of a prior, undiagnosed illness.” Sen. Chris Murphy (D-CT), and plainly speaking, they were not mentally ill.

Yesterday on Monday morning;

President Trump: “Mental illness and hatred pulls the trigger, not the gun. We must reform our mental health laws to better identify mentally disturbed individuals who may commit acts of violence and make sure those people not only get treatment and if necessary, involuntary confinement.” This is coming from a narcistic man who behaves irradicably and irrationally.

In response to President Trump’s remarks, Senator Chris Murphy (D-CT).

“Nineteen of 20 murderers had no diagnosis of a mental illness. Four out of 5 mass shooters had no mental illness diagnosis, and half showed no signs of a prior, undiagnosed illness. Framing mass shootings as just a mental illness problem is a gun industry trope. Period. Stop.”

In any case, the courts make little allowance for mental illness or for those who plead insanity. Those who are mentally ill and convicted of felony are locked away at level 4 prisons with the general population and the treatment is minimal. Trump’s “lock them up” comment of involuntary confinement just takes it one step further than the courts and without their interference.

Back to Senator Murphy and social media comments: some commenters agreed with Senator Murphy’s point about the validity of linking such events to mental illness as these comments only serve to stigmatize anyone with a mental illness. Other commenters questioned whether it is possible for a person to kill multiple strangers, at random, and not be mentally ill. One Twitter commenter; “So a healthy person does this?”

Yes, it can be a healthy normal person more often than not.

A much-cited 2016 review by forensic psychiatrists James L. Knoll IV MD and George D. Annas MD, SUNY Upstate Medical University in Syracuse New York may have been what Senator Murphy was referencing to in his comments.

Both doctors Knoll and Annas acknowledged the public and the media find the question of “mental illness” hard to resist.

“After all, who but a madman would execute innocent people in broad daylight, while planning to commit suicide or waiting to be killed by police?”

Adding to Knoll and Annas’s findings as well as other research; only a “minority” of mass shootings (however defined) have been perpetrated by individuals having recognized mental disorders.

“Few perpetrators of mass shootings have had verified histories of being in psychiatric treatment for serious mental illness.”

Again Knoll and Annas: Such individuals can function (perhaps marginally) in society and do not typically seek out mental health treatment. In most cases, it cannot fairly be said that a perpetrator ‘fell through the cracks’ of the mental health system. Rather, these individuals typically plan their actions well outside the awareness of mental health professionals.”

Mass shooters may not meet the criteria of a disorder as stated in DSM-5 – “Diagnostic and Statistical Manual of Mental Disorders.” They may have an ill-defined trouble of the mind, harboring anger or revenge and for which the field of mental health field has no immediate, quick-acting ‘treatment. “Psychiatrists and in particular forensic psychiatrists understand that dark and depraved acts are frequently committed for other reasons besides mental illness and more often committed for those other reasons.”

Can the matter of a hidden anger or other undefined trouble be resolved by labeling it ‘mental illness’ and calling for greater scrutiny of ‘troubled’ individuals? Knoll believes we would solve nothing by doing so and even risk making matters worse. This mindset makes us vulnerable to creating new and misguided laws. Such attempts further the medieval notion of equating mental illness with ‘evil’ or criminal behavior.

Mental health treatment has its limits is not designed to detect and uncover potential violent extremists. Formal psychiatric screening is not likely to identify those who may commit massacres.

Noting the wave of mass shootings beginning in the late 1990s; there was another propellant besides guns and mental illness both of which existed for a long time, and to which Knoll added the media as another. “It seems difficult to deny that the media coverage since the late 90s” has made it certain that those who commit heinous crimes become celebrities through the development of an online “Columbiner culture” glorifying the Columbine High School shooters and the others following in their footsteps.

We must eliminate the media attention gained from mass shooting.

Conundrum: Why Isn’t Killing 22 People ‘Mental Illness’?” — Psychiatrists say the question is beside the point, MedPage Today, John Gever, Managing Editor, August 5, 2019

Mass Shootings and Mental Illness,” Gun Violence and Mental Illness. James L. Knoll M.D. and George D. Annas M.D.

The Health 202: Trump blamed mental illness for mass shootings. The reality is more complicated” The Washington Post, Paige Winfield Cunningham

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Medicaid expansion saved lives

We use large-scale federal survey data linked to administrative death records to investigate the relationship between Medicaid enrollment and mortality. Our analysis compares changes in mortality for near-elderly adults in states with and without Affordable Care Act Medicaid expansions. We identify adults most likely to benefit using survey information on socioeconomic and citizenship status, and public program participation.

We find a 0.13 percentage point decline in annual mortality, a 9.3 percent reduction over the sample mean, associated with Medicaid expansion for this population. The effect is driven by a reduction in disease-related deaths and grows over time. We find no evidence of differential pre-treatment trends in outcomes and no effects among placebo groups.

Sarah Miller Sean Altekruse Norman Johnson Laura R. Wherry, NBER WP Working Paper 26081

I’ve been waiting for this. ACA Medicaid expansion is a policy experiment. The states which did not expand Medicaid made it easy to see if Medicaid saves lives. Obviously it does.

Via Axios where Sam Baker wrote; “expansion states saw a mortality rate that’s about 0.2% lower than nonexpansion states, the authors write — which would translate to roughly 15,600 lives, had the expansion not been optional for states.”

So Republican reactionary idiots have killed roughly 15,600 people so far through refusal to expand Medicaid alone. For comparison “In 2017, the estimated number of murders in the nation was 17,284” (just a number for comparison, I am not saying Republican legislators are murderers).

I don’t read Axios. I clicked there from Steve Benen

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Democratic Presidential Candidates Addressing Maternal Healthcare

Back in April, I finished up an article for ConsumerSafety.Org called A Woman’s Right to Safe Healthcare Outcomes. The topics covered in this as given to me by ConsumerSafety.Org were Clinical Trials, Essure, and Maternal Mortality. All of the topics dealt with women’s healthcare. Of the three issues addressed, I found Maternal Mortality to be the most compelling.

I told the story of a white upper middle class couple, Lauren Bloomstein a nurse and her husband Larry a surgeon. They went to the hospital to have their first baby. Lauren was a healthy young woman who did everything right. Unfortunately Lauren’s OB before and during her delivery missed many of the signs she was suffering from preeclampsia or high blood pressure. Lauren died after giving birth to a healthy baby girl. It is not unusual for doctors failing to heed the warning signs a women or her symptoms are alerting them too.

The warning signs of life-endangering problems were there, were missed (pain in the kidney area), or ignored (abnormal high blood pressure for Lauren). Excuses for other causes of the pain (reflux) were made, and pain killers administered to dull the pain and other symptoms (blood pressure) not explored while she deteriorated in front of her husband who suspected preeclampsia. The missing part of this was the protocol to diagnose early on and prevent Lauren from slipping into late stages of preeclampsia. This is not an isolated incidence as the deaths of women giving birth keep increasing as evidenced in the chart.

Even with the PPACA, expanded Medicaid in place; and when compared to their Canadian sisters, American women are three times more likely to die from the start of a pregnancy up till one year after the birth of a child (defined by the Centers for Disease Control). The death rate for American women is 26.4 deaths per 100,000 as opposed to 7.3 deaths per 100,000 in Canada (Chart). The ratio worsens when compared to Scandinavia countries as American women are six times as likely to die as Scandinavian women.

There are two stories, one for economically secure women and another for minority, native American, rural, and lower income women.

The statistics worsens for women of color with their being more likely to die in pregnancy or childbirth and are nearly four times more likely to die from pregnancy-related causes than white women. In high-risk pregnancies, African-American women are 5.6 times more likely to die than white women. Amongst women diagnosed with pregnancy-induced hypertension (eclampsia and pre-eclampsia), African-American and Latina women were 9.9 and 7.9 times in danger of dying than white women with the same complications. Native American and Alaskan Native women experience similar discriminatory care. Half of all U.S. births are covered by Medicaid and covers women up to two months past delivery leaving a substantial gap after child birth when other issues can arise.

Barbara Levy, vice president for health policy/advocacy at the American Congress of Obstetricians and Gynecologists; “We worry a lot about vulnerable little babies and we don’t pay enough attention to those things catastrophic for women.”

The emphasis has been on safe baby care and safe birthing which lead to a significant decline in baby mortality. As reported in a Propublica, NPR report, the difference in “maternal mortality numbers contrast sharply with the impressive progress in saving babies’ lives.” Maternal death rates while giving birth and up to one year later has increased by an approximate 10 deaths per 100,000 since 2000 till 2015 or greater than the 9.2 deaths per 100,000 in the U.K, (Chart).

In my email account, I found my usual Health Affairs article with a lead off title “The Maternal Health Crisis: Policies of 2020 Candidates

“Many of the Democratic presidential candidates met in Columbia, SC at the Planned Parenthood Women’s Health Forum to share their reproductive health proposals, including plans for maternity care. On Thursday, June 26th, they will engage in their first debate. Donald Trump launched his re-election bid on June 18th, 2019. While his campaign website does not include any specific reference to maternal mortality, members of his administration have recently brought attention to rural maternal health challenges.

This renewed focus on maternity care is desperately needed: U.S. rates of maternal mortality are the highest in the developed world and have been rising since the 1990s, with women giving birth today more likely to die in childbirth than their mothers. These adverse outcomes are also marked by significant racial disparities, with non-Hispanic black and American Indian/Alaska Native women at least 3 times as likely as non-Hispanic white women to die around the time of childbirth.”

About time.

run75441 (Bill H)

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Supreme Court to hear cases over ACA risk-corridor funds

Supreme Court to hear cases over ACA risk-corridor funds

“The U.S. Supreme Court said Monday it will take up cases over whether the federal government must pay billions of dollars to health insurers that sold coverage on the Affordable Care Act exchanges.

Letter to The Editor – Modern Healthcare Alert

If you are going to report on this particular incident with the Cromnibus Act which passed December 11, 2014, why not give the complete history of how the Risk Corridor Program was stymied?

Initially, then Budget Committee Republican Ranking Member Senator Sessions wrote a letter to the GAO asking whether the Risk Corridor payments were being appropriated correctly. In a letter back to Sessions the GAO said Agencies can only appropriate funds at the discretion of Congress. Funding had not been properly secured for the Risk Corridor Program. This effectively stopped any new funding from being used for the Risk Corridor Program; however, funding could be transferred from other healthcare programs.

With the aid of House Energy and Commerce Chair Fred Upton and House Appropriations Chair Jack Kingston, Section 227 was inserted into the Cromnibus Act.

“None of the funds made available by this act from the Federal Hospital Insurance Trust Fund or the Federal Supplemental Medical Insurance Trust Fund, or transferred from other accounts funded by this act to the “Centers for Medicare and Medicaid Services – Program Management “ account may be used for payments under section 1342(b)(1) of Public Law 111-148 (relating to risk corridors).”

This was far more nefarious than Congress as a whole making this budget neutral and its hides what Republican Senator Sessions, and House Representatives Upton, and Kingston did to sabotage the ACA, drive up premiums, bankrupt Coops, cause companies to leave the healthcare exchanges, and cause constituents to lose coverage.

Yes indeed, Congress did vote for the Cromnibus Act in the waning day(s) left before a government shut down. Section 227 was inserted during those last few days and more than likely overlooked in the process of passing a budget bill so the government would not shut down.

run75441 (Bill H)

Should these companies win at SCOTUS review, the costs and blame should be assigned to these three as their motives were “solely” party politics over country thereby penalizing citizens.

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Does President Trump Read “JAMA Network Open?”

It is doubtful Trump reads much beyond his own signature on Executive Orders and Twitter commentary. Someone is attempting to align him with current thinking creating a persona of his being a thoughtful and reasoning president as opposed to . . . ?

In “Again, Healthcare Cost Drivers Pharma, Doctors, and Hospitals ,” I had posted stats from a 2016 JAMA paper covering the period from 1996 to 2013. Healthcare costs had increased $1 trillion of which 50% was due solely to pricing. One significant factor in the JAMA report was the $66 billion increase in costs for diabetes treatment of which $44 billion was due to pharmaceuticals pricing. One impact to diabetes treatment was Eli Lilly’s increases for Humalog which was $21 per vial in 1996. By 2017, the price increased to $275 (700%) for a vial, a one-month supply. Humalog is a decades old drug and the manufacturing has not changed significantly.

“JAMA Network Open” has issued an end of May 2018 paper on pharmaceutical pricing trends covering the years from the period 2012 – 2017, “Trends in Prices of Popular Brand-Name Prescription Drugs in the United States.” The question it asks:

• What are the prices of top-selling brand-name prescription drugs in the United States and how have these prices changed in recent years?

answer:

• In this evaluation of 49 common top-selling brand-name drugs; 78% of the drugs have been available since 2012, have seen an increase in insurer and out-of-pocket costs by more than 50%, and 44% have more than doubled in price.

and concludes:

• Brand-name drug pricing associated with government-protected market exclusivity is likely to continue to increase and warrants greater price transparency.

Similar to what President Trump has proposed which “still” does not empower constituents to seek alternatives and typically the alternatives are just as costly.

Study Methodology

Data was obtained of 35 million individuals from the Blue Cross Shield Axis (data base) for the time period of January 2012 through December 2017. The researchers reviewed prescribed drugs exceeding $500 million in US sales or $1 billion in worldwide sales.

Within the identified parameters of 2012-2017 sales, 132 brand-name prescription drugs were identified. 49 of the 132 top-selling drugs exceeded 100 000 pharmacy claims, substantial cost increases among these drugs was experienced within the inclusion parameters with a 76% median cost increase, and 48 of the drugs had regular annual or biannual price increases.

Thirty-six of the 49 drugs were available since 2012. Twenty-eight had experienced an increase in insurer and out-of-pocket costs exceeding 50% and 16 more than doubled in price. Insulins such as Novolog, Humalog, and Lantus and tumor necrosis factor inhibitors such as Humira and Enbrel experienced highly correlated price increases coinciding with some of the largest growth in drug costs.

The results of the study revealed the median sum of out-of-pocket and insurance costs paid by patients or insurers for common prescriptions and presented both annually and monthly.
Pricing increases for 13 new drugs from January 2015 through December 2017) and entering the market in the last 3 to 6 years was not different than those (36) having been on the market longer, a 29% increase [median] from January 2015 through December 2017.

Nor did the study differentiate between drugs with or without a FDA approved therapeutic equivalent (number of drugs, 17 vs 32; median, 79% vs 73% price change).

Changes in prices paid were highly correlated with third-party estimates of changes in drug net prices (ρ = 0.55; P = 3.8 × 10−5), suggesting that the current rebate system incentivizes high list prices and greater reliance on rebates resulting in increased overall costs.

“The study concludes the growth of drug spending in the United States associated with government-protected market exclusivity is likely to continue. Greater price transparency is warranted.”

Interpretation? Pharmaceutical companies (and I will include companies such as Mylan [EpiPens]) are using the patent drug laws and resulting exclusivity time period to maximize profit margins ($14.50 for every $1 invested [WHO]) protecting their products from competition. A similar exclusivity holds true for generic products also (time periods for the introduction for a similar generic product). “Can You Patent The Sun (Jonas Salk)?

I sat over dinner with one Exec. VP from a major pharmaceutical company who confirmed what I had said in an earlier post (Can You Patent The Sun?) and here. A new pricing strategy is being used by pharmaceutical companies which maximizes return based upon benefits achieved in treatment, life, healthcare system, and in society. It is a well thought out reasoning being delivered by intelligent purveyors of healthcare supplies portraying a modicum of caring or concern for societal welfare while pursuing the profit motive. Novartis CEO Vas Narasimhan (not the one I talked to);

“Cell and gene therapies are bringing about a new era of cancer medicines going beyond ‘just improving lives and are saving them.’ The new therapies are challenging the traditional model for paying for medical treatment and the industry is divided on this approach. Pricing for these one-time usage therapies are to be based on four key measures of value – the improvements they offer to patients both clinically and in terms of their quality of life, and the resulting benefits to the health-care system and society.”

The pricing application is not limited to new drugs, cancer meds and gene/cell therapies; it is also being applied to older drugs and also generic replacements.

Findings:

Between 2012 – 2017, the study reveals an industry wide increase in costs for top-selling brand-name prescription drugs and less costly generic replacements. The increase in costs, biannual, and annually for 36 pharmaceuticals since 2012 can also be seen in newer drugs coming on the market after 2012. A pattern or practice of pricing determination based upon 4 values in the pharmaceutical market which will continue into the foreseeable future.

This particular chart depicts annual net price and annual paid price increases showing the percentage increases. This becomes more interesting where I cover “rebates” and whether the reduce costs.

Given median cost increases of 9.5% annually, the yearly increases will result in a doubling of costs for brand name drugs in this study every 7 to 8 years.

New and old brand-name competition does little to control rising costs of products which can be used interchangeably (hence this shoots transparency in the foot for constituents talking to pharmacists) such as Humira and Enbrel or diabetes drugs such as Humalog, Humulin, and Novolog. “Relative cost changes are highly synchronized” resulting in large increases over the last 6 years. As mentioned there appears to be a pattern or practice of pharmaceutical companies acting in concert.

There is little evidence of price changes associated with the existence of therapeutic equivalents such as generics, biosimilar drugs, or drugs entering the market later.

Legislated pricing transparency may lead patients to seek alternative drugs if available which may result in different pricing trends than what was observed over the six years of when the study was done. The impact of such is unknown as is the likelihood of those trends as they may already be in progress due to volume changes or speculation of volume changes due to expiration of exclusivity.

Neither was there evidence of products entering the market 3 to 6 years ago having different trends compared with other drugs in the first years of availability.

Transparency is need in the costing of drugs and the setting of prices by manufacturers. Only in the US, does the manufacturers of the product set the pricing. In Europe, pricing is influenced by governments.

Research and Development

There is a balancing act between reasonable pricing for consumers and the costs for bringing innovative drugs to market. The United States does provides strong patent laws globally. However, legal strategies by the pharmaceutical industry such as patenting the peripheral aspects of a drug (think EpiPen and its cap) extend protections beyond the original patent and delay generic and biosimilar versions. Furthermore, if a generic version brought to market by one company can not be used in the same manner by following the instructions of the brand name version; the company of the patented version can ask the FDA to block the generic version (again think Mylan’s Brand EpiPens and the TEVA generic [See; “Can You Patent The Sun?“]).

Healthcare and pharmaceutical companies can maintain exclusivity and pricing as set by the manufacturer much longer and well beyond the original patent limits with a range of new innovations. In similar countries as the US as found in western Europe, governments set pricing. The end result is a large discrepancy in pricing between the US and European countries for the same drug.

It is near impossible for private insurers to negotiate pharma pricing and Medicare is forbidden to do so. The Institute for Clinical and Economic Review’s value-based price benchmark is one approach to establish appropriate pricing. Using the four key measures the ICER assigned a cost effectiveness value of up to $1,688,000 for Kymriah for its use in children. This analysis takes into account all of the R&D cost in developing a drug, bringing it to market, and the cost save as measured against other therapies. Using the same ICER 4-point value-based analysis and understanding the range effectiveness determined by the ICER, Novartis set Kymriah list price for pediatric use at $475,000, well below the ICER’ cost effectiveness value, and $373,000 for adult cancers.

So, how is this drug paid for by the less financially endowed patients? Coupons by the manufacturer and rebates to the insurance payor set a net price for the patient which is price and profit neutral.

Rebates

Several points; Transparency of how rebates occur and affect net pricing is limited as to the impact of them on the pharmaceutical industry and healthcare insurance, rebates on list prices set by manufacturers are given by the manufacturers to commercial healthcare insurance and some government programs not including Medicare, and the rebates will vary by drug, by payer, and constitute “16% of all private insurer-branded drug spending returned as rebates in 2016.”

Whether rebates lower or increase costs is debated due to the lack of transparency of their application.

Due to the lack of data, this particular JAMA study used third party information or estimates of net price data on each drug. The observations did reveal a high correlation between increases in the rates of insurer and out-of-pocket costs paid for each drug and the net prices (ρ=0.55). The association suggests the offered industry supposition of higher list prices and greater reliance on rebates reducing costs may not be true.

Instead and a bit redundant by me, the paper offers an opposing supposition of increases in list prices, and the resulting increases in insurer and out-of-pocket costs paid, may coincide with increases in net prices, which in turn make these drugs more expensive overall. Seemingly biannual price increases should not be considered benign pricing strategies to offset paid against net price discrepancies in the current rebate system.

If true, this would be a façade making it appear rebates have an impact on final costs to the healthcare system and pricing to the patient. Rebates may only be a shuffling $dollars around.

Greater transparency of the process is needed to determine what is and what is not a cost save. The transparency is not for the purpose of patients deciding what to buy or pharmacists to recommend alternatives; although, it could be used by constituents to support healthcare proposals to bring prices down.

A healthcare system and its coverage without a foundation or mechanisms to control or account for costs is simply a blanket to pricing and hides its impact.

Run75441 (Bill H)

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Two articles to think about, one on opioids, the other billing for hospital care

Via Naked Capitalism:

Place based economic conditions and the geography of the opioid overdose crisis

By Shannon Monnat, Associate Professor, Syracuse University. Originally published at the Institute for New Economic Thinking website

Over 400,000 people in the U.S. have died from opioid overdoses since 2000. However, there is widespread geographic variation in fatal opioid overdose rates, and the contributions of prescription opioids, heroin, and synthetic opioids (e.g., fentanyl) to the crisis vary substantially across different parts of the U.S. In a studypublished today in the American Journal of Public Health, we classified U.S. counties into six different opioid classes, based on their overall rates and rates of growth in fatal overdoses from specific types of opioids between 2002-04 and 2014-16 (see Figure 1). We then examined how various economic, labor market, and demographic characteristics vary across these different opioid classes. We show that various economic factors, including concentrations of specific occupations and industries, are important to explaining the geography of the U.S. opioid overdose crisis.

 

1 in 6 hospital patients get a surprise bill for out of network care

By Rachel Bluth, Kaiser Health News reporter. Originally published at Kaiser Health News.

About 1 in 6 Americans were surprised by a medical bill after treatment in a hospital in 2017 despite having insurance, according to a study published Thursday.

On average, 16% of inpatient stays and 18% of emergency visits left a patient with at least one out-of-network charge. Most of those came from doctors offering treatment at the hospital, even when the patients chose an in-network hospital, according to researchers from the Kaiser Family Foundation. Its study was based on large employer insurance claims. (Kaiser Health News is an editorially independent program of the foundation.)

The research also found that when a patient is admitted to the hospital from the emergency room, there’s a higher likelihood of an out-of-network charge. As many as 26% of admissions from the emergency room resulted in a surprise medical bill.

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