Life Science Compliance Update

March 07, 2017

Update: Connecticut APRN Reporting Policy

ConnecticutMap2

Last month, we wrote about the Connecticut APRN policy that is starting to come to fruition. As we noted, the dates of reporting were different than what applicable manufacturers (GPO's, Distributors, Drug and Device Manufacturers) were expecting.

At the time of our previous article, we were uncertain as to why Connecticut went back to the July 1, 2015, recording date after the state legislature had previously announced it was delaying reporting.

As such, we contacted the Connecticut Department of Consumer Protection about the apparent erroneous information. In our communications, we noted that “the website currently says that the “first reporting date is from July 1, 2015 to July 1, 2017, and annual, rather than quarterly filings are now required.”

The way the website previously read may have lead manufacturers to believe that the very first report, due on July 1, 2017, must include payments made to APRNs from July 1, 2015 - July 1, 2017. However, it was our understanding that the legislature modified the law so that it would just be the “preceding calendar year” for reporting.

We have now found out that the statement on the website is a clerical error, and the website has been updated for the APRN expenditure reporting, which can be found here. Once again, the first report is due by July 1, 2017, for the period from January 1, 2016 to December 31, 2016.

Thank you to Abraham Gitterman for helping us get this clarification.

March 03, 2017

Johnson & Johnson Announces Plans to Disclose Average Price Increases

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As America continues to discuss the increase in the cost of prescription drugs, Johnson & Johnson (J&J) has announced that it plans to disclose average price increases of its prescription drugs.

High and rising prices have also infuriated doctors, insurance companies and politicians, and triggered government probes into the industry's practices. The government has no power now to regulate prices, but the industry appears to be starting to move to deflect further scrutiny and avoid price controls.

With annual price tags topping $100,000 for many new drugs for cancer and rare diseases, some patients have been unable to afford their medicines. Huge price hikes on old products with little competition, like Mylan's EpiPen emergency allergy injectors, also have left some patients scrambling.

"We hope that can create a better understanding of the industry and ... ultimately improve patient access to medicines," Joaquin Duato, head of J&J's prescription drug business, said in an interview Tuesday.

Experts say the company's move will help its image more than patients initially, but it could push other drug makers to tame future price increases and be more transparent. The company says it will divulge average list price increases and what middlemen pay for medicines.

Expected to start in February 2017, J&J will issue annual reports listing the average list and net price increases — but not the figures for individual drugs, as the discounts it gives middlemen are competitive information.

Erik Gordon, a professor and pharmaceuticals analyst at University of Michigan's Ross School of Business, called it "opaqueness masquerading as transparency. "They let you look not so bad by camouflaging your big price increases for drugs where you face little competition behind the small increases for drugs where you face strong competition," he said.

Many drug companies and their industry trade groups have been trying to shift public debate away from high prices to the value medicines provide. J&J's move could change that focus. Besides J&J being the world's biggest health care products maker, Duato on Monday became chairman of the Pharmaceutical Research and Manufacturers of America, a lobbying group.

Releasing the averages is "a start" and drug makers should realize "it would be foolish" not to follow J&J's lead, said analyst Steve Brozak, owner of WBB Securities.

J&J will also disclose what it spends on patient assistance, marketing versus research, and payments to physician consultants.

Duato said he doesn't see any impact on revenue and income because J&J has limited list price increases to below 10 percent for several years. About 70 percent of recent revenue growth came from selling more medicines, including a dozen approved since 2011, he said.

December 06, 2016

Money in Medicine Report

Money-medicine

In late November, a report was released that focused on money in medicine, and the top thirty drugs that were associated with pharmaceutical industry payments to Oregon doctors. Interestingly, the top thirty list did not include many drugs that are known to be household names. For example, the top three drugs – Bydureon, Invokana, and Toujeo – are prescribed for diabetes, a highly prevalent disease in America. Three others on the list are prescribed for multiple sclerosis, a debilitating condition that is incurable and can be hard to live with. Hysingla, an abuse-deterrent hydrocodone pill, is also high on the list.

According to the series, $2.6 billion in non-research payments were made by drug and device developers to U.S. teaching hospitals and physicians in 2015. In Oregon, 100 doctors collected $9 million in payments from industry.

This is interesting, in part because the media is always harping on the pharmaceutical industry for spending money and having “influence” on physicians. However, this article and the data show that the drugs (at least in Oregon) that are most associated with pharmaceutical industry payments tend to be drugs for diseases that are highly prevalent or diseases that are hard to beat. The author of the series also gives much time and attention to the physicians themselves, who help her (and the public) understand the benefits.

Doctors who receive the payments state that they are “being compensated for their time and expertise, or in several cases, the technology they devised to advance patient care.” They also “argue that safeguards are in place to prevent undue influence from industry, such as a prohibition on receiving royalties from your own practice or even region.”

Dr. L. Nelson Hopkins, a neurosurgeon and president of the Gates Vascular Institute at Buffalo General Medical Center, believes it is important for physicians and industry to have a good relationship, “To say that physicians shouldn’t work with industry is to say that innovation shouldn’t happen. If physicians weren’t working with industry to develop concepts and to advise industry on how it’s going in the marketplace, and working with industry to iterate the product to get better and better, then that technology would be stymied.”

Gerald Williams, Jr., both a practicing physician and the president of the American Academy of Orthopaedic Surgeons, notes that it makes sense that many of his group’s members account for a large portion of the non-research compensation because their practice areas account for almost 40 percent of the total health care spending in the United States. Williams states that many orthopedic surgeons fund their own product and equipment innovations, and that even more are asked by device makers to lend their expertise in developing new tools and approaches to delivering care.

Dr. Bryan Mehlhaff, a Springfield urologist who makes presentations about cutting-edge prostate cancer drugs, sums it up quite well, “this is very FDA regulated. A lot of my patients know I’m a speaker and that I participate on advisory boards and ask if I’ve heard anything new. A lot of them like that I’m on top of new developments and on the cutting edge of what might be possible for them.”

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