Washington Report: Shop and Compare - Pharmaceutical Executive


Washington Report: Shop and Compare
Insurers and payers believe that more comparative information on medical treatments will save money and improve care, but such analysis may be costly to pharma

Pharmaceutical Executive

Ensuring Product Safety

Concerns about the safety and efficacy of COX-2 inhibitors, arterial stents, and other treatments also are fueling the push for comparative assessments of medical products. Additional postmarket studies would help identify unsafe drugs, says AHIP, which supports enhanced FDA oversight of drug safety through its user-fee program. The insurers want to strengthen FDA's authority to require drug-labeling changes and postmarket clinical trials—information that would help plans update formularies and reimbursement policies.

The prospect that CE research can hold down healthcare spending without more sweeping drug cost-cutting has generated support from some pharma companies. Johnson & Johnson executives Kathy Buto and Peter Juhn note in a companion Health Affairs article that comparative studies can help establish the value of medicines, enable marketers to differentiate products, support expanded use of certain therapies, and possibly justify more streamlined approvals and premium reimbursement for "clinically meaningful improvements." Information on good clinical choices, they point out, may be the "best antidote" to government-set prices.

The danger is, of course, that effectiveness studies could be used to limit coverage and treatment options to low-cost products. And additional research requirements for sponsors could be costly. Prospective studies cost hundreds of millions of dollars and are vastly different from relatively low-cost retrospective data reviews, points out health economist Bryan Luce of United BioSource at a March seminar on comparative-effectiveness research sponsored by the Center for Medicine in the Public Interest. He notes a tension between FDA officials and clinicians who insist that data has to come from randomized, blinded, controlled clinical trials to support pharma marketing claims, and healthcare providers and payers who object that such trials don't produce "real world" information and prefer data from observational studies.

Control and Funding

The proposed research center could be structured and funded in such a way as to address these issues. Current comparative information often is "incomplete, misleading, or misinterpreted," Buto and Juhn observe, noting that establishing a research entity could improve the situation if the center is independent from payers, maintains transparent processes, invites all stakeholders (including manufacturers) to participate, and coordinates research with other government agencies.

One contentious issue is whether a new CE center should be part of the Agency for Healthcare Research and Quality (AHRQ), which currently leads federal efforts to provide clinical-effectiveness data. The new initiative would build on AHRQ's network of research centers. Even though the Medicare Modernization Act of 2003 boosted funding for AHRQ effectiveness research, the proposed CE center would represent a huge expansion.

Of course, it's not at all clear that Congress will provide even $100 million to launch such an initiative. A Congressional backlash in the 1980s eliminated Congress' Office of Technology Assessment and nearly defunded the predecessor of AHRQ, Luce recalls. The legislators also instructed Medicare officials to keep costs and comparisons out of their assessments of new technologies, and that policy still holds. Medicare's Coverage with Evidence Development policy, designed to obtain additional information on newly approved drugs and medical products, also has drawn complaints about linking new research requirements too closely to reimbursement, and CMS is revising the policy.

To fill the comparative-effectiveness information gap, several organizations have launched their own technology-assessment programs. Oregon's Drug Effectiveness Review Project (DERP) assesses clinical trial data on drug therapeutic groups to inform coverage decisions by managed care plans and state Medicaid programs. Consumer's Union uses the DERP assessments for its BestBuyDrugs program, which adds in drug-cost factors. The Academy of Managed Care Pharmacy (AMCP) recommends that drug marketers include such comparative and economic data in the dossiers they submit to formulary committees.

A new CE center would centralize and coordinate these and other research efforts, set standards for comparative analysis, and oversee dissemination of vetted results to providers, payers, and patients. Variations in patient response to treatments and the desire to link provider payments to quality measures speak to the need for more valid comparative healthcare information. Pharma companies will want to have a say in how the questions are framed and how the resulting data is used.

Jill Wechsler is Pharmaceutical Executive's Washington correspondent. She can be reached at


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