KHN’s ‘What The Health?’: Deciphering The Democrats’ Health Debate

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Twenty Democratic candidates for president debated health care at length over two nights in Detroit this week. But countless 30-second charges and counter-charges from “Medicare for All” backers and those who want a more gradual approach to universal coverage may have left the audience more confused than ever about the best way to make the health system better and more affordable.

Meanwhile, the Trump administration sought to counter-program against the debates, unveiling plans to allow states to potentially purchase cheaper prescription drugs from Canada and requiring hospitals to make public the prices they negotiate with insurers.

This week’s panelists are Julie Rovner from Kaiser Health News, Alice Ollstein of Politico, Kimberly Leonard of the Washington Examiner and Caitlin Owens of Axios.

Among the takeaways from this week’s podcast:

  • The Democratic presidential debate format has been good at exposing the differences among candidates on their plans to get more Americans health care. But there was little mention of other important health issues, including how they would protect the ACA’s requirement that insurers cover people with medical problems, lower drug prices or handle state requests to implement work requirements for Medicaid enrollees.
  • Debaters were quick to talk about problems they see stemming from the way insurers and drugmakers operate, but they did not touch on another major player in setting health care costs: hospitals.
  • Sen. Kamala Harris of California, a leading Democratic presidential candidate, unveiled her plan for a “Medicare for All” health system this week and endorsed the use of private Medicare Advantage plans. But Sen. Bernie Sanders (I-Vt.), another contender and the original author of a Medicare for All plan, complained that Medicare has been a lucrative part of the business for those private insurers and they should not be included in Democratic efforts to set up a single payer Medicare system.
  • Harris’ plan was also criticized by more moderate Democrats because it would require everyone with employer-provided insurance to change to either Medicare or a Medicare Advantage plan.
  • Recent announcements by the Trump administration on new health care policies, such as the option for states to explore importing drugs from Canada or forcing hospitals to post the prices they have negotiated with insurers, appear to be an effort to give the president a stronger health portfolio as he goes into the 2020 campaign.

Plus, for extra credit, the panelists recommend their favorite health policy stories of the week they think you should read too:

Julie Rovner: The Washington Post’s “Driven to the end: Olympic cyclist Kelly Catlin could do it all. Until it all became too much,” by Kent Babb.

Alice Ollstein: The New York Times’ “Need Extra Time on Tests? It Helps to Have Cash,” by Dana Goldstein and Jugal Patel.

Kimberly Leonard: The San Francisco Chronicle’s “One Day, One City, No Relief: 24 Hours Inside the city’s crisis,” by Kevin Fagan and Chronicle Staff.

Caitlin Owens: Bloomberg News’ “Drugmakers’ Alleged Price-Fixing Pushed a Needed Pill Out of Reach,” by Ben Elgin.

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California Bill Would Fight Deals That Delay Generic Drugs

California’s attorney general touted a legal victory this week against drugmakers who he said made secretive, backroom deals to keep less expensive drugs off the market.

In nearly the same breath, Xavier Becerra also lamented that he didn’t have enough legal tools to go after all the companies that engage in the practice of “pay for delay,” in which brand-name drugmakers pay off generic manufacturers to keep the more affordable generic versions of their medications off the market.

“It’s hard to prove some of these activities as being illegal,” Becerra said Monday.

So, even as he announced that Teva Pharmaceutical Industries and Endo Pharmaceuticals together will pay the state nearly $70 million to settle allegations that they entered into pay-for-delay agreements, he also called on the state legislature to pass a bill that he said would make it easier to crack down on the “collusive” deals.

The bill, by Assemblyman Jim Wood (D-Healdsburg), would be the first of its kind in the nation, Becerra said. It would classify all agreements in which “anything of value” is exchanged between brand-name and generic drugmakers to delay the release of generic versions as anticompetitive and therefore illegal. This would help the state Department of Justice bring cases against brand-name or generic drugmakers by shifting the burden of proof: It would be up to the companies to prove their deals are legitimate.

“Every pharmaceutical company has the right to get a return on their investment and on the products they produce that in many cases save lives, but they should not be allowed to exploit the desperation and the need of an American in order to make money,” Becerra said.

The state Assembly approved the measure in May. It is now under consideration in the state Senate.

Both the brand-name and generic drug industries are putting up a fight, warning that the measure could backfire by further delaying the entry of generics into the market.

The Federal Trade Commission has estimated that pay-for-delay deals cost U.S. consumers and taxpayers $3.5 billion in higher drug costs every year.

Here’s how they work: When a new drug debuts, the manufacturer obtains patents that give it a period of exclusivity — usually about 20 years — to supposedly recoup costs associated with researching and developing the drug.

As soon as those patents expire, generic versions of the drug can be manufactured and sold.

But generic drugmakers can try to shorten the period of exclusivity by challenging the patents. When they do, brand-name drugmakers often sue them for patent infringement. Because litigation is costly and timely, the generic drug companies often settle and agree to delay the release of their version of the drug. They typically agree to a date that’s a few years before the original patents expire.

When these deals include money or “anything of value” transferred from the brand-name manufacturer to the generic, that’s a red flag that the companies are using pay-for-delay tactics, which can violate antitrust laws, said Geoffrey Joyce, director of health policy at USC’s Leonard D. Schaeffer Center for Health Policy & Economics.

Brand-name drugmakers are “trying to make money, and the longer they can extend patents, it’s in their financial interest to do so,” Joyce said.

In his announcement Monday, Becerra said Teva delayed the release of a generic version of its narcolepsy drug Provigil for six years, from 2006 to 2012, through pay-for-delay agreements. The drug was previously made by Cephalon, which is now owned by Teva.

Becerra’s office also settled with Teva, Endo Pharmaceuticals and its partner Teikoku, a Japanese drugmaker with operations in the Bay Area, for making pay-for-delay agreements for the drug Lidoderm, a medical patch to relieve pain from shingles.

Neither Teva nor Endo returned calls for comment.

About $25 million of the settlement money will be used to create a fund to compensate California residents who purchased Provigil between 2006 and 2012. Some also will be used to strengthen the attorney general’s enforcement of pay-for-delay cases.

The Federal Trade Commission has made it a “top priority” to investigate these deals, according to its website, and has filed a number of lawsuits since 2001 to stop them. The commission would not comment on the California bill.

Recently, the agency noticed a curious trend: Even though the number of patent settlements has gone up in recent years, the number of those that resulted in pay-for-delay arrangements has gone down. The commission credits the drop to a 2013 Supreme Court decision, FTC v. Actavis, Inc., in which the court held that pay-for-delay settlements violate antitrust laws.

But these deals may just be better disguised now, said Robin Feldman, a professor at the University of California Hastings College of the Law. Originally, pay-for-delay agreements were simple cash exchanges, but over time these deals have become extremely complicated, she said.

“These are rational, profit-making companies. Why would companies enter into these agreements in increasing numbers if they’re not receiving any benefits?” Feldman said.

Pharmaceutical companies argue the bill overreaches — and will hurt patients.

The FTC already has a system to determine if patent settlements are anticompetitive, so state regulation would just add another layer between generics and consumers, said Jeffrey Francer, general counsel for the Association for Accessible Medicines, a generics trade group. “It wouldn’t make sense to have 50 different versions of this,” he said.

Industry representatives said they are particularly concerned about the bill’s definition of “anything of value,” which they believe is overly broad. Even if drug companies aren’t making financial settlements, brand-name manufacturers may offer compensation to generic drugmakers in other forms such as sharing knowledge or paying their legal fees.

Under the bill, those could qualify as “anything of value,” Francer said.

Ultimately, the bill would complicate the patent settlement process and result in more delays for consumers, said Priscilla VanderVeer, a spokeswoman with the trade group Pharmaceutical Research and Manufacturers of America.

Some patients feel they’ve already waited too long, said Blanca Castro, advocacy manager at AARP.

“We do think that this has been fueling the high cost of prescription drugs,” she said. “People are victims of an industry that gives them no choice.”

This KHN story first published on California Healthline, a service of the California Health Care Foundation.

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Pandemic bonds face scrutiny after Ebola outbreak yet to trigger payout

LONDON (Reuters) – World Bank funding instruments issued to help emerging countries swiftly tackle pandemics have come under the spotlight after the latest deadly Ebola outbreak has yet to trigger a payout.

Following the 2013-2016 Ebola outbreak that ravaged Sierra Leone, Guinea and Liberia and killed at least 11,300 people, the World Bank launched a bond and insurance instruments in 2017 to establish a mechanism that would quickly deploy funds to help tackle outbreaks of infectious diseases.

But while another Ebola outbreak — the second worst on record — has been raging for a whole year and has been classed an international health emergency by the World Health Organization, the pandemic instruments have so far not paid out.

Payouts are triggered once a virus outbreak crosses an international border and claims at least 20 lives in each of at least two countries.

The virus has killed more than 1,800 people in Democratic Republic of Congo and two in neighboring Uganda – meaning the threshold for payouts have not been reached.

On Thursday, Congolese authorities confirmed that a third case had been diagnosed in the densely populated city Goma, increasing fears that the virus could take root in the trading hub on the Rwandan border, hundreds of miles away from where the outbreak was first detected.

Asked about the lack of a payout, Michael Bennett, head of derivatives and structured finance at the World Bank’s capital markets division, explained the pandemic bonds were structured to cover cross-border events.

For payouts to be triggered, they “require a set number of confirmed cases or deaths in more than one country”, he said.

“Then the payout is also dependent on how many deaths and how many countries are involved.”


The Pandemic Emergency Financing (PEF), which includes funding for an Ebola outbreak, comprises $95 million of bonds and $55 million of insurance. It would also provide financing in event of pandemics caused by other infectious diseases such as Marburg, Crimean-Congo hemorrhagic fever or Lassa fever.

Payouts would be staggered: a death toll of 250 triggers a $45 million disbursement, while 750 deaths would bring another $45 million payout. The remaining $60 million is paid out when the death toll reaches 2,500.

Funded by the governments of Germany and Japan, the instruments carry a coupon of LIBOR plus 11.1%. According to data from Refinitiv, the bond is or has been held by asset managers such as Baillie Gifford, Amundi and Oppenheimer.

But the lack of payout from the World Bank instruments is raising questions over whether they can indeed offer governments timely help to tackle crises, given the stringent small print.

“The problem is that when there are catastrophes, there is often a lack of quick disbursing instruments because of very lengthy approval processes,” said Bodo Ellmers, head of policy at the European Network on Debt and Development (EURODAD).

“They raised the money ex-ante, so there is a pot of money available that can immediately kick in. The case we have now is that there is a financial need, but the criteria are so stringent that the facility is not disbursing.”

The World Bank’s Bennett said the pandemic facility had been very specifically designed to insure against cross-border events rather than single-country outbreaks.

But with the instruments due to mature next summer, the bank is examining possible changes to the structure, for instance, seeking out a cost-efficient way of insuring single-country events, he said.

It is also looking into instruments that could help tackle outbreaks of different viruses affecting humans, or even livestock such as pigs or poultry.

“Of course, we always run the risk of coming up with a structure that takes into account a previous event,” said Bennett. “If we now completely change the structure to pick up the current event it may not pick up a future one.”

Reporting by Karin Strohecker; Editing by Alison Williams

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Rwanda border with Ebola-hit Congo fully open after slowdowns: minister

KIGALI/GOMA, Democratic Republic of Congo (Reuters) – Rwanda’s border with Ebola-hit Democratic Republic of Congo was fully open late on Thursday, a minister said, hours after Congolese traders had reported it shut following a third case of the disease in the Congolese border city of Goma.

A Congolese health worker administers ebola vaccination to a resident at a centre in Goma, Democratic Republic of Congo, August 1, 2019. REUTERS/Djaffer Sabiti

Rwandan health minister Diane Gashumba said there had been traffic slowdowns at the border, caused by increased health screening in response to confirmation of new infections in Goma, a transit hub of at least 1 million people.

“The border was never closed and it is not closed,” Gashumba told reporters.

The outbreak has killed more than 1,800 people in Congo since it was declared one year ago and become the second-worst on record. Two people have died of the disease in Uganda, which also borders Congo, but there have been no registered cases in Rwanda.

Earlier, Congolese health authorities confirmed that a third case had been diagnosed in Goma, increasing fears the virus could take root in the densely populated city, which lies more than 350 km (220 miles) south of where the outbreak was first detected.

A second patient died in Goma on Wednesday after he sought treatment too late and was already bleeding, authorities said. These second and third cases in Goma, a father and daughter, are not linked to the first case, authorities say.

Nestled in hilly country at the foot of an active volcano, the city lies just 7 km (4.5 miles) from Rwanda’s main border town of Gisenyi.

Some 45,000 people go through the main border post between the two per day, according to an immigration official.

Lucien Kalusha, a Congolese hairdresser who crosses every day to work in Rwanda, told Reuters earlier on Thursday he and others had not been able to cross.

“By closing the border like this, they deprive a lot of people of their earnings today. Most of the women here cross into Rwanda to find food for us in Goma,” he said.

Another, smaller border post near Goma was unusually quiet, as traders and vehicles had left after it appeared to have been closed.

After the first Ebola case in Goma was confirmed in mid-July, the World Health Organisation (WHO) declared the outbreak an international health emergency. It was earlier reluctant to do so, partly out of fear countries bordering Congo might shut their frontiers.

Additional reporting by Djaffar Al Katanty in Goma; Stanis Bujakera in Kinshasa; Anna Pujol Mazzini in Dakar; Writing by Tim Cocks, Duncan Miriri, Alessandra Prentice; Editing by Alison Williams and John Stonestreet

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Harnessing anti-inflammatory function of macrophages holds great potential for treating diseases

Researchers at the University of Illinois at Chicago have identified a molecular switch that causes immune cells called macrophages to clean up cellular debris caused by infections instead of contributing to inflammation and tissue injury. Their findings are reported in the journal Proceedings of the National Academy of Sciences.

Macrophages are a type of immune cell found throughout the body. These cells can produce inflammation, which is good in moderation because inflammatory signals bring other immune cells to a specific location to clear an infection. However, when inflammation gets out of control, as it can in cases of inflammatory diseases, it can cause excess cellular and tissue damage, contributing to a vicious cycle that is very difficult to reverse. But macrophages also play a significant role in reducing inflammation when they engulf cellular debris or foreign microbes that contribute to inflammation. The mechanism behind macrophages’ ability to switch back and forth between these two diametrically opposed roles has long-puzzled scientists.

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Researchers led by Saroj Nepal, research assistant professor in the department of pharmacology at the UIC College of Medicine, have found that a molecule called Gas6 is required to induce macrophages to perform their anti-inflammatory role by engulfing and digesting cellular debris that can contribute to inflammation. The molecule could serve as a potential drug target for drug makers interested in coaxing the cells toward their anti-inflammatory state to help treat people.

In a mouse model of acute lung injury, Nepal and colleagues found that lung macrophages expressed both inflammatory and anti-inflammatory proteins. One of the anti-inflammatory proteins was Gas6. In a mouse model of acute lung injury where the animals’ macrophages were artificially depleted of Gas6, clearance of inflammatory molecules and proteins in the lungs was severely impaired, and the inflammation could not be resolved. When they artificially boosted levels of Gas6 in the mouse macrophages, inflammation was resolved much faster than in mice with normal macrophages.

Harnessing the anti-inflammatory function of macrophages using the Gas6 switch holds great potential for treating diseases ranging from heart disease to cancer to rheumatoid arthritis, where inflammation is a key underlying feature.”

Saroj Nepal, research assistant professor, department of pharmacology, UIC College of Medicine


University of Illinois at Chicago

Journal reference:

Nepal, S. et al. (2019) STAT6 induces expression of Gas6 in macrophages to clear apoptotic neutrophils and resolve inflammation. PNAS.

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