Author: Wayne Winegarden

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August 7, 2019 Blog, Price and Costs

The Trump Administration's Department of Health and Human Services (HHS) has officially proposed legalizing the importation of drugs from Canada (e.g. the Safe Importation Action Plan). Canadians’ reactions provide an important perspective demonstrating why drug importation will harm the U.S. Despite assurances from Prime Minister Justin Trudeau, Canadians are worried that the U.S. proposal will impose severe costs on Canadians. Their concerns are well founded. Typical of their reaction, the Canadian Pharmacists Association (CPhA) has noted that the Canadian medicine supply is not equipped...

August 5, 2019 Blog

Without pro-market payment reforms, cutting edge medical treatments known as gene therapies run the risk of becoming the dance that no one attends. Gene therapies are not medicines, instead, they are akin to an organ transplant. These procedures typically use re-engineered viruses to repair, replace, or shut off malfunctioning genes that cause devastating diseases. For example, the newest gene therapy to obtain FDA approval, Zolgensma, could save the lives of people with spinal muscular atrophy (SMA), a fatal genetic disease. Children...

July 26, 2019 Blog, Price and Costs

From the time we were toddlers, it has always been tempting to bang the square peg into the round hole. After all, there is always that one square peg that seems like it should just about fit into that round hole, and it would feel so satisfying if it did. Alas, square pegs don’t fit into round holes. The analogy is apropos for Congress’ current approach to drug prices. In the latest iteration, the Senate Health, Education, Labor and Pensions (HELP)...

July 11, 2019 Briefs, Industry Trends, Price and Costs

Biosimilars have the potential to realize billions in savings for the health care system if reforms are enacted to incent their market share to grow, according to a new issue brief issued today by the Center for Medical Economics and Innovation at the California-based, free-market think tank, the Pacific Research Institute. “Biosimilars are innovative medications that can treat patients at lower costs,” said Dr. Wayne Winegarden, director of PRI’s Center for Medical Economics and Innovation and author of the issue brief. ...

July 9, 2019 Blog, Policy Proposals

The Trump Administration is proposing a litany of contradictory healthcare reforms. Some reforms will empower patients, improve incentives, and strengthen the healthcare system. Others empower bureaucrats, worsen incentives, and will restrict patients’ access to needed healthcare treatments. A better outcome will only emerge if the Administration jettisons the ill-advised proposals and focuses policy on eliminating the disincentives that pervade the current healthcare system. Starting with the bad, the Trump Administration is threatening to impose government-mandated price controls on pharmaceuticals. Of course, this...

June 27, 2019 Price and Costs, Value

Determining whether the prices for medicines are appropriate or not is critically important, which is why studies that attempt to answer this question must stand up to scrutiny. Studies that undervalue medicines jeopardize the development of future cures, while studies that overvalue medicines justify the imposition of excessive health care costs today. Judged against this goal, a recent World Health Organization (WHO) technical report is disappointing. In this report the WHO claims that the industry’s current pricing approach “makes cancer medicines...

June 12, 2019 Briefs, Issues, Resources, Studies

The World Health Organization (WHO) is advocating that the price of cancer treatments are excessive, but its report that justifies this conclusion contains significant biases that drastically over-estimates the revenues multiple over research and development (R&D) costs, according to a new issue brief released today by the Center for Medical Economics and Innovation at the non-partisan Pacific Research Institute. “Cancer medications have revolutionized treatment, and it is unfortunate if the WHO’s flawed analysis jeopardizes patients’ access to these life-saving medicines” says...

May 30, 2019 Innovation, Policy Proposals

The U.S. economy thrives on innovation. According to the U.S. Patent and Trademark Office, industries that intensively rely on intellectual property (IP) protections, which includes the biopharmaceutical industry, account for nearly 40 percent of the U.S. economy and are responsible for an outsized share of our overall economic growth. Beyond the growth benefits, innovations improve our lives in countless ways. From mobile technologies inaptly called “mobile phones” to cutting-edge medicines that treat formerly incurable diseases, innovation helps us live better lives. Within this...

May 29, 2019 Blog, Price and Costs

The Senate Health, Education, Labor & Pensions (HELP) Committee has just released a bi-partisan bill authored by Senators Lamar Alexander (R-TN) and Patty Murray (D-WA) that would make health care more affordable and more transparent for patients. These reforms are not grandiose fantasies that are destined to fail, such as “Medicare for All”. Instead, the bill proposes modest “common sense” reforms that target specific inefficiencies and disincentives that plague the current health care system. For starters, the bill would promote greater...

May 20, 2019 Price and Costs

The wrong model, no matter how hard you work it, will never provide the right answer. When it comes to how we pay for health care, the U.S. is using the wrong model. What’s worse, these financing inadequacies could threaten the viability of new therapies that will bring hope to patients who formerly had none. The well-being, and sometimes the lives of patients, depend on getting the health care financing model correct. New gene therapies will transform the treatment of devastating diseases. For...

May 16, 2019 Policy Proposals

There is a legal adage that “hard cases make bad law.” California may soon rediscover this wisdom. Assembly member Jim Wood has introduced a bill (AB 824) with the intention of discouraging “pay-for-delay” tactics. “Pay-for-delay” practices refer to a situation when a manufacturer of a patented drug pays the manufacturer of a generic drug to delay launching its competitive product in order to extend its exclusivity period. Undoubtedly, these practices are anti-competitive and violate the spirit of the entire patent system. Such...

May 7, 2019 Price and Costs

Sometimes the important reforms are those that address the mundane details. The Administration’s proposed changes to how pharmaceutical rebates are paid fall into this category. While far from a panacea, this reform could meaningfully improve the pharmaceutical market. For this reason, the Congressional Budget Office’s (CBO) just released “budget score“ on the proposal is disconcerting. A budget score from the CBO estimates the impact of policy changes on the federal budget. In this case, the CBO estimates that between 2020 and 2029 the...

April 30, 2019 Price and Costs

The costs of medicines continue to dominate the headlines, attracting the attention of Congress and the Trump Administration. Reforms are necessary, but many of the reforms under consideration will make the situation worse. Indexing U.S. prices to the prices in other countries that use price controls, or using third-party arbitration to set the price of prescription drugs, exemplify these wrong-headed policies. The Trump Administration’s proposal would set Medicare Part B prices (prices for drugs administered in a clinical setting) to the...

April 19, 2019 Innovation

Gene therapies are transformative treatments that fundamentally differ from traditional medical and pharmaceutical options because they modify a patient’s DNA in order to address the genetic causes of diseases. These therapies have the potential to dramatically improve the lives of millions of Americans living with life-threatening or life-altering diseases. Since gene therapies directly address the genetic causes of diseases, doctors and scientists anticipate that these therapies will be cures. If successful, the goal will no longer be simply treating these devastating diseases...

April 1, 2019 Policy Proposals, Price and Costs

Senator Rick Scott (R-FL) has just doubled down on one of the Trump Administration’s unsound ideas. His proposal is disappointing for many reasons, particularly because Alex Azar, Secretary of Health and Human Services, has proposed an alternative reform that, if Congress implemented, would meaningfully improve the affordability of prescription drugs for patients. As part of the “Transparent Drug Pricing Act of 2019”, Senator Scott proposes to set the list price of all medicines to the lowest retail list price among five...

February 28, 2019 Innovation

Congress could soon vote on legislation that would gut America’s intellectual property laws. The bill isn’t just bad news for big pharmaceutical companies that hold lucrative patents. It’s terrible news for patients — medical research spending would dry up without strong patent protections. Americans could lose out on cures for cancer, heart disease, and other deadly chronic conditions. The proposed law would target patented drugs sold through Medicare’s Part D prescription drug program. Right now, private insurance companies design Part D plans...

February 26, 2019 Price and Costs

Today’s hearing in front of the Senate Finance Committee will, unfortunately, be another wasted opportunity. Surely, Senators will make grandiose speeches and be shocked at the cost of drugs. They will also continue to support the very policies that are causing the problems the hearing is supposed to address. A February 25th editorial from the New York Times exemplifies why this opportunity for effective reforms may very well be lost. The Senate hearing is not a day of reckoning as the Times claims. It should be an opportunity...

February 12, 2019 Price and Costs

In response to the problem of rising list prices for drugs, elected officials continue to propose counterproductive reforms. Whether it is importing drugs from Canada or indexing U.S. drug prices to the prices charged in other countries, these policies will make the current bad situation worse because they fail to understand the disincentives that are the root cause of the problem. Until now. A proposal by Health and Human Services Secretary Alex Azar, if implemented, would meaningfully improve the pharmaceutical market. The...

February 11, 2019 Price and Costs

Health and Human Services Secretary Alex Azar just released a sweeping proposal that would drastically change how Medicare pays for advanced cancer therapies and other potent medicines. The plan relies on foreign price controls to reduce drug spending by $17 billion over five years. Although drug spending may decline, the plan could increase health care spending elsewhere, as patients inevitably lose access to medicines. So while the savings is questionable, the negative health impact on patients is certain. Sec. Azar ought...

January 17, 2019 Price and Costs

In one of his first acts, Governor Newsom signed an executive order that will change how medicines are purchased in California. With visions of big-box store discounts dancing in his head, Governor Newsom has established a bulk program that will now purchase drugs for the state’s Medicaid program (Medi-Cal). The Governor believes that his executive order will create significant health care savings for the state, but he will be sorely disappointed. Imposing more government mandates and increasing bureaucratic control of the...