Peter Pitts

Peter Pitts is co-founder of Center for Medicine in the Public Interest and Senior Vice President for Health Affairs at Manning, Selvage & Lee. Prior to founding CMPI, Peter was a Senior Fellow for healthcare studies at the Pacific Research Institute, a San Francisco based think tank.

From 2002-2004 Peter was FDA’s Associate Commissioner for External Relations, where his challenge was to clearly define FDA’s brand image and to communicate the agency’s main themes to its many constituencies.

Before his work with the FDA, Mr. Pitts was Managing Partner of Wired World, a strategic public awareness company. He has served as Marketing Manager at the newly formed Cable Health Network, later to become Lifetime Network, Associate Creative Director at Reader’s Digest, Creative Services Director at McCall’s Magazine, Director of Marketing at The New York Post, and Director of Marketing for The Washington Times and Insight Magazine.

His most recent book, Become Strategic or Die, is widely recognized as a cutting edge study of how leadership, in order to be successful over the long term, must be combined with strategic vision and ethical practice.

Friday, January 25, 2008

Governor Spitzer's Pajama Game

By Peter Pitts

Fresh from his victory in the drivers' licenses for illegal aliens campaign, Governor Spitzer is turning his attention to reforming health care in the Empire State.

Here's the lay of the land, status quo ante:

Prior to any actions, New York will spend approximately $1.9 billion in State funds on prescription drugs in 2008-09 through the Medicaid and EPIC programs. The 2008-09 Executive Budget recommends actions that would control these costs and generate $172 million in State savings.

But these "savings" come at a cost -- the cost of quality health care for low income New Yorkers. And, considering that prescription medicines represent but 4 percent of the New York State health care spend (4 cents on the NY health care dollar), it's a penny wise/pound foolish proposition. "Seven and a half cents," the famous "Pajama Game" song tells us, "doesn't mean a hell of a lot." But when it comes to prevention, life saving interventions, and chronic care, four cents does.

The sampling of ideas below all save money for Albany in the short term -- and will result in a lower quality of care for New York's Neediest and a higher taxpayer burden for expensive hospital stays and other high cost health care interventions. Governor Spitzer's plan is a perfect examples of a cost-based, "government first" paradigm --when what we really need is more cost-efficient and humane patient-centric, "people first," health care policy.

High Cost Drugs. A Specialty Pharmacy Program will be created within Medicaid to lower the price of high cost drugs, which have increased dramatically in number and cost. Specialty drugs typically require specific handling and have a limited distribution.

Translation: Rationing.
Clinical Drug Review Program. The Executive Budget reflects the addition of new drugs to the Clinical Drug Review Program (CDRP) to generate additional savings while continuing to ensure proper usage of certain high-risk drugs.

Translation: Rationing through questionable evidence-based medicine schemes.
Physician Education. A program will be started to provide prescribes with unbiased clinical information about medications and to balance marketing efforts by manufacturers. This will improve patient outcomes and reduce unnecessary expenditures by providing objective information to prescribers.

Translation: Rationing. Anyone care to wager what these "unbiased" studies will recommend? Echoes of CATIE and ALLHAT. It's the battle between 20th century practice variation and 21st century patient variation/personalized medicine.
Pharmacy Reimbursements. Pharmacy reimbursement will be reduced from Average Wholesale Price (AWP) less 14 percent to AWP less 17 percent for brand name drugs to more closely reflect the actual wholesale price to pharmacies. This reduction will be offset by a one dollar increase in the dispensing fee for generics and brand name drugs in the PDP. In addition, co-payments for brand name drugs in the Medicaid PDP will be reduced from $3.00 to $1.00. These changes will encourage the use of lower cost and preferred products.

Translation: Bribe pharmacists to switch their customers to generic drugs -- even if that switch is from an on-patent medicine recommended by a patient's physician to an entirely different molecule. Savings first. Patients last.

What's most peculiar is that the Governor Spitzer offers no initiatives to deal with the most important health care issue in New York State (and, for that matter, every state) - chronic disease. This is, perhaps, the most explicit example of sins of omission and the Gov's focus on short term vs. long term savings. It's an ignorant and dangerous omission. Sins of omission, the saying goes, are seldom fun. And, while this particular omission may be politically expedient - it's also dangerous and short-sighted.

Here's a link to the full health care section of the Governor's executive budget:
http://publications.budget.state.ny.us/eBudget0809
/fy0809littlebook/HealthCareMedicaid.html

In "The Pajama Game," the union boss "Prez" sings, "With a pencil and a pen I figured it out." Governor Spitzer (who some say would like to play Prez himself some day) needs to return to the drawing board and figure out a way to put patients first -- before he prepares for his own second act.

posted by Peter Pitts
1:12 pm
0 comment

Thursday, February 15, 2007

The John Grishams of Drug Importation

By Peter Pitts

Categories: Pharmaceuticals

The Fearsome Foursome of Emanuel, Dorgan, Snowe, and Emerson want drug importation and are going to try to Rahm it through Congress. That’s politics. But they’re confused. They don’t seem to understand (or they choose not to admit) that you can’t cherry-pick drugs from just Canada or one or two of the 25 European Union nations. They may only want drugs from Canada, Great Britain or France, but that’s impossible — because that’s already the law – in Europe. And that's a fact.

In Europe, parallel trade (what we call “importation”) is legal between all 25 EU member states. And last year 140 million individual drug packages were parallel imported throughout the European Union — and a wholesaler repackaged each and every one. This means that, literally, parallel traders open 140 million packets of drugs, remove their contents and repackage them. But these parallel profiteers are in the moneymaking business, not the safety business. And mistakes happen. For example, new labels incorrectly state the dosage strength; the new label says the box contains tablets, but inside are capsules; the expiration date and batch numbers on the medicine boxes don’t match the actual batch and dates of expiration of the medicines inside; and patient information materials are often in the wrong language or are out of date. Oops.

This means that drugs purchased from a British pharmacy to an unknowing American consumer (or a blissfully ignorant member of the United States Congress) could come from European Union nations such as Greece, Latvia, Poland, Malta, Cyprus, or Estonia. In fact, parallel traded medicines account for about 20% (one in five) of all prescriptions filled by the same British pharmacies that have had a record number of counterfeit recalls in 2006. And Pharmaceutish Weekblad, a respected pharmacy journal in the Netherlands, recently reported that counterfeit medicines found in the Netherlands at the end of last year entered the legitimate supply chain through parallel importers. Stubborn facts.

In the EU there is no requirement to record the batch numbers of parallel imported medicines, so if a batch of medicines originally intended for sale in Greece is recalled, tracing where the entire batch has gone (for example, from Athens to London through Canada to Indianapolis) is impossible. And all the large "legitimate" Canadian internet pharmacies already admit to getting their supplies from Europe. (An interesting and important side note is that these EU-sourced drugs aren't even legal for sale in Canada. So those folks who say we'll be getting "the same drugs as Canadians" are just plain wrong.) Caveat Emptor is bad health care practice and even worse health care policy. Safety cannot be compromised, even if the truth is inconvenient.

The World Health Organization (WHO) estimates that 8-10% of the global medicine supply chain is counterfeit — rising to 25% or higher in some countries. The largest counterfeit market with close proximity to the EU free trade zone is Russia, where the generally accepted estimate is that 12% of drugs are counterfeit. Now that the Baltic nations of Latvia, Lithuania, and Estonia have joined the European Union, WHO has warned that an increase in the risks of counterfeits entering the EU supply chain is “obvious.” Facts are stubborn things.

According to Sue Mitchell, editor of the British journal Epilepsy Today, “The parallel trade in medication is damaging people’s health and, at worse, putting lives at risk. Strong words, but when the discussion of the parallel importing of medication seems to revolve primarily around money, the reality of patient experience goes unheard all too often.”

Mr. Emanuel, Ms. Emerson, Senator Dorgan, Senator Snowe -- my 18-year old son has epilepsy. Please pay attention to the facts – and leave the fiction to John Grisham.