2010: Not such a good year for Politics , Physicians, Patients and Pharma

2010 may be one of those years that many of us in the US want to forget. Chief among those hoping for a better year ahead will be politicians, physicians and the Pharma industry.

In view of the festive season we’ve decided to leave the political review of the past 12 months to the excellent political satirists at JibJab.  They entitled their remorseless, but as usual, stunningly accurate review of the year Duet of Regret.  Word on Health is delighted to re-gift this to you. Enjoy!

It’s been an equally bad year for doctors.  In late November, physicians learned that the reimbursement they receive for Medicare patients would drop by 23%  in December and a further 2% in January. These cuts are the latest installment of the 1997 Balanced Budget Act and attempts to rein in spending on health care for the elderly.

This is not only bad news for doctors, many of whose practices are largely composed of Medicare patients but also for the baby-boomer patients just turning 65 who may find themselves without a doctor.  Critics predict, some physicians will see Medicare patients  less frequently, while others will stop seeing them altogether.  Cynics have gone so far as to call this “elder cleansing.”

Now, to top of the year, a report from Public Citizen found that pharmaceutical companies top the list when it comes to defrauding the government. In fact , over the past decade, the pharma  industry accounted for 25% of all federal fines charged under the False Claims Act.

According to the analysis, drug-makers were the focus of 165 major settlements and have paid $19.8 billion in fines and settlements since 1991.  Three-quarters of these charges occurring over the past five years. GlaxoSmithKline, Pfizer, Eli Lilly, and Schering-Plough accounted for $10.5 billion of all financial penalties imposed over that period.

Pfizer holds the record for the largest criminal fine in United States history, $1.3 billion, and the largest health care fraud case, $2.3 from a settlement last year involving its marketing of the painkiller Bextra and other drugs.
Another company joined the violators  list just last week. Irish drug maker Elan announced that it had agreed to pay $203.5 million, half in criminal penalties, half in a civil payment, to settle an investigation of its illegal off-label marketing of the antiseizure medicine Zonegran.

While Word on Health sadly can’t fix politics or physician payments, SRxA can certainly help pharmaceutical companies stay out of trouble.  To find out how, make it your New Year’s Resolution list to contact us.

Walgreens tells Washington: No profit – no drugs

Walgreen’s has put the State of Washington on notice.   Because Washington has not adjusted its Medicaid reimbursements, branded script reimbursement does not cover Walgreens’ costs.   Effective April 16, none of the 121 Walgreen’s pharmacies operating in Washington will accept any new Medicaid patients.

“Obviously, we’re disappointed that the alternatives we’ve suggested have failed to achieve a compromise,” said Kermit Crawford, Walgreens Executive VP of Pharmacy. “We intend to continue our commitment to serving our existing patients, but we simply cannot take on additional losses.”

As government intervention and manipulation of the free market continues apace, Word on Health is concerned about the effect this will have on prescription drug manufacturers.

As if the prospect of Government mandated use of generics is not enough to cripple the branded prescription market, if prescription products can be substituted with OTC products paid out of the consumer’s pocket, both third party payers and OTC manufacturers would benefit.

To a large degree major Rx/OTC shifts have already happened for chronic disease therapies, i.e.

  • non-sedating anti-histamines (allergy)
  • non-steroidal anti-inflammatories (arthritis)
  • proton pump inhibitors (reflux)

However, since all chain pharmacies situate the pharmacist at the rear of the store to enhance impulse purchases of OTC products, the decrease in foot traffic from prescriptions could decrease OTC sales too.

Time for another healthcare reform? Word on Health wants to hear from you.