Thursday, December 22, 2011

3 ways to sink a new drug

I don't just rant about methods and evidence -- in my work life I also rant about health economics and outcomes! This is why I was so interested in this post by the health economist Ulf Staginnus called
"New Models for Market Access." I want to give a hat tip to for pointing me here.

The thesis of the article is that we need to refocus our discussion from market access to true innovation in the biopharma sector. There are some priceless quotes here, like this one, for example:
It is amusing, at least to me, to see the continued flood of articles, consultant presentations, blogs, congress announcements, workshops, summits, reorganizations, speeches, etc. all over the place, basically suggesting how the industry just needs to throw a few more people with fancy titles here and there, coupled with slight organizational changes, onto the problem and involve stakeholders and—guess what?!—actually talk to patients and perhaps even payers and all of a sudden, like Alice in Wonderland, everything will be good, after all.
The uncomfortable truth is, it won't be. All this “noise” is only good for one thing, paying the bills of the consultants, which is fine, too, as I have been one myself so I can understand. But it will not address the problem the research-based pharmaceutical industry and its employees are facing. Without a substantial increase in R&D productivity, the pharmaceutical industry's survival (let alone its continued growth prospects), at least in its current form, is in great jeopardy.
Don't you love it? It is hard to disagree. He also calls for more of a focus on the long-term returns than the short-term (duh!), as well as more internal honesty, or having the courage to stand up to the pathologic internal enthusiasm about a late-stage product that will obviously go nowhere. And all of this is on target.

He has this to say about health economics and outcomes and such:
Of course, you need experience in areas such as HE, outcomes research, pricing, economics, policy, advocacy, etc. and all needs to work in sync and early on and with the payer in mind and, yes, most people have understood that by now. So the problem is essentially not in the capabilities, although some are more advanced than others, but rather in the company cultures.
And this, I think, is where I have to disagree with him. In my experience there are glaring deficits in the approach to HEOR within biopharma, though of course there are exceptions to the rule. It starts with the fact that disease burden, and especially its costs, are initially assessed through less than, shall we say, rigorous methods. I have seen this critical information get pieced together through market "research", where 5-10 "thought leaders" are asked for their opinions, and the quantification is based on this tiny non-representative sample of nothing more than guesses. This is a shame because the data usually exist which can give a much more bona fide estimate of the extent of the problem.

The second problem is that articulating the value proposition of a nascent technology is usually an afterthought. In fact it is self-evident that drug pricing must be fed using the information on the burden of disease, and the impact the new technology can make in mitigating such burden. Unfortunately, time and time again I see companies backing into a price simply in reaction to what their Boards perceive the returns should be. And frequently this is based on the overly optimistic market projections flowing from, you guessed it, market "research."

So, the direct result of all this short-sightedness and business as usual is that even innovative useful products are driven into oblivion because there is no realistic look at what the technology is worth or where best to use it. And fixing the problem after the drug or device is on the market is a much bigger challenge for several reasons. First, the acquisition costs of new technologies are bound to be higher than of those already in use. This puts them at a disadvantage in that they get niched into populations that have much greater burdens of illness and therefore less of a chance of doing well. In other words, they are used as a last ditch therapy, which very rarely ends well. Ironically, these are usually not the populations who were studied in the pre-approval studies, and thus the use turns out to be off-label. But here is the real problem: When these technologies are in the "kitchen sink" category, they will almost always end up looking worse in terms of the outcomes than their older counterparts. And to the untrained eye, or an eye who does not have the time to discern the truth, particularly in the setting of perceived high expenses on the new product, this rings the death toll for the drug. But the reality, of course, is that the abysmal outcomes are the result of confounding by indication, where the drug was inappropriately given to those patients who were very unlikely to benefit from in the first place. But you see how this early lack of attention to the articulation of appropriate populations and health economic data can snowball into failure of a promising therapy.

So, if you want your drug to fail, do the opposite of what I recommend below. In other words DO NOT
1. Develop your market understanding
Do it not from the opinions of a handful of "experts" -- experts will rarely tell you the truth. Instead, do epidemiology studies to understand your population and its subpopulations so as to get the most reasonable idea of the disease.
2. Start thinking about the value proposition early 
At the end of a successful Phase 2 program is a good time to do this. The surprise to most companies is how little HEOR studies cost in comparison with their clinical trials program. Yet, as you can see from above, this drop in the ocean can make or break a product.
3. Focus on transparent pricing methods
When pricing the technology, be very very sure that you have all of the ducks in a row, meaning:
                    a. do understand your market 
                    b. do understand the burden and costs of the disease
                    c. do understand how your product impacts these costs
                    d. do price the product to reflect this balance
It is truly embarrassing to have to admit that your price reflects nothing more than the greed of your investors. Trust me, you will not score points with your customers.

Staginnus makes one other important point which I generally agree with:
And let's face it, if you need a major workshop and intensive external “coaching” to help define the value of your product … well, there actually is little to none. If it was really good, it would have been obvious from the start. So maybe we ought to stop beating around the bush and move on if there is nothing to be done anymore. 
There is a nuance here, however, as in most things. Given what I have said above, products are more likely to gut than sell themselves. So, while I agree that you do not need a throng of consultants in suits and hair gel to pollute your offices, you do need to understand how to articulate this value, even when it appears obvious.

Tuesday, December 13, 2011

When end of life is not

Twenty years ago, I helped save a man's life.
So begins this New York Times essay by Peter Bach, MD, where he talks about the inadequacy of resource use at the end of life as a policy metric. Now, I am not very fond of policy metrics, as most of you know. So, imagine my surprise when I found myself disagreeing vehemently with Peter's argument. Well, to be fair, I did not disagree with him completely. I only disagreed with the thesis that he constructed, skillfully yet transparently fallaciously (wow, a double adverb, I am going to literary hell!) Here is what got me.

He describes a case of a middle-aged man who was experiencing a disorganized heart rhythm, which ultimately resulted in dead bowel and sepsis. The man became critically ill, the story continues, but three weeks later he went home alive and well. This, Dr. Bach says, is why end of life resource utilization is a bad metric: if this guy, who had a high risk of dying, had in fact died in the hospital, the resources spent on his hospital care would have been considered wasted by the measurement. And I could not agree more that lumping all terminal resource use under one umbrella of wasteful spending is idiotic. Unfortunately, knowingly or not, Peter presented a faulty argument.

The case he used as an example is not the case. Indeed it is a straw man constructed for the cynical purpose of easy knock-down. When we talk about futile care, we are not referring to this middle-aged (presumably) relatively healthy guy, no. We are talking about that 95-year-old nursing home patient with advanced dementia being treated in an ICU for urosepsis, or coming into the hospital for a G-tube placement because of no longer being able to eat or drink. We are talking about patients with advanced heart failure and metastatic cancer, whose chances of surviving for the subsequent three months are less than 25%. And yes, we are also talking about some middle-aged guy with gut ischemia, sepsis and worsening multi-organ failure whose chances of surviving to hospital discharge are close to nil; but in his case, instead of being clear from the beginning, the situation evolves.

So, yes, the costs of end of life care, and specifically hospitalizations, are staggering. But more importantly, among patients with terminal illnesses like metastatic cancer, advanced heart failure and dementia, hospitalizations and heroic interventions at the end of life cause unnecessary pain and suffering, and without much, if any, benefit in return. Their families and caregivers suffer as well, and many studies suggest that these caregivers are not interested in prolonging suffering, provided they are aware of the prognosis. Unfortunately, just as many studies suggest that communication between doctors and patients' families about these difficult issues is less than stellar.

So, let me play the devil's advocate and pretend that I support end of life resource utilization as a quality metric. If I did, I certainly would not be interested in depriving Dr. Bach's middle-aged acutely ill patient of the chance to survive. In fact, my aim would be to make sure that we align resource use with where it can do most good, and turn away from interventions that are apt merely to prolong dying.