Mark Cuban said, “If you’re using one of the big 3 pharmacy benefit managers, you’re getting ripped off. Period.” And then I said, “Oh, man—we NEED to do an episode on this.” …and then I went and got highly acclaimed pharmaceutical benefits expert Pramod John to come on the show and talk long form about Rx benefits in America, buying Rx, managing Rx plans, Mark Cuban’s company, and the whooooole ball of wax.

Tobias Kennedy
Host of The H.I.T. Podcast

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In 2022, the US Congress passed the Inflation Reduction Act (IRA) to address high drug costs and limited drug accessibility. IRA’s passage followed a 2019-2021 investigation by the House of Representatives Committee on Oversight and Reform into pharmaceutical pricing that reviewed previously sealed communications and documents from manufacturers of blockbuster drugs. The Congress concluded that pricing and market protection practices by manufacturers resulted in high costs. One investigated drug was lenalidomide, a treatment for multiple myeloma. Lenalidomide is an example of a drug whose financial success resulted from price increases and anticompetitive market strategies. We review tactics that led lenalidomide to become the third largest revenue-producing pharmaceutical product worldwide, with $12.2 US dollars (USD) billion sales in 2020, focusing on impact on patients and Medicare and developing policy recommendations …

High costs of drugs are not tightly correlated with value, and pricing decisions by many manufacturers are responsible for high costs, patient burden, and unsustainable pharmaceutical markets.

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Pramod John, CEO of VIVIO Health, discusses issues with drug pricing and competition in the pharmaceutical industry. He talks about how the current system incentivizes higher spending on healthcare rather than better outcomes, and how lack of transparency and access to data prevents true competition.

[00:00:15] Introduces VIVIO Health mission
[00:02:07] Background and improving healthcare
[00:05:40] US overspends on drugs
[00:08:39] Public benefit corporation
[00:12:11] Rebates misalign incentives
[00:17:29] FDA approves ineffective drugs
[00:24:15] FDA efficacy vs. effectiveness
[00:29:47] Health insurance exchanges
[00:33:03] Humira lacks competition
[00:40:51] Lower cost Humira biosimilars
[00:44:38] Employers overpay despite alternatives
[00:47:53] Consultants have misaligned incentives
[00:51:46] Importance of fiduciary duty
[00:53:39] Data access drives competition
[00:55:33] Similar issues in other industries
[00:57:31] Ask doctors for data on treatments

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I vividly recall a young veteran with a highly treatable and potentially curable cancer. We quickly reached what seemed a “fork in the road.” Two effective therapies were available: one inexpensive and generic and a second an equally good patented and expensive medicine. There was no evidence of superiority of either.

I informed him of the vast price difference and asked which he would prefer. This veteran did not hesitate for a second: “I will take the cheap one, doc…. I am not the only one in this foxhole.” This sentence broke my heart, and, to this day, its recall gives me goose flesh and unavoidable flowing tears. This intense and unforgettable experience, although long ago and far away, remains highly relevant to today’s cancer medicine.

Read the full article at: The Food and Drug Administration (FDA) approves about two thirds of new cancer drugs on the basis of clinical trials that use surrogate end points, such as laboratory values or radiographic findings, rather than clinical end points that assess survival or how patients feel or function. The accelerated approval program allows drugs designed to treat serious conditions for which there is an unmet medical need to be approved on the basis of changes in surrogate measures that are only reasonably expected to predict clinical outcomes. Because in certain fields of medicine, such as cancer, a drug’s effects on surrogate measures such as tumor size (see table) are often more pronounced and occur more rapidly than effects on a patient’s clinical status, trials focused on surrogate measures can enroll fewer patients and can be completed more quickly than trials with clinical end points, thereby enabling products to reach the market earlier. Since clinical end points such as survival are generally what matter to patients, however, the FDA requires that the clinical benefits of drugs granted accelerated approval be confirmed in subsequent trials.

Read the full article at: benefit of any treatment for any disease should be judged by whether it improves either survival or its quality. For adjuvant treatment of cancer, effects on overall survival (OS) are paramount: Patients and their oncologists are willing to accept substantial toxicity and short-term deficits in quality of life, if long-term survival can be improved. Assessment of the validity of randomized controlled trials (RCTs) evaluating adjuvant therapy requires that several questions about trial design and analysis be addressed.

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Advancing principles for value in addressing inflammatory bowel disease As the Center for Medicare and Medicaid Innovation (CMMI) continues to advance value-based payment (VBP) models to address quality and total cost of care in primary care and large-scale populations, many stakeholders are grappling with how to build VBP models for chronic specialty and subspecialty conditions for smaller populations, such as inflammatory bowel disease (IBD).1 Some believe that VBP models have the potential to improve patient and cost related outcomes in IBD, and while some commercial payers and practice partners are experimenting with such models, most of these efforts remain nascent.

Beginning in 2021, Tapestry Networks engaged a diverse group of stakeholders—including payers, self-insured employers, gastroenterologists and clinical specialists, patient advocacy organizations, industry representatives, and others—in its IBD Shared Value Initiative to address the challenges and opportunities surrounding value-based care (VBC)2 and VBP models in IBD. The initiative culminated in the May 2021 Progress Summit. 3 Following the summit, many stakeholders noted that establishing consensus-based principles for value in IBD could help guide those looking to pilot new approaches. Therefore, throughout 2021 and early 2022, Tapestry continued discussions with key stakeholders to consider what those principles might be. From this broader group, a small subset of payers and providers, chosen for their roles and leadership in care delivery and contracting, collaborated to draft a publication on the topic. In June 2022, the draft framework publication was presented to the larger stakeholder group for further insights. Meeting participants also discussed considerations for practical implementation of the framework, including the incentives and resources necessary to advance the principles proposed in the draft. The meeting also provided a forum for candid discussion among stakeholders for continuous learning, and more such meetings may be convened in the future.

For more information, contact T. J. Tedesco at [email protected]

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