How Martin Shkreli is driving down drug prices

Thanks Mr. Evil for helping build consensus

Thanks Mr. Evil for helping build consensus

Breaking news: Martin Shkreli has been arrested for securities fraud. Not surprising, but actually I was hoping this wouldn’t occur for a while –at least until some of his drug pricing schemes had played all the way out. I hope he gets out on bail and keeps going with his business plan.

—–

Turing Pharmaceuticals CEO Martin Shkreli made waves this year by boosting the price of generic drug daraprim from $13.50 to $750 per tablet. Now he’s angling for an FDA voucher worth hundreds of millions of dollars by abusing an incentive program intended to encourage development of new drugs for neglected diseases. He’ll be ratcheting up the price of another drug to boot. And finally his interview with HipHopDx reveals him to be a very nasty and unsavory character. (Jump straight to the last question if you don’t believe me.)

Yet ironically his well publicized price-jacking of a few specific products seems reasonably likely to lead to a slowdown in price increases for the pharma industry as a whole, if not outright price controls. You see, what Shkreli has done differs only in degree from standard industry practices.

The industry spends a lot of money and energy to explain that its pricing is directly related to the high cost of drug development. We know that’s not true, but even if it were true it would not explain why prices for medications rise so quickly, even for products that have been on the market a long time.

The Shkreli affair, along with shenanigans from Valeant, have awakened serious journalists, who have started to look into drug pricing more broadly. This Wall Street Journal article (How Pfizer set the cost of its new drug at $9,850 a month) is a good example.  Pfizer doesn’t set its price based on R&D costs, but it doesn’t charge the maximum it can get away with either. Pfizer is in this game for the long term and likes the status quo. It doesn’t want to generate a backlash. But Shkreli is generating a backlash, not just against him but against the whole industry. Politicians are seizing on him as an example, and rightly so.

Free markets unfettered by government interference are great, but as I have written (Why drug price regulation should not be ruled out) we have to remember that the government plays a very big role in enabling high and rising product prices: it grants monopolies and market exclusivity that keep out competitors. And, through Medicare, Medicaid and other programs the government is the biggest payer for many products. Shkreli’s actions present legislators and the president with an opportunity to re-examine drug pricing policies and consider changes that are in the country’s interest. The longer he keeps up his act, the higher the chance for significant reform.

Image courtesy of Sira Anamwong at FreeDigitalPhotos.net

By healthcare business consultant David E. Williams, president of Health Business Group.

 

6 reasons to ignore listicles, even this awesome one

Captain Listicle

Captain Listicle

 

Are you bothered by  articles with headlines like, 21 Euphoric Experiences for People Who Just Love Food, 11 Christmas Cards Only Cubans Would Send or 7 Surprisingly Easy Ways to Get Organized for the Holidays? (These are just a few of the articles on BuzzFeed’s home page as I write this.)

I don’t like them either, and I don’t read them. (Neither should you.) So I thought I would do something therapeutic by explaining what’s wrong with them.

  1. The name for this format is “listicle.” It suggests a popsicle. Sweet, cheap, and with no nutritional value. That should be enough to keep you away.
  2. Most listicles are unoriginal. The writers aren’t experts; they’re just organizing a bunch of other junk they found on the web.
  3. Listicles are a tired format. Maybe you enjoyed the first few. Even the first few dozen. But aren’t you sick of them by now? Or are listicles more like crystal meth where you just can’t stop even if you’re brain literally rots out of your head?
  4. A good writer only needs three reasons to explain something.
  5. You’re a mature person. You’ve learned to avoid jailbait and are probably not even tempted by it. Can you say the same about clickbait? The publishers don’t care if you learn anything from the listicle. They just want you to see the advertising surrounding the piece.
  6. Listicle sounds way too much like a synonym for gonad.

Image courtesy of iosphere at FreeDigitalPhotos.net

By healthcare business consultant David E. Williams, president of Health Business Group.

 

Should patients choose doctors who are friends?

Come with me?

Can I help you?

In the social media era, it’s common to read articles discussing the blurring boundaries in the doctors/patient relationship. Usually it’s some version of, “Should a doctor accept friend requests from patients on Facebook?” or “Is it ok for doctors to Google their patients?”

The Wall Street Journal (The New Boundaries Between Doctors and Patients) explores these issues and goes on to explore what happens when patients and doctors become friendly during the course of treatment. In the midst of this there’s a throwaway paragraph:

“Some boundaries are clear. Professional medical organizations have strict rules against sex and romance with patients. Doctors are also advised not to treat family or close friends, situations that could compromise objectivity and judgment.”

I have no problem with the part about sex and romance. I also kind of understand the family issue. But the friend one is more interesting to me.

I read a few pieces that discuss this topic. (Here, here and here.) The typical scenario is a friend asking for medical advice in a casual setting, often on a topic that’s not related to the doctor’s specialty. I get why that’s a bad idea.

In my own case I know many practicing physicians socially, and most are in the prime of their careers: mid 40s to early 50s. A couple years ago when I was having trouble finding a new primary care doctor after mine retired, I asked physician friends who they went to. That was a little too clever on my part, since I forgot to account for the fact that physicians get treated differently than regular people when they go to the doctor’s office. No NPs for them!

But after some so-so experiences with a particular medical specialty, I decided to ask a specialist friend if he would be comfortable being my doctor. He said yes and I started seeing him. He’s a longtime friend but not an extremely close friend. I’ve been extremely satisfied with the experience. Partly because he’s an excellent doctor but also because I feel he understands me better and may even provide a little extra attention. He trusts me enough to exchange detailed emails. I’m not embarrassed to share personal medical details that I wouldn’t be comfortable with sharing someone who’s just a friend. Honestly, for me I don’t see the downside.

I did the same thing when I a needed a new dentist and that’s worked out well, too.

I hope I stay reasonably healthy and then die peacefully in my sleep when I turn 100, so I don’t have to spend a lot of time as a patient. But realistically it’s likely that I’ll be seeing more specialists as time moves along. I’m definitely planning to keep friends in mind when it comes time to find people to treat me.

Image courtesy of stockimages at FreeDigitalPhotos.net

By healthcare business consultant David E. Williams, president of Health Business Group.

Let the games begin: HITLAB World Cup

Sabra Bhat, Manager, HITLAB Healthcare Innovation Lab

Sabra Bhat, Manager, HITLAB Healthcare Innovation Lab

HITLAB is a New York based innovation and teaching lab that focuses on improving healthcare quality and accessibility globally. I caught up recently with HITLAB’s Sabra Bhat, who is coordinating a World Cup competition designed to stimulate original solutions to healthcare problems.

Here’s what we covered:

  • (0:09) What is the HITLAB World Cup?
  • (1:35) How do people hear about it? What kind of entrants did you attract?
  • (3:29) You have entrants from all over the world. Are there different sorts of entries by country or does that not matter?
  • (4:56) What can you say about the finalists?
  • (6:04) What is the relationship between the World Cup and the Innovators Summit?
  • (7:49) What does HITLab do. What do you see for 2016?

By healthcare business consultant David E. Williams, president of Health Business Group.

Health Wonk Review is up at Health System Ed

Health System Ed extends the Thanksgiving theme with the Healthcare on Parade Edition of the Health Wonk Review. The subtitle (“It’s beginning to look a lot like… chaos”) is, sadly a good summary of the healthcare scene.

In any case you’ll want to read the posts to get yourself at least partially straightened out.

Enjoy!

Twitter share counts – what happened?

Tweety bird on the way out?

Tweety bird on the way out?

Oh where oh where have my Twitter shares gone? Oh where oh where can they be?

Like most bloggers I have an option for readers to share posts they like (or hate) on social media, including Twitter, Facebook and LinkedIn. The share buttons at the bottom of the posts also indicate how many people have shared a post on each platform. Usually Twitter is the most popular share for my blog, followed by LinkedIn and then Facebook.

WordPress.com is pretty easy to use but it’s also glitchy. When I scroll down the page on my blog I notice it often stops showing share counts after the first several posts, although if you click on a specific post the share counts will reappear.

So at first when the Twitter counts disappeared a couple weeks ago I figured it was just a WordPress problem and probably a transient one. But after a few days I started to get suspicious and so probed a bit further. Turns out Twitter announced a couple months back that it was removing the share counts. For the life of me I can’t figure out why they would do it. All the other social media sites have kept theirs.

Search Engine Watch has a good take on this:

“So, all this move does is:

  1. Irritate publishers, bloggers and authors like me who use share counts as a lightweight performance metric
  2. Stick another two fingers up to developers, who are used to it by now
  3. Remove Twitter from being relevant, when it comes to social proof

I’ve put quite a lot of effort into Twitter over the past five years or so and have a solid following there of over 9500 people. Twitter is easy to use and informative, but this move is a real pain in the neck.

My favorite social network is LinkedIn.  I’m proudest of the posts that generate the most shares there and am surprised at how many people read the blog on LinkedIn.

Anyway, you’re still invited to share my blog posts on Twitter. You just won’t know if you’re the first or 101st to do so, and neither will anyone else.

Image courtesy of olovedog at FreeDigitalPhotos.net

By healthcare business consultant David E. Williams, president of Health Business Group.

Joslin Diabetes CEO faces ‘big challenges’ –I’m quoted

It's tough to win in the diabetes business

It’s tough to win in the diabetes business

Diabetes is a huge health problem, and Joslin Diabetes Center is a renowned, world-class institution. You’d think it would be a good moneymaker, or at least able to break even. But, as the Boston Globe explains in Big challenges ahead for new Joslin CEO, that’s not the case.

Here’s the part of the article where I’m quoted:

Diabetes typically doesn’t require the kinds of expensive treatments or surgeries used to fight illnesses such as eye diseases and cancers. That means Joslin doesn’t have the same opportunities to generate revenues as other specialty clinics in Boston, such as Dana-Farber Cancer Institute and Massachusetts Eye and Ear Infirmary.

“Diabetes is not as profitable a market as more procedure-oriented specialties,” said David E. Williams, a Boston health care consultant

Several years into health reform, it seems odd that we’re still rewarding expensive interventions rather than the type of coordinated, prevention-oriented care that Joslin provides. In some fields, prevention has an uncertain payoff, yet for diabetics proper care helps head off terrible and expensive downstream complications such as amputation, blindness, heart disease and kidney failure.

Joslin has a couple other things going against it:

  • Big healthcare systems have focused on keeping all care within their own systems, preventing “leakage” to other providers even when those providers are excellent
  • Joslin derives a fair amount of its revenue from research. Unfortunately for Joslin NIH rules such as salary caps and COLA freezes make research a loser from a purely financial standpoint. There’s also a lot of competition for grant dollars

Joslin has actually done a good job of recognizing these problems, and has built a substantial commercial business to license its knowhow and brand. But that hasn’t been enough to make up for all of the headwinds.

I am wishing new CEO Dr. Peter Amenta the best of success as he tries to turn this ship around.

Image courtesy of smarnad at FreeDigitalPhotos.net

By healthcare business consultant David E. Williams, president of Health Business Group.