Biotechnology Healthcare - September/October 2008 - (Page 22)

we’re working to notify both campaigns of the importance of thinking about an FDA commissioner. When the election is over we will urge the new president to do that. Meanwhile, we are ramping up our ability to communicate the value of biotechnology with the public at large and with policymakers, to help people understand what it is. Most people don’t know what biotechnology is, so we are expanding our communications capacity in a variety of ways. Do you see any reason to think the rate of increase for healthcare costs will be lower in the future? Leibowitz: Healthcare costs have to increase. The population is aging. We are discovering new ways of treating people. It doesn’t matter who’s elected, and it doesn’t matter what the government’s going to do about it. Healthcare expenses are going to go up, and the country has to figure out a way to pay for that. You can’t simply move those costs out of the employer space into the individual consumer space. At some point, you’ve got to find another funder, and that funder has to be the government. Miller: Our members, which include organizations ranging from UnitedHealthcare to AARP, support the idea of price constraints that bring annual percentage increases in healthcare costs and insurance premiums in line with the annual increase in per-capita gross domestic product. We’re not talking about a one-time shot; this would happen over a five-year period. There are those in Washington — people like Tom Daschle [former Senate minority leader, now a fellow at the Center for American Progress] and others — who are promoting the creation of a federal health board, similar to the Federal Reserve Board, which could have the authority to make recommendations on hospital cost increases and other healthcare costs, as well as increases in health insurance premiums. How significant are biologics to the nation’s healthcare tab? Greenwood: Approximately 1.8 percent of every healthcare dollar is spent on biologics. Even if you could achieve European-level pricing of drugs in the United States, the savings out of a $2 trillion-a-year health expenditure in this country would only be about $50 billion a year. That is almost as large as the entire private sector drug research and development budget. So I think downward pressures on pricing would likely have a very serious impact on the ability of biotech companies to innovate, when there’s reason to believe that the real way to take control of healthcare costs is to reduce the prevalence of chronic disease. Biotech products are all about reducing prevalence of chronic disease. If we could reduce prevalence of chronic disease even by 10 percent, we would save $150 billion a year. Healthcare costs are lower in other countries. Can we borrow anybody’s good ideas? Miller: The Commonwealth Fund’s recent report shows that the United States fell to last place on the rate of preventable deaths when compared with industrialized nations that have universal coverage. And those nations that have coverage for all their citizens, as well as cost-containment programs, did a much better job of coordinating care for patients, and patients are able to get timelier care versus patients in the United States. So there seems to be a gap that’s widening between the quality of care provided in the United States versus those nations that have universal programs and cost containment, even though we spend a lot more for medical care in the United States. Leibowitz: People talk a lot about the German system, the Canadian system, the British system. They’re all different. All of them involve an issue that Americans aren’t comfortable with: At some point in time, you make care decisions around reasonableness, and you have to decide whether you do knee replacement surgery in 90-year-olds and bypass surgery in 80-year-olds. Those are tough decisions. But the government could decide at some point to provide a certain level of coverage and individuals could have the option of buying private insurance to get services beyond that. Any takeaways to wrap up this conversation? Vogenberg: What we do know is that within our lifetimes we won’t be able to afford healthcare, given the rate of technological innovation and current level of benefit coverage. We won’t be able to afford insurance coverage in its current iteration. Inevitably, this is going to force us to make the tough choices. This is already happening. Because they don’t have insurance, or they can’t afford the cost sharing that has been put into their benefit plans, people are making the choice: “I’m not going to pursue this treatment any more because I can’t afford it, and therefore I’m going to die.” Whether the next president is McCain or Obama, this will be a hot potato, big time. What do you do? Lola Butcher, who writes about health policy and the business of healthcare, lives in Springfield, Mo. 22 BIOTECHNOLOGY HEALTHCARE · SEPTEMBER/OCTOBER 2008

Table of Contents Feed for the Digital Edition of Biotechnology Healthcare - September/October 2008

Biotechnology Healthcare - September/October 2008 Openers Editorial/David B. Nash, MD, MBA Contents At a Glance: Multiple Sclerosis Drug Track Personalized Medicine Healthcare Reform’s Effects on Biologic Access Breast Cancer Status Testing: A Crapshoot With Deadly Odds Trends, Issues, and Perspectives In the Management of MS So High-Tech, Yet So Simple The Evolution of Ascertaining the Value Proposition Specialty Pharmacy Employer to Employer Health Plan Confidential Trends

Biotechnology Healthcare - September/October 2008

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