News and Insights


June 24, 2019

“We have seen the enemy and it is us,” Pogo

More than half of the world’s greatest medicines – bending the survival curve for cancer, diabetes and heart disease – were invented in the United States – long home to great science and access to ample capital investment. Yet, among developed nations, our bill of health is poor. Our survival rates pale in comparison to other nations. According to a Johns Hopkins Bloomberg School of Public Health team, the chief reason is not greater health care utilization, but higher prices.

The late Princeton health care economist Uwe Reinhardt, came to the conclusion in his well-known 2003 study, “It’s the prices, stupid: why the United States is so different from other countries.” 

Whenever “price” is cited as culprit, the wanted poster generally features the product innovation sector – biopharma and medical device products. Pointing the offending finger at one part of the healthcare ecosystem as guilty is naïve. But, what happens if the biopharma and medical device industry is not the sole offender just one piece of a complex puzzle among many? What happens if it’s the system itself? Perhaps the famed cartoonist Walt Kelly, the illustrator for Pogo had it right? “We have met the enemy and he is us!”

There is no doubt that each health sector – payer, policymaker, product innovator and provider – has the patient’s interest at heart! Yet, our system has so many players with “ideas” on how to save money and allocate care that one system saves some dollars and another piece of the nation’s medical puzzle picks up the cost. We have a system that one part makes a decision, thereby kicking the can down the road so that another player needs to pick-up another chunk of the sales tag of care. 

A classic example of adding cost is “non-medical switching.” A physician prescribes a medical product recommended in third-party guidelines for managing a chronic condition. The patient is stable and adheres to that therapy. Then a pharmacy benefit management (PBM) company using its clout to adjust drug costs makes a formulary change. The domino effect requires the patient to either check with their physician – or the physician to contact patients – in order to change medications. The pharmacist spends added time counseling the patient. The patient often must visit their physician to confirm and understand the (uninvited) medical change. One piece of the puzzle saves, while the others pick-up the tab. Non-medical switching in a fragmentated health system doesn’t save money, it passes the buck along.

What about improving care for patients? Not really! The non-medical switching impact reported in third-party, peer-reviewed research is most often negative. One study, stratified by outcome type, demonstrated that non-medical switching was associated “negatively with clinical, economic, healthcare utilization and medication-taking behavior outcomes in 20.7%, 69.2%, 38.1% and 75.0% of cases, respectively; and positively in only 4.8%-17.2% of outcomes subgroups. Of 32 outcomes in patients demonstrating stable/well-controlled disease, 68.8%, and 31.3% had a negative and neutral direction of association. In patients without demonstrated disease stability, outcomes were negatively, neutrally and positively impacted by non-medical switching in 15.6%, 67.2% and 17.2% of 64 outcomes.” In short, no one really wins with non-medical switching – neither the system or patient.

Collaboration among the varied health sectors is essential if we are going to maximize our nation’s greatness in lab-to-bench science and ability to capitalize on great ideas and bring them to patients – in this nation and around the world. Our decision makers must begin to take a stand and refrain from kicking the most vulnerable and perhaps valuable part of our system – biopharma inventors – like a soccer ball. We need biomedical innovation to overcome many of the disease that drains our economy – cancer, diabetes, and heart disease. At the same time, we companies must act responsibly around pricing. 

Maybe the solution is, to begin with, a mindful decision that providing people with access to care – prevention, healthcare professionals and medicines – without one part of the system gaming the other – is a must. That’s how it works in other developed nations that have far better survival rates and spend less per capita. It does not mean we gravitate toward a one-payer system. Rather, our system seeks to find ways to collaborate and understand how each other makes money to survive and thrive. We all share the same customer – people seeking to live longer, healthier lives. Ultimately, that includes us too!


TAGS: Health

POSTED BY: Gil Bashe

Gil Bashe