Unbiased Analysis of Today's Healthcare Issues

Impact of Brexit on Pharma

There is a lot of talk that Brexit will be a disaster.  While I believe that much of this disaster talk is overblown, there are clear business implications.  Pharmafile provides an example of how Brexit would affect a small pharmaceutical company conducting clinical trials in the UK. In the latter case, UK-based pharmaceutical companies with no other […]

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Incentives for investing in “off label” trials

Aaron Carroll of the Incidental Economist draws on a column from his colleague Austin Frakt in The Upshot to explain why there is not more research into off-label uses of patented or generic drugs.  

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Will value-based pricing be coming to the U.S.?

The answer may be yes.  One of the big inpediments to value-based pricing of pharmaceuticals was that any discount given to any single organization based on outcomes needed to be reflected in the Medicaid price.  Since outcomes are subject to random noise, there will inevitably be health plans that end up getting a low price due to worse than expected […]

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Gates: US Drug pricing system is ‘Better Than Most’

There has been a lot of criticism of drug prices in the U.S. One person not included the chorus of critics is Bill Gates. In an interview with Bloomberg, he said: “The current system is better than most other systems one can imagine,” Gates said in an interview on Bloomberg Television. “The drug companies are […]

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After 190 failed tries…

Why are pharmaceuticals so expensive?  One reasons is that there is a lot of research that goes into developing a drug.  Most of that research results in drugs that don’t work.  One example is the search for Alzheimer’s treatment.  As Bloomberg reports: Drug companies have long focused on a different protein called amyloid that clumps in […]

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ICER and drug prices

The Institute for Clinical and Economic Research aims to measure the value of drugs and aims to reduce the price of treatments that they deem to be low-value.  Is this simply an academic exercises, or are payers paying attention?  An article in CNBC sheds some light on the topic: Asked about that analysis, Miller said: “We […]

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Medicaid Managed Care and Drug Utilization for Patients with Serious Mental Illness

How will Medicaid expansions affect patient access to pharamceuticals? This question is particularly relevant for patients with serious mental illness. The answer is complicated by the increasing presence of Medicaid managed care plans. Increasingly, states have turned to contracts with Medicaid managed care plans in order to better control costs and reduce budgetary uncertainty. However, in […]

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Part B drug reimbursement

In the past Medicare has reimbursed physicians that administer Part B drugs–typically injectable medications administered in a physician’s office–at 6% of the drug’s cost.  The 6% aims to cover the cost of purchasing and storing the drug as well as administering it.  Because physician reimbursement is proportional to the cost of the drug, physicians have […]

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Are drug prices higher or lower in the U.S.

The high price of prescription drugs in the U.S. has received a lot of press in recent years.  However, are drug prices really higher in the U.S. than other countries?  Tomas Philipson makes an interesting point regarding U.S. drug prices: It is well known that free-market prices of branded drugs still on patent are higher in […]

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How does cost sharing affect drug utilization?

Any economist knows that if you raise the price of a good, demand goes down.  Thus, one should not be surprised to find numerous studies that show that increased cost sharing decreases drug utilization.  But how does drug utilzation decrease?  Is it along the extensive margin (i.e., the decision to initiate the drug) or along the intensive margin […]

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