The editors at Bloomberg explain:
Here’s how the system works: When a doctor administers a drug in his or her office, Medicare pays 106 percent of its average selling price. The doctor keeps the extra as compensation for administering the injection.
What has this got to do with eye doctors? The drug Lucentis, used to treat macular degeneration, cost Medicare almost $2,000 a shot in 2012. Another drug, Avastin, which works just as well, costs about $50. If you were the doctor, faced with a system that pays you 6 percent of the drug’s cost, which would you choose? That Medicare spent a total of about $1 billion on Lucentis in 2012 suggests most ophthalmologists went with the more expensive one.
It gets worse:
This problem goes beyond a single drug. Of the $20 billion Medicare spent on drugs administered by doctors in 2010, 85 percent went to the 55 most expensive ones. In what seems unlikely to be a coincidence, 42 of those drugs also showed an increase in use from 2008 to 2010.
What is indisputable is that the status quo is untenable. An estimated 48,000 people die in Europe and the U.S. each year from infections caused by antibiotic-resistant bacteria, and this number is very likely to increase in years to come. “This is a global issue and a moral issue that needs to be dealt with in collaboration,” says Otto Cars, of the Swedish Institute for Communicable Disease Control in Solna.
At National Review Online, Jillian Kay Melchior, reports on a cancer patient who has run out of therapies. There are medicines under development that might help, but drug-makers won’t let her have them under the FDA’s “compassionate use” doctrine.
Clinical trials accept only “typical” patients — Mikaela’s rare form of kidney cancer has ruled her out, but for others in her situation, complications as common as diabetes or high blood pressure could also be reason for ineligibility. And the Food and Drug Administration’s approval process for “compassionate use” of an experimental drug outside of clinical trials is extremely arduous.
First, a pharmaceutical company has to be willing to provide the experimental drug — a high-risk proposition, given that an atypical result in an atypical patient can prompt the FDA to delay approval or require significant and expensive additional testing…And approval from a pharmaceutical company is just the first step. Next, patients and doctors must fill out an exhaustive paperwork disclosure to submit to the FDA, which is estimated to take at least 100 hours to complete. The FDA then begins a review, which is supposed to take no longer than a month — but if the agency’s reviewers have any additional questions or need more information, that 30-day clock is reset. Finally, the hospital’s institutional review board has to give approval — and if a patient is being treated at a small hospital that lacks such an administrative panel, the case has to be reviewed by a bigger facility, often one unfamiliar with the patient.