Two important articles to read

Yesterday, Tuesday, was a good day to read the WSJ if you are interested in the state of healthcare in the US. I've risked the wrath of Rupert and posted them both below in their entirety. The first article below by Geeta Anand is best summed up as "if you are going to get a life-threatening illness, make sure it's a mainstream life-threatening illness, as the newest, most effective medicines may not be paid for by your insurance - evidence of efficacy to the contrary, as its too expensive and there's no 'competitors' with which the insurance co's can negotiate lower prices." This illustrates my arguement that insurance co's are not in the business of making us healthy (as their PR says), but in the business of evaluating and pricing risk. duh.

The second article is best summed up as "medical research exists in silos and most, not all medical researchers are driven by the desire to publish their own idea, not to collaborate and advance a cure and save lives if at the expense of their research and the resulting professional meaning the system assigns to such achievement." In other words, a common business practice - partnering - does not exist really in the medical research world. Shame.

September 18, 2007


As Costs Rise,
New Medicines
Face Pushback
Insurers Limit Coverage
To FDA-Approved Uses;
$300,000 Drug Denied

May Chin-Louis, 44 years old, has a ballooning brain tumor. Her doctors wanted to attack it with a colon-cancer drug that has shown promise in treating brain tumors.

But for four months, Ms. Chin-Louis's insurer, WellPoint Inc., refused to pay for the drug, called Avastin. It costs about $8,000 a dose, every other week. A WellPoint spokesman says it denied coverage initially because there isn't sufficient medical evidence proving Avastin is effective against brain tumors.


Some patients are being denied potentially effective therapies."She's a young patient with a family who has run out of options -- she's just looking for a chance," says her oncologist, Susan Chang. Patients with Ms. Chin-Louis's condition typically live for only about four months.

Doctors, particularly oncologists, rely on medicines approved for other diseases to try to save patients for whom all other treatments have failed. But as new medicines come to market at ever-higher prices, insurers are pushing back, limiting coverage of these drugs to only the disease for which they are specifically approved by the Food and Drug Administration -- or for which there is extensive evidence of efficacy in clinical trials.

"A lot of patients are being denied potentially effective therapies," says James Vredenburgh, an oncologist at Duke University Medical Center. "What's happening is totally arbitrary and it's 100% correlated to when the prices went up. Ten years ago, we never got questioned on our medical decision to prescribe the medicine with the best chance of helping our patients."

Insurers say they must limit use of the most expensive drugs to control health-care costs, which are surging at a 7% to 8% annual rate and continue to outpace inflation. It makes sense, they say, to require proof that a drug works in a patient's particular disease before doling out tens or hundreds of thousands of dollars.

"We're trying to bring new drugs to consumers, but trying to do it with employers getting the best value of every health-care dollar spent in the system," says Mohit Ghose, spokesman for America's Health Insurance Plans, an industry trade group.

High-priced medicines used to treat relatively small groups of patients -- categorized as "specialty pharmaceuticals" -- comprise the fastest-growing part of health spending, insurance officials say. By pushing generics, insurers have clamped down on spending on other types of medicines, which rose 6% in 2006, according to Express Scripts, Inc., one of the largest pharmacy-benefit managers.

By contrast, spending on specialty drugs soared 21% last year. They accounted for nearly a quarter of total drug spending in the U.S., according to Health Strategies Group, a New Jersey consulting firm.

Insurers have little leverage in negotiating the prices of many specialty drugs because they often extend lives and lack competition. Drug companies have the freedom to price these medicines almost as high as they like. The companies say the prices are needed to fund research of new medicines and to compensate shareholders.

Genentech Inc. charges $4,400 a month, or $47,000 for the average treatment course of Avastin for colon-cancer patients. Higher doses are used in treating brain tumors, raising the cost.

Once a unique, life-saving drug is approved by the FDA for a disease, insurers almost always are required to pay for it, regardless of price. But insurers have leeway when a medicine isn't specifically approved for a particular patient's disease. Coverage varies among companies.

"As an insurer, you go where the money is to try to cut costs," says Abbie Leibowitz, former chief medical officer of Aetna, Inc., who runs Health Advocate, which advises employers and employees on health insurance. Spending on specialty drugs is "where there is the greatest opportunity to affect cost."

Wall Street is seeing the effects of the pushback in lower-than-expected revenue from some of the hottest new cancer drugs. Genentech's Avastin is FDA-approved for certain kinds of colorectal and lung cancers. But the drug should also be a big-seller in breast cancer based on a large study reported two years ago showing efficacy in that disease, says Steven Harr, a Morgan Stanley analyst. His research shows less than 10% of breast-cancer patients are using the treatment, for which Genentech charges $7,700 per month for the average patient.

With prices so high, insurers "won't pay until it's FDA-approved," Dr. Harr says. "For the first time ever, there's elasticity in demand."

Karen Kacures, who owns a lawn-care company in St. Francis, Minn., found that out the hard way. Ms. Kacures was diagnosed in January with Pompe disease, a rare genetic disorder. It is caused by a deficiency in an enzyme that leads to progressive muscle-weakening and an early death.

Along with the devastating diagnosis, her doctors brought some hope: Genzyme Corp., a Cambridge, Mass., biotech company, recently brought to market the first treatment for the disease. The drug, called Myozyme, replaces the enzyme deficiency that causes muscle degeneration.

Dosed by weight, the drug is priced at an average of $300,000 a year, for a patient's entire life.

In March, Ms. Kacures's insurer, PreferredOne Community Health Plan, a Golden Valley, Minn., nonprofit with 400,000 members, refused to pay for the drug.

"We consider that for adults, the evidence is not there to support its use," says John Frederick, chief medical officer of PreferredOne. He noted that Genzyme conducted its clinical trial to win approval of the drug only in infants. In approving the drug, the FDA required Genzyme to conduct another trial, which is under way, to prove safety and efficacy in adults.

Dr. Frederick acknowledges that the FDA didn't restrict approval of the drug to infants, but he says it was "a little fuzzy."

Drugs that are high priced and treat smaller populations have "just kind of taken over" the pharmacy budget, Dr. Frederick says. In the most recent fiscal year, his company's spending on specialty drugs rose 23% over the previous year; spending on other pharmaceuticals was almost flat, he says. Generics are helping "stem the tide" of spending, he says, but specialty medicines are "a concern to us from a cost perspective."

Calling Ms. Kacures's case "wrenching," Dr. Frederick says he wishes there were "a big systemic cure. I dream of a big super-insurance plan to cover these tragic cases."

Ms. Kacures, 47, who has appealed the denial, says she doesn't have time to wait until Genzyme finishes its study in adults. "I want to get treated while I can still walk and breathe on my own during the day," she says. She uses a cane to walk and a breathing machine at night.

Some adults do receive the drug. Mark Lingenfelter, 45, of Eau Claire, Wis., started taking Myozyme in November, after Medicaid, the government's health-insurance program for the disabled and poor, agreed on appeal to cover the cost of the drug.

For the first time in three years, Mr. Lingenfelter says, he's been able to stand up out of his wheelchair. His breathing has improved enough to be able to talk on the phone for a few minutes, sometimes to offer encouragement to Ms. Kacures. "It's made a complete difference in my life," he says.

Gideon Sofer, a freshman at the University of California, Berkeley, was turned down last year when he tried to get approval from his mother's New Jersey insurance plan to pay for a new medicine. The drug, Revlimid, was approved by the FDA to treat a rare blood disorder and not yet tested in Mr. Sofer's condition, Crohn's disease, an inflammatory disorder that causes severe digestive problems.

Mr. Sofer had been using thalidomide, the only medicine that had helped control the mouth and intestinal sores caused by his disease. But thalidomide caused such drowsiness that he says he couldn't take morning classes, and he experienced nerve damage causing him to lose sensation in his feet.

Revlimid, made by Celgene Corp., is billed as an improved thalidomide, minus the drowsiness and nerve damage.

At first, Horizon Blue Cross Blue Shield of New Jersey covered it for him. "I felt so much less fatigue, my anemia improved, it was just great," Mr. Sofer says. His doctor in New York, Maria Abreu, director of the inflammatory bowel disease center at Mount Sinai School of Medicine in New York City, says Mr. Sofer's weekly blood reports showed gains in his iron levels.

But in August 2006, Mr. Sofer received a letter saying "it was determined that you do not meet the Horizon Blue Cross Blue Shield of New Jersey established medical necessity criteria for this drug." It noted Revlimid was approved for patients with a blood disorder and not Mr. Sofer's disease.

"Although benefits are denied, you may elect to receive the medication at your own expense," the letter said.

Neither Mr. Sofer nor his mother, a social worker, could afford the drug, which retails at about $8,800 for a month's supply. Mr. Sofer called Celgene and asked if the company would donate the drug. He was connected to a Celgene program, called Patient Support Solutions, which provides free Revlimid to patients who meet certain guidelines.

In a letter, Mr. Sofer was told he didn't qualify for free drugs; he says an employee told him that Crohn's disease patients weren't eligible.

Last year, not long after his prescription ran out, Mr. Sofer was hospitalized, severely dehydrated. He withdrew for the semester, feeling too sick to continue. "This has depleted me physically and spiritually," he said at the time.

Celgene's Patient Support Solutions says that this year, the free-drug program was expanded to include patients regardless of diagnosis, as long as they meet certain financial criteria, which the company declines to publicly detail.

In April, Mr. Sofer began receiving free Revlimid. His iron levels rebounded, though he continues to struggle with infections related to his disease. "For people like me, for whom nothing has worked, access to new treatments is absolutely critical," says the 23-year-old Mr. Sofer. "It's the only thing that keeps me hopeful, that keeps me living."

Ms. Chin-Louis was diagnosed with a brain tumor in late 2001. She had been working as an administrator at an accounting firm and raising two boys in Danville, Calif., when her speech periodically became jumbled. A surgeon removed the tumor, which initially grew slowly.

Last year, the tumor returned. She underwent radiation and took a chemotherapy drug approved by the FDA to treat brain cancer.

Early this year, a magnetic resonance imaging, or MRI, showed a bigger spot on her brain, suggesting the drug she was using no longer was working.

At the same time, researchers at Duke University Medical Center were reporting a promising study of Avastin in combination with chemotherapy for brain tumors. In a small trial of 32 patients, 72% on treatment were alive at six months, 38% of them with no progression of their tumors -- about double what would be expected for patients with Ms. Chin-Louis's kind of recurring brain tumor.

"It was early data, but it was very exciting," says Dr. Chang, director of the division of neuro-oncology at the University of California, San Francisco, Medical Center. In April, Dr. Chang asked Blue Cross of California to cover Avastin for Ms. Chin-Louis.

Blue Cross, owned by WellPoint, an Indianapolis company with more than 34 million members, denied coverage on May 21, saying in a letter: "Studies are ongoing to determine the role of this agent in the treatment of brain tumors."

Ms. Chin-Louis and her husband, a supervisor in sales at United Parcel Service Inc., say they couldn't afford the treatment. Her sister, Linda Tong, says she and her brother offered to cover the cost, but Ms. Chin-Louis initially resisted.

"I really felt that I had been paying for insurance for years for a reason, and when I needed medical care, my insurance company should pay," Ms. Chin-Louis says. "I didn't want to put that burden on my family."

In June, the doctor says she put Ms. Chin-Louis on a chemotherapy drug and appealed the denial for Avastin -- telling insurance officials she wanted to use the drugs in combination. On July 20, a brain scan showed the chemotherapy wasn't working: Ms. Chin-Louis's tumor had grown by 30%. She immediately agreed to allow her siblings to pay for Avastin, and she underwent her first treatment early last month.

In early August, asked by The Wall Street Journal about the Avastin denial, James Kappel, a spokesman for WellPoint, said: "While this patient's condition is very unfortunate, there is no medical evidence that supports the use of the drug" in brain tumors.

But Mr. Kappel called back the next day, saying WellPoint had approved Avastin for Ms. Chin-Louis. He said the company denied coverage at first because Dr. Chang sought to use the drug alone. Because Dr. Chang subsequently requested to treat Ms. Chin-Louis in combination with chemotherapy, as in the Duke study, WellPoint approved it, Mr. Kappel said.

Dr. Chang says the UCSF center has participated in a trial comparing Avastin on its own for brain tumors and in use with chemotherapy. Avastin alone appeared effective in some patients in the study, which has yet to be published, she says.

Dr. Chang says Ms. Chin-Louis has responded well so far to the Avastin treatments. "She's awake and feeling good and able to engage with her family," the doctor says. Ms. Chin-Louis is due for a brain scan later this week, which she hopes will show the tumor's growth in check.

"I know none of these treatments works forever," Ms. Chin-Louis says. "But I definitely want a little more time."

She'd like to celebrate her 45th birthday on Sept. 30, she said. She's eager to see her sister Linda's baby girl, due to arrive by Cesarean section on Nov. 2. And a small part of her is even daring to hope she will be in the audience when her eldest son Andrew graduates from high school this June.

Write to Geeta Anand at geeta.anand@wsj.com1

September 18, 2007

Will Sharing Ideas
Advance Cancer Research?

Hedge-Fund Managers Offer
$1 Million Prize to Combat
Scientists' Culture of Secrecy

After Hope Goldstein was diagnosed with advanced ovarian cancer in 2001, her family wanted to help. Her husband and two sons started researching the disease and quickly realized that even with surgery and chemotherapy, the prognosis wasn't good.

So they went in search of the one thing they believed still might help Mrs. Goldstein: new ideas.

They started calling cancer researchers, doctors at leading academic centers, specialists in ovarian cancer. In their conversations, they ran into an unexpected obstacle. Many people did have new ideas. But frequently, they weren't willing to share them.

Friends who worked in medical research tried to explain: Companies often will not pursue an idea for commercialization unless it is patented, requiring secrecy in the early stages. In addition, the grant process is competitive, and no one wants to get scooped. Perhaps most notably, professional advancement depends on publishing ideas in scientific journals.

In 2004, Mrs. Goldstein died. But her son Robert Goldstein, 41, continued to think about the issue. It seemed to him that what was holding back cancer research wasn't only a lack of money but a culture that discouraged the sharing of promising leads.

"If you have a great idea but someone else publishes it first, you get no credit, professionally or financially," says Gary Curhan of Harvard Medical School, one of the researchers who spoke with Robert Goldstein about the issue of sharing. "Ideas," says Dr. Curhan, "are our currency."

A managing partner at the hedge fund Gotham Capital in New York, Mr. Goldstein recognized similarities with his own profession. Money managers also were reluctant to share investment ideas. A few years earlier, Mr. Goldstein's business partner and friend, Joel Greenblatt, the 49-year-old founder of Gotham Capital, had created an online, selective group called the Value Investors Club, to spur idea sharing. Members shared investing strategies and commented on each other's research. A cash prize was awarded for the best idea of the week.

The two men thought that perhaps a similar model would work in cancer research. So this year they agreed to put up $1 million of their own money every year to fund the Gotham Prize for Cancer Research. Modeled on the Value Investors Club, the annual prize will go to the person who posts the best new cancer-research idea, judged by a board of respected scientists, at the prize's Web site by the end of December.

The winner of the Gotham Prize doesn't have to present a shred of evidence that the premise will work. To attract ideas from people outside the field of cancer research, there is no requirement that the winner be capable of seeing the idea through. And the prize money is earmarked for personal use, to be spent on anything the winner wants, even a fancy car or a bigger house.

This concept has been met with some skepticism, even by the scientific advisory board that will judge the ideas. Board member Meir Stampfer of Harvard Medical School said that when he was invited to join he asked, "Is this really a good use of their money? Maybe there is something better they can fund."


But the unusual nature of the prize illustrates the lengths to which patients and patient advocates are increasingly willing to go to boost research into their disease, especially rare illnesses for which there is little funding. Patients have hired their own experts to conduct research in particular diseases, and even helped to fund their own clinical trials. Efforts are also focused on overcoming the reluctance to share ideas.

Avichai Kremer, a 32-year-old who has ALS, the neurodegenerative illness also known as Lou Gehrig's disease, is co-founder of the Prize4Life, which is awarding a $1 million prize for ALS biomarker discovery. The National Institutes of Health announced this year a program called the New Innovator Award offering grants of up to $1.5 million over five years for innovative research projects that don't have extensive preliminary data.

In addition, the National Cancer Institute is helping companies find a way to collaborate in drug testing without worrying about intellectual-property issues. The medical journal the Oncologist is encouraging the publication of failed medical trials in order to bring the ideas behind these trials -- which otherwise would never see the light of day -- to a broader audience. And Mr. Goldstein's father, Alfred, with help from the family's other son, Mark, also developed a venture that aims to improve idea-sharing: Through "Project Hope," named for his late wife, Alfred Goldstein guarantees certain funding for specific projects and requires the researchers share results with each other on a regular basis.

The Gotham Prize is a particularly ambitious project that is attracting attention. The foundation of the Ira Sohn Investment Research Conference, which runs the conference as a benefit to raise money for cancer, will fund an additional $250,000 prize for the best pediatric-cancer idea submitted to the Gotham site. Ephraim Gildor, founder of Axiom Investment Advisors, is also providing financial support for the prize.

In setting up the prize, Mr. Greenblatt and Mr. Goldstein knew that they couldn't evaluate the new ideas themselves, so they set up a board of pre-eminent scientists and researchers. They include people to whom they have a personal connection, like Dr. Curhan, who is also Mr. Greenblatt's brother-in-law. Others such as Michael Kastan, director of the cancer center at St. Jude Children's Research Hospital in Memphis, Tenn., said they had received letters "out of the blue" inviting them to participate.

Dr. Curhan, the head of the advisory board, says all ideas submitted are vetted by at least two members of the board before being posted. As a result, although there are over 1,030 registered users, only 54 ideas have been posted. About 75% of the submitted ideas have been rejected so far, Dr. Curhan says. The tension is always how to eliminate ideas "not because they are new or different, but because there is no scientific basis for them," says Mr. Greenblatt. "It can't become a free-for-all. We want quality ideas or the site won't work."

To submit an idea, applicants need supply only a 500-to-1,000-word explanation of their concept and the reasoning behind it. They don't have to supply any data or evidence that the concept has been tested.

Some of the ideas accepted so far are very unusual. Someone who described himself as a businessman and former guitar player in a rock band proposed searching for the resonant frequency of cancer cells and then applying subsonic sound waves to cancer patients in order to trigger the body's immune response. Dr. Curhan says that idea sparked debate on the board. But it was posted in the end because some members argued that it couldn't totally be ruled out and was novel and outside-the-box.

There was also a proposal for a sort of Pap smear for early detection of breast cancer by a scientist who runs a major university lab but says it would be very difficult to get funding for such an early-stage project. Another comes from an AIDS researcher, who discovered an idea about brain cancer and thought as an outsider in cancer research he was unlikely to get funding from traditional sources. A survivor of testicular cancer posted an idea about an algorithm he created that he believes could lead to better early detection of recurrence.

Dr. Kastan of St. Jude says that even after reading all the ideas, "I am still waiting to see if it works." He says that most important scientific discoveries are made by "someone who was doing an experiment that had an unusual result that took them in a different direction. It is data that shows us the way, not a wild idea that comes out of nowhere." But he says he agreed to get involved because he recognized there weren't many places for scientists to share an early idea.

Bert Vogelstein of Johns Hopkins University School of Medicine, another advisory-board member, says he isn't sure he totally embraces the "anyone can have a great idea" approach that seemed to drive the initial concept. But he says that getting grants from government agencies like the NIH sometimes "forces people to do somewhat mundane experiments that follow up on other experiments rather than thinking creatively. In cancer in particular, we need more things that have never been done before because I think that's the only way we're going to beat the disease."

Similar thinking was behind the efforts at the Oncologist, a journal for cancer specialists, to publish online the results of so-called negative trials -- those that don't end up supporting the initial hypothesis. These trials don't result in the drug getting approved and aren't typically published. "A font of information" is being lost that could be helpful if looked at a new way, says Martin J. Murphy Jr., founding executive editor of the Oncologist.

At the NCI, scientists found that investigators at different companies wanted to share ideas and test different drugs in new combinations. But often they "couldn't do so because their own legal departments wouldn't let them because of intellectual property issues," says James Zwiebel of the NCI's Cancer Therapy Evaluation program. The NCI stepped in and crafted an agreement that each company signs that lets the NCI test a drug in combination with other companies' agents; the companies share in any information and other ideas that arise from the experiments.

Not everyone supports the premise that there's some great idea out there today waiting to be heard. "I don't sense a lot of holding back of exciting information," says Robert Ozols, senior vice president of medical science at Fox Chase Cancer Center and one of the oncologists the Goldsteins felt was willing to share ideas. "If we knew something worked, we'd be doing it."

But the prize applicants believe otherwise. Mark Kantrowitz, the publisher of FinAid.org, a Web site about student financial aid, and director of advanced projects for FastWeb.com, came across a posting about the prize while scouring the Web. In May 2003, at age 36, he was diagnosed with advanced testicular cancer. After completing treatment, he was put on a surveillance schedule of regular CT scans to pick up any possible recurrence. "The schedule seemed totally arbitrary," says Mr. Kantrowitz, who has a background in mathematics. He wrote an algorithm for a computer program that creates a surveillance schedule based on the greatest likelihood of catching a relapse as early as possible.

"I know it needs a clinical trial, but I come from outside the field and wouldn't know how to start it," he says. Even if he doesn't win the $1 million, he says he hopes an oncologist sees the idea online and likes it enough to test it. All of the ideas posted for the prize can be seen at www.gothamprize.org3, by users who register as guests.

David Rimm, a tenured professor of pathology at Yale University School of Medicine, runs a large, grant-funded research lab, where he says he can get money for his mainstream research. But things that are very early or "more out on the limb, are very difficult to get funded," he says. So he posted an idea to develop a kind of pap smear for early breast-cancer detection, using spectral spatial imaging technology on breast-tissue samples, to detect cellular changes beyond what the pathologist's eye can see.

Dr. Rimm says a colleague told him about the prize, but that he was surprised when he learned that the $1 million was for personal use. At the site, the founders had explained that one of the goals of the prize is to fill in current research gaps. "If they're just giving us money to buy a boat, it won't lead to filling the gaps," he says.

Mr. Goldstein and Mr. Greenblatt recognize that there is no guarantee that the winner will spend the money on shepherding the concept into a clinic. What they hope is that the prize site can serve as a kind of marketplace of ideas, where additional investors might see something interesting and decide to invest in some of the other projects as well. The prize's true value, Mr. Greenblatt said, will come from jump-starting that process. In the end, says Dr. Curhan, "if you get even three or four really good ideas the first year, that would be a huge success."

Write to Amy Dockser Marcus at


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