Are Pharmaceutical Companies Earning Too Much?

Are Pharmaceutical Companies Earning Too Much?

Estimated Research and Development Investment Needed to Bring a New Medicine to Market, 2009-2018

The debate about pharmaceutical companies earnings is a never ending story. Now you can find in JAMA an article that reflects the cost of a new drug: $1336 million. This is the summary:

The FDA approved 355 new drugs and biologics over the study period. Research and development expenditures were available for 63 (18%) products, developed by 47 different companies. After accounting for the costs of failed trials, the median capitalized research and development investment to bring a new drug to market was estimated at $985.3 million (95% CI, $683.6 million-$1228.9 million), and the mean investment was estimated at $1335.9 million (95% CI, $1042.5 million-$1637.5 million) in the base case analysis. Median estimates by therapeutic area (for areas with ≥5 drugs) ranged from $765.9 million (95% CI, $323.0 million-$1473.5 million) for nervous system agents to $2771.6 million (95% CI, $2051.8 million-$5366.2 million) for antineoplastic and immunomodulating agents.

Why this new figure is relevant? Because previous estimates said that it was the more than the double!

The mean estimate of $1.3 billion in the present study was lower than the $2.8 billion (in 2018 US dollars) reported by DiMasi et al,

And   my impression is that we have entered in a difficult world to estimate the real cost. Right now many firms are buying research (buying firms that have already a product close to be commercialised) and they are paying a premium for outsourcing research. Therefore, how to estimate the cost in this situations? Uncertain.

David Cutler asks about the earnings of pharma firms and says:

Ledley showed that from 2000 to 2018, the median net income margin in the pharmaceutical industry was 13.8% annually, compared with 7.7% in the S&P 500  sample. This difference was statistically significant, even with controls, although earnings seemed to be declining over time.

Is this positive return differential evidence of too high a return? Not necessarily. The economics of pharmaceuticals are important to consider. Like several other industries (eg, software and motion picture production), the pharmaceutical industry has very high fixed cost and very low marginal cost. It takes substantial investment to discover a drug or develop a complex computer code, but the cost of producing an extra pill or allowing an extra download is minimal. The way that firms recoup these fixed costs is by charging above cost for the product once it is made. If these upfront costs are not accounted for, the return on the marketed good will look very high.

 Paying more than a drug is worth clinically is not a good strategy. Even if a drug is worth a high price socially, pricing patients who need the drug out of the market is a real loss, even if it leads to more innovation in the future. In still another case, price increases for older, generic drugs serve no innovation purpose. But, as a general rule, it is important to be wary of blunt “lower all drug prices” policies.

Cutler doesn't say too much on price according value and about public funding of research. It leaves the initial question open and waiting for adhoc answers. That's it , it's a complicated issue, no general prescriptions, they need to be adjusted to specific conditions without a captured regulator. This last point is the most difficult one to overcome.

Prix Pictet

Research and results

The Biomedical Bubble: Why UK research and innovation needs a greater diversity of priorities, politics, places and people

More resources for research are needed. This is the usual mantra. However, what about outcomes?. Since this is not so easy to measure it really lies in an uncertain land. A new report tries to put things clearer, at least for UK. It explains the mismatch about research funding and what is needed to improve health. This is exactly what I consider the right approach. It is useless to ask for more money unless we explain and focus on the priorities for achieveing better health.

A biomedical bubble has developed, which threatens to unbalance the UK’s research and
innovation system, by crowding out the space and funding for alternative priorities. This
is not a speculative bubble, as developed for tulips in the 1630s, or dotcoms in the early
2000s; there is far too much substance in the biomedical sciences for this. But it is a social, political and epistemic bubble (similar to the ‘Westminster bubble’, or the ‘filter bubble’), in which supporters of biomedical science create reinforcing networks, feedback loops and commitments beyond anything that can be rationalised through cost-benefit analysis.

The biomedical bubble represents a risky bet on the continued success of the pharmaceutical industry, despite mounting evidence that this sector faces a deepening
crisis of R&D productivity, and is cutting its own investment. And it favours a particular approach to the commercialisation of science, based on protectable intellectual property and venture capital based spinouts – despite the evidence that this model rarely works. Our health and social care system is under growing strain, and as the NHS marks its 70th birthday this month, there is renewed debate about its long-term affordability. Too often, the biomedical bubble distracts attention and draws resources away from alternative ways of improving health outcomes. Only 5 per cent of health research funding is spent on researching ways of preventing poor health. And more than half is spent in three cities - London, Oxford and Cambridge - despite variations in life expectancies of up to eight years across the country. This paper argues for a more balanced distribution, aligned to what the evidence clearly shows are crucial social, economic, environmental and behavioural determinants of better health outcomes.

 Food for thought.

Shomei Tomatsu in Barcelona

How technology may reduce the compensation of health professionals

THE IMPACT OF TECHNOLOGICAL ADVANCEMENTS ON HEALTH
SPENDING - A LITERATURE REVIEW

Six years ago I said that the argument of continous growth of health care expenditures due to techonology and ageing was flawed. Bob Evans explained long time ago that politicians sya that costs are inevitable to avoid responsibilities.
I demonstrated that it was possible to constrain health expenditures having both effects: technology innovation and ageing. Right now, it seems that OECD has not seen these patterns and publishes a review and says that according to:

Historical growth rates across OECD countries (1995-2015), we can estimate a historical contribution of around 1% yearly health care expenditure growth. Looking at projections in the next decades, health expenditure is projected to grow at a slightly lower pace compared to the previous period, with 2.7% estimated yearly growth . On average, this would mean a contribution of 0.9% per year to total health expenditure coming from technological change.

And...what happens if there is no growth in per capita health expenditures as has happened in our country in the last decade? which is the contribution of technology?. The answer is easy. If technology has been applied in fact, there has been a reduction in the cost of other inputs (!!!). And I can guess that there is only one factor that explains the growth in technology costs, the reduction in human resources costs. Salaries have decreased in real terms and there is no prospect for recover. I think that this result is the worst of any potential scenario. Physicians and professionals have to be compensated according to effort, responsibility and performance. Reducing its relative compensation is not an option. If you want innovation you have to pay for it.

 Guido Guidi. In Sardegna: 1974, 2011, an exhibition at the MAN museum (Museo d’Arte Provincia di Nuoro)

Against patents

The case against patents

Some months ago, a WP blog hightlighted a paper by Boldrin and Levine with a straightforward title. Now you can read it at the Journal of Economic Perspectives. The summary is in the first paragraph:

The case against patents can be summarized briefly: there is no empirical evidence that they serve to increase innovation and productivity, unless productivity is identified with the number of patents awarded—which, as evidence shows, has no correlation with measured productivity. This disconnect is at the root of what is called the “patent puzzle”: in spite of the enormous increase in the number of patents and in the strength of their legal protection, the US economy has seen neither a dramatic acceleration in the rate of technological progress nor a major increase in the levels of research and development expenditure.

A risky statement unless there is a clear support from research. However, once you continue reading you'll have arguments to be convinced about it. The impact on pharmaceutical industry is analysed in detail:

There are four things that should be born in mind in thinking about the role of patents in the pharmaceutical industry. First, patents are just one piece of a set of complicated regulations that include requirements for clinical testing and disclosure, along with grants of market exclusivity that function alongside patents. Second, it is widely believed that in the absence of legal protections, generics would hit the market side by side with the originals. This  assumption is presumably based on the observation that when patents expire, generics enter immediately. However, this overlooks the fact that the generic manufacturers have had more  than a decade to reverse-engineer the product, study the market, and set up production lines. Lanjouw’s (1998) study of India prior to the recent introduction of pharmaceutical patents there indicates that it takes closer to four years to bring a product to market after the original is introduced—in other words, the fifi rst-mover advantage in  pharmaceuticals is larger than is ordinarily imagined. Third, much development of pharmaceutical products is done outside the private sector; in Boldrin and Levine (2008b), we provide some details. Finally, the current system is not working well: as Grootendorst, Hollis, Levine, Pogge, and Edwards (2011) point out, the most notable current feature of pharmaceutical innovation is the huge “drought” in the development of new products.

And the proposal is a controversial one:

we could either treat Stage II and III clinical trials as public goods (where the task would be financed by National Institutes of Health, who would accept bids from firms to carry out this work) or by allowing the commercialization of new drugs—at regulated prices equal to the economic costs of drugs—if they satisfy the Food and Drug Administration requirements for safety even if they do not yet satisfy the current (overly demanding) requisites for proving efficacy.

The last sentence sounds far from what should be a "fair" regulatory process in pharmaceuticals. Anyway, it seems that we have entered in a new perspective on patents and more scholars will be supporting it in the future.  I'm close to this perspective, but the details are important, as usual.

Pharmaceutical innovation and value extraction

 Pharmaceutical innovation sourcing

Figure below shows that 23% of new medicines came from public bodies and private-private collaboration and they didn't apply for any marketing authorisation.

Key success factors of COVID-19 vaccine development

 How New Models Of Vaccine Development For COVID-19 Have Helped Address An Epic Public Health Crisis

 This acceleration has largely been fueled by an influx of resources—both financial and human—that is likewise record-setting. Significant levels of cooperation and innovation, which enable more-efficient use of those resources, have also played a key role.

There may be additional opportunities for innovation that deserve exploration. For example, master protocols, in which multiple vaccine or drug candidates are tested against a single control arm, could further accelerate clinical trials without compromising safety. Innovations to overcome potential delivery impediments, including supply chain challenges and insufficient numbers of health care workers in some regions, would also be welcome.

If widespread COVID-19 vaccination is realized in the coming months and years, the approach undertaken to arrive at that point will offer lessons for how to optimize the development and accessibility of vaccines against other pathogens, under both outbreak and non-outbreak scenarios. Our experiences with COVID-19 may also offer knowledge spillovers to other areas of medicine and public health.

More details in this Health Affairs issue. 

FT on Why the three biggest vaccine makers failed on Covid-19. GlaxoSmithKline, Merck and Sanofi are left playing catch-up to upstarts with new technology

 

Can capitalism be reimagined?

Reimagining Capitalism in a World on Fire

A new book says that reimagining is possible. Rebecca Henderson is a well known reference for her studies on pharmaceutical innovation for decades. Beyond pharma, she is recognised by her works on innovation in general. Now, she has released a book on Reimagining Capitalism and this may sound a huge goal. Rebecca provides clear hints about what can be done, and says:

I spend a good chunk of my time now working with business people who are thinking of doing things differently. They can see the need for change. They can even see a way forward. But they hesitate. They are busy. They don’t feel like doing it today. It sometimes seems as if I’m still at the bottom of that ladder, looking up, waiting for others to take the risk of acting in new and sometimes uncomfortable ways. But I am hopeful. I know three things.
First, I know that this is what change feels like. Challenging the status quo is difficult—and often cold and lonely. We shouldn’t be surprised that the interests that pushed climate denialism for many years are now pushing the idea that there’s nothing we can do. That’s how powerful incumbents always react to the prospect of change.
Second, I am sure it can be done. We have the technology and the resources to fix the problems we face. Humans are infinitely resourceful. If we decide to rebuild our institutions, build a completely circular economy, and halt the damage we are causing to the natural world, we can. In the course of World War II, the Russians moved their entire economy more than a thousand miles to the east—in less than a year. A hundred years ago, the idea that women or people with black or brown skin were just as valuable as white men would have seemed absurd. We’re still fighting that battle, but you can see that we’re going to win.
Last, I am convinced that we have a secret weapon. I spent twenty years of my life working with firms that were trying to transform themselves. I learned that having the right strategy was important, and that redesigning the organization was also critical. But mostly I learned that these were necessary but not sufficient conditions. The firms that mastered change were those that had a reason to do so: the ones that had a purpose greater than simply maximizing profits. People who believe that their work has a meaning beyond themselves can accomplish amazing things, and we have the opportunity to mobilize shared purpose at a global scale.

 The titles of the chapters speak by themselves. You'll get the flavour of a great book, and a personal message (in chapter 8). And don't miss chapter 4 on Aetna CEO and the purpose of the firm.

1 “WHEN THE FACTS CHANGE, I CHANGE MY MIND. WHAT DO YOU DO, SIR?”
Shareholder Value as Yesterday’s Idea
2 REIMAGINING CAPITALISM IN PRACTICE
Welcome to the World’s Most Important Conversation
3 THE BUSINESS CASE FOR REIMAGINING CAPITALISM
Reducing Risk, Increasing Demand, Cutting Costs
4 DEEPLY ROOTED COMMON VALUES
Revolutionizing the Purpose of the Firm
5 REWIRING FINANCE
Learning to Love the Long Term
6 BETWEEN A ROCK AND A HARD PLACE
 Learning to Cooperate
7 PROTECTING WHAT HAS MADE US RICH AND FREE
 Markets, Politics, and the Future of the Capitalist System
8 PEBBLES IN AN AVALANCHE OF CHANGE
 Finding Your Own Path Toward Changing the World

Què hem de fer?

Using Market-Exclusivity Incentives to Promote Pharmaceutical Innovation

Sabem que la indústria farmacèutica investiga, però també que els medicaments que s'aproven cada vegada són menys, i generen més controvèrsia. Aquest article del NEJM ens diu el que s¡ha fet en termes d'incentius per a promoure la recerca i els dubtes raonables sobre el que s'ha assolit. Conclusió:

Although use of market-exclusivity incentives to promote pharmaceutical innovation has potential benefits, future legislative efforts aimed at encouraging investment in drug research and development should be more precisely designed to avoid waste and misuse, and they should be linked to demonstration of positive public health outcomes. Without these limitations, making exclusivity incentives available to pharmaceutical manufacturers may not be worth the potential risks to public health.

Extendre el termini de la patent pot ser contraproduent. Cal evitar el malbaratament. I això es relaciona amb el que deia fa uns dies, massa incentius provoquen que els errors els paguem molt cars.

Ps. Record de Juan Gris a Christie's 28m de $

Is there any justification for interventions that aren't cost-effective?

Ethics, priorities and cancer

This is one of the most challenging questions nowadays. Anthony Culyer sheds light n this difficult issue in a recent article applied for cancer care. These are his nine  arguments:

Argument 1: the whole health maximisation assumption underlying the approach is misconceived. health care is about more than just promoting health. Other objectives commonly include financial protection (e.g. from the out-of-pocket expenseof costly interventions), innovation, and all those listed earlier
Argument 2: innovation is stifled by the strict application acost-effectiveness threshold that is too low
Argument 3: the use of standard outcome measures, like theEQ-5D QALY or averted DALYs, underestimates the health benefits of cancer treatments
Argument 4: the assessment of benefit excludes the beneficial effects that treatment and its consequences have on those who care for cancer patients
Argument 5: the opportunity cost argument is weak. There are always efficiency savings that can be found in any systemwhich mean that the alleged sacrifice of health represented by the threshold is spurious. the actual sacrifice is much smaller
Argument 6: cancer is a scary disease and people who suffer from it deserve to have access to treatments that would fail aconventional cost-effectiveness test
Argument 7: for some cancer patients a costly and not very effective treatment may offer a “last chance” to someone in despair. such a situation might exist if no intervention of any kind existed for these patients or if the patient suffered from a rare form of cancer
Argument 8: cancer is a “severe” disease and should accordingly be given a higher priority than less severe diseases
Argument 9: many cancer patients have a short life expectancy even with treatment. a quasi-utilitarian argument might cite the law of diminishing marginal value: even small gains for such people are to be valued more highly than the same gains of equivalent quality of life for people with an already long expectation of life. alternatively, there is the more direct emotional appeal “Our moral response to the imminence of death demands that we rescue the doomed proof"

These arguments fall into two broad groups. Some are questionsof social value: how should we value health gains of particular kindsand should we value them differently according as they accrueto different people? Others are questions of fact: would informa-tion about the quantitative size of the effects in question lead us to conclude that cancer is indeed a special case? The burden of proof in both cases lies with those making the assertion that cancer is, indeed, special. That burden of proof is not impossible to bear.

Is cancer a special case? The question may apply to many diseases and will provide more difficulties than answers. In the end any analysis relies on distributive justice principles and according to different views you'l apply different prioritisation criteria.

PS. The article was published in a cancer journal. I was surprised by the new perspective by Tony Culyer.

PS. What do you think about a new cancer inmunotherapy service that may cost $750.000???

Le Corbusier Guitariste (1960)

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The Innovation Ultimatum. How six strategic technologies will reshape every business in the 2020s

 The Innovation Ultimatum. How six strategic technologies will reshape every business in the 2020s

Vaccines for all

How to Develop a COVID-19 Vaccine for All

Messages from Mazzucato and Torreele:

The first, critical step is to adopt a mission-oriented approach that focuses both public and private investments on achieving a clearly defined common goal: developing an effective COVID-19 vaccine(s) that can be produced at global scale rapidly and made universally available for free. Realizing this aim will require firm rules regarding intellectual property (IP), pricing, and manufacturing, designed and enforced in ways that value international collaboration and solidarity, rather than competition between countries.

Second, to maximize the impact on public health, the innovation ecosystem must be steered to use collective intelligence to accelerate advances. Science and medical innovation thrives and progresses when researchers exchange and share knowledge openly, enabling them to build upon one another’s successes and failures in real time.

Third, countries must take the lead in building and buttressing manufacturingcapabilities, particularly in the developing world. While an effective COVID-19 vaccine probably will not be available for another 12-18 months, a concerted effort is needed now to put in place the public and private capacity and infrastructure needed to produce rapidly the billions of doses that will be required.

Because we don’t know yet which vaccine will prove most effective, we may need to invest in a range of assets and technologies. This poses a technological and financial risk that can be overcome only with the help of entrepreneurial states backed by collective, public-interest-driven financing, such as from national and regional development banks, the World Bank, and philanthropic foundations.

Finally, conditions for ensuring global, equitable, and affordable access must be built into any vaccine-development program from the start. This would allow public investments to be structured less like a handout or simple market-fixer, and more like a proactive market-shaper, driven by public objectives.

PS. Masks, tests, treatments, vaccines – why we need a global approach to fighting Covid-19 now
Bill Gates dixit:

 I’m a big believer in capitalism – but some markets simply don’t function properly in a pandemic, and the market for lifesaving supplies is an obvious example. The private sector has an important role to play, but if our strategy for fighting Covid-19 devolves into a bidding war among countries, this disease will kill many more people than it has to.

Edward Hopper. Cape Cod Morning, 1950. Smithsonian American Art Museum

Lliçons sobre política farmacèutica (3)

Regulation, Innovation and Competition in Pharmaceutical Markets

Si voleu un llibre introductori que descriu amb precisió el mercat farmacèutic aquesta és l'opció del moment. Els conceptes habituals necessaris per moure's bé en aquest entorn són explicats amb tots els detalls.

M'ha interessat especialment el tema de pagar per retardar l'entrada dels genèrics, els acords de pagament invers, perquè s'explica amb tota claredat una pràctica vergonyosa de la indústria que ja coneixia però que em faltaven peces.

Es tracta d'això:

‘reverse payment’ patent settlement agreements (also called pay-for-delay settlements), because they provide for the patentee to pay the alleged infringer, rather than the opposite (considering the standard expectation that a defendant would pay a plaintiff to settle), with the aim of delaying its market entry. In other words, in its typical scheme, the brand-name drug pharmaceutical company enters into an agreement with the generic competitor to settle the dispute and to limit its market entry in return for a transfer of value.1 Such transfer can take different forms, including either a direct monetary payment or another form of valuable agreement (eg an authorised licensed entry at a specific date, distribution agreements, favourable terms in a side deal in which the originator company grants a commercial benefit to the generic company), or both. 

Aquest és l'índex del llibre: 

Introduction 1

I. The Different Faces of Pharmaceutical Markets 1

PART I

1. Regulating Entry 15

I. The Main Features of Pharmaceutical Markets: The Supply Side and the Demand Side 15

II. The Product Life Cycle and the Costs of Innovation 20

III. The Access to the Market: Regulatory Approaches 23

A. The European Regulatory Framework 23

B. The US Regulatory Framework 27

IV. Concluding Remarks 33

2. Regulating Exclusivity 34

I. The Interplay between Regulatory Exclusivities and Intellectual Property Rights 34

II. Intellectual Property Rights in the Pharmaceutical Industry: An Overview on the Role of Patents 35

III. EU Supplementary Protection Certificate and US Patent Term Restoration 41

IV. Regulatory Exclusivity 48

V. Research and Bolar Exemptions 52

VI. Exhaustion Doctrine and Parallel Trade 59

VII. Concluding Remarks 63

3. Regulating Prices 64

I. Pharmaceutical Pricing and Reimbursement Systems in Europe 64

II. The US System 70

III. Concluding Remarks 76

viii Contents

PART II

4. Competition Law Enforcement in Pharmaceutical Markets: An Introduction 79

I. EU and US Antitrust Rules: An Essential Overview 79

II. Antitrust Enforcement in the Pharmaceutical Sector 87

III. Market Definition 95

IV. Concluding Remarks 100

5. Reverse Payment Patent Settlements 102

I. The Recurrence of Reverse Payment Patent Settlements in Pharmaceutical Markets 102

II. Reverse Payment Patent Settlements in the United States 105

A. Earlier Case Law and the Actavis Ruling 105

B. Critical Issues after Actavis 109

C. Further Developments 113

III. EU Case Law on Reverse Payment Patent Settlements 119

A. Lundbeck 120

B. Generics 123

IV. Comparative Analysis 127

A. Legal Frameworks 127

B. The Antitrust Assessment 129

V. Concluding Remarks 134

6. Product Hopping 136

I. Pharmaceutical Product Reformulations 136

II. Product Hopping before US Courts 140

III. The EU Experience 146

IV. The Antitrust Assessment of Product Reformulation 151

V. Concluding Remarks 155

7. Excessive Drug Pricing 157

I. The Resurgence of Excessive Pricing Cases in the Pharmaceutical Sector 157

II. Excessive Pricing under EU Competition Law 161

A. Aspen 165

III. The US Approach 169

IV. The Role of Antitrust Enforcement on Excessive Drug Prices 176

V. Concluding Remarks 178

PART III

8. Further Interactions: Pharmaceutical Markets, Intellectual Property and Human Rights 183

I. The Right to Health and Access to Medicines and the Relationship with Intellectual Property Rights: An Overview 183

II. Compulsory Licensing 191

III. Concluding Remarks 196

9. Public Health and Public Interest in Competition Law 198

I. Public Health and Competition Law 198

II. Competition Law and Non-competition Interests 203

III. Concluding Remarks 208

Conclusion 209

Bibliography 213

Index 233

Incentives for innovation

 Inventing Ideas. Patents, Prizes, and the Knowledge Economy

How do knowledge and ideas influence the competitiveness of firms and nations?

You'll find the answer inside this book:

The twentieth century has been characterized as “the American century,” but at this critical juncture, new global competitors are adopting economic policies and institutions that have the potential to outpace U.S. achievements. Whether the twenty-first century will remain the American century will largely depend on the extent to which the lessons of the past are kept to the forefront. American technological and industrial progress owed to democratic open-access markets in ideas where entrepreneurial innovators succeeded, not by decree of administrators, but because their creations satisfied the ultimate judges—consumers in the marketplace. The evolution of administered innovation systems over the past three centuries largely serves as a cautionary tale rather than as a success story. The economic history of innovations instead suggests that the best incentive for necessary changes is failure in the marketplace; while the best prize for creative contributions to the knowledge economy is success in the marketplace.

A closely guarded secret

Stealth Research. Is Biomedical Innovation Happening Outside the Peer-Reviewed Literature?

How can we identify a snake-oil seller?. Not so easy. Have a look  at JAMA, John Ioannidis article shows his concerns about Theranos, a company that is providing lab services with a new propietary technology that has no peer-review article in any scientific publication. Nobody can check tests sensibility and specifity, no external quality controls, and so on.
If this is the path for the future of health care provision, then I am really concerned because it will be a complete disaster. No consumer protection, no regulation, uncertain science and more uncertain outcomes. After all this years, is this what citizens deserve?.
Such style of "laissez-faire, laissez-passer" medicine could represent huge profits for some and a big loss for everyone.
Otherwise some alternative should be proposed to boost publication and transparency. The author's suggestion is the following one:

To solve this conundrum, it may be necessary to find ways to realign the reward system for innovation. One possibility is to make the scientific literature more receptive to innovators. This could include models in which reports of disruptive discoveries that are in dissonance with the mainstream can still be communicated as preprints without prior peer review, perhaps in the same way as the successful example of arXiv in the physical sciences, which has now reached 1 million e-print articles. That there has been no peer review of these initial reports should be transparent to researchers and the public.

Thus, some better regulatory process is needed so that innovative ideas for financially successful applications can be scrutinized by the wider scientific community as to their validity. A company should not be forced to disclose its science secrets in detail, especially while its efforts are still exploratory rial-and error and while creating basic elements for its products and services. However, if a product or service reaches the point at which it generates substantial revenue, the science behind it should then be communicated in detail to ensure adequate review.

Enciclopèdia de gestió sanitària

 Elgar Encyclopedia of Healthcare Management

 Una enciclopèdia amb aquest índex.

PART I SCENARIOS
1 Big data and artificial intelligence 2
2 Disruptive technology innovations 6
3 Genomics 8
4 Globalization 11
5 Medical tourism 13
6 Precision medicine 16
7 Robotics 19

PART II BASIC MODELS OF HEALTH SYSTEMS
8 Beveridge model 22
9 Bismarck model 24
10 Market-driven model 26

PART III EVOLUTION OF THE PHARMA AND MEDTECH INDUSTRY

11 Market access 30
12 Digital therapeutics 33
13 Biotech 36

PART IV FOUNDATIONS OF HEALTH ECONOMICS

14 Baumol’s cost disease 40
15 Disease mongering 42
16 Moral hazard in health insurance 44
17 Quasi-markets 46
18 Supplier-induced demand 48

PART V FUNDING

19 Payment mechanisms 51
20 Sources of funding 55
21 Tariff vs price 57

PART VI HEALTH POLICY PRINCIPLES

22 Equality and equity 60
23 Universalism 62
24 Well-being 64

PART VII INVESTMENT ANALYSIS

25 Business planning of healthcare services 69
26 Sources of funding for investments 71

PART VIII LEVELS OF CARE

27 Acute, sub-acute and post-acute care 77
28 Chronic care 79
29 Home care and community care 83
30 Hospital 86
31 Long term care 91
32 Prevention 93
33 Screenings 97
34 Primary healthcare 101
35 Secondary vs tertiary vs quaternary care 104

PART IX NEW PARADIGMS

36 Access to healthcare 108
37 Co-production 110
38 Demedicalization 113
39 Evidence-based medicine 115
40 From compliance to concordance 119
41 Gender medicine 121
42 Global health 123
43 Health literacy 125
44 Initiative medicine 127
45 Integrated care 130
46 Population health management 133
47 Skill mix and task shifting in healthcare 136
48 Value-based vs

PART X PLAYERS

49 Boundaryless hospital 142
50 Community and country hospital 144
51 Intermediate and transitional care settings 147
52 Primary care center 150
53 Research hospital 152
54 Teaching hospital 154

PART XI TRENDS

55 Business models 157
56 Decentralization and devolution in healthcare 159
57 Multidisciplinarity and inter- professionality 161
58 Telemedicine 164
59 Vertical and horizontal integration (hub and spoke network) 168

PART XII BEHAVIOURS:

CHALLENGES TO LEADING HEALTH ORGANIZATIONS

60 Accountability 173
61 Accountable care plan and organization 174
62 Iatocracy, professional bureaucracy and corporatization 177
63 Political arena 180
64 Professional vs managerial culture 182
65 Professionalism 184
66 Stakeholder management 186
67 Teamwork 187
68 Turf wars 189

PART XIII PRACTICES

69 Change management 193
70 Disaster management 195
71 Leadership and leadership styles 199

PART XIV ROLES

72 Case manager 203
73 Clinical engineer 205
74 Clinical leader 208
75 Controller 211
76 Family and community nurse 215
77 General practitioner 218
78 Hospitalist 220
79 Medical director 223
80 Operations manager 225
81 Pharmacist 228
82 Quality and risk manager 233

PART XV TOOLS SYSTEM AND

PROCESS: DISEASE MANAGEMENT

83 Clinical governance 237
84 Guidelines and protocols in healthcare systems 239

PART XVI INNOVATION MANAGEMENT

85 Clinical trial 243
86 Health technology assessment 246

PART XVII OPERATIONS

87 Electronic clinical records 251
88 Patient flow logistics 253
89 Patient management 256
90 Supply chain 258
91 Techniques for process and organizations improvement: lean management in healthcare 261

PART XVIII ORGANIZATION

92 Clinical service lines 264
93 Converging trends in hospital transformation 267
94 Divisionalization, clinical directorates and Troika model in healthcare 271
95 Organizational culture 273
96 Organizational design and development for healthcare organizations 276
97 Patient-centered hospital and health organization 281

PART XIX PEOPLE

98 Clinical and professional engagement 285
99 Great Place to Work® 288
100 Magnet hospital 291

PART XX PERFORMANCE

101 Balanced scorecard in healthcare organizations 294
102 Budgeting (financial vs operational) 298
103 Customer satisfaction 301
104 DRG and case mix index 303
105 Length of stay 305
106 Performance measurement and management systems 307
107 PROMs and PREMs 310
108 Strategic control 313

PART XXI PLANNING

109 Strategic planning 318
110 Strategy making 320

PART XXII PROCUREMENT

111 Centralized procurement 324
112 Innovation procurement 327
113 Managed entry agreements (MEA) 330
114 Value-based procurement 333

PART XXIII QUALITY

115 Accreditation in healthcare 337
116 Audit 340
117 Quality management 343

AI in Health Care

 Artificial Intelligence in Health Care. Benefits and Challenges of Technologies to Augment Patient Care

This report is being jointly published by the Government Accountability Office (GAO) and the National Academy of Medicine (NAM). Part One of this joint publication is the full presentation of GAO’s Technology Assessment: Artificial Intelligence in Health Care: Benefits and Challenges of Technologies to Augment Patient Care. Part Two is the full presentation of NAM’s Special Publication: Advancing Artificial Intelligence in Health Settings Outside the Hospital and Clinic.

 Policy Options to Address Challenges or Enhance Benefits of AI to Augment Patient Care

Policy Option	Opportunities	Considerations
Collaboration (report p. 32) Policymakers could encourage interdisciplinary collaboration between developers and health care providers.	Could result in AI tools that are easier to implement and use within a providers’ existing workflow. Could help implement tools on a larger scale. Approaches to encourage collaboration include agencies seeking input from innovators. For example, agencies have used a challenge format to encourage the public to develop innovative technologies.	May result in the creation of tools that are specific to one hospital or provider. Providers may not have time to both collaborate and treat patients.
Data Access (report p. 33) Policymakers could develop or expand high-quality data access mechanisms.	A “data commons”–a cloud based-platform where users can store, share, access, and interact with data–could be one approach. More high-quality data could facilitate the development and testing of AI tools. Could help developers address bias concerns by ensuring data are representative, transparent and equitable.	Cybersecurity and privacy risks could increase, and threats would likely require additional precautions. Would likely require large amounts of resources to successfully coordinate across different domains and help address interoperability issues. Organizations with proprietary data could be reluctant to participate.
Best Practices (report p. 34) Policymakers could encourage relevant stakeholders and experts to establish best practices (such as standards) for development, implementation, and use of AI technologies.	Could help providers deploy AI tools by providing guidance on data, interoperability, bias, and implementation, among other things. Could help improve scalability of AI tools by ensuring data are formatted to be interoperable. Could address concerns about bias by encouraging wider representation and transparency.	Could require consensus from many public- and private-sector stakeholders, which can be time- and resource-intensive. Some best practices may not be widely applicable because of differences across institutions and patient populations.
Interdisciplinary Education (report p. 35) Policymakers could create opportunities for more workers to develop interdisciplinary skills.	Could help providers use tools effectively. Could be implemented in a variety of ways, including through changing academic curriculums or through grants.	Employers and university leaders may have to modify their existing curriculums, potentially increasing the length of medical training.
Oversight Clarity (report p. 36) Policymakers could collaborate with relevant stakeholders to clarify appropriate oversight mechanisms.	Predictable oversight could help ensure that AI tools remain safe and effective after deployment and throughout their lifecycle. A forum consisting of relevant stakeholders could help recommend additional mechanisms to ensure appropriate oversight of AI tools.	Soliciting input and coordinating among stakeholders, such as hospitals, professional organizations, and agencies, may be challenging. Excess regulation could slow the pace of innovation.
Status quo (report p. 37) Policymakers could maintain the status quo (i.e., allow current efforts to proceed without intervention).	Challenges may be resolved through current efforts. Some hospitals and providers are already using AI to augment patient care and may not need policy-based solutions to continue expanding these efforts. Existing efforts may prove more beneficial than new options.	The challenges described in this report may remain unresolved or be exacerbated. For example, fewer AI tools may be implemented at scale and disparities in use of AI tools may increase.

Source: GAO.

The charade of doing well by doing good

Winners Take All
THE ELITE CHARADE OF CHANGING THE WORLD

Anand Ghiridhas has done a great job with his new book. He has set up the context for understanding the duality government elites. I've picked only several key statements. The whole book is well written and gives a lot of examples (US-based of course).

Many millions of Americans, on the left and right, feel one thing in common: that the game is rigged against people like them. Perhaps this is why we hear constant condemnation of “the system,” for it is the system that people expect to turn fortuitous developments into societal progress. Instead, the system—in America and around the world—has been organized to siphon the gains from innovation upward, such that the fortunes of the world’s billionaires now grow at more than double the pace of everyone else’s, and the top 10 percent of humanity have come to hold 90 percent of the planet’s wealth.

Some elites faced with this kind of gathering anger have hidden behind walls and gates and on landed estates, emerging only to try to seize even greater political power to protect themselves against the mob. But in recent years a great many fortunate people have also tried something else, something both laudable and self-serving: They have tried to help by taking ownership of the problem.

What is at stake is whether the reform of our common life is led by governments elected by and accountable to the people, or rather by wealthy elites claiming to know our best interests. We must decide whether, in the name of ascendant values such as efficiency and scale, we are willing to allow democratic purpose to be usurped by private actors who often genuinely aspire to improve things but, first things first, seek to protect themselves. Yes, government is dysfunctional at present. But that is all the more reason to treat its repair as our foremost national priority.

Why we must not let the tech and drug industry forge the future alone

On the tech industry by Martin Wolf in FT

Selected statements on 7 reasons

What are the economics of these extraordinary valuations? The answer must be monopoly. As of September 30, the book value of Apple’s equity was $134bn, while its market valuation was close to $900bn. The difference has to reflect the expectation of enduring “super-normal” profits. This may not be the product of malign behaviour, but of innovation and economies of scale and scope, including the network externalities that lock in customers. Yet only monopoly could deliver such super-normal profits

How should we think about competition policy for businesses that benefit from such powerful monopoly positions? A question is whether these positions are temporary — as the great Austrian economist, Joseph Schumpeter, with his idea of “creative destruction”, would argue — or lasting. This suggests a host of responses, but one at least seems straightforward. Schumpeter would argue that new entries are a necessary condition for eroding such temporary monopolies. If so, the technology giants should be strongly deterred from buying up their potential competitors. That must be anti-competitive

Yet these enormously profitable businesses are parasitic on the investments in collecting information made by others. At the limit, they will become highly efficient disseminators of non-information. This links to a further point: they can, as we now know, be used by people of ill will for the deliberate dissemination of dangerous falsehoods. These facts raise huge issues.

Finally, the activities in which the technology industry is now engaged — what Andrew McAfee and Erik Brynjolfsson call “machine, platform, crowd” — are going to have a huge impact on our labour markets and, if artificial intelligence continues to advance, on our very place in the world.

What are the implications? They are that our futures are too important to be left to the mercies of the technology industry alone. It has done magical things. Yet nobody elected it master of the universe. Policymakers must get an intellectual grip on what is happening. The time to begin such an effort is now

On a particular drug company, in Project Syndicate:  The Opiate of the Bosses

Business ethics are again making headlines. This time, the focus is on the rapidly escalating opioid crisis that is destroying lives across the United States. While there is plenty of blame to go around, the largest share of the guilt belongs squarely on the shoulders of the major drug companies – Big Pharma.

The cynicism with which pharmaceutical firms have encouraged opioid drug use is appalling. Providing far too little analysis and oversight, they distribute opiates widely, alongside misinformation about how addictive the drugs truly are. Then they entice doctors with inducements and giveaways – including trips, toys, fishing hats, and, in one case, a music CD called “Get in the Swing with OxyContin” (one of the most popular opioids) – to prescribe them.

In 2007, several executives of the parent company of Purdue Pharma, which markets OxyContin, pleaded guilty to misleading doctors, regulators, and patients about the risk of addiction associated with the drug. The company was hit with some $600 million in fines and penalties.

Mobile medicine transformation

THE TRANSFORMATIVE POWER OF MOBILE MEDICINE, Leveraging Innovation, SeizingOpportunities, and Overcoming Obstacles of mHealth

Eleven topics in a book reflecting current mhealth:

1. Innovations in mHealth Part 1

2. Innovations in mHealth, Part 2

3. Exploring the Strengths and Weaknesses of Mobile Apps

4. Mobile Apps Critique: Heart disease and hypertension

5. Mobile Apps Critique: Diabetes and asthma

6. Mobile Apps Critique: Mental health/Depression

7. Reinventing clinical decision support: Is there a role for mobile technology?

8. Telemedicine: Opportunities and Challenges

9. Patient Engagement must be our Top Priority

10. Security and privacy concerns

11. Designing the ideal mobile medical app

Defining roles and skills for digital health

The Topol Review
Preparing the healthcare workforce to deliver the digital future.

The NHS asked Dr. Eric Topol about the new health workforce and how digital health will change the current landscape. A must read:

This is an exciting time for the NHS to benefit and apitalise on technological advances. However, we must learn from previous change projects. Successful mplementation will require investment in people as well s technology. To engage and support the healthcare workforce in a rapidly changing and highly technological orkplace, NHS organisations will need to develop a learning environment in which the workforce is given very encouragement to learn continuously. We must better understand the enablers of change and create culture of innovation, prioritising people, developing an agile and empowered workforce, as well as digitally capable leadership, and effective governance processes
to facilitate the introduction of the new technologies, supported by long-term investment.