BIO Releases Seven Proposed Topics for HHS Forum on Pharmaceutical Innovation, Access, Affordability and Better Health
Washington, D.C. (November 18, 2015) – Today, the Biotechnology Industry Organization (BIO) released a list of seven proposed topics for the November 20th U.S. Department of Health and Human Services (HHS) Forum on Pharmaceutical Innovation, Access, Affordability and Better Health. The consideration of these topics at the Forum will help to ensure that patients have access to the most innovative new treatments and cures.
These topics have been shared with HHS and with the committees of jurisdiction in the U.S. House and Senate in the hope that they help facilitate a fruitful dialogue at the Forum.
1. Innovation Ecosystem: Of the approximately 1,200 biopharma companies in the United States, more than 90 percent of these enterprises do not earn a profit – yet they are on the frontlines in the search for the new cures and therapies that continue to transform modern medicine. According to the BioMedTracker Clinical Trial database, there are approximately 5,070 clinical programs in Phase I, Phase II, or Phase III for medicines being developed by companies world-wide. Seventy percent of the clinical pipeline is attributed to small, emerging companies. These companies also are pursuing the next generation of innovation, including major advances in gene therapy, immunotherapy and RNAi therapy. How can we ensure that the rest of the health care ecosystem (e.g., health insurers, hospitals, providers) is keeping pace with these innovative entrepreneurs in terms of delivery of care?
2. Capital Formation: The success of these small biotech companies in getting new cures and therapies across the finish line rests on one key factor: the ability to attract the enormous amounts of private capital required to fund these challenging and incredibly risky endeavors. This ability, in turn, depends on a public policy environment that supports innovation and incentivizes such investment, including continued advancement of scientific understanding; strong intellectual property (IP) rights and a reliable system for IP transfer, licensing, and collaboration; an efficient and predictable regulatory review process; and transparent payment systems that reward innovation and encourage free market competition. Set-backs across any of these areas can cause the entire innovation ecosystem to falter, but the challenge can be particularly acute when it comes to capital formation. Private investment can flow to and shift among a wide spectrum of different sectors, and investors have shown that they will flee areas like biotechnology when they think policy decisions could adversely impact an already risky investment. With all of the discussion about the value of medical innovation, how do we make sure that any action taken will not negatively impact these small, pre-revenue innovators who are clearly punching above their weight when it comes to doing the hard work of bringing new cures and therapies to patients?
3. Innovation Saves: Medicines account for only about 10 percent of overall health care costs, a figure that has remained stable for decades and that is projected by government actuaries to remain so for at least the next decade. Medicines also can produce savings in other areas of the health care system. That’s why the non-partisan Congressional Budget Office (CBO) credits each dollar of additional spending on medicines with a twenty cent reduction in other healthcare expenses (e.g., reduction in stays in hospitals and nursing homes). How do we find savings and efficiencies in the other 90 percent of our nation’s health care spending? In addition, critics talk about money spent on medicine as if it is a bad thing (even though the U.S. is significantly lower than the European Union and other countries when it comes to the percentage of healthcare costs spent on medicines). Since increased utilization of new medicines is decreasing hospital stays and the need for expensive surgeries, shouldn’t we be encouraging this type of innovation and allocation of resources? Isn’t it money well spent in terms of both a patient’s well-being and our nation’s long-term health care costs?
4. Patient Out-of-Pocket Costs: Ensuring that patients have access to the innovative medicines their doctors prescribe is critical to the treatment of diseases. One area this forum should explore is the extent to which out-of-pocket fees charged by insurance companies are denying working families access to innovative new medicines their doctors think will help improve or even save their lives. In addition, the forum should explore why insurance companies will pay for almost all of a life-saving surgery, but they make a patient pay an excessive out-of-pocket share of the cost for a life-saving medicine.
5. Access to Innovation: People buy insurance to protect the important things in their lives: our homes, our car, our health. We expect that when something terrible happens the insurance policies we pay for will help cover these expenses. Yet, the health insurance industry routinely denies access and payment for certain cures and therapies for diseases. Are there policies that we should be considering that will ensure that insurance actually helps patients get access to the drugs and therapies that their doctors believe will be the best course of treatment for their disease? Additionally, the forum could explore the impact that proposed rate hikes by insurance companies will have on the ability of patients to afford the type of coverage they need. According to news reports, health insurance companies around the country are seeking rate increases of 20 percent to 40 percent or more. One of the areas the forum should explore is the impact this will have on patients’ ability to access the innovative medicines that they need.
6. Patient Assistance Programs: Biopharmaceutical companies’ Patient Assistance Programs provide hundreds of millions of dollars of free and reduced-price treatments and therapies for patients who cannot afford their products. What are private insurance companies, including AARP/UnitedHealthcare’s supplemental insurance policies, doing to help patients who cannot afford their insurance products or the co-pays they charge to patients?
7. Insurer Consolidation: There is consolidation happening across the insurance industry. This is benefiting shareholders and giving insurance industry executives even more bargaining power and leverage, but this is happening at the expense of patients’ bargaining power. Just last week the American Medical Association came out against several of these mergers in a letter to the Department of Justice. It raised serious questions about the impact of consolidation on access, quality and affordability for patients. What can be done to protect patients during this wave of consolidation?
For more information about the value of innovative medicines, please visit bio.org/innovation.