FDA Uses New Labeling Authority

The Food and Drug Administration has ordered Amgen and Johnson & Johnson to relabel their anti-anemia drugs Aranesp, Epogen and Procrit over the protests of both firms. The new label says therapy shouldn't be initiated until red blood cell counts fall below 10 grams per deciliter of blood and it will no longer include an upper bound of 12 g/dl, which had been tantamount to declaring the drugs safe at that level for which, as today's New York Times story points out, there is no evidence.

Why did it take since March, when an advisory committee recommended the changes, for the FDA to act? Despite authority in the last year's FDA reform law to order changes without company negotiations, Amgen had been pushing to exclude certain restrictions from the label change, specifically, including a ban on using the drugs for breast or head and neck cancers, which the advisory committee had also recommended. The companies won that battle.

Serendipity and Drug Development

An important perspective on why drug development productivity is declining appeared in yesterday's Financial Times. Authors David Shaywitz and Nassim Talib emphasized the inherent uncertainties of science, and the importance of serendipity in the process (a point made in my book, and what I frequently emphasize in my talks on the subject):

In the face of declining productivity, pharma companies have been trying to boost output by increasing efficiency, narrowing their focus to a handful of disease areas, shelving safe but ineffective compounds without fully exploring their scientific potential and trying to ensure that each project the company is working on is carried out with a clearly defined market segment in mind (emphasis added). Unfortunately, for new medicines in particular, this strategy often fails significantly to reduce exposure to negative uncertainty – all the bad things that can happen during drug development – and eliminates much of the exposure to positive uncertainty (serendipity) that remains so vital.

So intent are managers on maintaining focus that important opportunities for novel discovery are lost, as is the intellectual space for tinkering and capitalising on the chance observations and unexpected directions so important in medical research. Instead, pharma executives are creating an ever-more-rigid environment and then wondering why their productivity is going down, and why they have such difficulty attracting and retaining talent.

. . . If I Only Had a Brain

Hip replacement devices go bad. Europeans and Australians know it long before Americans. Why? They have a electronic registry that tracks performance, according to today's New York Times.

But why limit this story to joint replacements? Why not all medical devices. Hey, while we're on the subject, why not adverse events from drugs? Or all off-label uses of drugs so we can track their performance? Heck, why don't we track performance of on-label uses to see if there is huge discrepancies between the results of the small clinical trials that led to Food and Drug Administration approval and the product's widespread use in the general population?

Isn't this really a story about electronic medical records and public reporting, and how America, despite spending nearly twice as much on average as other advanced industrial nations on health care, lags behind on these measures of performance, just as it does on life expectancy, infant mortality, and unnecessary medical errors? As a Commonwealth Fund Report Card pointed out last week:

The U.S. now ranks last out of 19 countries on a measure of mortality amenable to medical care, falling from 15th as other countries raised the bar on performance. Up to 101,000 fewer people would die prematurely if the U.S. could achieve leading, benchmark country rates.

But not everything on the report card was grim:

The exception to this overall trend occurred for quality metrics that have been the focus of national campaigns or public reporting. For example, a key patient safety measure—hospital standardized mortality ratios (HSMRs)—improved by 19 percent from 2000–2002 to 2004–2006. This sustained improvement followed widespread availability of risk-adjusted measures coupled with several high-profile local and national programs to improve hospital safety and reduce mortality. Hospitals are showing measurable improvement on basic treatment guidelines for which data are collected and reported nationally on federal Web sites. Rates of control of two common chronic conditions, diabetes and high blood pressure, have also improved significantly. These measures are publicly reported by health plans, and physician groups are increasingly rewarded for results in improving treatment of these conditions.

In other words, keeping close track of data, publishing the results, and rewarding physicians for improved performance works.

Ambitious, But Toward What End?

The New Yorker recently ran a profile by Ryan Lizza on Barack Obama's rise to political prominence. Entitled "Making It: How Chicago shaped Obama," the article portrayed a man of overweaning ambition, who picked his friends and mentors with a constant eye on political upward mobility, and discarded them when they no longer served his purposes.

The writer interviewed a number of people I knew from my days in Chicago. As I read the article, some of their perspectives on Obama didn't sound like the people I once knew. One of those was Marilyn Katz, an antiwar activist since the late 1960s who now runs a political public relations firm with close ties to Mayor Richard Daley. This evening, I was one of many people who received an email from Marilyn containing a complaint she sent to the author of the New Yorker profile. You may find it interesting:

Of all the ways possible to explore the extraordinary person and journey of Barack Obama, I found it fascinating that Ryan Lizza would spin a tale of the 'canny politician,' who chose and discarded venues and friends as they fit his political ambitions in a city dominated by insider politics, intrigue and personal gain.

Nothing could be further from the truth, (although given that I was misquoted in the article even after informing your fact checker about it in advance) perhaps the 'truth' is not what Mr. Lizza was seeking; rather it was the crafting of a tall tale and a compelling read.

When I met with Mr. Lizza, we talked about the new Chicago, now one of the nation's most well-knit communities, where decision-making is shared among traditional political leaders and the scores of community, women's, ethnic, and environmental organizations that comprise its vibrant city life.

We talked about - and I referred your reporter to - the core of people who came of age during (and whose politics were forged by) the civil rights and anti-war movements of the 1960s. These are the people who elected Harold Washington in 1983, changing the city's old-school politics forever. Many now lead its City Council and Congressional Delegation, having evolved into crucial leaders of the progressive network that enabled a talented young political leader to build a base that stretched across the state in record time.

Mr. Lizza and I talked about the critical importance of the grassroots political networks from which this young political leader emerged, in the wake of the invasion of Iraq, to build a base for his successful senate run. That Lizza opted to build his story out of the comments of two people who see things otherwise speaks more to story craft than to the truth.

While I don't recognize the reality of Barack or the Chicago he presents in his piece, ironically the tale that Lizza spins is an interesting one, even worth considering. It would not be a bad thing if Obama were the crafty, calculating politician that he describes. These are not times for 'accidental presidents.' The presidency of the United States has always been fought for by ambitious men – in the best of times those ambitions being in pursuit of a vision of the future about which they are passionate. Those who seek the presidency are by their very nature filled with an extraordinary sense of possibility and responsibility.

What makes Barack Obama stand out for me and others – what millions have recognized in him, is that while he is ambitious, his politics are not the 'politics of ambition,' a disease from which the nation has suffered too long. A disease that has led us into short-term thinking and long-term disasters from which I hope we will be liberated in November.

--Marilyn Katz

Don't Bury Fannie Yet; We May Need It

John McCarron, a former colleague from my days at the Chicago Tribune, weighs in today with the first defense of Fannie Mae that I've seen in print (other than former CEO Franklin Raines' op-ed in the Washington Post). John spent many years covering non-profit development groups, which used the Community Reinvestment Act and loans and grants offered by Fannie Mae to pressure banks to help rebuild urban neighborhoods devastated by disinvestment, so he knows a bit about this subject.

Here's his conclusion:

Yet what's ailing Fannie now—the fall of its stock price amid fear of insolvency— isn't so much her dalliance with subprime as the general retreat of home prices. Even holders of fixed-rate 30s are tempted to walk away when what they owe is far greater than what they own.

But whose fault is housing's burst bubble? Is it Alan "Easy Money" Greenspan's? The loan sharks pushing subprimes? The go-go Wall Street investment houses and their go-along rating agencies?

There's plenty to go around. Point is, don't believe those who want to deflect public anger onto Fannie Mae. It has earned the financial guarantee that a Democratic Congress has given it. Chances are that guarantee won't be needed. More likely Fannie soon will be called upon, as it was in '38, to pull the housing market out of the ditch and help rescue capitalism from its own excess.

Jim Edwards Dissects Bad Math in Kids-on-Drugs Article

We welcome Jim Edwards back to the blogging fray, and note from his bio that he specialized in writing about drug pricing and drug R&D while at Columbia J-School (my own alma mater). Today's excellent post goes through the numbers in a New York Times article on the growing number of kids on drugs due to the obesity epidemic, and finds them implausible. Lesson to young journalists: It never hurts to haul out the back of the envelope and do your own math!

Experts: Vytorin Not a "Front-Line Agent"

As reported earlier this week, the latest trial involving cholesterol-lowering drugs found a troubling increase in cancer cases and cancer deaths in the group that received Vytorin, a combination of ezetimibe (Zetia) and simvastatin (Zocor, a statin). Ezetimibe is a cholesterol absorption inhibitor, a first-in-class drug that operates by a different mechanism than statin drugs.

As previously reported on GoozNews, ezetimibe was approved in 2002 solely on the basis of its ability to lower LDL ("bad") cholesterol, a surrogate endpoint. The FDA did not require Merck Schering Plough (MSP) to conduct clinical trials evaluating ezetimibe's effect on clinical endpoints (heart attacks, strokes, death, etc.), an unfortunate decision that we are still paying for today as millions of people continue to take a drug that may not be benefiting them.

Eventually, under pressure from the medical community, MSP sponsored a trial testing ezetimibe's effect on atherosclerosis -- the ENHANCE trial -- and started three trials testing ezetimibe's effect on clinical endpoints. ENHANCE tested the effect of adding ezetimibe to a statin (as compared with the statin alone) and showed no effect on atherosclerosis from ezetimibe, despite substantially lower LDL levels in the ezetimibe group.

The latest trial, known as SEAS, is the first Vytorin trial since ENHANCE to be completed. Unfortunately, SEAS tested Vytorin versus a placebo, so we have no way of separating out the effect of ezetimibe from the effect of the statin. Vytorin was no better than placebo in reducing the primary combined endpoint of aortic valve and ischemic cardiovascular events and a secondary endpoint of aortic valve events. However, Vytorin achieved a 22 percent reduction in the risk of ischemic cardiovascular events. This positive result was expected, given that Vytorin contains a statin that has reduced such events in other trials. The result, however, is somewhat underwhelming given that the Vytorin group's LDL went down a whopping 61 percent.

No two clinical trials are directly comparable, but as Allen Taylor (head of cardiology at Walter Reed Army Medical Center) pointed out in an interview with heartwire, the 22 percent risk reduction in a high risk population is less than was achieved in two other trials that tested simvastatin versus placebo. "That's actually less relative risk protection than was seen in 4S and the Heart Protection Study, studies using similar doses of simvastatin but with less LDL reduction," said Taylor, "It falls beneath one's expectations."

How ezetimibe works to lower cholesterol and whether it might have off-target effects is a matter of dispute, as discussed in a recent editorial by Allen Taylor that appeared in the Cleveland Clinic Journal of Medicine. That leaves many doctors reluctant to discount the cancer risk. "Obviously, if you see it in one study, even if it's not statistically significant, you've got to be worried," oncologist Ezekiel Emanuel of the National Institutes of Health said in an interview with USA Today. "Maybe this has a biological mechanism we don't know anything about."

"Your first reaction is, 'Is it just a chance finding?' Then you see it in a second trial, and say, 'Whoa, can this be true? What's the science here?'" Taylor told USA Today.

Asked about the results and how they fit into the context of existing Vytorin data, Harlan Krumholz of Yale University School of Medicine told heartwire that SEAS reinforces the message from March when the ENHANCE trial was presented at an American College of Cardiology conference. "This drug does not have sufficient evidence for it to be used as a front-line agent," he said. "Statins are the drugs of choice. The evidence is not even strong enough to say that people who cannot tolerate statins should go on it. It is an option. Right now using it is based on an assumption that you know what IMPROVE-IT will find." IMPROVE-IT is a large clinical trial testing Vytorin versus simvastatin alone, but the results will not be available until 2012, ten years after ezetimibe was approved.

-- PM

Reforming How Physicians Get Paid

Physicians should be put on a prospective payment system, where they get paid a set fee for each patient and each condition they treat, not a fee for every test or procedure they order. That recommendation, which parallels the system set up for hospital payments several decades ago, comes from former Center for Medicare and Medicaid Services adviser Peter Bach of Sloan-Kettering Memorial Hospital in an op-ed in today's New York Times.

While Bach correctly points out the perverse incentives that fee-for-service medicine establishes for physicians who own their own diagnostic and procedure clinics, his suggested reform is a half-measure that won't solve the deeper problem: the failure of many physicians to use best available evidence to inform their medical practice. Indeed, prospective payments may encourage some doctors to skimp on needed care, which can actually increase costs to the system in the long run.

He also doesn't address the issue of specialty care. Most serious conditions involve patients getting handed off from their general practitioner to specialists. Would the entire case come under the prospective payment? If so, would the primary care physician be reimbursed for managing the patient's complicated journey through the medical system, or would each specialist get a prospective payment? If the latter, it's hard to see where the proposed reform would lead to significant savings -- or better health care.

The evidence is overwhelming that the best and most cost-effective care comes from organizations like Kaiser Permanente and the Mayo Clinic where physicians are on salary and operate in teams. In the auto industry, Toyota taught that lesson to General Motors decades ago. Arnold Relman, the former editor of the New England Journal of Medicine, made teamwork a central motif of his call for reorganizing medical practice in his most recent book, "A Second Opinion."

On Tuesday, the Century Foundation announced that it has set up a panel of prominent physicians, bioethicists, and health care policy advocates led by senior fellow Maggie Mahar to propose ways of holding down health care costs and improving quality. I hope they take on the reorganization of physician practice, even though their initial list priorities did not include it.

Every high technology business depends on skilled workers to deliver high performance. The best performing organizations have carefully thought through how they organize and pay those skilled workers. In medicine, that process has barely begun.

Getting rid of the piece-work system is only a start, and prospective payments isn't the answer. Ultimately, very complicated and expensive cases are insurance problems, not situations whose outlier costs can be controlled through incentive schemes aimed at better individual case management.

Here's just a partial list of some of the questions that need to be addressed: Should specialty group practices be integrated into larger organizations that encompass all medical specialties, where a team of physicians is available to review every complex case? Should there be two- or three-to-one spread between the incomes of physicians with differing skills? Should physician ownership of facilities to which patients get referred ever be allowed?

I'm sure that researchers more familiar with the daily practice of medicine could come up with a half dozen more questions worth considering. There is no magic bullet fix for the lack of coordination that leads to improper care and waste in American medicine. Only thoroughgoing reform of how medicine gets practiced in the U.S. will get at the tangled roots of health care's high cost and low quality.

Iraq, Oil and Barack Obama

Who made the following statement today:

Mr. Obama's account of his strategic vision remains eccentric. . . [Afghanistan's] strategic importance pales beside that of Iraq, which lies at the geopolitical center of the Middle East and contains some of the world's largest oil reserves. If Mr. Obama's antiwar stance has blinded him to those realities, that could prove far more debilitating to him as president than any particular timetable.

(A) John McCain
(B) Dick Cheney
(C) The lead Washington Post editorial in today's paper

If you chose (C), you win an all expenses paid vacation to the Green Zone, and four more years in Iraq.

In his brief trip through the Middle East, Sen. Obama succeeded in getting the Iraqi Prime Minister Nouri al-Maliki on record as supporting the eventual pullout of U.S. troops from Iraq, whether it's in 16 months (Obama) or two years (al-Maliki). And he put the advice of Gen. David H. Petraeus, President Bush's appointee, and the other local commanders in its proper context: "I'm factoring in their advice but placing it in this broader strategy framework," he told the Post.

In the wake of this diplomatic triumph, the Post editorialist fulminates that the U.S. needs to maintain 160,000 troops in that country to keep a military stranglehold over the world's declining and environmentally unsustainable oil resources. It's the same thinking that led Japan to bomb Pearl Harbor.

All-Electric v. Hybrids

While my wife drives a Prius, I'm still driving a 1994 beater (18 mpg city, 28 highway) as I await a plug-in hybrid. I do most of my driving within 25 miles of home. I would like to buy a car that I can use as an all-electric vehicle for those trips. But it should also have the capacity to shift over to a gasoline or alternative liquid fuel option on those rare occasions when I venture farther from home. And I would like to ride in a car of at least moderate size and comfort for either of those trips.

Yesterday, Nissan announced that it would introduce an all-electric vehicle by 2010. Its chairman, Carlos Ghosn, told reporters that "“I want a pure electric car. I don’t want a range extender. I don’t want another hybrid.” Top range? 100 miles. I can see it now: an enclosed golf cart. He just lost my business.

I sometimes think auto executives are the stupidest people in business. How can men arrive at the top of these large organizations without a clue about what their customers want or need?

Vytorin and Cancer

The news that the cholesterol-lowering drug Vytorin (a combination of Merck's Zocor, a statin, and Schering-Plough's Zetia) didn't reduce heart valve disease but raised the risk of cancer sent the stocks of both companies plunging yesterday. I don't have much to add to the basic story. The New York Times got it right. Headline: "Trial Intensifies Concerns About Safety of Vytorin."

The trial's sponsors brought in Richard Peto of Oxford to explain away the cancer results, which, while small, reached statistical significance. Of the 1,900 people in the four-year trial, "102 patients taking Vytorin developed cancer, compared with 67 taking the placebo. Of those, 39 people taking Vytorin died from their cancer, compared with 23 taking placebo," according to the paper.

Said Peto, who compared those results to a still uncompleted set of trials of the combination drug: “I think we should not be diverted by fears of cancer.” His argument? It triggered many different types of cancers, not just one type. So it couldn't have been the drug.

What kind of science is that? According to Times reporter Alex Berenson, the cancer signal reached the 95 percent level of certainty, the benchmark used by medical researchers as statistical significance. You don't get to move the goal posts after the ball is kicked, in this case, away from where the data landed.

I guess I shouldn't be surprised. Though Peto has been a leading voice in the crusade against second-hand smoke, the last time we heard from him was when he explained away the late Richard Doll's undisclosed conflicts of interest with Monsanto. The two men issued a famous report in the early 1980s that downplayed the environmental causes of cancer.

He's always claimed to be a great stickler for the sanctity of the data. This appears to be a case where he should have let the data speak. If those larger trials come back without a cancer signal, then the famed epidemiologist (or others) can do a meta-analysis (a pooling of all the data) and say the risk is not statistically significant. But as of now, it would appear that this combination pill, still taken by millions of people, raises the risk of cancer.

The Times and Anonymous Government Leakers

The anonymous source is one of the most overused crutches in journalism, whose use by a media outlet is usually justified by the public's right to know what its government is doing. So it went this morning when the New York Times's public editor Clark Hoyt explained away the panic caused by a July 10 article that relied on anonymous government sources: "U.S. Weighs Takeover of Two Mortgage Giants" (Fannie Mae and Freddie Mac), the headline read.

Public editor Clark Hoyt backs authors Stephen Labaton and Steven Weisman, who used the usual justification. They told him they relied on anonymous sources because it was necessary to get "information to the public about what government officials are considering doing with the public's tax dollars." And then Hoyt added, "That is what I think too."

Then he goes on to quote bank analyst Richard X. Bove of the brokerage house Ladenburg Thalmann. The story "clearly affected the market, but it was correct."

Er, the article wasn't correct. Subsequent comments by Federal Reserve Bank and Treasury officials said the government never considered taking over Fannie Mae and Freddie Mac. The Wall Street Journal story of the previous day (July 10), which spurred the Times to try to one-up their rival given they were a day late on the story, in fact went to great lengths to explain that the government was primarily concerned about ensuring Fannie and Freddie's continued access to debt markets. If that faltered, it could bring the entire world financial system to its knees.

There is, of course, always contingency planning at the Fed and Treasury for worst case scenarios, just as there is at the Pentagon. But the clear implication of the language of the July 11 Times story was that such plans were being actively considered.

So who is this Bove whom the Times' public editor used to defend the paper's use of anonymous sources that were subsequently proved wrong? Public editor Hoyt also uses him to back the paper's more sensitive coverage of the downfall of San Francisco's IndyMac, whose demise threatened to trigger widespread depositor panic at small banks all across the country. Commenting on a list of banks in trouble that was published on the St. Petersburg Times website, Bove said such lists run the danger of "frightening the public about the soundness of the banking system when it's unnecessary to do so."

So, panic over Fannie and Freddie is okay, but panic over small and medium-sized banks who aren't too big to fail is a sin.

Too bad that Hoyt didn't publish some of Bove's other ideas, which appeared in this Associated Press article over the weekend. Here's what Bove of Ladenburg Thalmann would like to see happen to Fannie and Freddie:

The government (should) create a new agency to buy both Fannie Mae and Freddie Mac, and then distribute their holdings to 12 government-created banks around the country. Those regional banks would be owned by thousands of local lenders, much like the 8,100 member Federal Home Loan Bank system, which also provides money for mortgage lending. The federal government would set standards for loans made under the new system.

This would, of course, wipe out the equity in Fannie and Freddie stock that is held by tens of millions of retirement accounts across the country. It would transfer that equity at no or low cost to small and medium-sized banks, many of which are suffering because they are dependent on lending to their local real estate markets and local builders, whose business has collapsed. Many may also be holding sub-prime mortgages on their books.

So, the only thing I need to know now is whether Ladenburg Thalmann, which acts as a brokerage and investment adviser for wealthy investors, has put many of its clients into the stocks of those regional banks.

Alas, the public editor of the New York Times didn't see fit to report whether his sole source had any conflicts of interest that ought to be taken into account by readers. Perhaps there are none. Perhaps the only statement that was needed, and one that would have bolstered the veracity of his explanation for the paper's earlier use of anonymous government sources, was one that assured readers that Bove's employer has no financial interest in the fate of small- and medium-sized bank stocks across the country, banks whose balance sheets might be bolstered by getting the profitable book of business now held by Fannie Mae and Freddie Mac (you know, the book of business that represents the 98 percent of Americans who are paying their mortgage on time; at last glance, the number of loans in foreclosure has gone from about .75 percent to 1.5 percent in the past year).

But we didn't get such disclosure. Instead, what we have is a public editor -- whose job is to highlight improper journalistic techniques -- using what appears to be conflicted sources to justify the use of anonymous sources.

Perhaps he should look for another line of work.

On TWA Flight 800 and Other Press Failings

During the summer of 1996, I found myself, recently returned from Tokyo, sitting in a bar in a Holiday Inn on Long Island, covering the investigation of the demise of TWA Flight 800. The guy sitting next to me was an engineer from Boeing. Both of us had been reading, day after day, headlines in the New York Times about the traces of chemical explosives that bomb-sniffing dogs had found in the wreckage. The stories, based on undisclosed sources, had been leaked to the reporters, presumably by government agents. I say presumably because it was my job to compete on those stories, and I couldn't get anyone associated with Louis Freeh's office, he was then head of the FBI office in charge of the investigation, to open up to me, a lowly Chicago Tribune reporter.

So what did you think of the latest story, I asked the Boeing engineer. I remember his laugh and snarky reply as if it were yesterday. "It's the central fuel tank. Sparks. It happened in Manila, too." He took another drink. "And you can't use my name with that."

Yesterday, the Times
reported that the government has finally gotten around to rewriting the rules so that the fumes in those empty fuel tanks do not pose even a remote risk to passengers. And if you're wondering what happened to the reporters who "broke" all those wonderful investigative stories about the terrorists behind the destruction of TWA Flight 800, their bylines would later be seen on other "investigative" pieces about Monica Lewinsky and weapons of mass destruction in Iraq, other stories that were entirely dependent on deliberate "leaks" by government investigators.

Other stories that left my head scratching the last couple of days included this one in the Wall Street Journal on the failure of electricity deregulation in Texas, where ratepayers will be absorbing huge increases later this year and could be subjected to brownouts and blackouts. Reporter Rebecca Smith won widespread plaudits earlier in this decade for her coverage of the Enron collapse, but I was mystified by her conclusion at the end of this story. She quoted a Republican legislator saying the "toothpaste is out of the tube."

That's absurd. We've seen this before, in California, and what has been deregulated can be re-regulated. Interested readers may want to read this article that I wrote for the American Prospect in August 2001.

Finally, the scientific quest to come up with an AIDS vaccine hit another stumbling block yesterday. Training the body's immune system to fight diseases that it does not naturally develop immunity to after the initial exposure (assuming you survive that initial bout with the disease) is one of the hardest intellectual challenges in modern medicine. The ongoing failure to develop an AIDS vaccine doesn't mean it is impossible, only that the evolution of science hasn't reached the point where scientists know what to do. Maybe they'll never know. One thing we do know, though, is that success does not hinge on how much money gets poured into the project. Money is necessary. But it certainly isn't sufficient.

That's why I had to laugh yesterday when reading about the Clinton Foundation's deal to use advance purchase agreements to get a consistent supply at a fixed cost of the plant that produces artemisinin for treating malaria. Why are global drug companies continuing to rely on Chinese farmers, who seem more than willing to price gouge when suppliers are tight? This is a weed that can grow anywhere (when it first appeared on the cover of Science magazine in 1984, the picture came from the banks of the Potomac River near Washington, DC). What has happened to efforts to get poor farmers in Africa, where most of it will get used, to grow it as a cash crop? Alas, the story was silent on that subject.

The other mysterious part of yesterday's announcement involved the comments of Novartis chief executive Daniel Vasella. The Swiss drug company has been supplying the overwhelming majority of artemisinin-combination therapy to the developing world -- 66 million treatment courses last year alone. The company complained its investment in the drug and associated losses exceeded $100 million, "including research-and-development costs."

Vasella was also quoted as complaining that the Clinton agreement "doesn't address the need for new drugs and the incentives for innovators to engage more. . . How was it possible that we have a product that completely transformed malaria treatment, saving 500,000 lives? It's only possible by innovation," Dr. Vasella said.

Readers not intimately familiar with the world of malaria drug development might have been led to believe that Novartis was somehow involved in bringing artemisinin to market (their role, if I understand it correctly, has been in coming up with a once-a-day version that includes all the necessary drugs in one pill -- an innovation to be sure but hardly the kind of breakthrough that requires massive investments).

Two years, I spent time on the Thai-Burmese borders with the physicians who have struggled for two decades to make the world aware of this revolutionary treatment for malaria. It was the cover story in The Scientist in December 2006. If you read that and these two sidebars (here and here), you'll get a much better sense of the history.

FDA Seeks Scientist Trainees

Public Service Announcement

The U.S. Food and Drug Administration (FDA) today announced it is launching a two-year fellowship program aimed at attracting scientists, engineers and health professionals to the agency. The FDA Commissioner’s Fellowship Program will provide participants with advanced training in the scientific analysis involved in the safety and regulatory decisions unique to the agency’s mission.

"Attracting the best scientists to FDA helps us make timely decisions and give doctors and patients helpful and accurate advice about treatment options. And timely decisions encourage more investment in developing new drugs and better medical devices,” said Deputy Secretary of Health and Human Services Tevi D. Troy. "The FDA Commissioner’s Fellowship Program will not only bring great fellows in the door, but encourage them to make FDA their career.”

Applicants are being considered for the first entering class of the program, which will begin in October 2008. The agency is seeking physicians, microbiologists, chemists, statisticians, pharmacists, biomedical engineers, nutritionists, veterinarians and other science professionals. Applicants should have a doctoral degree in medicine or another scientific field; engineers must have at least a bachelor’s degree. Between 30 and 40 applicants will be accepted for the first entering class.

"The FDA is a science-based regulatory agency, and to fulfill our mission over the coming decade we will need to recruit thousands of highly skilled scientists and others with specialized and relevant expertise,” said Frank M. Torti, M.D., M.P.H., principal deputy commissioner and chief scientist. “The FDA Commissioner’s Fellowship Program is designed to attract these people to the FDA and provide them with in-depth knowledge of the science that underpins regulatory decisions as we meet the challenges of both globalization and rapid changes in science and technology."

The FDA Commissioner’s Fellowship Program will include coursework and extensive hands-on experience in FDA regulatory science including regulatory review opportunities. More than 20 courses and seminars will be offered on topics including FDA law, ethics and decision making, biostatistics, clinical trial design, population science and epidemiology, risk assessment, international activities, budgeting and operations, leadership, and public policy.
A full listing of courses is available here. The courses will be taught at the agency's new, state-of-the-art campus at White Oak, Md., and at other facilities by senior FDA staff and faculty from universities in the region.

During the first semester, each fellow will identify an in-depth research project to be completed during the program, allowing each fellow to explore a specific area of interest under the guidance of a senior FDA scientist who will serve as a preceptor. Fellows will devote about 70 percent of their time to the scientific project and 30 percent to coursework.

More information about the FDA Commissioner’s Fellowship Program and instructions for applicants are available here.

Diet Advice

A newly released Israeli study showed that moderately obese folks put on diets for two years lost more weight on the Mediterranean (fish, olive oil, wine, 9.7 pounds lost) and low-carbohydrate diets (10.3 pounds lost) than on a low-fat diet (6.4 pounds lost). The Mediterranean diet was best for lowering the bad-to-good cholesterol ratio, while the low-carb diet worked best for improving diabetics' fasting glucose levels.

Comment: Great comparative research. As for me, I'll take the Mediterranean diet. I need the bread to soak up the olive oil, and who can say no to a glass of red wine with that? It also suggests that while variety may be the spice of life, it's the kiss of death when it comes to weight control. Even well-off Americans eat Thai food one night, Mexican the next, an all-American beef-centered meal the next, and so on. And it doesn't matter if they are eating at home or out. It's a recipe for weight gain. Better to pick a healthy style of eating, no matter what it is, and stick with it.

Bon appetit.

Controversy over Bone Drugs Builds

Yesterday's New York Times reported on increasing evidence that long-term use of bisphosphonates, a class of drugs used to decrease the risk of fractures in people with osteoporosis, may lead to weaker bones in some people. The concern arises mainly from case reports of fractures that occurred with little or no trauma, including an unusual type of fracture to the upper thigh bone. In addition, patients on bisphosphonates may experience delayed fracture healing.

Studies of bisphosphonates which include alendronate (Fosamax), risedronate (Actonel), and ibandronate (Boniva), show the drugs increase bone density and decrease fracture risk. The drugs, which are heavily advertised (think Sally Fields and Boniva) are used by large numbers of women and a smaller number of men with osteoporosis.

Bone remodeling is the process by which old bone is dissolved and new bone added. Bisphosphonates slow the dissolving of old bone and thus preserve bone density. However, there has long been a concern, based on theory and animal studies, that microscopic bone cracks that occur through normal wear and tear ("microdamage") may not be repaired when bone remodeling is suppressed. This concern is increased when bisphosphonates are combined with another drug that may inhibit bone turnover, such as estrogen.

In 2005, the Journal of Clinical Endocrinology and Metabolism published a report on nine patients who had nontraumatic fractures after 3 to 8 years on alendronate. Bone biopsies revealed severe reductions in bone formation rates. Six of these patients had fractures that did not heal properly.

Since then, there have been other similar case reports.

Based on these reports, some experts have suggested that bisphosphonates should be stopped after five years, and that studies should be conducted to determine the risks and benefits of long-term therapy. In addition, use of the drugs should be limited to people who are at a high enough risk of fracture to justify the possible risks.

-- PM

No Magic Bullet in Fighting Malaria

The latest Journal of the American Medical Association reviews "The Making of a Tropical Disease—A Short History of Malaria" by Randall Packard, a medical historian at Johns Hopkins University. Says reviewer Markley Boyer of Tufts:

Now that The Gates Foundation, Ted Turner, and the Bush administration have all decided to eliminate malaria from the world, many health workers (especially those at the recent Gates-sponsored "Eradicate Malaria" convocation in Seattle, Washington) should read and reflect on the lessons presented in this excellent monograph . . . Most practitioners are first-rate at understanding the pathology of the illness and how to therapeutically interrupt its course, but they are unusually poor at comprehending that diseases like malaria are ultimately controlled by larger social, economic, and political factors. AIDS, obesity, heart disease, and tuberculosis are among those maladies that are hopelessly dependent on extramedical forces. Until researchers accept that there is more to health than the creation of some medicinal 'magic bullet,' they are doomed, in F. Scott Fitzgerald's well-known words, to 'beat on, ceaselessly, boats against the current . . . ,' with little impact on the disease itself. Packard's book reminds readers—through the lessons of history—of the factors that must be addressed before malaria can be controlled, let alone eradicated.

I interviewed author Packard a few years ago while writing about malaria for The Scientist magazine. I was very impressed by his level-headed analysis of the current situation, and his deep understanding of the past. If someone sends me a copy, I will definitely review it for this or any space.

DJ Wire: SEC Curbs Shorting of Fannie, Freddie and Big Investment Banks

Last summer, in a last fling with deregulation, the Securities and Exchange Commission eliminated the uptick rule, which since the Great Depression had required that anyone who shorts a stock (sells now in hopes of buying it back later at a lower price) can only do so when a stock's last move was up. Done on the eve of the current financial crisis, this may well go down as one of the greatest blunders in U.S. financial regulatory history.

Today, the SEC ordered an immediate end to short-selling of stock without having arranged to borrow it from someone who owned it before the short sale. The emergency decree applied to all the major Wall Street brokerage firms, Fannie Mae and Freddie Mac. The SEC will undertake a rulemaking to permanently extend the new requirement to all stocks.

If you're wondering why this blog, which usually devotes itself to health care, is paying close attention to this story, it began Sunday when I opened my newspaper and saw that not a single paper -- not my Sunday New York Times and not my Sunday Washington Post -- had a single word about what was obviously the biggest financial story of late last week: the massive bear raid conducted by short sellers on two institutions that are the backbone of the U.S. home mortgage market. As a former financial journalist, I was simply appalled at the lack of even an effort to explain what was happening. It wasn't just regulators who failed the American people.

Short Sellers Advising Bush Administration on Fannie/Freddie

Here's an interesting story on the Bloomberg wire: Hedge fund manager William Ackman of Pershing Square Capital Management ($6 billion in private equity under management) began shorting the stock of Fannie Mae and Freddie Mac last Thursday and says any government guarantee to stockholders would be a waste of taxpayers money. Deep in the story is this stunning piece of information:

Ackman said he briefed Treasury and Federal Reserve officials last week on a plan to reorganize the companies.

Looks like a smoking gun to me.

The WSJ's Fannie/Freddie Agenda

The Wall Street Journal editorial page this morning laid out the agenda behind the bear raid on Fannie Mae and Freddie Mac, the government sponsored entities whose implicit federal guarantee was made explicit over the weekend. It called for placing the two firms in receivership, wipe out stockholders, but allow it to continue operating. How would the government dispose of its new asset?

Down the road, as the mortgage crisis eases, the receiver could decide whether to wind the companies down, sell them in parts to the private sector, or let them continue in far more restricted form.

Who are Fannie/Freddie's competitors who might be interested in taking over this business? Here's the competition section from Fannie's annual report to the Securities and Exchange Commission:

Our competitors include the Federal Home Loan Mortgage Corporation, referred to as Freddie Mac, the Federal Home Loan Banks, the FHA, financial institutions, securities dealers, insurance companies, pension funds, investment funds and other investors.

Ah, investment banks, insurance companies, even pension funds, you know, the people who profited handsomely in the high-turnover, securitized sub-prime mortgage market from 2005 through mid-2007 when the roots of the current crisis were planted. It's important to recall that the Fannie Mae accounting scandal of 2004 led to a substantial drop in its market share for securitized mortgages. Its market share fell to just 24.6 percent in the fourth quarter of 2006. It's once again more than half since the investment banking industry fled the field because of losses in its sub-prime portfolios and the resulting credit crunch.

The Journal's solution? Liquidate Fannie and Freddie and give its business -- an estimated $5 trillion in securities backed by vast majority of Americans who will continue to pay their mortgages on time even if the nominal value of their homes declines 20 to 30 percent from bubble-era notional prices -- to the same people who brought you the crisis in the first place.

Why do I smell a rat?

Perhaps because I'm one of tens of millions of Americans who own Fannie and Freddie stock in their retirement portfolios. I looked up who owns Fannie's stock yesterday. It is perhaps the most widely held stock in America -- nearly a billion shares with 94 percent of it held by institutions. The largest single holder is an outfit called Capital Research Global Investors out of Los Angeles with 115 million shares or 11.7 percent of Fannie as of last March 31.

Who are these guys? They are the investment advisers for the American Funds, a suite of about 30 mutual funds that have an estimated 40 million accounts in the names of about 20 million holders, according to a spokesman for the firm. The advisory firm reports its collective ownership in one report.

Don't own any of the American Funds? Perhaps you have Vanguard in your retirement portfolio. They have 30 million shares or over 3 percent of Fannie's stock.

These are the people the Wall Street Journal wants to wipe out -- you and me, card carrying members of the middle class -- so they can turn the business over to their pals on Wall Street, who've suffered some mighty big losses on their last venture into real estate securitization.

Fannie stockholders have already seen the market eliminate $20 billion in equity value since March 31 (if you want to do the math on that, it's about $1,000 per household if there are 20 million accounts with Fannie stock, a reasonable estimate). But since Fannie and Freddie stock are mostly held in well-diversified portfolios, few individual holders -- or the mutual funds, apparently, that are supposed to defend their interests -- will complain. It will all simply be folded into their quarterly 401(k) statements that people will be receiving in a few weeks. Well, the market's down and so am I. Life is risky, no? Time to get back to work.

Wall Street maxim for the day: It's always best to keep the sheep in closely-packed herds when it's time for them to be sheared.

Bear Raid?

After reading all the press accounts about the Fannie Mae and Freddie Mac stock price collapse over the weekend, I still didn't have the foggiest idea what had caused investor sentiment to suffer a sharp decline last week. Then a friend sent me this press release late last night. It's from the Securities and Exchange Commission, issued on Sunday (hmmm, the SEC was also working yesterday):

Washington, D.C., July 13, 2008 — The Securities and Exchange Commission today announced that the SEC and other securities regulators will immediately conduct examinations aimed at the prevention of the intentional spread of false information intended to manipulate securities prices. The examinations will be conducted by the SEC's Office of Compliance Inspections and Examinations, as well as the Financial Industry Regulatory Authority and New York Stock Exchange Regulation, Inc.

The securities laws require that broker-dealers and investment advisers have supervisory and compliance controls to prevent violations of the securities laws, including market manipulation. Examiners will focus on these controls and whether they are reasonably designed to prevent the intentional creation or spreading of false information intended to affect securities prices, or other potentially manipulative conduct.

Is it possible that the run on Fannie and Freddie constitutes one of the great bear raids in U.S. financial history? After all, the vast majority of American homeowners are still paying their mortgages, the companies appear well capitalized for expected losses, and are designed to weather even a further downturn as long as their still have access to capital markets (i.e., the ability to sell debt to roll over existing obligations, which the bailout package over the weekend is designed to insure. It made the implicit federal guarantee behind these institutions explicit).

We know that right-wing think tanks like Cato, the American Enterprise Institute, the Hoover Institution, and editorially supported by the Wall Street Journal have been braying for the dismantling of these two organizations for years. Is it possible that this is their, and their financial backers', chance?

Who might benefit from false rumors that drive the stock price down? You might want to read this New York Times story from a few months ago to get a few clues. Here's the lead:

Almost two centuries ago, as Napoleon marched on Waterloo, a scion of the Rothschilds banking dynasty is said to have declared: The time to buy is when blood is running in the streets.

Now, as red ink runs on Wall Street, the figurative heirs of the Rothschilds — bankers, traders, hedge fund gurus and takeover artists — are plotting to profit from today’s financial upheaval.

All the news stories about Fannie and Freddie talk about how the implicit government guarantees have allowed them to dominate the home mortgage refinance business (their job is to buy up mortgages from loan originators like banks, savings and loans and mortgage finance companies so those firms can continue to make new mortgages without raising additional capital). How big is their share? "Over 50 percent" all the stories say. Hmmm. Who has the other 40-plus percent? Nary a word. Might they benefit if Fannie and Freddie are dismantled? And how about recent purchasers of Fannie and Freddie debt who bought their bonds at deep discounts? Will the government bailout announced Sunday turn investments made last Monday into instant profits on the ever-active bond trading floor?

And what if this bear raid, if this is what it is, continues for another few weeks and the government takes over Fannie and Freddie, with the intent of flipping it back to the private sector in a few years without government guarantees. Who would be the big losers? Equity holders of current Fannie and Freddie stock, which were largely mutual funds which manage the middle classes' 401(k) assets. The other big losers would be Fannie and Freddie employees, who have seen their personal retirement assets wiped out in the current collapse.

At least the Washington Post covered that story this morning.

Disclosure: I own Fannie Mae and Freddie Mac stock in my retirement accounts, both individually and through mutual funds. It represents less than one percent of my retirement assets -- now. It had been about one percent.

Who Owns Science? Rejuvenating Public Sector Science

Citing the "moral corruption" of organized medicine, Sir John Sulston, the British genome scientist who won the 2002 Nobel Prize for medicine, is launching a new institute on science, ethics and innovation. He wants to put innovation in medicine back on track by limiting gene patenting. According to this BBC report, he also blames disease mongering by the big pharmaceutical firms for distracting researchers from dealing with the serious problems facing millions of poor people around the world. He's holding a conference in London this weekend entitled, "Who Owns Science."

The Center for Science in the Public Interest's Integrity in Science project will hold a conference in Washington, DC today. The featured speaker at "Rejuvenating Public Sector Science" will be James Hansen of NASA, who has been speaking out on global warming since the late 1980s. A 2 p.m. panel on comparative effectiveness in medicine features Gail Wilensky, Ezekiel Emanuel and Gregg Bloche and will be webcast by the Kaiser Family Foundation. If you're in Washington and can make it down to the Reagan Center at 13th and Pennsylvania, registration is available at the door.

Giving Up on Small Gifts

The Pharmaceutical Research and Manufacturers Association this morning will unveil a voluntary code asking member companies to give up the practice of showering drug logo-bearing small gifts like mugs, pens and mousepads on physicians. Both the New York Times and Wall Street Journal report that the code won't limit the consulting and speakers fees earned by so-called key opinion leaders who encourage other doctors to use particular pharmaceuticals.

Critics, while welcoming the move, will continue to push for the Physician Payments Sunshine Act, which requires disclosure of such gifts, according to the story. It seems to me that PhRMA's endorsement of a ban, while voluntary, should embolden the bill's sponsors to include that more far-reaching step, at least on small gifts.

But even if the chotzkes disappear from physician offices (as I write this, I'm staring at the Vioxx-labeled reflex hammer that a physician-friend gave me as a present a few years ago), this PhRMA guideline doesn't get at the most significant ways that drug companies (and medical device and biotechnology companies, who aren't covered by this voluntary guideline) influence medical practice.

Doctors in community practice take their cues for the most part from their professional societies, from the leading journals in their fields, from their annual continuing medical education classes, and, most importantly, from what will be reimbursed. With that thought in mind, here's a starter list of items that ought to be banned:

* Clinical practice guidelines that are written by physicians who double-dip on industry's payroll;

* Clinical practice guidelines that are underwritten by professional societies that accept cash from firms with a stake in the outcome;

* Continuing medical education classes that are underwritten by the drug and medical device industries (Pfizer recently announced it would stop underwriting CME at for-profit CME providers, a start);

* Medical journals allowing industry-funded physicians to write reviews and conduct meta-analyses that outline the "state of the science" in their medical fields; and

* Reimbursement guidelines that rely on compendia that are written by clinicians with financial ties to firms whose products they are evaluating.

On the Need to Coordinate Medical Humanitarianism

A Journal of the American Medical Association essay this morning targets the lack of coordination in medical humanitarian programs offered by non-profit organizations and the global economic powers, meeting this week in Japan. It also unfavorably compares the U.S. response to its military efforts around the globe, and lambasts the Bush administration for failing to ratify international accords that would improve global public health.

While medical historian Howard Markel of the University of Michigan and attorney Lawrence Gostin of Georgetown note there is never enough money, they also lament the increasing fragmentation and duplication of aid efforts by a proliferation of government and non-government organizations:

As noble as the existing efforts of these humanitarian organizations and governments are, the efforts often compete with each other and, worse, compete with local programs by drawing away human resources needed for coordinated global health systems. Moreover, the efforts tend not to share the same values or visions for the future and often focus on the donors' own pet projects wanting rapid, measurable progress rather than long-term sustainable solutions. Rarely do all of these organizations truly listen to what the host country wants and needs to ensure the long-term health of its people. Consequently, donors and service providers typically address a single disease or salient health crisis but not the "basic survival needs" of the world's poor, such as clean air and water; sanitation; surveillance; vector control; and a strong health system with well-trained physicians, nurses, pharmacists, and other health care professionals.

The essay goes on to urge "an effective system of global health governance that harmonizes objectives, establishes priorities, coordinates activities, sets funding levels, and monitors progress."

One missing element in this excellent essay: the need for democracy, transparency and good governance in the host countries. All the best coordinated aid in the world won't reverse deteriorating public health if the country is ruled by someone like Robert Mugabe.

Fat Kids? Feed 'em Statins and Supplements

The American Academy of Pediatricians provoked an instantaneous uproar yesterday after releasing new guidelines calling for screening kids for high cholesterol and prescribing statin drugs if diet and exercise interventions don't work. The New York Times' Tara Parker-Pope was forced to print a reaction story today that included all the critical comments left out of the previous day's report.

“What are the data that show this is helpful preventing heart attacks?” asked Dr. Darshak Sanghavi, a pediatric cardiologist and assistant professor at the University of Massachusetts Medical School. “How many heart attacks do we hope to prevent this way? There’s no data regarding that.”

Nor, Dr. Sanghavi added, are there data on the possible side effects of taking statins for 40 or 50 years.

Other doctors said the recommendation would distract from common-sense changes in diet and exercise, which are also part of the new guidelines.

“To be frank, I’m embarrassed for the A.A.P. today,” said Dr. Lawrence Rosen of Hackensack University Medical Center in New Jersey, vice chairman of an academy panel on traditional and alternative medicine. He added: “Treatment with medications in the absence of any clear data? I hope they’re ready for the public backlash.”

How hard would it have been to include those perspectives in the original story?

Here's something else that was left out of all the stories. A lot of bloggers, and even Parker-Pope in today's story, focused on possible financial ties to statin manufacturers of the seven physicians who wrote the guidelines for the AAP. I briefly checked out that possibility yesterday since the AAP in-house journal Pediatrics, which published the guidelines, failed to include a conflict of interest disclosure statement even though the journal has a policy requiring such statements.

I didn't come up with much on statins. But Jatinder Bhatia, who sat on the committee and was prominently quoted by Parker-Pope in her first story, has disclosed elsewhere that he is consultant and speaker for Mead Johnson, a unit of Bristol Myers-Squibb best known for its line of infant formulas (Enfamil). It also makes supplement-enhanced foods aimed at young kids. The AAP itself has numerous financial ties to manufacturers of enhanced foods.

Is that relevant? Should it have been disclosed? Here's a couple of other lines from the guidelines:

Increasing the intake of soluble fiber can be helpful in reducing plasma LDL concentration. . .

Plant stanols and sterols are added to a number of products, including spreads and margarine, orange juice, yogurt drinks, cereal bars, and dietary supplements. These compounds lower the absorption of dietary cholesterol and, in adults, have been shown to reduce cholesterol concentration by approximately 5% to 10% with minimal adverse effects.

Mead Johnson makes kid foods with added fiber. Yoplait markets a line of "heart healthy" yogurts. I don't know if Dannon does, but that firm is clearly a competitor of Yoplait. Besides Bhatia's ties to Mead Johnson, Nicolas Stettler, another panel member, sits on the board of the Dannon Institute, a non-profit research wholly funded and housed within the Dannon Yogurt Co.

While everyone is focused on the statin angle, the subtext here may be functional foods. Ads touting "heart healthy" brands for fat kids -- now recommended by the nation's pediatricians -- may be just around the corner.

Just what they need. More food advertising.

The True Costs and Benefits of Avastin

The New York Times on Sunday revisits the escalating controversy over the high cost of cancer care with a major story on Avastin, Genentech's blockbuster drug for colon, lung, and breast cancer that is already generating $2.3 billion a year for the firm.

The story points out that "many patients with cancers other than those of the colon, lung or breast are taking the drug, even in cases where there is no compelling evidence that it can help." And now that the Center for Medicare and Medicaid Services has allowed oncologists to use the National Comprehensive Cancer Network compendium to justify payment for many more off-label uses, many of which have very weak evidence behind them (see this GoozNews post), you can be assured costs to patients and taxpayers will only grow in the years ahead.

The Times story asks all the right questions:

What does it mean to say an expensive drug works? Is slowing the growth of tumors enough if life is not significantly prolonged or improved? How much evidence must there be before billions of dollars are spent on a drug? Who decides? When, if ever, should cost come into the equation?

I addressed many of them myself last July in this GoozNews post.

Alas, the Sunday Times story provides no real answers. At the least, the story could have raised an idea that I addressed last February (in this GoozNews post). All results from the on- and off-label use of anti-cancer drugs like Avastin should be registered in a publicly available database so that researchers can later conduct studies to see how well they actually worked. This has been done for years in the Children's Oncology Group, and has resulted in tremendous improvements in the protocols for treating pediatric cancers. (I highly recommend clicking on that story and reading the comments if you're interested in this subject.)

Since the central motif of the story involved the high cost of the drug vis-a-vis its marginal utility, allow me to add a few facts to one misleading paragraph that some may interpret as justification for the drug's high cost. It was buried deep in the story and was couched in the journalistic phraseology reserved for "scoops":

Genentech, which has never before revealed what it spent to develop Avastin, now says that it and its partner Roche have spent more than $2.25 billion starting with Dr. Ferrara’s original work. The figure includes research, clinical trials and filing for regulatory approval and is well beyond what was spent by the federal government, which conducted important clinical trials of Avastin. Through May 2006, the government had spent $44.6 million on Avastin trials and related laboratory work, according to figures obtained from the National Cancer Institute by Consumer Watchdog, an advocacy group.

Here's what that paragraph doesn't include. First, it doesn't include the support the National Cancer Institute gave to Judah Folkman, the recently deceased scientist whose pioneering work on angiogenesis (blood vessel formation) gave Genentech and other firms developing vascular endothelial growth factor inhibitors a target to aim at. In just one year (1992, the first in an easily accessible database that I could turn up in two minutes of Internet searching), NCI awarded Dr. Folkman $1.1 million. The agency supported his work for over 30 years until he passed away in January (see this GoozNews obit).

It also doesn't include the $250 million a year that NCI spends (see this NCI budget) on maintaining groups like the Eastern Cooperative Oncology Group, which conducted three of the first four major third stage clinical trials that led to Avastin's approval for colon, breast and lung cancer (see this NCI fact sheet).

It also fails to put the $2.25 billion that Genentech spent in its proper context. That money was spent over many years. Every year, that money was a cost of doing business for the firm. That means, from an accounting standpoint, it was paid for by current consumers, i.e., you and me as patients and taxpayers.

Last year, Genentech took in $2.3 billion from the drug -- almost exactly what it spent over its 15 years of development. It accounted for about a third of its total revenue. How much did actually cost to make the drug? The cost of sales (i.e., manufacturing) came to just $1.6 billion for all its drugs or about 17 percent of sales. That means the gross profit margin on Avastin recoups the entire amount spent on its R&D over 15 years within 15 months.

It's also useful to compare that R&D cost to Genentech's pre-tax income, which was $4.2 billion, or its after tax income, which was $2.8 billion. Assuming that Avastin accounted for about a third of each, that means the company generates earnings equal to its entire R&D investment in less than three years.

The anecdotes of patients, taxpayers and insurers paying through the nose for the chance of extending lives for a few months are heartrending. As the story quotes former Merck ceo Roy Vagelos saying, the national debate on the wisdom of paying exorbitant prices for so little medical return is about to begin. Let's just make sure that all the facts are on the table as we have that debate.

War Isn't Over, Even If You Want It

Sorry for that riff on an old John Lennon song, but it's July 4th and a good day to catch up on my Iraq war reading. May I recommend this essay in the New York Review of Books by Michael Massing, who recently returned from Iraq after "embedding" with U.S. troops on patrol in several neighborhoods in Baghdad.

He did a masterful job of narrating how his U.S. military minders attempted to stage manage his tour -- a fact of life for any foreign correspondent made exponentially more perverse when traveling through a war zone. But he deftly got his soldier-minders to open up, and his reporting reveals some startling truths about what is going on, especially among the middle-ranked officers:

As I'd expected, my embed had provided little opportunity to hear the Iraqi point of view. Rather, it offered a look at the war through the eyes of the US military, and in that respect it had been very revealing. On the one hand, it had left me with little doubt about the very real gains the surge had brought about, and about the effectiveness of the Petraeus-led counterinsurgency strategy. The situation in Dora had obviously improved, and the combination of aggressive raids, large-scale detentions, and mixing with the community (together with the Sunni Awakening) had had a big hand in achieving that.

At the same time, I'd gotten a look at the crushing effect the war is having on the troops. The breakdown in the Army has advanced so far that in a mere thirteen hours, I could see the rising dissatisfaction, anger, and rebellion within it. The message from the soldiers themselves was that keeping so large a force in the field over the long term seemed unsustainable.

That fact, more than the situation on the ground, will dictate the next president's options in Iraq.

There's also some juicy tidbits about Iran's growing influence in Iraq, the corruption of U.S. private contractors, the squandering and plundering of Iraq's oil wealth, and, unbelievably, the ongoing incompetence and lack of coordination among U.S government agencies trying to sort out the mess.

If you are turned off thinking and reading about the war, as I am on most days, Massing's essay is definitely worth fifteen minutes of your time. It is bracing to be reminded of the magnitude of the disaster that President George W. Bush and his neoconservative advisers will bequeath to his successor, whomever that will be.

Haste Still Makes Waste

Corrections in the press or scientific literature usually involve author backpeddling and gracious apologies. But that's not what Harvard researcher Daniel Carpenter offered after the Food and Drug Administration criticized his study showing that new drug approvals made on the eve of deadlines set by the Prescription Drug User Fee Act had a 14 percent likelihood of later getting a black box warning because of safety concerns. After reviewing the data (and making adjustments for new information that the FDA had not posted on its website), Carpenter concluded: "we found more modest but still significant associations between just-before-deadline approvals and safety problems."

NEJM Issues Strong Editorial Against Preemption

The Supreme Court next fall will hear a landmark case that could rob consumers of the right to sue drug manufacturers in state courts when the Food and Drug Administrations fails to protect them from unsafe drugs. Drug manufacturers are claiming in Wyeth v. Levine that federal regulation preempts state product liability laws, even though the Food, Drug and Cosmetic Act -- unlike the Medical Devices act, which the court has already ruled preempts state laws -- contains no such language.

A few weeks ago, I was critical of the New England Journal of Medicine for failing to take a strong stand against federal preemption. Well, that blog post is no longer operative. In Thursday's edition, the top editors of NEJM authored a strong editorial warning "Why Doctors Should Worry About Preemption."

In stripping patients of their right to seek redress through due process of law, preemption of common-law tort actions is not only unjust but will also result in the reduced safety of drugs and medical devices for the American people. Preemption will undermine the confidence that doctors and patients have in the safety of drugs and devices. If injured patients are unable to seek legal redress from manufacturers of defective products, they may instead turn elsewhere.

Only that last sentence, which hints that injured patients might turn to suing their doctors, rang false. I'm sure that a Supreme Court willing to rewrite laws to give drug manufacturers a "but the FDA said it was safe" defense, will be more than happy to legislate from the bench giving doctors something similar to ward off malpractice suits.

No, it's the patients who will be the real losers if the high court invalidates state efforts to protect their citizens from unsafe prescription drugs. But it is nice to know that the prescribers -- or at least the leading editorial voices who speak on their behalf -- are on their side.

"What's The Matter With Kansas" Author Rocks

The hallmark of a great columnist is great reporting. Whatever one thinks about Rupert Murdoch taking over the Wall Street Journal, adding Thomas Frank, editor of The Baffler magazine and author of "What's The Matter With Kansas", as leftwing ballast to that paper's usual roster of rightwing crank columnists was inspired. Read today's column on Charlie Black, one of John McCain's top advisers, to see what I mean. Here's a small taste:

During the Reagan years, the Department of Housing and Urban Development allegedly began steering contracts to clients of political favorites; one gang thus favored was Mr. Black's firm, and in particular, Mr. Black's partner, Paul Manafort. The firm took in over $300,000 lobbying HUD for funds, some of it to rehab a New Jersey housing development that, according to the Boston Globe, "New Jersey officials said they did not want and was a waste of taxpayers money." Allegations also flew about Mr. Black's own role in the HUD scandal, but no wrongdoing was ever proven in court. Mr. Manafort, for his part, became a principal in a lobbying firm headed until recently by Rick Davis, John McCain's campaign manager.

There's also some juicy tidbits about Black's early days in Young Americans for Freedom, where, at their 1971 convention, they lifted their voices in unison to sing a fascist Spanish anthem.

Going Beyond Hospital Report Cards

Death rates for hospitals, adjusted for patient sickness, are often used to measure quality of care. Hospitals with high adjusted death rates are then identified as needing improvement. This method has two problems, however: (1) the risk-adjusted death rates include both preventable and unpreventable deaths, and the percentage of preventable deaths is unknown; and (2) many preventable deaths occur at hospitals with average or below average death rates. Thus, these hospital "report cards" can only be a starting point in determining how to reduce the number of preventable deaths.

A study recently published in Circulation analyzed a sample of 347 inpatient deaths following bypass surgery in Toronto hospitals and determined that as many as one-third of the deaths could have been prevented with better care. The researchers also showed that the hospitals' report card grades were not correlated with the rates of preventable deaths. Even in the hospital with the lowest risk-adjusted mortality rate, about 20 percent of deaths were preventable. Preventable deaths occurred frequently among both low and high risk patients, and were actually more common in lower-risk patients. A large proportion of preventable deaths were related to problems in the operating room (86 percent) and intensive care unit (61 percent), and the study produced a list of specific improvements needed in the care of bypass surgery patients.

The method used in this study is one that could be used in other situations to improve quality of care, even in hospitals that are already performing well. In the study, experienced cardiac surgeons who were blinded to patient, surgeon, and hospital reviewed the medical records of the patients who died following surgery to identify preventable deaths. Two reviewers examined the records for each death, and a third reviewer was used when the two reviewers disagreed. For each preventable death, specific improvements in quality of care were identified that could have prevented the death. The use of reviewers who were expert in cardiac surgery allowed the reviewers to identify and provide solutions to the problems identified in preventable deaths.

In an accompanying editorial, Yale cardiologist Harlan Krumholz emphasized that the post-bypass death rates in Toronto hospitals were already low and the system "could have been content with its successes." Krumholz noted that high-profile medical mistakes that clearly cause harm represent only a small portion of the causes of preventable deaths. Thus, an important feature of the study was that the investigators did not require that a preventable death be one that the medical record reviewer was certain was preventable, but only one where the reviewers felt that the likelihood that it could have been prevented was greater than 50 percent. This standard was designed to identify more deaths where care was not optimal so as to maximize the potential for quality improvements.

How can the number of preventable deaths be reduced? Krumholz advocates that hospitals routinely and systematically identify problem areas that contribute to bad outcomes. Quality improvements that reduce or eliminate these problems should reduce the number of preventable deaths, even though it generally will not be possible to determine the particular deaths that were prevented. Krumholz notes that there is a need for a shift in culture so that assessments of preventable deaths are part of the expectation of every hospital, provider, and patient. "How else will we attain the goal of creating the high-reliability, high-performance institutions that we prefer for our practices and that our patients deserve?"

-- PM

Next Week's Battle over Medicare

The Health Affairs blog has a long article by inside-the-Beltway analyst Robert Laszewski foreshadowing next week's battle between physicians and the insurance industry over Medicare legislation, which must be passed or physicians will be forced to absorb a major paycut. His conclusion -- "the sky is falling" -- comes from his belief that the Democrats in Congress will cut Medicare Advantage payments to pay for maintaining physician salaries. His analysis is definitely worth reading.

Low-Income Housing Will Make a Comeback -- As a Political Issue

Here's a prediction: Now that the pre-convention summer doldrums of political campaign coverage has descended to a discussion of presumptive Democratic nominee Barack Obama's patriotism, it won't be long before he's defending his record as a fellow traveler of slumlords.

Can you say Tony Rezko? This long article in last Friday's Boston Globe certainly could, along with Valerie Jarrett (major campaign adviser), Allison Davis (former law partner and major fundraiser) and a host of other close Obama associates connected to the low-income housing development industry in Chicago. The upshot: some of these public-private partnerships, developed under official U.S. housing policy that channeled tax credits to subsidize private-sector and non-profit housing for low- and moderate-income renters over the past 20 years, have fallen into disrepair. Some of the developers and managers have walked away from the projects, leaving rat-infested, deteriorating buildings in their wake.

Is this a failure of the public-private partnership model, as suggested by Slate's Kausfiles? I'm curious what Kaus would offer people who can't afford market rents. Would he like to see a return to the massive public housing projects that drew his and better writers like Alex Kotlowitz' justifiable condemnation in the 1980s?

With the foreclosure crisis sending thousands, perhaps millions, of struggling families back into the rental market, the nation could use a decent discussion about what it takes to provide adequate housing for those whose incomes cannot support rents high enough to pay for reconstruction, heat, electricity, maintenance, and profit for developer/landlord. There are many developers in Chicago who used the low-income housing tax credits and section 8 voucher program to build and maintain solid housing for people who otherwise would be living in slums. Alas, in a political season, those positive examples aren't discussed, nor why they may have succeeded.

Instead, we get a story about the failures (which are real) tied to a political candidate who politically supported that industry. Given the way the campaign is going, no doubt Obama will soon be apologizing for that, too.

But if public policy doesn't empower public-private partnerships to build and rehab low-income housing (and no one would seriously suggest a return to building public housing), then what? Here's an idea. How about capping the home mortgage interest deduction at $500,000 per household. Any new tax payments collected can be earmarked into a fund (thus be revenue neutral for the federal government) to pay for rent subsidies for people earning less than $75,000 a year whose rents exceed 30 percent of income. Perhaps then landlords (the responsible ones, at least) will be able to charge high enough rents to maintain their buildings in low- and moderate-income neighborhoods.

As my father was always fond of saying, the problem with poor people is that they don't have enough money. Whenever I see a run down rental building, the first question I ask is, "what's the rent?" Too bad the Globe reporter or Mickey Kaus never asked that question.