Seeking to Grow Market Share?

Get a FREE assessment of your CDH products —
a $3,000 value.

Readout of Secretary Azar’s Second Day in Brazil

HHS Gov News - October 03, 2018

Today, Secretary Alex Azar began his meetings in São Paulo, Brazil. First, he visited the Municipal Infant Hospital “Menino Jesus” and met with hospital leadership. They discussed the shared challenges U.S. and Brazilian hospitals face in improving quality and implementing efficient service models to integrate principles of value-based care. At the hospital, Secretary Azar visited the outpatient ward as well as the newly opened transplantation ward, which is an example of their successful public-private partnership with the Syrian-Lebanese Hospital.

Next he visited the Syrian-Lebanese Hospital with the Brazilian Minister of Health Gilberto Occhi, other government officials, and hospital leadership. Here Secretary Azar learned about efforts they are making on quality metrics and how principles of value-based care might have a positive impact on controlling costs and improving outcomes at the hospital. He saw their state-of-the-art robotic training facilities and simulation training center, which is available to all the clinicians affiliated with Syrian-Lebanese, including those at their public hospital partners. He finished his tour with a conversation with members of the board of directors, who are descendants of the women who originally founded the hospital.

In the afternoon, Secretary Azar and Minister Occhi visited the Butantan Institute with Marco Antonio Zago, the São Paulo State Secretary of Health. They were hosted by Dimas Tadeu Covas, the Director of the Butantan Institute, and Rui Curi, the Deputy Director of the Butantan Institute. The Butantan Institute is a semi-autonomous, biomedical research and production facility and is the main producer of immunobiological products in Brazil. At the Institute, Secretary Azar saw the “milking” of a snake for anti-venom and the newly expanded influenza vaccination manufacturing facility. The Butantan Institute has longstanding collaborations with HHS’ National Institutes of Health (NIH) and HHS’ Biomedical Advanced Research and Development Authority (BARDA).

While at the Butantan Institute, Secretary Azar and Minister Occhi discussed the U.S.-Brazil long-standing cooperation in health research including biotech and vaccine production. HHS’ collaborative work with Brazil has successfully resulted in a number of new treatments moving all the way to the manufacturing stage. At the Institute, Secretary Azar discussed the latest updates on the tetravalent dengue vaccine that was developed in collaboration with NIH. The candidate vaccine has completed Phase 1 and 2 trials in the United States, Brazil, Bangladesh, and Thailand. As a result of the technology transfer from NIH, the ongoing Phase 3 clinic trial in Brazil, and the completion of a state-of-the-art manufacturing plant, the Butantan Institute is now well positioned to produce the vaccine and make it available for large-scale immunization initiatives in Brazil.

Next, Secretary Azar visited the São Paulo Research Foundation (FAPESP). He participated in a meeting with senior leadership where he highlighted the extensive history of U.S. scientific cooperation with FAPESP and the larger Brazilian scientific community. Then he delivered a speech to an audience composed of members of São Paulo’s scientific and innovation community in which he discussed his priorities to spur the innovation economy in the United States, including leveraging research collaborations and utilizing public-private partnerships.

In the evening, Secretary Azar participated in a dinner and roundtable meeting with the American Chamber of Commerce in São Paulo. The meeting focused on private sector innovations in Brazil to spur value-based transformation in the health system.

Additional information regarding the Secretary’s meetings and schedule will be forthcoming in news releases and social media posts. 

To view his remarks online, please visit:

HHS Extends Deadline for DSIIS Recommendations

HHS Gov News - October 03, 2018

Today, the U.S. Department of Health and Human Services announced that it is extending the application deadline for the Deputy Secretary’s Innovation and Investment Summit (DSIIS) to October 12, 2018. As announced on September 19, 2018, the DSIIS will be a yearlong collaboration between healthcare innovation and investment professionals and HHS personnel who will meet quarterly to engage in high-level dialogues about emerging opportunities and the government’s role in facilitating more investment and accelerated innovation in the healthcare sector. Due to strong interest and requests for additional information regarding DSIIS, the Department is extending the application deadline as well as posting a list of frequently asked questions (FAQ) for further guidance.

Recommendations of DSIIS participants must include a resume/CV and a brief description of why the individual recommended would be a good candidate to help deliver on and advance the goals of the DSIIS. Recommendations should be submitted to by October 12, 2018, with the subject line “DSIIS Recommendation.” Individuals wishing to update an existing recommendation can do so by emailing the same address using the subject line “Additional Information for [NAME] Recommendation.”

FAQs are available here:

Additional information on DSIIS is available here:

Drugmakers Play The Patent Game To Lock In Prices, Block Competitors

Kaiser Health News:Marketplace - October 02, 2018

David Herzberg was alarmed when he heard that Richard Sackler, former chairman of opioid giant Purdue Pharma, was listed as an inventor on a new patent for an opioid addiction treatment.

Patent No. 9861628 is for a fast-dissolving wafer containing buprenorphine, a generic drug that has been around since the 1970s. Herzberg, a historian who focuses on the opioid epidemic and the history of prescription drugs, said he fears the patent could keep prices high and make it more difficult for poor addicts to get treatment.

“It’s hard not to have that reaction of, like … these vultures,” said Herzberg, an associate professor at the University at Buffalo.

James Doyle, vice president and general counsel of Rhodes Pharmaceuticals, the Purdue subsidiary that holds the patent, said in an email statement that the company does not have a developed or approved product and “therefore no money has been made from this technology.”

“The invention behind the buprenorphine patent in question was developed more than a dozen years ago,” he wrote. “If a product is developed under this patent, it will not be commercialized for profit.”

Yet, the patenting of a small change in how an existing drug is made or taken by patients is part of a tried-and-true pharmaceutical industry strategy of enveloping products with a series of protective patents.

Drug companies typically have less than 10 years of exclusive rights once a drug hits the marketplace. They can extend their monopolies by layering in secondary patents, using tactics critics call “evergreening” or “product-hopping.”

Lisa Larrimore Ouellette, a patent law expert at Stanford University, said the pharmaceutical industry gets a greater financial return from its patent strategy than that of any other industry.

AztraZeneca in 2001 famously fended off generic versions of its blockbuster heartburn medicine Prilosec by patenting a tweaked version of the drug and calling it Nexium. When Abbott Laboratories faced multiple generic lawsuits over its big moneymaker Tricor, a decades-old cholesterol drug, it lowered the dosage and changed it from a tablet to a capsule to win a new patent.

And Forest Laboratories stopped selling its Alzheimer’s disease drug Namenda in 2014 after reformulating and patenting Namenda XR to be taken once a day instead of twice.

Another common strategy is to create what Food and Drug Administration Commissioner Scott Gottlieb calls “patent thickets,” claiming multiple patents for a single drug to build protection from competitors. AbbVie’s rheumatoid arthritis drug Humira has gained more than 100 patents, for example.

Email Sign-Up

Subscribe to KHN’s free Morning Briefing.

Sign Up Please confirm your email address below: Sign Up

The U.S. Patent and Trademark Office awards patents when an innovation meets the minimum threshold of being new and non-obvious. Secondary patents are routinely granted to established drugs when an improvement is made, such as making it a once-a-day pill instead of twice a day, said Kristina Acri, an economist and international intellectual property expert at the Fraser Institute and Colorado College.

“Is there a better way? Maybe, but that’s not what we’re doing,” Acri said.

The controversial patent that Sackler and five co-inventors obtained is widely known as a “continuation patent.” (The original patent application for the wafer was filed in August 2007.)

Continuation patents do not necessarily extend the patent life of a drug, but they can have other uses. In 2016, Rhodes filed a lawsuit against Indivior alleging patent infringement.

Indivior, formerly part of Reckitt Benckiser, sells a film version of the popular addiction treatment drug Suboxone that is placed under the tongue — an oral medicine similar to what Rhodes has patented. Indivior’s comes in a lime flavor.

Indivior’s film, which federal regulators approved in 2010, dominates the market with a 54 percent average market share, according to the company’s most recent financial report. And the company has vigorously fought rivals, including filing lawsuits against firms such as Teva Pharmaceutical Industries, which sought approval to manufacture generic versions. Indivior declined to comment.

The Rhodes Pharmaceuticals version would be a wafer that melts quickly in the mouth. The inventors list potential flavors including mint, raspberry, licorice, orange and caramel, according to the patent.

For opioid historian Herzberg, the patent battles between companies like Rhodes and Indivior are “absolute madness.”

Decisions on what is available on the market to treat addicts should be based on what is the best way to treat the people who have the problem, he said.

Patent battles, Herzberg said, are “not how you want drug policy getting made.”

Attempts to change the patent system have intensified over the past decade as prices of prescription drugs continue to climb.

In 2011, President Barack Obama signed the America Invents Act, which included the creation of the Patent Trial and Appeal Board. The PTAB is an alternative to using the cumbersome U.S. court system to challenge weak patents. Generic drug manufacturers have used the board’s “inter partes review” process and overturned 43 percent of the patents they challenged, according to recent research.

Critics of the administrative process, including the pharmaceutical industry trade group PhRMA, said it creates “significant business uncertainty for biopharmaceutical companies.” Often companies have to defend their products twice — both in the courts as well as before the PTAB, said Nicole Longo, PhRMA’s director of public affairs.

Drug giant Allergan attempted to overcome the PTAB’s review process by arguing that the patent couldn’t be challenged at the review board because they sold the patent to the St. Regis Mohawk Tribe, which had sovereign immunity. A federal appeals court ruled this summer that Allergan could not shield its patents from the PTAB review this way.

This year, several members of Congress proposed bills that would unwind or limit changes made by the America Invents Act, though nothing is likely to happen before the midterm elections. The STRONGER Patents Act, introduced in both the House and Senate, would weaken the PTAB board by aligning its claims standards with what has been established by court rulings.

KHN’s coverage of prescription drug development, costs and pricing is supported in part by the Laura and John Arnold Foundation.

Readout of Secretary Azar’s First Day in Brazil

HHS Gov News - October 01, 2018

As previously announced, Health and Human Services (HHS) Secretary Alex Azar traveled to Brazil over the weekend to participate in bilateral meetings with government officials and others to discuss the ongoing collaboration between the United States and Brazil towards global health security, our bilateral science partnership, and health sector reform. Later in the week, Secretary Azar will travel to Argentina for the G20 Health Ministerial Meeting.

Today, Secretary Azar began his meetings in Fortaleza, Brazil. First he visited the Urgent Care Center Praia do Futuro where he learned about the structure of 24-hour urgent care units and how such centers function as a part of Brazil’s decentralized public health system. Here he also saw first-hand how Fortaleza has used its decentralized model to manage patient flows for greater efficiency and improved outcomes.

Next, Secretary Azar attended a breakfast meeting with Ceará State Governor Camilo Santana, Ceará State Health Secretary Henrique Javi, and other key health officials to discuss the unique aspects of the healthcare system in the State of Ceará and how they have implemented innovative ways to increase access and improve outcomes. They also discussed the United States-Brazil collaboration on the Zika virus and how our two nations can work together to enhance and protect our citizens against global health threats.

Later in the morning, Secretary Azar met with Dr. Islane Verçosa of CAVIVER and her medical team. CAVIVER is a non-governmental organization (NGO) in Brazil that engages with the public health system and international partners. Secretary Azar and Dr. Verçosa discussed the partnership between the Centers for Disease Control and Prevention (CDC) and the Brazilian Ministry of Health on the CDC’s Zika Outcomes and Development in Infants and Children (ZODIAC) investigation and how the results of this study have informed the care of children impacted by Zika. This follow-up assessment of children aged 12-24 months conceived during the 2015-2016 Zika virus outbreak in Brazil provided a first-ever description of the longer-term health and developmental effects of congenital Zika virus infection in children with microcephaly. At CAVIVER, Secretary Azar met and spoke with children and families affected by congenital Zika syndrome.

In the afternoon, Secretary Azar met with additional children and families affected by congenital Zika syndrome at the Albert Sabin Infant Hospital. This hospital serves as a specialty care center in the Brazilian public health system and as a reference center for care of infants and children in the northeastern region of Brazil. Here Secretary Azar learned about the hospital’s partnership with CDC on Zika and about the services they provide to care for children affected by the range of problems caused by microcephaly, including hearing and vision problems and other neurological conditions.

Secretary Azar reaffirmed HHS’ and the CDC’s continued support for Zika activities and reiterated that the Zika story is not over for affected families who face  managing lifelong disabilities for affected children.  CDC continues to monitor the health outcomes and care of affected babies to learn how to best protect mothers and babies from Zika virus infection and other emerging threats. Zika remains a threat in over 100 countries and territories, and pregnant women should still avoid travel to areas with risk of Zika. For a full list of areas with risk of Zika, please visit

Later in the afternoon, Secretary Azar traveled to São Paulo, Brazil where he will participate in meetings on Tuesday, October 2. Additional information regarding the Secretary’s meetings and schedule will be forthcoming in news releases and social media posts.

HHS, Genentech join forces on medicines to combat influenza, other health security threats

HHS Gov News - October 01, 2018

To develop innovative medicines that combat diverse national health security threats, the U.S. Department of Health and Human Services’ Office of the Assistant Secretary for Preparedness and Response (ASPR) today announced a strategic partnership with Genentech, a member of the Roche Group, of South San Francisco.

The company and ASPR’s Biomedical Advanced Research and Development Authority (BARDA) will jointly manage and share the cost to develop a portfolio of medicines that meet national health security requirements and have commercial uses. The partners will focus first on developing a first-in-class therapeutic for hospitalized influenza patients and a treatment for lung injuries caused by inhaling sulfur mustard gas.

“The United States faces a host of national health security threats requiring innovative solutions,” said BARDA Director Rick Bright, Ph.D. “Partnership agreements like this one allow flexibility to detect, prevent, or treat diverse illness and injury caused by these threats and at the same time decrease costs and maximize efficiency.”

BARDA will contribute $43 million over five years to support a study of the investigational oral medicine baloxavir marboxil in treating severely ill patients hospitalized with seasonal or pandemic influenza viruses. Influenza, or flu, is one of the most common, yet serious, infectious diseases, representing a significant threat to public health. CDC estimates that influenza has resulted in between 140,000 and 900,000 hospitalizations and between 12,000 and 80,000 deaths in the United States annually since 2010.

BARDA also will provide $19 million over 18 months to advance the development of alteplase (tPA) for a new indication to treat acute lung injuries called cast formation caused by inhaling sulfur mustard gas. The medicine, known under the brand name Activase is approved and marketed to treat heart attacks, stroke, and pulmonary embolism.

There are currently no FDA-approved therapeutics for use by severely ill patients hospitalized with influenza or for treatment of inhalational injury due to sulfur mustard.

In addition to sharing development costs, BARDA will have joint oversight, help determine which medicines to develop, and collaborate on decisions about which products enter or leave the partnership’s portfolio.

The agreement also gives BARDA access to Genentech’s extensive portfolio of potential medical countermeasures, including diagnostics, therapeutics for influenza, and medicines to reduce the transmission of influenza, and other products to combat health security threats.

Rather than standard contracts, HHS entered into the agreement using other transaction authority that was granted to HHS under the Pandemic and All Hazards Preparedness Act of 2006. Although not a contract, grant or cooperative agreement, other transaction authority provides a funding and collaboration vehicle to promote innovation in technology for advanced research and development. The new partnership agreement is BARDA’s eighth under other transaction authority.

Feds Settle Huge Whistleblower Suit Over Medicare Advantage Fraud

Kaiser Health News:Marketplace - October 01, 2018

One of the nation’s largest dialysis providers will pay $270 million to settle a whistleblower’s allegation that it helped Medicare Advantage insurance plans cheat the government for several years.

The settlement by HealthCare Partners Holdings LLC, part of giant dialysis company DaVita Inc., is believed to be the largest to date involving allegations that some Medicare Advantage plans exaggerate how sick their patients are to inflate government payments. DaVita, which is headquartered in El Segundo, Calif., did not admit fault.

“This settlement demonstrates our tireless commitment to rooting out fraud that drains too many taxpayer dollars from public health programs like Medicare,” said U.S. Attorney Nick Hanna in announcing the settlement Monday.

Medicare Advantage plans, which now enroll more than 1 in 3 seniors nationwide, have faced growing government scrutiny in recent years over their billing practices. At least a half-dozen whistleblowers have filed lawsuits accusing the insurers of boosting payments by overstating how sick patients are. In May 2017, two Florida Medicare Advantage insurers agreed to pay nearly $32 million to settle a similar lawsuit.

The DaVita settlement cites improper medical coding by HealthCare Partners from early 2007 through the end of 2014. The company, according to the settlement agreement, submitted “unsupported” diagnostic codes that allowed the health plans to receive higher payments than they were due. Officials did not identify the health plans that overcharged as a result.

Email Sign-Up

Subscribe to KHN’s free Morning Briefing.

Sign Up Please confirm your email address below: Sign Up

One such “unsupported” code was for a spinal condition known as spinal enthesopathy that was improperly diagnosed in patients in Florida, Nevada and California from Nov. 1, 2011, to Dec. 31, 2014, according to the settlement. The agreement did not say how much health plans took in from the unsupported codes.

The company also contracted with a Nevada firm from 2010 through January 2016 that sent health care providers to visit patients in their homes, a controversial practice that critics have long held is done largely to inflate Medicare payments. These house calls also generated “unsupported or undocumented” diagnostic codes, according to the settlement.

Officials said that DaVita disclosed the practices to the government. It acquired HealthCare Partners, a large California-based doctors’ group, in 2012. They said the government agreed to a “favorable resolution” of the allegations payment because of the self-disclosure.

In a statement, DaVita said the settlement “reflects close cooperation with the government to address practices largely originating with HealthCare Partners.” DaVita said the settlement will be paid with escrow funds set aside by the former owners.

“This case involved illegal conduct in which patients’ medical conditions were improperly reported and were not corrected after further review — all for the purpose of boosting the bottom line,” reads the government’s statement.

The settlement also resolves allegations made by whistleblower James Swoben that HealthCare Partners knew that many of the diagnostic codes were unsupported, but failed to report them. The company reported only cases in which it deserved higher reimbursement, while ignoring codes that would slash payments, a practice known as “one-way” chart reviews.

Swoben, a former employee of a company that did business with DaVita, will receive just over $10 million for the settlement of the “one-way” allegations, under the federal False Claims Act, which rewards whistleblowers who expose fraud.

Immigrants’ Health Premiums Far Exceed What Plans Pay For Their Care

Kaiser Health News:Insurance - October 01, 2018

President Donald Trump has repeatedly condemned U.S. immigration policy, arguing that many immigrants pose a threat to the nation and drain U.S. resources. But a study released Monday about health insurance challenges the president’s portrayal.

The study in the journal Health Affairs found that immigrants covered by private health insurance and their employers contributed nearly $25 billion more in premiums in 2014 than was spent on their care. Those in the country without legal status contributed nearly $8 billion toward the surplus.

In contrast, U.S.-born enrollees spent nearly $25 billion more than they paid for in premiums.

These findings surface as the Trump administration’s immigration policies — including a plan to tie migrants’ efforts to get permission for permanent residency to their use of federal benefit programs — have come under scrutiny.

Earlier studies also found that immigrants contribute more to Medicare than they receive in benefits, but the authors of this study say it is the first to look at the effect in private insurance plans.

Leah Zallman, assistant professor of medicine at Harvard Medical School and lead author of the study, said her findings allude to the potentially negative consequences that tighter immigration policies could have on the health care industry.

“I think in today’s era … there’s so much concern about immigrants and immigration really sort of draining our resources in the U.S.,” Zallman said. “This really points to the critical role that immigrants have in actually subsidizing and maintaining our current systems.”

Researchers calculated the financial contributions and expenses of enrollees and their employers using two surveys created by the federal government. Plans sold on the federal health law’s insurance exchanges were not included because they “differ from other private insurance in important ways and are unavailable to undocumented people,” the study authors noted.

Email Sign-Up

Subscribe to KHN’s free Morning Briefing.

Sign Up Please confirm your email address below: Sign Up

Anyone born outside of the United States was categorized as an immigrant. However, the surveys did not ask non-citizens with private coverage about their legal status. Researchers used national data on undocumented immigrants to estimate how many people in the study group illegally resided in the country.

In 2014, immigrants and their employers contributed $88.7 billion in private insurance premiums, but spent only $64 billion for care, according to the study’s findings. Of that group, undocumented immigrants alone paid more than $17 billion to private insurers but used only $9.4 billion.

Native-born consumers paid $616 billion in premiums and received nearly $641 billion in insurers’ payments for care. They also consistently outspent immigrants across all age groups. Among enrollees 65 and older, the U.S.-born made a net contribution of nearly $10,000 more toward their care than those born overseas, according to the study.

The researchers reported that, on average, individual immigrants paid $1,123 more for premiums in 2014 than they received in insurance-covered care. U.S. natives instead cost insurers $163 on average.

Leighton Ku, director of the Center for Health Policy Research at George Washington University who was not involved in the study, said several factors contribute to immigrants’ low health care expenses. The group tends to be healthier and younger when they arrive in the United States. Cultural and language differences also hinder them from accessing care.

The study noted that immigrants’ health care expenditures increased the longer they remained in the country. But it added that since their premiums also increased at the same time, they continued to make a net contribution to their private health plans.

The findings come about a week after the Department of Homeland Security proposed redefining how it would determine “public charge,” a term used to describe a person likely to become dependent on the government for assistance. The proposal would make it harder for immigrants to live and work permanently in the U.S. if they receive certain types of federal assistance, such as Medicaid, food stamps and housing subsidies.

Trump has vowed to be tough on immigration standards. During his campaign, he berated U.S. health expenditures on immigrants, arguing that the U.S. spent $11 billion for care to people who were in the country without authorization, the study’s authors note.

But they point out that earlier research shows that immigrants have low rates of health care use and spending, compared with native residents. Their payments to private plans and Medicare in essence prop up care for patients who are U.S.-born, the authors say.

A study Zallman published earlier showed unauthorized immigrants contributed $35.1 billion more to Medicare from 2000 to 2011 than they used in services.

Benedic Ippolito, an economist at the American Enterprise Institute, cautioned using the study’s findings to draw conclusions on a large scale about immigrants and their role in health insurance. An estimated 20 percent of immigrants — including nearly half of the undocumented population — are uninsured, according to the study. Ippolito said the cost of their uncompensated care affects whether immigrants’ financial contributions actually lead to surpluses for health care overall.

“I would be careful about how much I extrapolate these results to a) other parts of the health insurance market and b) even further to what this means for immigration policy,” Ippolito said. “This paper alone does not tell us everything we need to know.”

Ku echoed the uncertainty. He said he is not certain how the Trump administration’s latest actions will affect immigrants enrolled in private insurance. Having a private plan may suggest they are employed with a certain income stability. However, if enough immigrants leave the insurance market, he added, it may have the unintended consequence of making health plans more expensive for everyone else.

“That does have the following implication that to the extent that we do things to suppress immigrants or make it harder for them to purchase insurance then in that case we may do harm to the citizens,” he said.