Pharmaguy's Insights Into Drug Industry News
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Pharmaguy's Insights Into Drug Industry News
Pharmaguy curates and provides insights into selected drug industry news and issues.
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Increase in Prescription Drug Prices Greater Than Any Other Category of Health Spending

Increase in Prescription Drug Prices Greater Than Any Other Category of Health Spending | Pharmaguy's Insights Into Drug Industry News | Scoop.it

Total health spending per person is now growing at faster rates than prior years, with 4.6% growth in 2016 compared to. 4.1% growth in 2015, which followed 2 years of sub-3% growth from 2012 to 2014. Spending growth in each year from 2012 to 2016 was almost entirely due to price increases. We saw particularly large increases in spending and price for administered drugs, emergency room (ER) visits, and surgical hospital admissions. (Source: The Health Care Cost Institute’s (HCCI) 2016 annual report on U.S. health care cost and utilization?

 

Consumer out-of-pocket (OOP) spending per person increased, but grew more slowly than total spending. This difference in growth led to a decline in OOP spending as a share of total spending.

 

From 2012 to 2016, they observed increases in prices each year and across nearly all service categories. The greatest cumulative price increase was seen in prescription drugs, with 24.9% price growth.

Pharma Guy's insight:

It will be interesting to see data for 2017 whenever that becomes available and then for 2018, one year after the drug industry fully takes over HHS!

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Cory Booker and 12 Other Dems Just Stopped Bernie Sanders’ Amendment to Lower Prescription Drug Costs

Cory Booker and 12 Other Dems Just Stopped Bernie Sanders’ Amendment to Lower Prescription Drug Costs | Pharmaguy's Insights Into Drug Industry News | Scoop.it

Just recently, Senator Sanders proposed an amendment to the 21st Century Century Cures Act to lower drug costs and allow for the import of cheaper drugs from other countries. However, that failed thanks to Republican opposition, and so he tried again, this time attaching a similar amendment to a concurrent budget resolution for the fiscal year of 2017, to allow importing of cheaper prescription drugs from Canada.

 

As a Reddit user, gideonvwainwright, pointed out, that amendment failed despite having the support of 12 Republicans including both Senator Ted Cruz (R-TX) and Senator Rand Paul (R-KY) because of the 'Nay' votes of thirteen Democrats—one of whom was Senator Booker.

 

Between 2010 and 2016, a handful of the Democratic senators who voted “nay” were amongst the top Senate recipients funded by pharmaceutical companies: Sen. Booker received $267,338; Sen. Patty Murray (D-WA) received $254,649; Robert Casey (D-PA) received $250,730; Michael Bennet (D-CO) received $222,000. As the former mayor of Newark, Cory Booker faced corruption scandals and increased crime and unemployment levels as his star power outside the state rose. He is heavily favored by Wall Street, with securities and investment firms donating $1.88 million to Booker during the 2014 midterm elections; their second-favorite candidate was Mitch McConnell.

 

In response to the growing outcry against his actions, Senator Booker tweeted the following: “Please know, a number of dems who voted no last night AGREE WE MUST IMPORT. But we believe basic FDA standards must be met.”

 

What he fails to mention is that Canada’s drug approval process is similar to our own in that it first requires various animal testing, and then rounds of clinical trials before a drug can enter circulation. What differences there are hardly seem to matter given that Canada’s average life expectancy is two years longer than the United States’ according to the World Bank. In addition, the word “safe” already appears in the Sanders amendment when related to the importation of drugs. This excuse seems like a cynical effort to divert responsibility for a bad call.

 

Further Reading:

  • “How to Alleviate High Cost of Prescription Drugs in the U.S.”; http://sco.lt/765VGj
  • “Federal Judge Strikes Down Maine Drug Re-Importation Law: Is It a Victory for Patients or for Pharma?”; http://sco.lt/7e2ykT
Pharma Guy's insight:

Public Citizen, a consumer-advocacy group and longtime critic of the pharmaceutical industry, has a mixed view of importation. The group, founded by Ralph Nader, has expressed concerns about quality and maintaining FDA standards. But it also is wary of industry influence opposing proposals to provide lower-cost drugs.

 

“Quality is not an illegitimate argument,” said Peter Maybarduk, director of Public Citizen’s Access to Medicines Program. “However, our experience counsels that it sometimes is a fig leaf for protecting pharma profits, and that issue shouldn’t be ignored as well.”

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Holy Sh*t! Is There No End to Mylan's Shenanigans? Paying Off Patient Groups to Lobby!

Holy Sh*t! Is There No End to Mylan's Shenanigans? Paying Off Patient Groups to Lobby! | Pharmaguy's Insights Into Drug Industry News | Scoop.it

Against a growing outcry over the surging price of EpiPens, a chorus of prominent voices has emerged with a smart-sounding solution: Add the EpiPen, the lifesaving allergy treatment, to a federal list of preventive medical services, a move that would eliminate the out-of-pocket costs of the product for millions of families — and mute the protests.

 

Dr. Leonard Fromer, a clinical professor of family medicine at the University of California, Los Angeles, just promoted the idea in the prestigious American Journal of Medicine. A handful of groups are preparing a formal request to the government. And Tonya Winders, who runs a patient advocacy nonprofit organization, reached out late last month to crucial lawmakers on Capitol Hill.

 

“We can save lives by ensuring access to these medications,” said Ms. Winders, chief executive of the Allergy and Asthma Network.

 

A point not mentioned by these advocates is that a big potential beneficiary of the campaign is Mylan, the pharmaceutical giant behind EpiPens. The company would be able to continue charging high prices for the product without patients complaining about the cost.

 

An examination of the campaign by The New York Times, including a review of documents and interviews with more than a dozen people, shows that Mylan is well aware of that benefit and, in fact, has been helping orchestrate and pay for the effort.

 

The journal article says it was “drafted and revised” by a medical writing consulting firm paid by Mylan, in consultation with Dr. Fromer. And Dr. Fromer himself has served in the last year as a paid Mylan consultant — which he discloses as part of the journal article. The company has also contributed money to many other groups behind the effort, and it has met with them — and Ms. Winders’s organization in particular — to coordinate its strategy, the participants said.

 

The idea being advanced is simple: If the EpiPen makes the federal preventive list, most Americans would have no insurance co-pay when getting the product. That means they could obtain the medication with no direct cost, regardless of its retail price. Mylan could keep the EpiPen at the current price, or perhaps raise it more, while keeping patient anger at a minimum.

 

Instead, the federal government, health insurers and employers would pay the bill. Those costs, in turn, could be passed on to consumers in other ways, as in higher premiums or higher co-pays on other drugs.

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The Real Reason Big Pharma Wants to Help Pay for Your Prescription

The Real Reason Big Pharma Wants to Help Pay for Your Prescription | Pharmaguy's Insights Into Drug Industry News | Scoop.it
Fueled almost entirely by drugmakers’ contributions, the seven biggest copay charities, which cover scores of diseases, had combined contributions of $1.1 billion in 2014. That’s more than twice the figure in 2010, mirroring the surge in drug prices. For that $1 billion in aid, drug companies “get many billions back” from insurers, says Fugh-Berman.
“Drug companies aren’t contributing hundreds of millions of dollars for altruistic reasons,” says Joel Hay, a professor and founding chair in the department of pharmaceutical economics and policy at the University of Southern California. The charities “don’t ever have to scrounge for money. It falls right to them.” Both Hay and Fugh-Berman have served as paid expert witnesses in lawsuits against drug companies.
When Turing bought Daraprim and sought to boost its annual revenue from $5 million to more than $200 million, the use of patient-aid funds was considered essential, internal company documents show. Last May, as the company did its due diligence before the purchase, one executive warned in an e-mail that new, high copays would force toxoplasmosis patients to seek alternative drugs.
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Pharma Marketing Blog: Tufts New Estimate of Costs to Bring a Drug to Market & Beyond

Pharma Marketing Blog: Tufts New Estimate of Costs to Bring a Drug to Market & Beyond | Pharmaguy's Insights Into Drug Industry News | Scoop.it

The pharmaceutical industry is currently struggling to defend the high cost of drugs. It is using advertising and lobbying to reach lawmakers and payers (read, for example, "#Pharma Ramps Up Ads & Lobbying to Fend Off Rx Pricing Regulation").

PhRMA's multi-million dollar "From Hope to Cures" campaign, for example, pulls the heart strings by featuring a 5-year-old boy with Type 1 diabetes. This is part of PhRMA's pledge to spend several million dollars this year, and 10% more than in 2015, on digital, radio and print ads that emphasize the industry’s role in developing new drugs and advancing medical science. It also plans to spend more money lobbying and donated to political campaigns.

In these campaigns, the strategy is less focused on defending drug costs to pay for the cost of developing new drugs and more focused on the benefit of new drugs in fighting intransigent diseases such as diabetes, rare cancers, and Alzheimer's Disease.

Nevertheless, many pharma CEOs still speak of "return on capital" to defend high drug prices.

So capital expenditures (R&D costs) are still a big deal for pharma executives. I have been reporting on various estimates of the costs to bring new drugs to market for several years now. Most of these estimates come from the Tufts Center for the Study of Drug Development.

Tufts has a new estimate of these costs that includes a new cost item.

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Senate Invites Turing CEO Shkreli to Visit. Just What He Wanted!

Senate Invites Turing CEO Shkreli to Visit. Just What He Wanted! | Pharmaguy's Insights Into Drug Industry News | Scoop.it
A Senate committee is launching an investigation into prescription drug pricing, responding to public anxiety about companies hiking prices for once-inexpensive medicines.


The Senate’s special committee on aging requested documents and information Wednesday from Turing, Valeant Pharmaceuticals and two other drugmakers already under scrutiny for recent price spikes.


Notably, the senators called for a face-to-face meeting with Turing Pharmaceuticals CEO, Martin Shkreli, “as soon as it is practicable.” A former hedge fund manager, Shkreli has become the public face of the pricing controversy, after his company raised the price of the anti-infection drug Daraprim by more than 5,000 percent. The drug, which Turing acquired in August, is the only U.S.-approved treatment for a deadly parasitic infection that can affect pregnant women and patients with HIV.


Turing said in an emailed statement: “We are reviewing the committee’s request and, as we have and continue to do with similar congressional inquiries, we look forward to having an open and honest dialogue about drug pricing.”

Pharma Guy's insight:

Shkreli taunted politicians on Tweeter on November 3, saying he was "In DC. If any politicians want to start, come at me." (see photo above). Looks like Shkreli was not anywhere near the Senate in the photo.


IMHO, this guy is basking in his 15 minutes of fame. Who knows? He may become the next Trump and run for president some day... Yikes!

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Medicare Part D Spending on Drugs is Like "Pouring Money Down the Drain"

Medicare Part D Spending on Drugs is Like "Pouring Money Down the Drain" | Pharmaguy's Insights Into Drug Industry News | Scoop.it

Because of congressional restrictions on the government’s ability to negotiate with the pharmaceutical industry, Medicare Part D drug prices are significantly higher than those in either Medicaid or the Veterans Health Administration (VHA) and 30 other countries, a study by Carleton University and Public Citizen finds.


In fact, 27 of the non-U.S. OECD (Organization for Economic Co-operation and Development) countries were able to purchase the medications studied from manufacturers at less than 50 percent of the purchase price in the U.S.


In a letter sent to Congress today, the authors call for a House-Senate committee to be formed to draft legislation that would lower Medicare Part D prices to those of Medicaid or the VHA. Doing so could save Medicare Part D between $15.2 billion and $16 billion a year and reduce the number of people who don’t fill their prescriptions for financial reasons.


The study, which was partially based on previously unpublished data, compared prices paid to manufacturers for a standardized group of brand-name medications in the 31 OECD countries, including the U.S. The study was conducted by Marc-Andre Gagnon, an associate professor at the School of Public Policy and Administration at Carleton University in Ottawa, and Dr. Sidney Wolfe, co-founder and senior adviser of Public Citizen’s Health Research Group.


Gagnon said he was surprised at the results. “We thought that brand-name medicines were a little bit more expensive for Part D, but we never thought that it would be twice as much as in other developed countries,” he said. “It is like pouring money down the drain.” 

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Drug Effectiveness Should Determine Drug Prices, Not Drug Discovery Costs

Drug Effectiveness Should Determine Drug Prices, Not Drug Discovery Costs | Pharmaguy's Insights Into Drug Industry News | Scoop.it

Ever wonder how much it costs to develop a new drug? The independent, non-profit research group, The Tufts Center for the Study of Drug Development, estimates US$2.6 billion, almost double the centre’s previous estimate a decade ago. But how accurate is this figure?


While the details of the study remain a secret, a press release, slideshow and background document on the Tufts website provide some insight into how this figure was calculated. Interestingly, only slightly more than half of this cost is directly related to research and development (R&D). US$1.2 billion are “time costs” – returns that investors might have made if their money wasn’t tied up in developing a particular drug.


So why is this debate important and why does it matter whether or not these estimate are correct?


These costs are used to justify high drug prices. These prices increasingly have the potential to disable health-care systems, create enormous opportunity costs (as funds that could be spent on other goods and services are diverted to purchase more and more expensive drugs), and place medicines out of reach of all but the most wealthy individuals or governments.


This is a reminder that the real issue is not how much it costs to develop a drug, but whether or not these drugs are worth the high prices pharmaceutical companies charge for them.


While advocates of a completely free market might see “just” pricing and all forms of price control as “medieval”, “socialist” or as suppressing innovation, others worry that drug prices bear little, if any, correlation with actual clinical value.


Rewarding innovation is necessary, but allowing drugs to be priced according to whatever the market will bear, rather than according to their benefits and cost-effectiveness, leads to inefficiencies, inequities and dramatic global inconsistencies.

Pharma Guy's insight:

The debate continues! I was wondering how long it would take to rebuke Tufts estimate. Read La Mattina's piece: "Do R&D Costs Matter When It Comes To Drug Pricing?" http://onforb.es/1JGqtKr 


Here's Avorn's NEJM Perspective piece: "The $2.6 Billion Pill — Methodologic and Policy Considerations"; http://bit.ly/1ISWv5l 


And Tufts rebuttal: "The Cost of Drug Development"; http://bit.ly/1Hyrfqv

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A Patient Journey Story Pharma Wishes Wasn't Told

A Patient Journey Story Pharma Wishes Wasn't Told | Pharmaguy's Insights Into Drug Industry News | Scoop.it

Attend any pharma marketing  conference these days and most likely you will hear these buzzwords: "storytelling" and "patient journey."

For example, at iPharma 2015, Brandon Graham, Chief Creative Officer, EUXmedia, talked about "storytelling" and the "patient journey" and how to effectively use video to follow a typical patient in their "journey" from pre-diagnosis through therapy (read more about that here).

I hate to tell you this, but the news media does a much better job following Graham's advice than any pharma company I know. But media stories more often than not portray pharma as the villain, not the shinning knight that rides in to save the damsel in distress!

Take, for example, last night's NBC Nightly News story about Lauren Baumann, a cancer patient who manages her chronic myeloid leukemia by taking Gleevec, a medicine developed by Novartis (after much pushing & shoving by cancer patient advocates -- but that's another story).

What's her story? Why was it told on national TV? And what should have been done to prevent the story in the first place?


Read more here: http://bit.ly/1Fx2jfb

Pharma Guy's insight:


After seeing this story, I want to kill Novartis (in a Supreme Court kind of way, not literally).

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Hype Over "Miracle" Cancer Drugs Overshadowed by Cost Criticism at ASCO

Hype Over "Miracle" Cancer Drugs Overshadowed by Cost Criticism at ASCO | Pharmaguy's Insights Into Drug Industry News | Scoop.it

Every year in late May, nearly forty thousand oncologists flock to Chicago for the world's biggest cancer jamboree - ASCO, the American Society of Clinical Oncology. I've been going intermittently for as long as I've been an NHS consultant, over 35 years.


For the next few days the global media will be awash with miracle cancer drugs. Positive stories are carefully placed by smart marketing and PR people in Armani suits and dazzling power dresses on behalf of the pharmaceutical industry. It all sounds so convincing. But the reality is a sophisticated conspiracy to hype up products being sold to bigger companies by small start-ups, to get more investment for the industry from the City or Wall Street, or simply to ramp up share prices and make short-term gains.


Just look at one press release put out yesterday for a new immunotherapy product. It claimed: "Terminally-ill cancer patients have been “effectively cured” by a game-changing new class of drugs". This was for a new type of immune stimulation therapy studied in a variety of cancers. Called a checkpoint inhibitor, this drug removes the brakes from the immune system, allowing it to recognise and destroy cancer cells. But the key study only shows a 3 month prolongation of survival compared to chemotherapy alone. And the cost is over £100,000 a patient. Imagine all cancer patients were given it - that would consume more than the entire current NHS budget.

Pharma Guy's insight:


Read what a keynote speaker at ASCO had to say about prices of cancer drugs: Keynote Speaker at ASCO Says Value of Cancer Drugs Don't Justify the Cost - http://sco.lt/8A1w5B 

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Multi-Millionaire Ex-Pfizer Exec's Effort to Defend Pharma Drug Pricing is "Transparent Jive"

Multi-Millionaire Ex-Pfizer Exec's Effort to Defend Pharma Drug Pricing is "Transparent Jive" | Pharmaguy's Insights Into Drug Industry News | Scoop.it
The Forbes columnist and pharma cheerleader, John La Mattina, left Pfizer in 2008 as their R&D head with a $22.6 million package after spending $1 billion of the company's money on an HDL-cholesterol enhancer that never got past the FDA. This week he wrote an item attacking two members of the Harvard Medical School faculty because they dared to criticize the industry's basis for pricing its drugs.


The interesting fact here is the only thing Drs. Jerry Avorn and Marcia Angell did, was show that pharma's lobby, PhRMA, has been using phony evidence to justify exorbitant pricing for over 50 years.  During this time the industry tried justifying high drug prices by claiming they were necessary for the R&D to develop better, new drugs.  Avorn and Angell merely made the case that pharma wildly exaggerates its real R&D expenses.  Yet La Mattina claims their criticisms miss the mark entirely because, in his view, drug prices are justified by their value, not their ability to recoup R&D costs.


If La Mattina's efforts to exonerate pharma weren't such transparent jive, they would be quite amusing.  Think about it.  Avorn and Angell show that pharma's explanation of R&D costs as the basis for high drug prices is baloney, so La Mattina accuses them of pursuing a wrong direction in trying to understand drug prices.  According to La Mattina, pharma is not wrong when it uses an irrelevant argument supported by phony cost numbers.  Instead he claims that Avorn and Angell miss the point behind drug pricing.  That's like saying traffic cops are at fault for excessive speeding by motorists.


With a writer less disingenuous it would be reasonable to ask whether he has thought through the consequences of his position. 

Pharma Guy's insight:


The debate continues! I was wondering how long it would take to rebuke Tufts estimate. Read La Mattina's piece: "Do R&D Costs Matter When It Comes To Drug Pricing?" http://onforb.es/1JGqtKr 


Here's Avorn's NEJM Perspective piece: "The $2.6 Billion Pill — Methodologic and Policy Considerations"; http://bit.ly/1ISWv5l 


And Tufts rebuttal: "The Cost of Drug Development"; http://bit.ly/1Hyrfqv 

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#Pharma Behaves as a "Classic Oligopoly Cartel," Says Oncologist

#Pharma Behaves as a "Classic Oligopoly Cartel," Says Oncologist | Pharmaguy's Insights Into Drug Industry News | Scoop.it

Dr. Hagop Kantarjian is an oncologist who spends his days treating leukemia patients at Houston's M.D. Anderson Cancer Center and conducting research to develop new treatments.  His humane concerns and interest in public policy came to light in a study he authored this month for the Mayo Clinic Proceedings, titled, "Why Are Cancer Drugs So Expensive in the United States"?


The fact that engaged Dr. Kantarjian's interest and disapproval was that prices for cancer medications increased from an average of $5,000 - $10,000 before 2000 to more than $100,000 by 2012, during a time when average household income in the U.S. fell by 8%.  An increasing proportion of his patients became unable to afford their medications, even though taxpayers fund 85% of cancer research in this country. 

Kantarjian's travels overseas also showed him that the U.S. pays 50-100% more than other advanced countries for the same medications. Overall, health care consumes 18% of this country's GDP, contrasted to 5-9% for the European countries. Yet the outcomes here are worse, according to numerous sources such as the Commonwealth Fund, the Institute of Medicine, the World Health Organization and others.


The reasons for these sad state affairs were not difficult for Kantarjian to locate.  The red thread running through all of them is that the U.S. operates a for-profit health care system.  This need to pursue profit drives all of the arguments that pharma uses to justify its exorbitant prices.  Kantarjian examined every one of those justifications for high prices and found each to be incorrect or blatantly misleading.


For decades pharma's trade association, the PhRMA, has trotted out the excuse that the high costs of R&D require the drug companies to charge steep prices. Kantarjian shows that explanation to be nonsense. The actual out-of-pocket costs for developing a real drug are no more than 10% of what the industry claims.  Kantarjian also refers to the studies of Nobel laureate Joseph Stieglitz and other economists that demonstrate how pharma behaves as a classic, oligopoly cartel with only negligible pricing competition. Drug prices are high, according to the economists, mainly because pharma possesses the economic muscle to keep them that way. In fact, this lack of price competition amounts to the functional equivalent of "monopolistic agreements."


Pharma Guy's insight:


Kantarjian next goes on to show that higher profits for drug companies do not result in better drugs. Instead, he concludes that, "High profits are often channeled toward higher salaries and bonuses of drug companies’ CEOs, not invested back into cancer research."


It's interesting to note that 86% of pharmaceutical executive attendees at today's #e4pbarca pharma conference in Barcelona agree that pharmaceutical companies need to become genuine healthcare providers! Yikes! That would really boost the pay of pharma CEOs! Read my summary of this conference: http://bit.ly/re4pbarca

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Graham Player Ph.D.'s curator insight, March 26, 2015 12:36 PM

Prices for cancer medications increased from an average of $5,000 - $10,000 before 2000 to more than $100,000 by 2012, during a time when average household income in the U.S. fell by 8%.

The U.S. pays 50-100% more than other advanced countries for the same medications. Overall, health care consumes 18% of the U.S. GDP, contrasted to 5-9% for the European countries. Yet the outcomes in the U.S. are worse, according to numerous sources such as the Commonwealth Fund, the Institute of Medicine, the World Health Organization and others.

Dr. Hagop Kantarjian authored a study for the Mayo Clinic Proceedings, titled, "Why Are Cancer Drugs So Expensive in the United States"? In that he asserts that the main reason for the higher cost of drugs is that the U.S. operates a for-profit health care system.  This need to pursue profit drives all of the arguments that pharma uses to justify its exorbitant prices. Kantarjian examined every one of those justifications for high prices and found each to be incorrect or blatantly misleading.

For decades pharma's trade association, the PhRMA, has trotted out the excuse that the high costs of R&D require the drug companies to charge steep prices. Kantarjian shows that explanation to be nonsense. He reveals how pharma behaves as a classic, oligopoly cartel with only negligible pricing competition.

Drug prices are high, according to the economists, mainly because pharma possesses the economic muscle to keep them that way. In fact, this lack of price competition amounts to the functional equivalent of "monopolistic agreements."

Kantarjian next goes on to show that higher profits for drug companies do not result in better drugs. Instead, he concludes that, "High profits are often channeled toward higher salaries and bonuses of drug companies’ CEOs, not invested back into cancer research."

Other culprits include branded pharma's efforts to delay the appearance of cheaper generics (through such tactics as "patent evergreening,"  "pay for delay," and "approved generics") and the industry's use of political connections to prohibit drug re-importation from Europe and the Commonwealth countries.

He believes that pricing must be based on "fairness," which he defines as pricing in which profit does not jeopardize affordability to patients and the country. This was in fact part of pharma's historic mission, which its current pricing practices have abandoned "in favor of maximizing profits regardless of the potential consequences to patients."

To read the full study see here - http://www.mayoclinicproceedings.org/article/S0025-6196%2815%2900101-9/fulltext

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The Vatican Berates #Pharma's Excessive Focus on Profits and Total Disregard for the Poor

The Vatican Berates #Pharma's Excessive Focus on Profits and Total Disregard for the Poor | Pharmaguy's Insights Into Drug Industry News | Scoop.it
You know, Jesus was pretty big on that whole "healing poor people" thing.


According to Vatican Radio, last Wednesday Archbishop Silvano M. Tomasi, the Permanent Observer of the Holy See to the United Nations, spoke at a UN Forum dedicated to making medicines more affordable and accessible for people in poorer nations. In his address, Tomasi argued that there are many obstacles that keep poor people from purchasing drugs, but called out one issue as particularly devastating: the abuse of intellectual property laws by pharmaceutical companies.


“A major stumbling block in providing such access is found in restrictive applications and interpretations of intellectual property rights by many in the pharmaceutical industry,” Tomasi said, adding “[The current system] can lead to total disregard for those who cannot afford the price of certain medical products and allow an imbalanced free trade system, and thus constitute a virtual monopoly.”


The Archbishop also noted that most intellectual property systems only incentivize developing medications that accrue the biggest profits, which usually means companies spend the vast majority of their resources making drugs for people in wealthier nations. As such, businesses often fail to develop treatments for maladies common in poorer countries, such as tropical diseases, tuberculosis, malaria, hepatitis, and Ebola.


“It is most regrettable, therefore, that, due to an excessive focus on profit, we witness a preference within much of the pharmaceutical industry to orient research toward health issues that have greater market potential in wealthier industrialized countries,” Tomasi said.

Pharma Guy's insight:


The article concludes with this:


Taking on the drug industry and overhauling a global intellectual property system is a tall order, and the Catholic Church certainly can’t change things overnight on its own. Still, the Vatican and Pope Francis have shown themselves highly capable of impacting domestic and international health policy in the past — Catholics were crucial players onboth sides of the debate over the ACA, for instance. More importantly, with more than more than 5,000 Catholic-owned hospitals and 18,000 health dispensaries spread across the globe, the Church is as well positioned as anyone to address health issues on an international scale.

 

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Tackling the Prior Authorization Challenge: A Critical Task for #Pharma

Tackling the Prior Authorization Challenge: A Critical Task for #Pharma | Pharmaguy's Insights Into Drug Industry News | Scoop.it

Talk with busy physicians and you’ll soon hear about the ever-increasing difficulty in getting approval for the medications that they believe are most appropriate for their patients. For pharma marketers, a superior efficacy, side effect and dosing profile is a necessary start, and a favorable managed care formulary position can be another positive step toward commercial success—but, more and more frequently, a prior authorization (PA) request must be approved before a medication can be dispensed and taken by the patient.

 

In other words, it’s not enough that the physician prescribes your product—something on which pharma often spends hundreds of millions of dollars in promotional investments, including advertising, sales, training, samples, conferences, and late phase research, all aimed at demonstrating that the product is best suited to treat certain therapeutic conditions. These efforts may lead a physician to write a prescription, yet there is no guarantee that the product will be dispensed, if the managed care plan restricts the patient from getting the medication.

 

Prior authorization (PA), is a stipulation by managed care organizations requiring a prescriber to seek approval for a specific drug by completing and submitting information before a drug can be reimbursed. The incidence and complexity of PAs is increasing, affecting more and more medications.

 

While most pharma executives are aware of PA requirements, they are sometimes unaware of the full implications. When a PA requirement is imposed, only 29% of patients end up with the originally prescribed product—and 40% end up abandoning therapy altogether. Not only is this negative for pharma and frustrating to prescribers, but it is even worse for those patients who don’t get the medication that could best treat their condition, or who don’t get any therapy at all. Further, the abandonment of prescriptions because of PA hurdles can have an “economic backlash” on the healthcare system as a result of additional office and emergency department visits, hospitalizations/re-admissions and other avoidable costs.

 

Most branded medicines face PA requirements across multiple managed care plans. While electronic PA processing (ePA) offers hope for a more efficient process in the future, for most managed care plans today the PA process can involve multiple steps for a physician practice: securing the correct form, filling it out with the required clinical information, appending clinical documentation in certain instances, submitting the form to the plan, and often completing and submitting a “follow-up, patient specific” form.

 

Further Reading:

  • “Adherent Health's Mobile Health Library Includes Prior Authorization App”; http://sco.lt/8slvcH
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Consumers' Healthcare Costs Continue to Rise - Drug Costs First & Foremost

Consumers' Healthcare Costs Continue to Rise - Drug Costs First & Foremost | Pharmaguy's Insights Into Drug Industry News | Scoop.it

The key contributors to health care spending by percentage were, first and foremost, prescription drugs which rose 9% in the year — notably, specialty medicines like anti-infective drugs (such as those for Hepatitis C and HIV) costing on average $83 per “filled day.” This cost doubled from $53 per person in 2012 to $101 per person in 2015.

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PhRMA Puts the Cost of Medicines in Context from Its Perspective

PhRMA Puts the Cost of Medicines in Context from Its Perspective | Pharmaguy's Insights Into Drug Industry News | Scoop.it

Discussions about costs are important. No patient should have to worry about whether they can afford the care they need. At the same time, it is important to look at costs across the health care system and not just the share going toward life changing medicines.

Researchers and scientists across the biopharmaceutical industry have dedicated their lives to the search for new treatments and cures for patients. As a result of this perseverance, new therapies are transforming care for patients fighting debilitating diseases like cancer, hepatitis C, high cholesterol and more. In the midst of all this progress, the share of spending on retail medicines remains the same as it was 50 years ago. In fact, government actuaries project the share of health care spending attributable to medicines will continue to grow in line with overall health care cost growth for at least the next decade.  

PhRMA's updated Prescription Medicines: Costs in Context explains how competition among brand-name medicines, high generic utilization rates and aggressive tactics by insurers and pharmacy benefit managers to negotiate lower prices all help to keep costs under control. Costs in Context also dives into recent advances in treating devastating diseases, challenges and opportunities for biopharmaceutical companies in the rapidly changing marketplace and policy solutions we need to focus on to continue delivering innovative treatments to patients.   

Pharma Guy's insight:

Also read “PhRMA Plans to Seize Control of Public Narrative Over Drug Prices with Massive Ad Campaign”; http://sco.lt/9E2Lab

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#Pharma's Drug Price Blame Game: Politics (Clinton Especially) & The Media

#Pharma's Drug Price Blame Game: Politics (Clinton Especially) & The Media | Pharmaguy's Insights Into Drug Industry News | Scoop.it

Drug industry executives don’t get it: They’re not supposed to be the bad guys.

That was the feeling that seemed to permeate the annual meeting of the Pharmaceutical Research and Manufacturers of America, which gathered here this week amid withering scrutiny from politicians and the public.

The blame was spread around. Political candidates don’t understand how drug prices work. Neither does the public. The media isn’t helping, of course, focusing on outlandish characters like Martin Shkreli who don’t represent the bulk of a $300 billion industry.

“The headlines don’t tell the full story,” said Kenneth Frazier, Merck CEO and chair of PhRMA’s board, said to open the meeting Wednesday.

Stephen Ubl, PhRMA’s new president and CEO, was even more blunt. He alluded to a tweet from Hillary Clinton, announcing a forthcoming plan to combat price-gouging for medications. Some analysts blamed the tweet for a $132 billion loss in biotech investment.

Ubl was indignant.

“As we all know, the debate is largely myopic and misinformed,” he said. “The debate also ignores the value our products bring to patients, the health care system and the broader economy.”

“You wouldn’t know it from the headlines,” Ubl added. “The value is barely a footnote in these stories.”

Pharma Guy's insight:

Also read: "Merck CEO Repeats Same Old Defense for Raising Prices of #Pharma Drugs"; http://sco.lt/7eHLIf 

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Deloitte Claims Pharma R&D Returns Are Too Low: No Wonder Drug Prices Are Rising

Deloitte Claims Pharma R&D Returns Are Too Low: No Wonder Drug Prices Are Rising | Pharmaguy's Insights Into Drug Industry News | Scoop.it

Returns on R&D in the drug industry are too low to sustain future pipeline investment, according to a new Deloitte study.


While the number of new drugs reaching the market last year reached a record 43 products, the headline figure masks underlying problems that will require a transformation of the R&D approach to fix, the study suggests.


The report - Measuring the return from pharmaceutical innovations 2015: Transforming R&D returns in uncertain times - reveals that R&D returns for the top 12 pharma companies in 2015 have fallen to 4.2% - less than half the 10.2% return enjoyed in 2010.


The bottom line is that costs to develop new products are rising - from an average of $1.18bn in 2010 to an estimated $1.58bn this year - while average peak sales have halved from $816m to $416m.

"The numbers simply do not add up for life sciences R&D to generate an appropriate return," notes Deloitte. 


Some companies have responded with a push into specialty therapeutics, but they need to be mindful about potentially missing valuable opportunities in primary care categories.


On the plus side, costs associated with terminated R&D projects have reduced from $80bn in 2010 to $30bn this year. Meanwhile, a new cohort of four smaller, mid-to large-cap companies - included in the report for the first time this year - paints a rosier picture.

Pharma Guy's insight:

No wonder the drug industry is emulating Martin Shkreli in jacking up drug prices while vilifying him unjustly (see here: http://bit.ly/1TRLhB8

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Transparency Hits a Wall When It Comes to Drug Pricing

Transparency Hits a Wall When It Comes to Drug Pricing | Pharmaguy's Insights Into Drug Industry News | Scoop.it

Americans are starting to feel the pinch from high drug prices. In a survey recently reported by Consumer Reports, one-third of Americans said they paid an average of $39 above the usual cost for their latest prescription. One in ten said they paid $100 or more out-of-pocket. Forty per cent of people answering the survey said that during the past 18 months, high prescription prices forced them to cut corners with their medications; while many say their increased drug costs make them twice as likely to avoid seeing their doctor or forego a medical procedure.


Even Congress has noticed how drug costs have squeezed their constituents. Earlier this month Senator Bernie Sanders (D-Vt) and Rep. Elijah Cummings (D-Md) sent a letter to Valeant's CEO, Mike Pearson, demanding the following information by September 3:


"Dates, quantities, purchasers and prices paid for all sales of the drugs; total expenses relating to their sales, including specific amounts for manufacturing, marketing and purchasing of [active ingredients]; sales contracts, profit projections and more."


The sentiment demanding pricing transparency from pharma companies is not limited to Congress. Massachusetts, New York, California, Pennsylvania, Texas, North Carolina, and Oregon have various bills pending to expose the way pharma company’s price their drugs. 

Pharma companies and their powerful lobby, the Pharmaceutical Research and Manufacturers Association (PhRMA), have long claimed that such costs drive up drug prices. Now the states are demanding information to see if that's true or if drug companies are gouging prices to enhance their own profits.


Pharma spokesmen resist [these calls] for transparency, claiming that the measure would dampen incentives for companies to develop lifesaving therapies. Their objection also sings the PhRMA's old tune that while drugs constitute only 10 to 12 percent of health care costs, they save the system money by keeping patients out of the hospital.


Those arguments to defend exorbitant prices and prevent legislative oversight are irrelevant and misleading. Although drug prices at this time do represent 10 to 12 per cent of total health care costs, they are rising at a faster rate than the costs of other health sector components.


Secondly, prices have been rising enormously for almost all drugs, regardless of their respective contributions to life and well-being. When the prices for drugs that have been on the market for a decade or two shoot up between 50 and 500 percent in a single year, something is behind it other than some newly discovered ability to save lives.


Third, while many drugs help to delay or avoid hospitalization and other health care costs, the same argument can be made to defend the prices of food, good housing, safe automobiles and scores of other products and services. When an increasing number of Americans have to choose between paying for their medications and paying for food, housing and other necessities, then the argument about drugs saving other costs and enhancing life loses its persuasiveness.

Pharma Guy's insight:

Related story: "Poll: High Drug Prices, Not Obamacare, Alarm US Public"; http://sco.lt/54gQbJ 


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Patients, shareholders take aim at Vertex over drug prices & exec bonuses

Patients, shareholders take aim at Vertex over drug prices & exec bonuses | Pharmaguy's Insights Into Drug Industry News | Scoop.it

Vertex, who is based in downtown Boston, got the kind of headlines that pharma has been trying to avoid.  Three stories, talk about the high price of their new CF drug and the urges shareholders to reject compensation packages for senior executives.


Vertex won US approval for a two-drug therapy called Orkambi that eventually could treat roughly half of the 30,000 Americans with cystic fibrosis but the price the drug at $259,000 per patient annually which is steep.


According to the Boston Globe “the question resonates with health insurers and consumer groups that have raised alarms about the soaring prices of specialty therapies for everything from cancers to rare genetic disorders. Vertex’s prices have come under scrutiny, initially in a 2013 article in a leading medical journal, partly because they seemed to crystallize the broader debate over how to hold down health costs while rewarding makers of treatments for relatively small numbers of patients.”

 

But that’s not the end of it.

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Specialty Drugs Driving Growth in Rx Spend

Specialty Drugs Driving Growth in Rx Spend | Pharmaguy's Insights Into Drug Industry News | Scoop.it

U.S. prescription-drug spend in 2014 reached $373.9B — a 13 percent increase from the previous year and the largest increase in more than a decade, as more effective and expensive new specialty drugs came to market and existing specialty drugs saw prices rise. The cost increase in specialty drugs makes it ever more difficult for consumers to access needed therapies. It is also squeezing state budgets, constraining employer-provided benefits and consuming resources that could otherwise go toward improving critical areas of healthcare delivery.


Recent analysis of data from Blue Cross Blue Shield (BCBS) companies, the largest commercial claims database in healthcare, confirms this broader trend. BCBS companies’ data reveal that prescription drug (Rx) per-member per-month (PMPM) spend increased by 9.3 percent from 2013 to 2014. This growth outpaced even the substantial rise in outpatient costs, and it far exceeded growth in inpatient and other professional costs. More importantly, this rise in Rx spend also runs counter to other trends, such as greater use of less-expensive generic drugs. For example, in 2014, consumers chose generic drugs two-thirds (67.7 percent) of the time when a branded counterpart was available versus just over half (54.9 percent) of the time in 2012.

Pharma Guy's insight:


The driving factor behind the Rx cost trend is the cost of specialty drugs. Data confirm that in 2014, specialty drug unit costs jumped 20.1 percent, compared to 5.7 percent for non-specialty drugs. Utilization for specialty drugs also rose by 7.3 percent in 2014.


Within the specialty pharmaceutical portfolio, the top 10 drugs contribute to 61 percent of overall spend. New Hepatitis C and Multiple Sclerosis drugs have contributed significantly to the trend (e.g., Sovaldi®, a Hepatitis C treatment introduced in October 2014 priced at $84,000 for 12 week treatment, and Tecfidera® for Multiple Sclerosis priced at $55,000 for 1 year treatment).

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#Pharma Trash Talk Bites Hand That Feeds ASCO

#Pharma Trash Talk Bites Hand That Feeds ASCO | Pharmaguy's Insights Into Drug Industry News | Scoop.it

In a sign of growing frustration with rising drug prices, a prominent cancer specialist on Sunday sharply criticized the costs of new cancer treatments in a high-profile speech at one of the largest annual medical meetings in the U.S.


“These drugs cost too much,” Leonard Saltz, chief of gastrointestinal oncology at Memorial Sloan Kettering Cancer Center, said in a speech heard by thousands of doctors here for the annual meeting of the American Society of Clinical Oncology.


Dr. Saltz’s remarks focused mainly on an experimental melanoma treatment made byBristol-Myers Squibb Co., but he also criticized pricing more widely.


(Read the statistics he cited here: http://sco.lt/7YrrHt). 


Dr. Saltz’s speech was unusual because it was made at the meeting’s plenary session, where the field’s most significant scientific research is presented and which all meeting participants are expected to attend. An estimated 25,000 doctors and scientists attended this year’s meeting.

It is unprecedented for plenary speeches, which typically address scientific and medical issues, to substantially take on the topic of drug costs, said Alan Venook, a professor of medicine at the University of California San Francisco who planned the meeting’s scientific session and invited Dr. Saltz to speak.


The prominent venue for the speech was also unusual because, like many medical meetings, ASCO is sponsored by pharmaceutical companies and often focuses on highlighting advancements in drug development, said Dr. Venook. He said discussing drug prices there is “uncomfortable” because it could be seen as “biting the hand that feeds you.”

Doctors are also reluctant to antagonize the drug industry because they need pharmaceutical firms to invest in developing new medicines for patients, he said.


“It’s a tough balancing act for ASCO where the meeting is largely funded by pharma,” Dr. Venook said in an interview. “You can’t have a [plenary] talk trashing pharma, but you can have a talk by a respected person questioning it.”


“All of the stakeholders involved need to stop pretending that price is something we don’t need to discuss, because it affects all of us, and it’s affecting our ability to deliver quality care to everyone,” Dr. Saltz said in the interview. He said that one step toward controlling prices would be allowing Medicare to negotiate prices directly with pharmaceutical companies, which it is currently barred by law from doing. He also called for changing the way Medicare pays for infused drugs. Doctors currently receive a percentage of the drug’s total sales price. The payment method has created a conflict of interest because cancer doctors can make more money by using the most expensive drugs, he said.

Pharma Guy's insight:


Meanwhile, Robert Goldberg over at Drug Wonks blog said: "Dr. Saltz said cancer drug prices are insane and immoral.  I’d say the same about someone who said ... we shouldn’t perhaps pay even a little more."


Leonard Saltz, MD, is the C.K. Lewis of ASCO!



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Keynote Speaker at ASCO Says Value of Cancer Drugs Dosen't Justify the Cost

Keynote Speaker at ASCO Says Value of Cancer Drugs Dosen't Justify the Cost | Pharmaguy's Insights Into Drug Industry News | Scoop.it

Leonard Saltz of Memorial Sloan Kettering Cancer Centre (MSKCC) told delegates in a keynote presentation that cancer drug prices are not related to the value of the drug but are "based on what has come before and what the seller believes the market will bear."


In a presentation focusing mainly on immuno-oncology drugs, he pointed out that the much-lauded combination of Bristol-Myers Squibb's PD-1 inhibitor Opdivo (nivolumab) and anti–CTLA-4 antibody Yervoy (ipilimumab) in melanoma carries a regimen cost for a typical 80kg patient of nearly $300,000.


If all the US patients with metastatic cancer took a regimen set at that price, the total cost to the healthcare system would be an eye-watering $174bn, he pointed out.


"The price of ipilimumab is "approximately 4,000 times the cost of gold," said Saltz who indicated that while the efficacy of Opdivo/Yervoy was clear from the study, their value in terms of cost and associated benefits is still in question.


The rising costs of these drugs do not reflect development costs, nor do they help drive innovation, said Saltz, who noted that the median price of new cancer therapies in the US had doubled from $4,716 in 2000-2004 to $9,900 in 2010-2014.


He also outlined a hypothetical case in which Merck & Co's Keytruda (pembrolizumab) - given at a dose of 10mg/kg every two weeks to a 75kg patient - could cost $83,500 per month or more than $1m a year. Even at the lower dose of 2mg/kg the price would still be $16,700 per month using the model.


"The unsustainably high prices of cancer drugs is a big problem, and it's our problem," he told delegates at ASCO, suggesting there has to be some upper limit that society is prepared to pay to treat a cancer patient.


"It's a very unpleasant discussion. It's very uncomfortable," but it is a necessary one to have, he said.  

Pharma Guy's insight:


I wonder if he was booed off the stage?

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"The Price of Cancer Drugs is Independent of Novelty" & Certainly Not Rational

"The Price of Cancer Drugs is Independent of Novelty" &  Certainly Not Rational | Pharmaguy's Insights Into Drug Industry News | Scoop.it

New research conducted by JAMA Oncology has found that prices for new cancer medicines sold in the US are too high with many simply not being justified by their limited efficacy.


The report's authors found that the annual cost of a new cancer medication now routinely exceeds $100 000, and that medical bills have become the single largest cause of personal bankruptcy.


Of these 51 drugs, 21 used a novel mechanism of action, while 30 are next-in-class drugs. Among 63 unique indications for approval, 22 drugs were approved based on disease response rate (RRs), while 22 were based on progression free survival (PFS), and just 19 based on the golden standard in oncology trials, that of increasing overall survival (OS).


The authors say however that there was “no difference” in the median price per year of treatment between the 30 next-in-class drugs ($119,765) and the 21 novel drugs ($116,100).


Drugs approved based on RR were priced highest, with median costs per year of treatment of $137,952.


This was greater than the price of drugs approved on the basis of OS (median cost, $112,370) and drugs approved on the basis of PFS (median cost, $102,677). There was no significant difference in the price of drugs approved on the basis of OS or PFS.

Pharma Guy's insight:


"The sad reality is this: The death rate for cancer (adjusted for the size and age of the population) has dropped only 5% from 1950 to 2005 (see here). 


So, (1) the reality is that the death rate for cancer hasn't improved very much in the past 50 years, and (2) pharma's little "pills" haven't contributed much to that statistic.


BTW, are many of these drugs sold directly by Oncologists who make a profit from the sale? 

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Calif Newspaper CEO Calls Gilead a "Good Pirate" that Knows Certain Captives are Worth More. What About Amgen?

Calif Newspaper CEO Calls Gilead a "Good Pirate" that Knows Certain Captives are Worth More. What About Amgen? | Pharmaguy's Insights Into Drug Industry News | Scoop.it

"Pharmaceutical company pirates hold Californians hostage," says Jeff vonKaenel is the president, CEO and majority owner of the News & Review newspapers in Sacramento, Chico and Reno.


Perhaps Gilead spent so much time and money researching and developing this wonder drug that they deserve a fair return on their investment? Well, no. Gilead did not create the drug. Another company, Pharmasset, developed Sovaldi.


After Pharmasset conducted successful clinical trials for treating hepatitis C in 2011, their stock price soared, tripling in value. Then in November 2011, Gilead bought them for $11 billion, 89 percent higher than the stock price.


Why did Gilead pay such a premium for Pharmasset? Perhaps they wanted the right to jack up the price of the wonder drug. Pharmasset had planned to charge only $36,000 for a course of the drug. But Gilead saw the huge profit potential. And, as any good pirate knows, one should not have the same ransom price for each captive. Certain captives are worth more.


So while Gilead charges Americans $84,000, they charge the Germans $66,000 and the English $57,000. And they charge the Egyptians only $900 for a supply of the drug. While this ransom pricing has been good for Gilead stockholders, who have seen their stock rise from $20 in October 2011 to $102 last week, it has not been so good for the millions of people who are waiting to be cured of hepatitis C. Only a small percentage of the world’s population who would benefit from the drug can now afford to pay for it.


Ransom pricing instead of reasonable pricing means that many people will die needlessly. And millions will suffer. We should say “no” to the Big Pharma pirates and empower our government to regulate the pharmaceutical companies so that we can get similar prices and access to drug treatment that people in other countries do.

Pharma Guy's insight:


LOL! But vonKaenel should also take a look at another Calfornia drug company: Amgen, which sells Blincyto (blinatumomab) for  $178,000 per two-cycle course, making it one of the most costly drugs on the market. For more on that, read Et Tu, Amgen? Blincyto's Bling! Bling! Price Tag!

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