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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Pharma Payments to HCPs Topped $8 Billion in 2016. Allergan & Celgene Paid Out the Most!

Pharma Payments to HCPs Topped $8 Billion in 2016. Allergan & Celgene Paid Out the Most! | Pharmaguy's Insights Into Drug Industry News |

Payments from drug and device companies to physicians and teaching hospitals hit more than $8 billion in 2016 according to Open Payments data recently released by CMS.

All told, nearly 631,000 physicians and approximately 1,146 teaching hospitals received $8.18 billion in payments and ownership and investment interests in 2016, according to tallies compiled by the CMS. Last year's total was $7.52 billion.

About half of the overall payments were for research and $2.7 billion were in payments not related to research. A little more than $1 billion stemmed from ownership or investment interests.

Of the largest pharmaceutical companies, Allergan paid out the most in 2016 with $66 million in total payments. Dr. George Patrick Maxwell, a plastic surgeon in Nashville, is listed as the highest payment recipient from Allergan, with $4.6 million.

Celgene was the second-highest spender with a total of $54 million in payments last year. Of its recipients, Boston oncologist Dr. Kenneth C. Anderson a took in the most, with $1.9 million.

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Pharma's Hidden CME Payments

Pharma's Hidden CME Payments | Pharmaguy's Insights Into Drug Industry News |
New rules will require manufacturers to report some indirect payments made to physicians for CME activities.


The Centers for Medicare and Medicaid Services updated reporting requirements for continuing medical education, pushing back the deadline for manufacturers to start reporting indirect payments to the Open Payments database by one year.

Drug and medical device manufacturers that pay third-party CME providers to hire physicians for education events are required to report those payments to the CMS if they find out the identify of the doctors who spoke or attended the event within one year.

CME advocates believe that this will mean the majority of CME payments will still remain unreported. Others have said they expect more reporting because manufacturers tend to find out the identify of the speakers.

The indirect payments that meet the new reporting threshold now have to be reported to the CMS starting in 2017 and will eventually be published in the Open Payments database, according to guidance issued by the CMS on Friday. The CMS defines direct payments as transfers of value made directly by the manufacturer to the physician or teaching hospital.

In 2014 the CMS revised reporting requirements for CME payments, removing a carve-out that it had created in the rulemaking process that exempted reporting of CME activities that fit certain categories, such as activities conducted by companies that are accredited by the ACCME, one of the nation's largest accrediting bodies. The revision was criticized by organizations that represent CME providers and drugmakers.

Those groups have advocated in Washington for legislation that would again provide an exemption. The sweeping 21st Century Cures Act that passed 344-77 in the House of Representatives in mid-July would exempt CME payments from reporting.

Pharma Guy's insight:

Also, ACCME's annual report does not break down income from "other" sources, but I suspect that at least some of that income originates from the drug industry through grants made to medical societies and private medical education communication companies (MECCs). These grants may not be included in the  "commercial" support category. For more on that, go here: 

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Value-Based & Transparent Drug Pricing a Priority for CMS

Value-Based & Transparent Drug Pricing a Priority for CMS | Pharmaguy's Insights Into Drug Industry News |

Andy Slavitt, CMS Acting Administrator spoke on Nov. 20 at the HHS Pharmaceutical Forum on the growing problem of consumer access to life-saving medications. Slavitt put forth a three-pronged strategy.

  • Applying a model of value-based payments to drugs
  • Increasing drug pricing and value transparency
  • Reexamining existing regulatory hurdles

National spending on drugs increased 13 percent in 2014. This is the highest increase the government has seen since 2001, according to Slavitt. He compared that figure to a 5 percent increase overall in health care spending.

“State Medicaid agencies in some cases are in the difficult position of withholding vital therapies for people in need,” said Slavitt.

In addition to high-cost specialty drugs, which are known cost drivers, Slavitt expressed concern for what he views as an industry-wide dysfunction in generic medications.

“Each year, the use of FDA-approved generics saves the country $200 billion. However, in some instances, the prices of generics available for years have increased substantially without any additional health benefits for patients,” said Slavitt.

One area that CMS is looking to reform is applying value-based payments to pharmaceuticals. Slavitt pointed out that while the government has shifted towards financial incentives for quality in providers and hospitals, similar incentives do not exist for more efficient drug therapies.

In addition, Slavitt states that CMS will also begin to look into drug pricing transparency.

“The truth is we don’t have enough public information on the effectiveness of new drugs in the real world or about prices and rebate structures,” said Slavitt. “In order to avoid reacting to misinformation, we must increase the transparency of the information available about drug pricing and value.

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AMA Says Docs Need More Time to Review Sunshine Data

AMA Says Docs Need More Time to Review Sunshine Data | Pharmaguy's Insights Into Drug Industry News |

The American Medical Association (AMA) is calling on the Centers for Medicare and Medicaid Services (CMS) to expand the timeframe for registering and using the Open Payments system to allow physicians adequate time to review and seek correction of inaccurate claims made by pharmaceutical companies, device manufacturers, and group purchasing organizations under the Sunshine Act. The call comes amidst continued poor functionality of the government website and poor communication to physicians and the public, which has led to widespread confusion among physicians and hindered education efforts about the program.

CMS reports that it has reopened the Open Payments database as of today, but indicates it will only allow physicians until September 8th to complete registration and seek correction of data.  Yet, the agency has not fixed the major problems that continue to mark the roll-out of this database including confusing and inaccurate information, lack of reliable functionality, and excessive time required to register and review reports.  This inadequate response will lead to inaccurate publication of data.  

While the AMA believes that transparency can strengthen our health care system and benefits both physicians and patients, if the government releases incorrect information to the public it can create misinterpretation and misrepresentation and inhibit the delivery of quality care to patients.

“In order for the Sunshine Act to be effective, physicians need enough time to review and correct any inaccurate data that may be reported,” said AMA President Robert M. Wah, MD. “The issues that resulted in the system being taken offline further underscore the need for more time than CMS proposes to ensure the system is actually ready and that physicians have adequate time to register, review, and seek correction of inaccurate data. The lack of faith physicians have in the system at this point in time, is making them wonder if taking time away from patients to go through the process is even worthwhile.”

CMS created widespread confusion by taking the Open Payments database offline without notice to physicians or physician organizations and without any indication of when the database would be available again. According to media reports, the Open Payments system was taken offline the evening of August 3rd due to significant technological problems. CMS inadequately communicated about website failures, not releasing a public statement about the system being offline until August 7th and not providing any indication of when the database would be available again, causing confusion among physicians.

Physicians were already given a short window to go through the cumbersome process of registering for the Open Payment System (which required a more than 360 page guidebook), reviewing information reported about them, and disputing any inaccurate data before publication in September. In order to get proper participation in the program to ensure all data reported is fair and accurate, AMA is asking CMS to significantly expand the timeframe for registration and data correction until March 31, 2015.

While the AMA supports the Sunshine Act, it cannot support the publication of inaccurate data. Wrong information, reduces patient trust which unnecessarily damages patient-physician relationships. Physicians deserve adequate amount of time to ensure the information being reported is accurate.

Pharma Guy's insight:

Meanwhile, Pharmalot reports:

Despite a disruptive tech glitch this past week, the U.S. Centers for Medicare and Medicaid Services is sticking with its Sept. 30 date for publishing detailed information about how much money drug and device makers pay physicians and teaching hospitals.

CMS announced today it would extend to Sept. 8 from Aug. 27 a review period for doctors and teaching hospitals to get an online preview the payment data before it goes public, in order to compensate for the 11 days the system was offline while CMS investigated a data mix-up.

But notably, CMS did not change the Sept. 30 date for the launch of a widely anticipated online searchable database, despite a recent request by some medical groups to delay the publication by six months so that doctors have more time to review and correct any inaccurate payment data.

[UPDATE: Meanwhile, more problems emerged. CMS is withholding about one-third of the data from the site. Why? The agency is "returning records to the manufacturers and group purchasing organizations because of intermingled data, and will include these records in the next reporting cycle," a spokesman tells us. This latest snag was reported byProPublica. CMS is due to report the next batch of payment data in June 2015]

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