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Pitting the FDA Against CMS

Biotechnology Healthcare...Fall 2011

The good, the bad, and the ugly about “parallel review.”
 

BY STEPHEN BARLAS


    
    
     When the Food and Drug Administration (FDA) approved Dendreon's novel prostate cancer vaccine in April 2010, the company believed PROVENGE® (sipuleucel-T) would lead it to the financial promised land. After all, the drug was a novel treatment, the first autologous cellular immunotherapy for the treatment of prostate cancer. Medicare's regional contractors quickly fell in behind the FDA, agreeing to pay for the drug.
     But Dendreon hit a speed bump on its fast track to fortune later in 2010. That is when federal Medicare, under the aegis of the Centers for Medicare and Medicaid Services (CMS), announced it would issue a National Coverage Determination (NCD) on Provenge, whose price is pegged at about $90,000 per treatment. Federal Medicare rarely questions the coverage decisions of its contractors, much less the quality of clinical trials ordered by the FDA as part of the approval process, although it has done so more frequently, and in high profile cases, in the past few years. Subsequently, a Medicare Evidence Development & Coverage Advisory Committee met in November 2010. It blessed coverage of the FDA approved use of Provenge with faint praise and threw icy water on off-label use.
     "For Medicare to take on a new cancer drug, that is pretty unusual," states Steve Phurrough, Chief Executive Officer of the Center for Medical Technology Policy. Phurrough served in executive positions at the CMS coverage and analysis division during the terms of Presidents George W. Bush and Barack Obama.
      Medicare's decision to undertake a NCD probably cooled the ardor of oncologists and urologists who might have been expected to prescribe the expensive new drug. Decision Resources, one of the world’s leading research and advisory firms for pharmaceutical and healthcare issues, released a survey in mid-June 2011, two weeks before the CMS published the final NCD, which ratified the recommendations of the November Advisory Committee. The Decision report said that over the next 12 months, according to surveyed physicians’ estimates, only 15 percent of patients eligible to receive Provenge would get prescriptions for it, despite the views of many surveyed physicians that the launch of Provenge represents a breakthrough in the treatment of prostate cancer.
    Provenge is a prime example of what can happen when the FDA approves a new drug it deems "safe and effective" based on clinical trials it prescribes, clinical trials which do not answer Medicare's questions about whether reimbursing for that drug is "reasonable and necessary." That FDA/CMS dissonance was examined at one session at the BIO convention in Washington, D.C. on June 28. The panel was called "Common Needs and Uncommon Cooperation: The State of Joint FDA and CMS Initiatives." The panel focused on a joint FDA/CMS proposal in the Federal Register in September 2010 to conduct "parallel reviews" of some drugs and/medical devices. The idea is to prevent FDA/Medicare "disconnects" such as the one caused by Provenge.
     The agencies are concerned that new drug applications have fallen off because brand name companies fear spending millions on clinical trials necessary to get FDA approval only to find that the FDA gift wrapping provides only " limited predictability of market access" and for that reason may "hinder investment in the development of innovative therapies and diagnostics."
     Drug companies, patient advocacy groups, physician professional organizations and others all sent in comments to the agencies with varying viewpoints. The agencies have been sifting through those comments and are apparently preparing a guidance document, whose publication may be imminent. Peter C. Beckerman, Senior Policy Advisor, FDA Office of Policy, says the agencies plan to announce a pilot program for medical devices. "Subsequently, pending our experience with the pilot, we would consider additional steps or public communications, he adds.
     Michael McCaughan, senior editor of the RPM Report, a newsletter which covers federal drug regulatory issues, and who spoke during the BIO panel, explained that the reaction from the pharmaceutical industry to the joint review proposal was "an almost hyperbolic fear."     
     "Fear" may be a bit too strong a description. But many trade associations such as BIO and pharmaceutical companies have nonetheless clearly voiced strong reservations about the concept of parallel review. In a letter to the CMS, Evan L. Morris, Vice President, Government Affairs, Genentech, Inc., wrote: "At this time, Genentech does not feel that the current system, under which Medicare initiates national or local coverage analyses/determinations only after FDA has approved a drug or biologic, has resulted in significant delays in post-approval coverage. Therefore, we do not see the need for the proposed parallel review process with respect to drugs and biologics."
    Patricia DeSantis, Vice President, Global Regulatory Policy and Intelligence, Johnson & Johnson, thinks collaborative review might make sense for some subgroups of drugs such as theranostics (e.g., therapy-related biomarkers) and regenerative medicine. But in the main, she states that if FDA trials were able to be used by the CMS toward a NCD, "the benefits of early discussions with CMS may be overcome by the disadvantages of premature initiation of an NCD that could lead to high risk of a negative coverage decision due to the paucity of clinical data."
    In fact, one pharmaceutical industry executive, who asks not to be identified, says the FDA is grasping for the wrong straw. He says, "It is more important for the FDA to get its house in order, as we move toward personalized health care, so that drugs and diagnostics get approved at the same time."
   Of course health insurers have a stake in the debate, too. They are somewhat unenthusiastic, but for the opposite reason drug companies have voiced. Allan M. Korn, MD, FACP, Senior Vice President, Clinical Affairs and Chief Medical Officer, the Blue Cross and Blue Shield Association (BCBSA), is concerned that parallel review, rather than keeping the FDA "honest," in a sense, by allowing Medicare some say in clinical trials, might end up watering down Medicare's coverage standards. "Assessments by the BCBSA Technology Evaluation Center over the course of two decades have identified numerous instances where the science supporting new devices cleared by the FDA did not also demonstrate improved clinical benefit or safety relative to existing covered products," says Korn. "In light of this, the establishment of parallel review must not allow a foregone conclusion that products evaluated through parallel review will be covered by Medicare if cleared for market by the FDA."
     Provenge is just the latest in some notable differences of opinion which have split the FDA and CMA over the years. Phurrough cites Erythropoiesis Stimulating Agents (ESAs) such as Epogen, Procrit and Aranesp, the hemoglobin boosters manufactured by Amgen. They were approved starting in 1989 by the FDA for use in cancer and kidney patients. Medicare undertook an NCD  nearly 20 years after their approval and in July 2007 restricted use of ESAs to cancer patients with hemoglobin levels below 10 and to treatments of no more than 150 micrograms three times a week. "That was a reasonable decision," states Phurrough, another speaker at the BIO seminar. The FDA subsequently adjusted the label indication for cancer to comply somewhat closely, but not exactly with the NCD.
     Subsequently, three years later, Dennis Cotter, president, Medical Technology & Practice Patterns Institute, submitted a request to CMS to issue a NCD for ESAs for chronic kidney disease (CKD). On June 16, 2011 Medicare declined to issue the NCD for chronic kidney disease. "This was despite the fact that the agency found no evidence of benefit and evidence of harm," says Phurrough, who suggests the Obama administration may have applied political pressure to the CMS.  "The decision was incongruent with the evidence." Amgen did not respond to a request for its view of the CMS decision. 
     But when the FDA in 2011 looked again at ESAs and CKD, it took the opposite tack from the CMS deciding on June 24, 2011 to revise the Black Box warning that had previously been required for ESAs with regard to CKD.  Cotter worked for the U.S. Public Health Service for five years advising Medicare on which drugs to cover. With regard to ESAs and CKD, he argues that for two decades no one has done a clinical trial to identify the appropriate hemoglobin target, a fault of Amgen, the FDA and the CMS.
      Phurrough thinks it is unlikely that the FDA and Medicare will begin a robust parallel review process in the near future simply because the CMS is constrained by its legal authorities. However, he notes that the Affordable Care Act, the health care reform bill passed by Congress, established an Independent Payment Advisory Board (IPAB) with authority to make changes in Medicare payment procedures. The IPAB could clear the way for Medicare to work more closely with the FDA. "If the IPAB survives, it has significant potential for allowing there to be greater cooperation between the two agencies," Phurrough says.

New Proposed HIPAA Disclosures Vex Healthcare Players


     P&T Journal...September 2011

 
     Pharmacists are already concerned about various new federal requirements coming down the pike which would complicate pharmacy software systems. We're talking about things such as potential drug package verification and electronic health record (EHR) entries. Now there is another software hurdle appearing on the track: compiling audit records of people inside the pharmacy and outside who take a peak at a customer's personal medical and pharmaceutical information.
        That is one of the looming new requirements for both in- and out-patient pharmacies stemming from the 2009 Health Information Technology for Economic and Clinical Health (HITECH) Act. Some HITECH provisions made changes to the  Health Insurance Portability and Accountability Act (HIPAA) Privacy Rule. Players throughout the pharmacy industry will be affected by the new HITECH requirements when they come into play. No word yet on when the final rule with compliance deadlines will be published.
    The HIPAA Privacy Rule requires covered entities such as physicians, health plans, hospitals and pharmacies, and their business associates--pharmacy benefit managers, for example. When a patient makes a request, the entity must disclose which third parties it sent that individual's protected health information to. There has been an exemption since 2000 for disclosed information pertaining to "treatment, payment, and health care operations (TPO)."    
      The proposed rule the Department of Health and Human Services issued on May 31 suggested one expanded and one new disclosure covered entities and business associates would have to make, both stemming from HITECH requirements: (a) the currently required accounting of disclosures (AOD) would have to include TPO information for the first time, where the AOD was made via either electronic or hard copy-- and (b)  individuals could, for the first time, request an access report of electronic-only disclosures of that person's designated record set (DRS) information.  An access report would include the date and time of the access, the identity of the person accessing the information, and, if available, a description of the information that was accessed and what actions were taken while in the system (e.g., create, modify, view, print, etc.).
     The expanded AOD and new access report requirements have earned numerous detractors. The HHS views compilation of an access report as a relatively easy, automated process, and thinks it will contain more useful information than an AOD, which would be more detailed, and would also have to be done manually. So it will be expensive.

       The College of Healthcare Information Management Executives (CHIME) disputes the notion that access reports will be quick and easy to assemble.  “CHIME is extremely concerned about the entire concept of access reports,” said Pam McNutt, Senior Vice President and Chief Information Officer at Dallas-based Methodist Health System and chair of CHIME’s Policy Steering Committee. “We believe the access logs, report filters, and other technical specifications needed to generate an access report would be inconsistent or nonexistent across many clinical data sources that might be considered part of a DRS. For these and other reasons, CHIME is urging rule-makers not to include access report requirements in the final rule. If rule-makers include access reports in the new rules, CHIME believes that only data gathered through certified EHRs, not the full array of designated record sets, should be expected to populate such reports.
     There are numerous critics, too, of  the HHS's conception of an expanded AOD.  Daniel C. Walden,  Senior Vice President, Corporate Compliance and Privacy Officer, Medco Health Solutions, Inc., says, "Accounting of Disclosure provisions and ensuing proposed regulations if applicable to PBMs would  impact Medco’s ability to utilize patient-specific information and as such could delay access to care and create an unnecessary increase in our paperwork burden."
     Rebecca Carlson, General Counsel Assistant and Privacy Officer, Dean Health System, says her hospital assembled a trial AOD for a patient, and it was 46 pages long. It took somewhere between 40-50 hours to assemble the data required currently in an AOD.  And Dean did not compile the additional information which would be required under the proposed rule, including pharmacy information.
    Another problem with the potential AOD requirement is that the EHRs currently on the market do not account for TPO within a personal medical record, nor does the HHS stage 1 meaningful use requirement--tied to the eligibility of physician practices and hospitals for federal HIT incentive payments--require EHRs to do so. Moreover, only a handful of people have ever asked for the existing AODs established by the 2000 HIPAA Privacy Rule requirement. Since 2003, Medco has captured over 13.6 million records in its accounting of disclosures database.  How many requests has Medco received for AODs in the past eight years? Thirteen!
     One wonders why Congress even expanded the requirement as part of the HITECH Act. But these days, many of the things Congress does raises questions about its ability to formulate sound public policy.