Medicare Will cover New Treatments But Patients Will be Required to Enroll in Clinical Trials

Fri, 5 Nov 2004

Dr. Mark McClellan, Director of Medicare, estimates that of Medicare’s $320 billion budget, “a third of all medical expenditures are for unnecessary or ill-advised treatments.” Medicare’s chief medical officer, Dr. Sean Tunis, acknowledged: “We have a huge budget deficit and looming huge costs for health care. And we know we are spending huge amounts of money on things that don’t work. But we don’t know what they are.”

These stunning admissions point to a disturbing fact no longer in dispute. The FDA review and approval process is utterly deficient: we don’t have a viable drug testing system to ferret out unsafe and useless treatments.

When he was head of the FDA, Dr. McClellan was instrumental in speeding up the drug approval process. Under his watch, the agency was geared toward reducing the time for drug approval, and increasing the number of drugs approved. That policy downgraded safety and efficacy evaluation to a minimum, leading to the approval of useless and even lethal drugs. Vioxx is but the most recent example making news headlines: the entire class of antidepressant drugs is another example of marketed drugs whose value is highly questionable, and their suicide-inducing risk has only recently been acknowledged.

Equally disturbing is that FDA scientists who have analyzed the data and attempted to report their negative findings are being intimidated and muzzled by senior officials in FDA’s Center for Drug Evaluation and Research (CDER).

Until recently, clinical trials were touted by industry, the FDA, and medical opinion leaders, as the “gold standard” for determining safety and efficacy. However, in the wake of a series of revelations about the concealment of negative findings, FDA’s “lethal weakness” has resulted in worthless and harmful drugs to be approved. Company controlled pre-marketing trials are now recognized as having no value – except to gain FDA approval.

The New York Times reports that Dr. Richard Platt, professor and chairman of the department of ambulatory care and prevention at Harvard Medical School, admitted that the tests to gain F.D.A. approval “leave an awful lot of ground uncovered.” They do not tell doctors or patients whether an older and cheaper drug is as good as or better than a newer one, for example. And they do not reveal whether older people, with many medical conditions, will fare as well as the generally younger and healthier people on whom the drugs or devices were tested.

Although Dr. McClellan obliquely acknowledges the consequences of FDA’s flawed drug approval process which adversely impacts on the nation’s health and wealth–“a third of all medical expenditures are for unnecessary or ill-advised treatments” – he does not call for a needed revamping of the FDA’s safety and efficacy standards.

In an editorial in The Lancet, the most prestigious of medical journals, Richard Horton takes a critical hard look at FDA’s role in the Vioxx debacle – noting FDA’s “lethal weakness” in its oversight role. The editorial goes to the heart of the problem: the Center for Drug Evaluation and Research (CDER) which “saw and continues to see the pharmaceutical industry as its customer – a vital source of funding for its activities – and not as a sector of society in need of strong regulation.” But “we must not diminish the importance of the covenant of trust that society has established with powerful commercial and governmental institutions. For with Vioxx, Merck and the FDA acted out of ruthless, short-sighted, and irresponsible self-interest.”

See: Horton R. Vioxx, the implosion of Merck, and aftershocks at the FDA, The Lancet, Nov 5, 3004 at: http://image.thelancet.com/extras/04cmt396web.pdf

Dr. McClellan does not call for a needed revamping of the FDA drug approval process, or strengthening FDA’s oversight role by establishing a fire wall between regulators and industry. Neither does he call for revisions of regulatory standards for approval, to ensure that only safe and useful treatments are approved. Why should manufacturers not be required to conduct scientifically valid clinical trials that are designed to provide clinically useful information about the safety and demonstrated effectiveness of drugs – before they are approved for marketing?

Instead, Dr. McClellan offers a new Medicare policy that will (a) provide windfall profits for drug manufacturers and medical device providers who, for the first time, will be paid for their costliest treatments – even if they later prove useless. (b) require post-marketing clinical trials to compensate for the inferior trials that got the drugs approved. (c) rquire that patients whose physician prescribes a costly new drug or device, to enroll in clinical trials where they may be randomly assigned to a placebo. That’s unfair and fiscally irresponsible.

We would also remind Dr. McClellan that his coercive quid pro quo policy – enroll in a clinical trial or Medicare won’t pay – strips the elderly of the fundamental right to voluntary, informed consent to participation in research.

Contact: Vera Hassner Sharav
212-595-8974

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THE NEW YORK TIMES
November 5, 2004 A-1
Medicare Covers New Treatments With a Catch

By GINA KOLATA

For the first time in its history, Medicare has systematically begun to make payments for new and expensive treatments and diagnostic tests conditional on agreement by companies or other groups to pay for studies on whether these new methods actually work on the Medicare patients who get them.

The move was decided by the agency’s recently appointed director, Dr. Mark McClellan, who said the goal was better and more cost-effective medicine.

The new initiatives began this year when Dr. McClellan, who is both an internist and an economist, decided that evaluating treatments for elderly Americans falls under Medicare’s purview to pay for whatever is medically necessary. If the treatment does not work, he argues, then it really is not medically necessary, and Medicare should not be paying.

Over the past six months, he has been fundamentally transforming Medicare’s scope by offering to pay for a number of new and expensive treatments and diagnostic tests – ranging from $30,000-a-dose cancer drugs to brain scans to diagnose Alzheimer’s – but with a catch. Patients can only have them if they enter into studies that evaluate how well they work. And someone other than Medicare will have to pay for those studies.

In the past Medicare just paid the bills or said no to treatments. Now, with a flood of promising but astronomically expensive treatments and little data on how they work in the real world, Medicare has decided to use its 41 million beneficiaries to get some answers. And it is using the threat of refusing to pay unless patients are in a study as a cudgel to get companies or foundations or professional groups to pay for the research.

The goal, Dr. McClellan said, is better and more cost-effective medicine.

“Instead of having 10 to 20 percent success rates over a broad population, we want to get to 80 to 90 percent who will benefit, and with fewer side effects,” he said.

At issue are questions that will determine the future and price of health care: Do new cancer drugs costing $10,000 to $20,000 a dose help in many situations where they are now being prescribed? What are the long-term effects of weight-loss surgery, costing $30,000 to $40,000 per operation even when there are no complications? How well do implantable defibrillators for heart patients, each costing $35,000, work? Will PET scans to look for early Alzheimer’s disease, costing $1,670 per scan, make any difference?

“It’s a whole new role for Medicare,” said Dr. Sean Tunis, Medicare’s chief medical officer. In many ways, Medicare officials say, they are forced to take the lead because their beneficiaries are the biggest users of the new drugs and medical devices and no one else is getting the information that patients and doctors need to decide on treatments. Medicare itself has no research budget, the National Institutes of Health can only do so much with its budget and private companies often have a narrow focus in studies they pay for.

Now, with medical costs soaring, with Medicare’s budget at $320 billion and with estimates that a third of all medical expenditures are for unnecessary or ill-advised treatments, the stakes are enormous.

And with Medicare the dominant payer for elderly Americans, who are most likely to need the treatments, its clout, when it insists on studies, is substantial. When Medicare says it will only cover treatments for patients enrolled in such studies, that’s “a pretty big stick,” said Dr. Stephen Hammill, president of the Heart Rhythm Society.

Reaction among those who may end up paying for new research has been mixed. Some are going along; others are arguing why them? But Medicare holds a powerful hand – its beneficiaries are the biggest users of drugs and medical devices, and private insurance companies often follow Medicare’s lead on coverage decisions.

The problem arises because while drugs and devices are tested and evaluated by the Food and Drug Administration before they come on the market, those tests often leave huge gaps in doctors’ knowledge of how well they work, and for whom.

The tests to gain F.D.A. approval “leave an awful lot of ground uncovered,” said Dr. Richard Platt, professor and chairman of the department of ambulatory care and prevention at Harvard Medical School. They do not tell doctors or patients whether an older and cheaper drug is as good as or better than a newer one, for example. And they do not reveal whether older people, with many medical conditions, will fare as well as the generally younger and healthier people on whom the drugs or devices were tested. “The best way to learn about practical problems and practical benefits,” Dr. McClellan said, “is to evaluate how treatments do in real world settings.”

Dr. Platt and other academic experts, as well as patient advocacy groups like the Center for Medical Consumers in New York, agree, and applaud the new Medicare initiative. It is so compelling, said Dr. Robert Califf, director of the Clinical Research Institute at Duke University, that “almost regardless of your political philosophy, this makes sense.” “We have an increasingly powerful array of drugs and devices and a bewildering array of choices,” he said. “And there is a broad agreement among people who make these choices that we don’t have the information we need.”

The dearth of information reached a crisis with cancer drugs, Dr. Tunis said, when new drugs, so-called biologics, began reaching the market. With cancer drugs, he said, the tradition is to test new medications in situations that their makers think are most likely to show benefit. That leads to approval by the F.D.A. Then the drugs often come into widespread use off-label – doctors give them to patients with different cancers or in combination with other drugs, trying them out in new contexts. Medicare is required to pay for the original approved use and for uses listed in certain drug compendia. Other than that, Medicare payments for off-label uses are up to the discretion of local contractors to the agency. Some pay; others do not.

The system was never questioned until about two years ago, when Zevalin, or Ibritumomab tiuxetan, made by Biogen Idec, was approved for non-Hodgkin’s lymphoma, at a cost of about $25,000 a dose, and Medicare started paying the bills. Medicare administrators were taken aback by the price. They also worried that it would be widely used in patients other than those with non-Hodgkin’s lymphoma, and that taxpayers would be paying for it without anyone knowing how well it worked in these untested situations.

More biologics began to be approved. “Each one of these biologics hits the market with a price tag of $10,000 to $30,000 a dose,” Dr. Tunis said. “It is one thing to try through clinical experience and trial and error to learn the off-label uses of drugs that cost $100 to $200 a dose. It is another thing with biologics that are not only expensive but can have pretty significant side effects.”

The agency decided to use its influence to speed up research on off-label uses of four new drugs approved for colorectal cancer – oxaliplatin, irinotecan, bevacizumab and cetusimab.

On Monday, Medicare said it would require national contractors to pay for off-label uses of the drugs for patients in any of nine clinical trials being started by the National Cancer Institute. That way, Dr. Tunis said, Medicare hopes to encourage patients to enter the studies, which will determine whether the drugs are effective in the new contexts.

CancerCare, a nonprofit group providing support services to cancer patients and their families, was delighted. “What I most impressed with is to see C.M.S. really focused on this issue of quality and not just as acting as a payer,” said Diane Blum, the group’s director, referring to the Centers for Medicare and Medicaid Services. “It is an enormous step forward and I hope the patient community pays attention.”

For PET scans for people with suspected Alzheimer’s disease, Medicare announced on Sept. 15 that it would pay only if patients are in a clinical trial in which they will be randomly assigned to have a PET scan of the brain, or not. The agency wants to know whether early diagnoses with the PET scans make a difference in the medical care that patients receive, the course of their disease, and outcomes like the time before patients are admitted to a nursing home.

The makers of PET scanners have agreed to do a clinical trial with Medicare beneficiaries, said Dr. David Rollo, the chief medical officer for Siemens Medical Systems. He said that there are many logistical problems to sort out in this first-ever industry-wide collaboration because each machine is different, “each manufacturer brags that theirs is the best” and yet, in the study, the brain images must be comparable no matter what machine is used.

On Friday, the PET scan manufacturers will have a conference call with Medicare officials to plan how to proceed, Dr. Rollins said. On Sept. 28, Medicare issued a proposal to pay for implantable defibrillators for hundreds of thousands of patients with severe heart disease, but who have not had a heart attack, but only if they are in a national registry to follow the outcomes. The questions the agency wants answered, Dr. Tunis said, include: Who is still alive in 6 to 12 months? Whose defibrillator actually went off, shocking their heart back to life? Does it matter whether a cardiologist or general surgeon put the device in the patient’s body? Does it matter which brand of defibrillator a patient receives?

But the defibrillator makers are not enthusiastic about starting a registry. “The first option is that C.M.S. should pay for it,” said Peter Gove, a spokesman for St. Jude Medical, a defibrillator maker, referring to the Centers for Medicare and Medicaid Services.

The Heart Rhythm Society is meeting with the makers of implantable defibrillators and other groups next week to discuss what to do. “I think there will be funding from somewhere,” Dr. Hammill said. In September, the agency proposed similar restrictions on paying for stents to open blocked carotid arteries in the neck for patients, like many elderly Americans, who are at high risk of stroke from such an obstruction, but who cannot tolerate surgery.

And after a meeting yesterday of a Medicare advisory committee, which said there were large gaps in knowledge about the safety and long-term effects of weight-loss surgery for the extremely obese, Medicare officials said they were thinking of requiring a registry for that treatment as well. Medicare does not intend to force studies of everything it pays for. Instead, Dr. Tunis said, “We plan to do this for treatments that are potentially very important to the Medicare population but for which the evidence is not yet definitive.”

While there may be opposition to Medicare’s newly aggressive approach, patients, and taxpayers, can only be better off, Dr. Califf said. “We have a huge budget deficit and looming huge costs for health care,” he said. “And we know we are spending huge amounts of money on things that don’t work. But we don’t know what they are.” So, he said, the nation has a choice. “Medicare could pay for everything, or we could develop a rational system to pay for the things that matter.”

Copyright 2004 The New York Times Company

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