Doubling Down: Will Large Increases in the NIH Budget Promote More Meaningful Medical Innovation?

Kesselheim proposes doubling the NIH's budget to promote clinically meaningful pharmaceutical innovation. Since the effects of a previous doubling (from 1998-2003) were mixed, I argue that policymakers should couple future budget growth with investments in experimentation and evaluation.

Fixing The FDA's Orange Book.

The modern regime for balancing innovation and competition in pharmaceuticals was established through the Drug Price Competition and Patent Term Restoration Act of 1984, also known as the Hatch-Waxman Act. This regime needs updating. The process that Hatch-Waxman established for listing patents and challenging patents on the Food and Drug Administration's Orange Book is one important area for reform.

The Government and Pharmaceutical Innovation: Looking Back and Looking Ahead.

Current debates about the roles of the public and private sectors in pharmaceutical innovation have a long history. The extent to which, and ways in which, the public sector supports drug innovation has implications for assessments of the returns to public research funding, taxpayer rights in drugs, the argument the high prices are needed to support drug innovation, and the desirability of patenting publicly funded research.

Indian pharmaceutical patent prosecution: The changing role of Section 3(d).

India, like many developing countries, only recently began to grant pharmaceutical product patents. Indian patent law includes a provision, Section 3(d), which tries to limit grant of "secondary" pharmaceutical patents, i.e. patents on new forms of existing molecules and drugs. Previous research suggests the provision was rarely used against secondary applications in the years immediately following its enactment, and where it was, was redundant to other aspects of the patent law, raising concerns that 3(d) was being under-utilized by the Indian Patent Office. This paper uses a novel data source, the patent office's first examination reports, to examine changes in the use of the provision. We find a sharp increase over time in the use of Section 3(d), including on the main claims of patent applications, though it continues to be used in conjunction with other types of objections to patentability. More surprisingly, see a sharp increase in the use of the provision against primary patent applications, contrary to its intent, raising concerns about potential over-utilization.

The applied value of public investments in biomedical research.

Scientists and policy-makers have long argued that public investments in science have practical applications. Using data on patents linked to U.S. National Institutes of Health (NIH) grants over a 27-year period, we provide a large-scale accounting of linkages between public research investments and subsequent patenting. We find that about 10% of NIH grants generate a patent directly but 30% generate articles that are subsequently cited by patents. Although policy-makers often focus on direct patenting by academic scientists, the bulk of the effect of NIH research on patenting appears to be indirect. We also find no systematic relationship between the "basic" versus "applied" research focus of a grant and its propensity to be cited by a patent.

Corporate Funding for Schools of Public Health: Confronting the Ethical and Economic Challenges.

We discuss the public and private sponsoring of university research and the issues it raises in a context of diminished federal funding. We consider research funding at schools of public health and why these schools have historically had weaker links to industry than have other academic units. We argue that the possibility of enhanced links with industry at schools of public health may raise specific concerns beyond those facing universities generally. Six issues should be considered before entering into these relationships: (1) the effects on research orientation, (2) unacceptability of some funders, (3) potential threats to objectivity and academic freedom, (4) effects on academic standards, (5) the effects on dissemination of knowledge, and (6) reputational risks.

Citations in Life Science Patents to Publicly Funded Research at Academic Medical Centers.

BACKGROUND: The contributions of Academic Medical Centers (AMCs) to biomedical innovation have been difficult to measure because of the challenges involved in tracing knowledge flows from their origin to their uses. METHODS: The authors examined patent citation linkages between AMC research funded by the National Institutes of Health (NIH) and patents. In prospective analyses, they examine the extent to which articles resulting from NIH grants to AMCs awarded between 1990 and 1995 were cited in drug and medical patents. The authors then examine the extent to which these patents are associated with marketed drugs. In retrospective analyses, they examine the share of drugs approved between 2000 and 2009 that have citation links to NIH-funded AMC research. RESULTS: The prospective analyses show over a third of AMC grants resulted in publications that were cited in patents. Most the patents are drug and biotechnology patents, and are assigned to private firms. Patents citing NIH-funded AMC publications were associated with 106 new FDA approved drugs, half of which are new molecular entities and a quarter of which are priority NMEs. The retrospective analyses showed that about half of the new molecular entities approved over the 2000-2009 period had citations links to NIH-funded AMC research. CONCLUSIONS: There are strong links between articles from NIH-funded AMC research and private sector medical patenting, including drugs. More research is needed to better understand the types of links the citations represent and their implications for public policy.

How do public health safeguards in Indian patent law affect pharmaceutical patenting in practice?

The 1995 Trade Related Intellectual Property Rights (TRIPS) agreement required developing countries to grant product patents in pharmaceuticals. Developing countries have since explored various measures to ameliorate potential negative effects of the new laws on public health. A prominent example is India, whose post-TRIPS patent laws include a provision, section 3(d), that restricts patents on incremental pharmaceutical innovations. Its critics and supporters alike suggest that this provision makes Indian patent law very different from that in other jurisdictions. Yet there are concerns that given resource constraints facing the Indian patent office, this novel feature of Indian patent laws on the books may not have an effect on Indian patent prosecution in practice. We test this by examining the prosecution outcomes of 2,803 applications filed in both India and Europe, coded by whether they include claims that trigger 3(d) considerations. We find that having the 3(d) provision on the books does not translate into very different patent outcomes in practice in India, relative to Europe, a jurisdiction without this provision.

New evidence on the allocation of NIH funds across diseases.

CONTEXT: The responsiveness of NIH (National Institutes of Health) funding to disease burden is a long-standing issue of policy interest. Previous analyses of this issue have been hindered by data constraints, have not specified channels through which the NIH funding process could be responsive to disease considerations, and have not examined differences across NIH institutes and centers. METHODS: We collected data from the NIH's new RCDC (Research, Condition, and Disease Categorization) database on funding for 107 diseases in 2008 and linked these to data on deaths and hospitalizations for these diseases. We used RCDC data and information from another NIH database--RePORTER--to determine institute-specific funding for these diseases and also funding by award type. We used these data to examine the overall responsiveness of NIH funding to disease burden, within-institute responsiveness, and the responsiveness of different types of NIH awards. FINDINGS: Overall, we found a strong and statistically significant relationship between NIH funding and deaths and hospitalizations associated with a disease. We detected some evidence that more "applied" grant mechanisms--in particular, funding for clinical trials--are more responsive than other types of funding. We also found evidence of differences across institutes in their extent of responsiveness. CONCLUSIONS: Overall, the data suggest that NIH funding is responsive to the two measures of disease burden. More applied grant mechanisms also may serve as "safety valves" in the allocation process, allowing Congress, disease advocacy groups, and others to apply pressure to address particular health priorities in a more fine-grained way than is possible through investigator-initiated "basic" research grants alone.

Evergreening, patent challenges, and effective market life in pharmaceuticals.

Observers worry that generic patent challenges are on the rise and reduce the effective market life of drugs. A related concern is that challenges disproportionately target high-sales drugs, reducing market life for these "blockbusters." To study these questions, we examine new data on generic entry over the past decade. We show that challenges are more common for higher sales drugs. We also demonstrate a slight increase in challenges over this period, and a sharper increase for early challenges. Despite this, effective market life is stable across drug sales categories, and has hardly changed over the decade. To better understand these results, we examine which patents are challenged on each drug, and show that lower quality and later expiring patents disproportionately draw challenges. Overall, this evidence suggests that challenges serve to maintain, not reduce, the historical baseline of effective market life, thereby limiting the effectiveness of "evergreening" by branded firms.

We all want it, but we don't know what it is: toward a standard of affordability for health insurance premiums.

The 2010 Patient Protection and Affordable Care Act (P.L. 111-148), or ACA, requires that U.S. citizens either purchase health insurance or pay a fine. To offset the financial burden for lower-income households, it also provides subsidies to ensure that health insurance premiums are affordable. However, relatively little work has been done on how such affordability standards should be set. The existing literature on affordability is not grounded in social norms and has methodological and theoretical flaws. To address these issues, we developed a series of hypothetical vignettes in which individual and household sociodemographic characteristics were varied. We then convened a panel of eighteen experts with extensive experience in affordability standards to evaluate the extent to which each vignette character could afford to pay for one of two health insurance plans. The panel varied with respect to political ideology and discipline. We find that there was considerable disagreement about how affordability is defined. There was also disagreement about what might be included in an affordability standard, with substantive debate surrounding whether savings, debt, education, or single parenthood is relevant. There was also substantial variation in experts' assessed affordability scores. Nevertheless, median expert affordability assessments were not far from those of ACA.

Another special relationship? Interactions between health technology policies and health care systems in the United States and the United Kingdom.

Confronted with similar challenges, the United States and the United Kingdom have adopted very different health technology policies. In the United States, the focus has been on technology creation, in particular the funding of basic biomedical research at the National Institutes of Health. This both reflects and reinforces an innovation-first culture in the United States, including in health. By contrast, the United Kingdom has been much more heavily committed to applied research and evaluative research, including health-technology assessment. That is, while U.S. policy has focused on technology creation, U.K. policy has been more oriented toward technology diffusion. This article surveys the sources of these differences. We consider the impacts of institutional, cultural, and other factors that may explain them, and emphasize that it is hard to disentangle the separate effects of those factors. We conclude with a discussion of the difficulties in drawing cross-national lessons in health technology policy.

What are the respective roles of the public and private sectors in pharmaceutical innovation?

What are the respective roles of the public and private sectors in drug development? This question is at the heart of some policy proposals, such as those that would give the government a share of profits from drugs at least partly developed with federal research dollars. This paper provides empirical data on these issues, using information included in the patents on drugs approved between 1988 and 2005. Overall, we find that direct government funding is more important in the development of "priority-review" drugs-sometimes described as the most innovative new drugs-than it is for "standard-review" drugs. Government funding has played an indirect role-for example, by funding basic underlying research that is built on in the drug discovery process-in almost half of the drugs approved and in almost two-thirds of priority-review drugs. Our analyses should help inform thinking about the returns on public research funding-a topic of long-standing interest to economists, policy makers, and health advocates.