Factors Associated With Generic Drug Uptake in the United States, 2012 to 2017.

OBJECTIVES: In the United States, brand-name prescription drugs remain expensive until market exclusivity ends and lower-cost generics become available. Delayed generic drug uptake may increase spending and worsen medication adherence and patient outcomes. We assessed recent trends and factors associated with generic uptake. METHODS: Among 227 drugs facing new generic competition from 2012 to 2017, we used a national claims database to measure generic uptake in the first and second year after generic entry, defined as the proportion of claims for a generic version of the drug. Using linear regression, we evaluated associations between generic uptake and key drug characteristics. RESULTS: Mean generic uptake was 66.1% (standard deviation 22.1%) in the first year and 82.7% (standard deviation 21.6%) in the second year after generic entry. From 2012 to 2017 generic uptake decreased 4.3% per year in the first year (95% confidence interval, 2.8%-5.8%, P < .001) and 3.2%/year in the second year (95% confidence interval, 1.2%-5.1%). Generic uptake was lower for injected than oral drugs in the first year (38.5% vs 70.0%, P < .001) and second year (50.3% vs 86.9%, P < .001). In the second year, generic uptake was higher among drugs with an authorized generic (86.1 vs 80.1%, P = .045) and those with ≥3 generic competitors (87.7% vs 78.6%, P = .055). CONCLUSION: Early generic uptake decreased over the past several years. This trend may adversely affect patients and increase prescription drug spending. Policies are needed to encourage generic competition, particularly among injected drugs administered in a hospital or clinic setting.

How Should the World Pay for a Coronavirus Disease (COVID-19) Vaccine?

The potential health and economic value of a vaccine for coronavirus disease (COVID-19) is self-evident given nearly 2 million deaths, "collateral" loss of life as other conditions go untreated, and massive economic damage. Results from the first licensed products are very encouraging; however, there are important reasons why we will likely need second and third generation vaccines. Dedicated incentives and funding focused explicitly on nurturing and advancing competing second and third generation vaccines are essential. This article proposes a collaborative, market-based financing mechanism for the world to incentivize and pay for the development of, and provide equitable access to, second and third generation COVID-19 vaccines. Specifically, we propose consideration of a Benefit-Based Advance Market Commitment (BBAMC). The BBAMC uses health technology assessment to determine value-based prices to guarantee overall market revenues, not revenue for any specific product or company. The poorest countries would not pay a value-based price but a discounted "tail-price." Innovators must agree to supply them at this tail price or to facilitate technology transfer to local licensees at low or zero cost to enable them to supply at this price. We expect these purchases to be paid for in full or large part by global donors. The BBAMC therefore sets prices in relation to value, protects intellectual property rights, encourages competition, and ensures all populations get access to vaccines, subject to agreed priority allocation rules.

Regional Market Competition is Associated with Aneurysm Diameter at the Time of EVAR.

BACKGROUND: Local market competition has been previously associated with more aggressive surgical decision-making. For example, more local competition for organs is associated with acceptance of lower quality kidney offers in transplant surgery. We hypothesized that market competition would be associated with the size of an abdominal aortic aneurysm (AAA) at the time of elective endovascular aneurysm repair (EVAR). METHODS: We included all elective EVARs reported in the Vascular Quality Initiative database (2012-2018). Small AAAs were defined as a maximum diameter <5.5 cm in men or <5.0 cm in women. We calculated the Herfindahl-Hirschman Index (HHI), a measure of physician market concentration (higher HHI = less market competition), for each US census region. Multilevel regression was used to examine the association between the size of AAA at EVAR and HHI, clustering by region. RESULTS: Of 37,914 EVARs performed, 15,379 (40.6%) were for small AAAs. There was significant variation in proportion of EVARs performed for small AAAs across regions (P < 0.001). The South had both the highest proportion of EVARs for small AAAs (44.2%) as well as the highest market competition (HHI 50), whereas the West had the lowest proportion of EVARs for small AAAs (35.0%) and the lowest market competition (HHI 107). Adjusting for patient characteristics, each 10 unit increase in HHI was associated with a 0.1 mm larger maximum AAA diameter at the time of EVAR (95% CI 0.04-0.24 mm, P = 0.005). CONCLUSIONS: Physician market concentration is independently associated with AAA diameter at time of elective EVAR. These data suggest that physician decision-making for EVAR is impacted by market competition.

Certificate of need and the cost of competition in home healthcare markets.

We used 2010-16 Medicare Cost Reports for 10,737 freestanding home health agencies (HHAs) to examine the impact of home health (HH) and nursing home (NH) certificate-of-need (CON) laws on HHA caseload, total and per-patient variable costs. After adjusting for other HHA characteristics, total costs were higher in states with only HH CON laws ($2,975,698), only NH CON laws ($1,768,097), and both types of laws ($3,511,277), compared with no CON laws ($1,538,536). Higher costs were driven by caseloads, as CON reduced per-patient costs. Additional research is needed to distinguish whether this is due to skimping on quality vs. economies of scale.

Competition and price among brand-name drugs in the same class: A systematic review of the evidence.

BACKGROUND: Some experts have proposed combating rising drug prices by promoting brand-brand competition, a situation that is supposed to arise when multiple US Food and Drug Administration (FDA)-approved brand-name products in the same class are indicated for the same condition. However, numerous reports exist of price increases following the introduction of brand-name competition, suggesting that it may not be effective. We performed a systematic literature review of the peer-reviewed health policy and economics literature to better understand the interplay between new drug entry and intraclass drug prices. METHODS AND FINDINGS: We searched PubMed and EconLit for original studies on brand-brand competition in the US market published in English between January 1990 and April 2019. We performed a qualitative synthesis of each study's data, recording its primary objective, methodology, and results. We found 10 empirical investigations, with 1 study each on antihypertensives, anti-infectives, central nervous system stimulants for attention deficit/hyperactivity disorder, disease-modifying therapies for multiple sclerosis, histamine-2 (H2) blockers, and tumor necrosis factor (TNF) inhibitors; 2 studies on cancer medications; and 2 studies on all marketed or new drugs. None of the studies reported that brand-brand competition lowers list prices of existing drugs within a class. The findings of 2 studies suggest that such competition may help restrain how new drug prices are set. Other studies found evidence that brand-brand competition was mediated by the relative quality of competing drugs and the extent to which they are marketed, with safer or more effective new drugs and greater marketing associated with higher intraclass list prices. Our investigation was limited by the studies' use of list rather than net prices and the age of some of the data. CONCLUSIONS: Our findings suggest that policies to promote brand-brand competition in the US pharmaceutical market, such as accelerating approval of non-first-in-class drugs, will likely not result in lower drug list prices absent additional structural reforms.

The Role of Assisted Living Capacity on Nursing Home Financial Performance.

The rapid growth of the assisted living industry has coincided with decreased levels of nursing home occupancy and financial performance. The purpose of this article is to examine the relationships among assisted living capacity, nursing home occupancy, and nursing home financial performance. In addition, we explore whether the relationship between assisted living capacity and nursing home financial performance is mediated by nursing home occupancy. This research utilized publicly available secondary data, for the state of Florida from 2003 through 2015. General descriptive statistics were used to assess the relationships among financial performance, assisted living capacity, and occupancy. To explore the relationships among financial performance, assisted living capacity and occupancy, and test potential mediation of occupancy, we followed Baron and Kenny's approach and estimated 3 models examining the relationships between (1) assisted living capacity and nursing home financial performance, (2) assisted living capacity and nursing home occupancy, and (3) nursing home occupancy and financial performance after assisted living capacity is included in the model. We used generalized estimating equations, to adjust for repeated measures and to model the above relationships. Year fixed effects control for time trend. The independent variable, assisted living beds, was lagged for 1 year to account for the potential influence on financial performance. The final analytic sample consisted of 7688 nursing home-year observations from 657 unique nursing homes. Our findings suggest that assisted living capacity does have a negative impact on nursing homes' financial performance. Even though, assisted living capacity seems not to significantly decrease nursing home occupancy. The relationship between assisted living capacity and financial performance was not mediated through occupancy. These findings suggest that assisted living communities may not be able to significantly reduce nursing home occupancy; however, the presence of assisted living communities may create additional financial/competitive pressures that result in decreased nursing home financial performance.

Hospital Consolidation: The Rise of Geographically Distant Mergers.

This Viewpoint discusses how and why cross-market hospital mergers are different than prototypical within-market mergers in their effects on patients and communities, why the trend may be accelerating, and future policy and research directions.

Price controls for medical innovations in a life cycle perspective.

We study the market for new medical technologies from a life cycle perspective, incorporating the fact that healthcare utilization is biased towards old age. Contrary to conventional wisdom, we find that price controls on medical innovations can expand investment in medical R&D and results in Pareto superior social outcomes, a consequence of the price controls' ability to increase saving. Importantly, this finding occurs only when the price cap regime is extensive: selective regulation on few technologies - such as pharmaceuticals alone - have the conventional negative effect on innovation.

Advantage management strategy in competition via technological race perspective: empirical evidence from the Taiwanese manufacturing industry.

This study investigated the advantage management strategies of a firm regarding the technological race in the manufacturing sector. This is to reveal whether firms adopt a catch-up or leapfrogging strategy in the competition for innovation. The results show that competition is fierce in the Taiwanese manufacturing industry. Taiwanese manufacturing firms (mostly SMEs) tend to adopt the "catch-up" strategy to keep up with their competitors in order to remain in the technological race. The result indicates that, under financial constraints, Taiwanese manufacturing firms attempt to invest in R&D to catch up with their rivals or to avoid being eliminated from the race.

[Beyond the horizon of health-care delivery - medical marketing]. / Neue Wirklichkeiten - Marketing und Chirurgie.

BACKGROUND: The progress in medical health care and demographic changes cause increasing financial expenses. The rising competitive environment on health-care delivery level calls for economisation and implementation of a professional marketing set-up in order to ensure long-term commercial success. METHODS: The survey is based on a questionnaire-analysis of 100 patients admitted to a trauma department at a university hospital in Germany. Patients were admitted either for emergency treatment or planned surgical procedures. RESULTS: Competence and localisation represent basic criteria determing hospital choice with a varying focus in each collective. Both collectives realise a trend toward economisation, possibly influencing medical care decision-making. Patients admitted for planned surgical treatment are well informed about their disease, treatment options and specialised centres. The main source of information is the internet. Both collectives claim amenities during their in-hospital stay. CONCLUSION: Increasing economisation trends call for a sound and distinct marketing strategy. The marketing has to be focused on the stakeholders needs. Concomitant factors are patient satisfaction, the establishment of cooperation networks and maintenance/improvement of medical health-care quality.

Trends in a changing vascular practice environment for members of the Society for Vascular Surgery.

OBJECTIVE: To survey the Society for Vascular Surgery (SVS) membership with regard to practice trends related to work effort, employment status, practice ownership, endovascular cases, and anticipated changes in practice in the near future. METHODS: A survey questionnaire was developed to gather information about member demographics and practice, hours worked, full-time (FT) or part-time status, employment status, practice ownership, competition for referrals, proportion of endovascular vs open procedures, and anticipated changes in practice in the next 3 years. We used SurveyMonkey and distributed the survey to all active vascular surgeon (VS) members of the SVS. RESULTS: The response rate was 207 of 2230 (10.7%). Two thirds were in private practice, and 21% were in solo practice. Twenty-four percent were employed by hospitals/health systems. Those VS under the age of 50 years were more likely to exclusively practice vascular surgery compared with VS over the age of 50 years (P = .0003). Sixty-eight of the physicians (32.7%) were between 50 and 59 years old, 186 (90.3%) were men, 192 (92.8%) worked FT (>36 hours of patient care per week), and almost two thirds worked >60 hours per week. Those in physician-owned practices worked >40 hours of patient care per week more often than did FT employed VS (P = .012). Younger VS (age <50 years) more frequently reported >50% of their workload being endovascular compared with older VS (age ≥50 years; P < .001). Eighty percent of FT VS planned to continue their current practice over the next 3 years. Of the 43.6% indicating loss of referrals, 82% pointed to cardiologists as the competition. CONCLUSIONS: The current workforce is predominately male and works FT; one-third is between the ages of 50 and 59 years. Younger VS (age <50 years) are more likely to exclusively practice VS and have a higher caseload of endovascular procedures. Those in physician-owned practices are more likely to put in >40 hours of patient care per week than are FT employed VS. Longitudinal surveys of SVS members are imperative to help tailor educational, training, and practice management offerings, guide governmental activities, advocate for issues important to members, improve branding initiatives, and sponsor workforce analyses.

The quest for equity in Latin America: a comparative analysis of the health care reforms in Brazil and Colombia.

INTRODUCTION: Brazil and Colombia have pursued extensive reforms of their health care systems in the last couple of decades. The purported goals of such reforms were to improve access, increase efficiency and reduce health inequities. Notwithstanding their common goals, each country sought a very different pathway to achieve them. While Brazil attempted to reestablish a greater level of State control through a public national health system, Colombia embraced market competition under an employer-based social insurance scheme. This work thus aims to shed some light onto why they pursued divergent strategies and what that has meant in terms of health outcomes. METHODS: A critical review of the literature concerning equity frameworks, as well as the health care reforms in Brazil and Colombia was conducted. Then, the shortfall inequality values of crude mortality rate, infant mortality rate, under-five mortality rate, and life expectancy for the period 1960-2005 were calculated for both countries. Subsequently, bivariate and multivariate linear regression analyses were performed and controlled for possibly confounding factors. RESULTS: When controlling for the underlying historical time trend, both countries appear to have experienced a deceleration of the pace of improvements in the years following the reforms, for all the variables analyzed. In the case of Colombia, some of the previous gains in under-five mortality rate and crude mortality rate were, in fact, reversed. CONCLUSIONS: Neither reform seems to have had a decisive positive impact on the health outcomes analyzed for the defined time period of this research. This, in turn, may be a consequence of both internal characteristics of the respective reforms and external factors beyond the direct control of health reformers. Among the internal characteristics: underfunding, unbridled decentralization and inequitable access to care seem to have been the main constraints. Conversely, international economic adversities, high levels of rural and urban violence, along with entrenched income inequalities seem to have accounted for the highest burden among external factors.

Changes in the economy, the labor market, and expectations for the future: what might Europe and the United States look like in twenty-five years?

In times of globalization, modern societies' labor markets have been marked by an increasing segmentation and growing social inequality. Youths in particular have experienced a worsening of their employment chances in the past three decades. However, what will the future bring?

Trends in Prices of Drugs Used to Treat Metastatic Non-Small Cell Lung Cancer in the US From 2015 to 2020.

Importance: Oncology drug prices are a determinant of health disparities in the US and worldwide. Several new therapeutic agents for non-small cell lung cancer (NSCLC) have become available on the US market over the past decade. Although increased competition typically produces lower prices, competition among brand-name oncology drugs has not resulted in lower prices. Objective: To assess price changes in class-specific brand-name medications used to treat metastatic NSCLC in the US from 2015 to 2020. Design, Setting, and Participants: This cross-sectional study, conducted from August 13, 2015, to August 13, 2020, used data from the Micromedex Red Book and Medi-Span Price Rx databases. The study sample was limited to 17 brand-name medications used to treat metastatic NSCLC that were available for purchase before January 1, 2019. Main Outcomes and Measures: The main outcomes were trends over time in average wholesale prices and wholesale acquisition cost unit prices and the correlation in price among the multiple brand-name medications within each therapeutic class (immune checkpoint inhibitors, epidermal growth factor receptor inhibitors, anaplastic lymphoma kinase inhibitors, ROS1 inhibitors, BRAF inhibitors, and MEK inhibitors), measured using the Pearson correlation coefficient. The compounded annual growth rates of different medication costs were compared with the annual inflation rate and the consumer price index for prescription drugs. Results: For all drug classes, the Pearson correlation coefficient approached 1.0, indicating an increase in drug list prices despite within-class drug competition. The median Pearson correlation coefficient values were 0.964 (range, 0.951-0.994) for immune checkpoint inhibitors, 0.898 (range, 0.665-0.950) for epidermal growth factor receptor inhibitors, 0.999 (range, 0.982-0.999) for anaplastic lymphoma kinase inhibitors, and 0.999 for BRAF and MEK inhibitors. The median compounded annual growth rates for most drug costs were higher than the annual inflation rate and consumer price index for prescription drugs: 1.81% (range, 1.29%-2.13%) for immune checkpoint inhibitors, 2.56% (range, 2.38%-5.26%) for epidermal growth factor receptor inhibitors, 2.46% (range, 1.75%-4.66%) for anaplastic lymphoma kinase and ROS1 inhibitors, and 3.06% (range, 0%-3.06%) for BRAF and MEK inhibitors. Conclusions and Relevance: In this cross-sectional study, prices of brand-name medications for treatment of NSCLC increased in the US from 2015 to 2020 without evidence of price competition, raising concern about the affordability of promising oncology drugs. These findings suggest that drug pricing reform is needed.

Economic factors converge: force hospitals to review pricing strategies.

The US hospital service price structures are complex and tend to be significantly higher than the actual cost to provide the service. Health care consumers have been given more authority to drive health care decisions. Transparency in health care is forcing hospitals to critically review and substantiate service prices. It is vital that US hospitals review their pricing strategies in order to continue as strong leaders in the health care market.

Do hospital chief executive officers extract rents from Certificate of Need laws?

Prior research suggests that Certificate of Need (CON) laws reduce competition in the hospital services industry. As a result, this study empirically investigates if not-for-profit hospital chief executive officers (CEOs) are able to extract rents from CON laws in the form of higher compensation. A sample of 256 not-for-profit hospital CEOs in states with and without CON laws and data for 2007 are used in the empirical analysis. The study considers the endogenous nature of a CON law and allows such a law to indirectly affect CEO compensation through its impact on the number of hospitals and beds. The multiple regression results indicate that special and public interests both motivate the decision of a state to maintain a CON law. CON laws are shown to reduce the number of beds at the typical hospital by 12 percent, on average, and the number of hospitals per 100,000 persons by 48 percent. These reductions ultimately lead urban hospital CEOs in states with CON laws to extract economic rents of $91,000 annually.