The Global Interface of Medicine, Business and

GovernmantTimothy F Christian, MD, MPA

The InterfaceRegulation, FDAHealth Care SystemSocial InsuranceIP, Trade

Delivery, CostPreventionResearch

PharmaceuticalsDevicesCosts, R&DInsuranceITIP

Some Definitions

• Cost benefit analysis: Cost of an intervention/cost of an outcome.\– Requires placing monetary value on an outcome such

as death• Cost effective analysis (CER): cost A-cost

B/outcome A-outcome B) – outcomes are in yrs of life saved or events averted

• Cost Utility Analysis: same as CER except outcomes are measured in quality adjusted life years (QALY)-a subjective measure

Where does Healthcare Spending Come from?

TAVI case

1. Should Medicare cover the cost of the procedure?– If not, who should, if anyone

2. What type of metric should UK NICE use?3. Is their a political line that is crossed or is “rule of

rescue” invoked?– Who should decide where the line is?

4. Is the price from Edwards fair?5. Would Edwards have developed the device knowing

the price would need to be reduced or disapproved based if CER data used?

Anthrax Case Background• 1980’s pharma companies and IBM push US Gov to

establish IP protection.• Film and music companies jump on board• Uruguay Round: US leads GATT to adopt TRIPS• LDCs do not block TRIPS in exchange for Ag• LDCs get exception to TRIPS in Doha Round after

threatening to walk (consensus format) for emergent public health issues

• HIV epidemic, Brazil challenges US drug pat. Not LDC• US plans retaliation against Brazil through WTO for

patent infringement of retrovirals

Anthrax Case Background

• Ciprofloxacin FDA-approved against anthrax• Patented by Bayer, sells for $1.83/pill• 1 week after 9/11, letters containing anthrax

spores kill 5 people• There is a run on Cipro and US gov unsure it can

supply Nation with adequate stock.• US Gov decides to acquire 100 million doses• US states Bayer patent void for pub health

emerg. And plans to produce generics to cover pop.

Anthrax Case Questions1. Was the US wrong to threaten Bayer?2. Would Bayer be likely to develop more such drugs

against potential terror vectors?3. Should Bayer Profit from a health emergency?4. What is the difference between HIV infection in

Brazil and Anthrax infection in the US? Is the US trying to have it both ways?

5. What if a new drug were found to cure cancer, would we as a society, insist it be given out free? If not, who decides who gets it and at what cost?

6. If the new drug will be given out at min. cost, does this diminish the chance it will exist?