FDA is revisiting the 10-year old regulation that allows unapproved clinical emergency research in conditions when patient consent isn’t possible. The Human Subject Protection and Bioresearch Monitoring Initiative is supposed to strengthen FDA’s oversight and protection of patients in clinical trials involving medical devices, drugs, biologics, food, and veterinary medicine. Recently, the agency has taken flack for two blood substitute studies–Northfield Laboratories’ PolyHeme, a product used in trauma patients, and the U.S. Navy’s request to use Biopure Corp.’s Hemopure without patient consent. FDA is drafting a guidance on emergency research and will hold a public hearing on the issue on October 11. The meeting will address the challenges of balancing emergency research with the protection of human subjects, along with providing suggestions for improving the process.
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Johnson & Johnson came out victorious yesterday in a lawsuit filed by Applied Medical Resources Corp. The case claimed that Johnson & Johnson’s Ethicon unit engaged in anticompetitive business practices in the trocar market. According to Bloomberg News, Applied Medical accused Johnson & Johnson of using its monopoly on sutures to boost sales of its surgical devices. The company stated that Ethicon offered discounts on sutures to hospitals that also purchased its trocars and clip appliers. William White, an antitrust lawyer who was quoted in the LA Times article, pointed out that companies who have monopolies walk a “very fine line,” as what is legal for a nonmonopolist could be illegal for a monopolist. Applied Medical sued Johnson & Johnson three years ago for $54 million, which could have tripled under antitrust laws.
Today’s New York Times has an enlightening column by Dan Hurley about his use of Medtronic MiniMed’s Paradigm Real-Time, a combination insulin pump and continuous glucose sensor. Over a six-week trial period, the device enabled him to drastically reduce (but not eliminate) the number of times his blood sugar level was too low. While his experience wasn’t perfect, it was a major improvement from his previous condition, so after the trial period finished, he decided to spend $350 per month for replacement sensors (which must be changed every three days) because insurance companies aren’t covering that cost yet. Let’s hope Medtronic and its competitors are going to provide them the data to make them change their minds.
At FDA’s request, a federal court issued a warrant for seizure of four models of Alaris Signature Edition Gold infusion pumps. The pumps, made by Alaris, a division of Cardinal Health, have a defect called “key bounce” in which a number pressed once on a keypad may appear twice. This could cause overinfusion. For example, entering an infusion rate of 4.8 ml/hr could produce a rate of 44.8 ml/hr. Alaris issued a recall on August 15; the seizure was made to ensure that pumps being stored at Alaris’ San Diego facility are not distributed until the problem is fixed. More information is available on Cardinal’s Web site. There have been quite a few problems with infusion pumps reported in recent years. This incident won’t make FDA any less distrusting of the technology.
The third-party inspection program, authorized in MDUFMA, hasn’t taken off as expected. FDA is now preparing to collect information on it in order to determine whether to modify or scrap the program when MDUFMA is reauthorized next year. The agency has published a notice in the Federal Register of its intention to collect information about the program. The public has until October 23, 2006 to comment as to whether the collection is necessary or burdensome, and to suggest ways to enhance the quality, utility, and clarity of the information to be collected. Comments can be submitted electronically. (Make sure to reference Docket No. 2006N-0326.) What FDA digs up is likely to determine whether the program survives the next version of MDUFMA.
The Boston Globe’s Steven Syre has a fascinating column today about significant changes among Boston Scientific’s outside investors since the company bought Guidant. Twelve of the firm’s 20 largest investors are different from a year ago. Why? Because Wall Street has stopped considering Boston Scientific a growth company and started considering it a value company. New investors think that the firm’s stock is at or near bottom and that its management is capable of fixing its problems — and that perhaps these problems aren’t as bad as they’ve been made out to be. Hence, value investors such as Wellington Management Co. (which has become the largest outside investor) and Primecap Management have snapped up the stock, as have hedge funds managed by firms like D.E. Shaw & Co. and Paulson & Co. And growth and “momentum” investors have bailed. Boston Scientific has a history of defying expectations and overcoming short-term obstacles. A lot of folks seem to be betting on its management to pull off such feats again.
(Full disclosure: One of my best friends is an analyst for Wellington, and another is a manager for D.E. Shaw. I have never discussed Boston Scientific or any other device company with either of them.)
The November issue of MD&DI will feature our Medical Manufacturers of the Year. We want to honor companies that are the best of the best. We are looking for companies that have, for example, achieved tremendous market success, have shown market savvy or innovation, or have made it through adversity. The categories are not mutually exclusive, of course. The competition is open to manufacturers of finished medical devices. Entrants can be of any size. Submissions should be sent to mddi@cancom.com by Tuesday, September 5. You may nominate your own company (if eligible) or another company. Please include your name, company, email, and phone number, the name of the company being nominated, a contact person and Web site (if available) for the company, the category (market success/savvy, innovation, overcoming adversity) into which the company fits best, and an explanation of why the firm should be a Medical Manufacturer of the Year.
Healthcare spending is nearly 16% of Gross Domestic Product in the United States and could climb as high as 25% by 2030. When such figures are discussed, the tone is usually one of alarm. But, reports the New York Times, there is a school of thought emerging among economists that this may not be such a bad thing. In fact, it may just be part and parcel of belonging to a wealthy society. Food, shelter, and clothing don’t account for as large a percentage of the average American’s income as they used to. Hence, more can be spent on healthcare. And hence, perhaps policymakers should be encouraging medical device innovation, rather than fretting about its costs. Something has to drive the economy, why not healthcare?
Medtronic’s stock has been taking a beating recently, after the company announced it would miss earnings estimates. So why did it soar on Thursday and Friday, and why did its shares trade so heavily? The rumor on Wall Street, according to the Star Tribune of Minneapolis, is that it is an acquisition target for Johnson & Johnson. This doesn’t make much sense: J&J recently completed a purchase of Pfizer’s consumer products division and has said it has no plans to make any other major acquisitions right now. But two or three years ago, no one believed Guidant was an acquisition target, either.
In the latest piece in its series on how drug and device companies can influence the practice of medicine, the New York Times looks at the town of Elyria, OH, where angioplasties are performed so frequently that Medicare and at least one commercial insurer are starting to investigate. The doctors there have a strong preference for angioplasty over alternative procedures. Why is this so? The Times (and our friend Reed Abelson, who always assumes the worst about industry’s motives) slants the article to plant the idea in the reader’s mind that something suspicious is going on here. Maybe something is — but let’s let the insurers investigate before jumping to any conclusions. Doctors tend to perform procedures in their comfort zone, regardless of motive.
