The Wall Street Journal reports that doctors at the American College of Cardiology’s annual conference voiced concerns about increased pressures on reimbursement for certain procedures.
Doctors who perform angioplasty and implant heart stents are concerned about the potential for government moves that could compress reimbursement payments for such procedures, which would in turn hurt device makers.
“There’s a general concern that reimbursement for hospitals as well as physicians will be under increasing pressure,” said Gregg Stone, who directs cardiovascular research and education at the Center for Interventional Vascular Therapy at the New York-Presbyterian Hospital/Columbia University Medical Center.
Stone also said this is a long-running worry that changes will drag down salaries, making medicine a less attractive profession. He also noted the potential for worse circumstances, saying he dreads “being in a hospital system that tries to limit the type of care I practice.”
Stent applications are a particular worry because they are such a reliable cash cow for big players in the device market. According to the journal, “that worry took a toll after the budget proposal was issued on Feb. 26, and medical device stocks haven’t reclaimed lost territory despite the market’s recent scorching run.”
Although there has been no government signal about sudden plans to squeeze prices for medical devices, the fear is real. But is the fear justified?
I find it difficult to believe that changes to reimbursement would discourage the use of technology that limits the need for far costlier healthcare, which is what stents do. It’s illogical. Device makers shouldn’t worry about stents unless they are being used on patients that won’t benefit from them.
As for doctors concerned with being limited in the type of care they practice, haven’t HMOs effectively already done that? It seems to me that the thing he is most afraid of is the very problem healthcare initiatives are trying to solve.
Am I oversimplifying?
Heather Thompson
As many companies continue to downsize in Michigan, two subsidiaries of Japan-based Terumo Corp. are expanding in a town near Ann Arbor called Scio Township. Terumo Cardiovascular Systems and Terumo Heart Inc. have created nearly 150 new jobs in the area last year and could be moving some of its manufacturing and R&D from California, according to the Detroit Free Press. Terumo Cardiovascular’s heart-lung machines are made at its Scio facility. It currently has about 38% of its market and is aiming to reach 50% by 2012, according to Terumo Cardiovascular’s president and CEO Mark Sutter. Sales are also anticipated to go up 10% for its fiscal year, which ends this month.
Terumo Heart was started to develop and commercialize the DuraHeart left ventricular assist system. A U.S. clinical trial involving the device was started at the University of Michigan in Ann Arbor last summer and will be expanding to other sites.
A sting operation involving fake medical research was discussed today at a House Energy and Commerce Committee meeting. According to the Wall Street Journal, the point of the investigation was to determine whether companies that oversee clinical studies of medical devices (known as Institutional Review Boards or IRBs) actually protect the safety of patients. To accomplish this mission, the Journal says that the Government Accountability Office set up “a fake company with a fake surgical adhesive to be used in a fake clinical trial.â€
News of this investigation broke when the IRB that agreed to oversee the study, the Coast Independent Review Board, released a press release saying that it had been tricked by federal officials. According to the New York Times, the Coast IRB got a late jump on the background check of the fake medical device company. The Coast IRB realized five months after approving the clinical study that the company was located in a store that rents mail boxes. When asked about this delayed background check, the president of the Coast IRB told the Times that it never occurred to him that someone would develop a fake study.
Apparently the congressional panel also had an idea to setup a bogus IRB with a dog as the CEO. No word yet on whether that plan was actually enacted.
Can the human body give warnings when it is at risk of a heart attack? Joe Clancy, 69-year-old man in Indiana, is banking on it. A heart attack victim about three months ago, he is a participant in trials for the AngelMed Guardian System. Physicians have implanted the device, similar in size to a pacemaker, near his heart. The device and his heart are connected by a wire that detects changes in electrical activity before any heart attack symptoms are felt. Using Bluetooth technology, the implant sends activity information to a pager-like wireless device that Clancy wears on his belt. The alarm on the pager has two modes: an external one with lights and sounds that warns him to call his doctor in the next day or two (or call 911), and an internal one that emits vibrations in his chest, which Clancy can feel (and his wife can even hear them).
Providing patients with more power over their treatment and reducing costs in the process has been a trend recent medical innovations (see the April issue of MD&DI). The heart attack warning system treads the same waters:
“It’s going to be cost-effective in the long run if (patients) come to the hospital sooner. Then you are preventing further damage to the heart muscle, and these people will be less prone to congestive heart failure,†says Sree Karanam, Clancy’s cardiologist.
In what looks to be a trend-setting action, Medtronic Inc. led the funding effort for a developer of catheter-based devices used to treat hypertension. On Monday, the medical technology giant raised $47 million for Ardian Inc. (Palo Alto, CA).
Other participants included Advanced Technology Ventures, which has an office in Palo Alto, Morgenthaler Ventures and Split Rock Partners, which have offices in Menlo Park, and a new investor, Portola Valley-based Emergent Medical Partners.
The clinical-stage medical device company is the eighth company created by The Foundry, a medical device incubator based in Menlo Park. It may be a sign of the times that developing medical device firms should look toward larger device companies to gain funding, particularly if the technology is complementary or tangential to the larger firm’s area of expertise.
Spinal cord stimulation could be a way to achieve normal movement in Parkinson’s patients. In an article in Friday’s issue of the journal Science, researchers explain their method of epidural electrical stimulation in the doral columns and how it restores motion in dopamine-depleted mice. During the treatment, the dopamine-depleted rodents had electrodes implanted on their spinal cords. Three seconds after the electrical stimulation started, the mice were able to move normally. The Duke University researchers hope their approach could become a more-efficient and less-invasive way to treat Parkinson’s disease.
In a New England Journal of Medicine (NEJM) editorial, three editors (2 of whom are doctors) argue that medical device makers have been unfairly shielded from litigation. They disagree with the Supreme Court’s decision in the landmark Riegel v. Medtronic case that device manufacturers cannot be sued under state law by patients who allege harm from a device that was approved by FDA. The NEJM editors write, “Until that ruling by the Court, the possibility of litigation for ‘failure to warn’ or design defect served as a strong inducement for device companies to be vigilant about the safety of their products.â€
The editors also point out that the Supreme Court’s support of preemption when it comes to medical devices seems to contradict its position on pharmaceuticals. In the Wyeth v. Levine case, the Court ruled that failure-to-warn suits filed against Wyeth are not preempted by FDA approval of the drug’s label. A New York Times editorial also notes the apparent hypocrisy regarding drugs versus devices and backs the Democrats’ push for the Medical Device Safety Act. The act, which would nullify the ruling in Riegel, would help promote patient safety, the NYT article says.
Conversely, Sara Dyson expresses support for the Riegel decision in an article published in MD&DI’s February issue. Dyson, a loss control manager for Medmarc Insurance group, writes that, “Preemption encourages innovation, enabling device makers to enhance existing technologies and make discoveries. Litigation, in contrast, impedes access to certain medical treatments.â€
A ribbon-cutting ceremony took place yesterday at Engel North America’s new technical center in Corona, CA. Engel manufactures injection molding machines for thermoplastics and elastomers. The technical center is designed to offer support to Engel’s customers in the western part of the United States, as well as in Mexico.
“The West Coast market is very diverse in general, with more demanding molding applications than we see with the rest of the country,” explains Stephan Braig, president and CEO Engel North America (York, PA).
Braig estimates that 10% of the firm’s global business is related to medical, but much of that business is concentrated in the United States, particularly, he says, on the West Coast. The tech center, which measures 7300 sq ft offers medical and other customers maintenance and spare parts inventory, a training center, and a show room equipped with the company’s all-electric injection molding machines.
There’s no end in sight to the hype behind Apple’s iPhone, and part of it is because so many other companies have some sort of stake in the device. Yesterday a series of companies spoke at Apple’s headquarters in Cupertino, CA, to show what their applications (often just called apps) on the phone could do for its users. One of those companies was LifeScan, a company owned by Johnson & Johnson. Company representative Anita Mathew took the stage to demonstrate how blood glucose testing equipment could send results to a diabetic’s iPhone via Bluetooth. LifeScan’s app can also provide recommendations on diet and exercise.
A Purdue University (West Lafayette, IN) researcher has created magnetic nanoscopic probes that can locate tumors and attach to cancer cells. This would not only help doctors find tumors, but it could also aid them in better treatment of the cancer. The probes, which have antibodies, have the potential to carry drugs to treat cancerous cells. Developed by Joseph Irudayaraj, the probes use both gold nanorods and magnetic particles so that they can be more easily tracked via imaging devices during their trek to cancer cells. A magnetic resonance imaging (MRI) machine can follow the magnetic particles, even as they go deeper into tissue, and microscopy can be used to track the gold nanorods. The Herceptin-loaded probes would be injected into the body through a saline buffering fluid. They’re able to bind to a cancer cell that expresses a protein marker that is complementary to Herceptin, according to Irudayaraj. He says the researchers are working on improving the technology in order to add other drugs that the probes deliver.
