Monday, August 11, 2008

PhRMA Shoots Itself in the Foot in Massachusetts

Yesterday Massachusetts Governal Deval Patrick signed Senate Bill 2863, "An Act to promote Cost Containment, Transparency and Efficiency in the Delivery of Quality Health Care."

The most controversial aspect of the bill is Section 14 - new regulations for "Pharmaceutical and Medical Device Manufacturer Conduct." PhRMA lobbied hard against this section. (See here, here and here.) I think the industry misjudged its own long term interests and shot itself in the foot.

Here's part of what Ken Johnson, PhRMA Senior Vice President, had to say about the Massachusetts bill:
We believe the compromise language passed by the Massachusetts legislature could have grave consequences on both the future of clinical research in the state of Massachusetts and patient health in general.

Massachusetts is a hub of valuable health information and medical discovery. Physicians and other healthcare professionals in the commonwealth are at the nexus of both groundbreaking clinical research and quality patient care.

As written, Section 14 (Chapter 111N), which would require public disclosure of payments (valued at $50 or more) between pharmaceutical research companies and healthcare providers, could chill ongoing clinical research in the commonwealth.

Massachusetts has many academic medicine centers with healthcare providers who provide patient care, but who also conduct research in partnership with pharmaceutical companies. Physicians and other healthcare providers who do not want such personal information disclosed may decide to no longer work with the pharmaceutical research companies sponsoring the clinical studies.

Public disclosure of a pharmaceutical company’s arrangements with the principal investigators of its clinical trials also would reveal sensitive, proprietary business information to a company’s competitors. This could erode the independent decision-making of companies trying to bring science from research facilities to patient care settings.
Here's what I would have advised him to say:
We at the Pharmaceutical Research and Manufacturers of America disagree with much of Senate Bill 2863. But we understand that Massachusetts must control health care costs for its important reform process to succeed.

Our interests as business entities are not always aligned with the interests of the state. Sellers want to maximize profits. Buyers want to minimize costs. But we share a commitment to the health of the population and to ensuring that our industry can continue to draw on the many talented scientists in Massachusetts in pursuing research and development in the state.

To that end we propose that Massachusetts and the Pharmaceutical Research and Manufacturers of America work together to advance our shared interests, and to ensure that where our interests diverge we work as collaboratively as possible...
I would have explained that the handwriting is on the wall with regard to (a) understanding the impact of pharmaceuticals and medical devices on the cost trend, (b) the need to minimize conflicts of interest through new regulations, and (c) the need to strengthen trust through greater transparency. And I would have pointed out that Massachusetts would not, and should not, be sympathetic with "physicians and other healthcare providers who do not want [payments] disclosed..."

If PhRMA had persuaded the legislature or governor to squash Senate Bill 2863 it would have provoked a tremendous backlash that would have overwhelmed whatever value a short term "victory" provided.

In War and Peace, Tolstoy tells us how Mikhail Kutusov, the great Russian general, guided his troops - he observed which way the tide of war was going and then advised his army to go with it.

That's what PhRMA should have done. Health care costs are so destructively out of control, and wasteful care is so rampant, that the kind of stonewalling it attempted simply won't work over time. General Kutusov let Napoleon capture Moscow without a fight, and simply waited for winter to drive the French back.

PhRMA blew a good chance to ally itself with the future.