The National Center for Health Research

Cordially Invites You to Our

2015 Foremother and Health Policy Hero

Awards Luncheon

Friday, May 8, 2015 at Noon

 The Cosmos Club of Washington, D.C.

2121 Massachusetts Ave NW

Please join us and WJLA’s Maureen Bunyan on May 8th, the Friday before Mother’s Day, at the elegant Cosmos Club in Washington, D.C. as we celebrate our 16th  anniversary as a national charity!

Help us honor these wonderful 2015 Foremothers:

  • Jodie Bernstein is one of our nation’s  foremost consumer advocates.  As director of the Bureau of Consumer Protection at the Federal Trade Commission (FTC), she was the country’s top Cybercop, making the Bureau a model for consumer protection agencies around the world. Her new initiatives involved protecting children and adults who shop online, subprime lending, privacy protection, and fraud prevention.  Described in a Washington Post magazine cover story this month as an audacious woman “before audacious was in,” she mentored, nurtured and inspired generations of consumer protection advocates.
  • Karen Mulhauser has dedicated her life to key progressive causes, and was one of the early leaders of the modern women’s movement.  She is Chair of the UN Association of the USA and has been a founding force behind many progressive nonprofit advocacy organizations, including the Women’s Information Network and Public Allies. She served as Executive Director of nonprofit groups dedicated to women’s reproductive rights and against nuclear war, and has been a leader in improving race relations and increasing voter registration.  She has provided support, encouragement, and mentoring to scores of women in Washington, DC.
  • Our 2015 Health Policy Heroes are two physicians who have become the most visible and effective patient advocates in the country:  Dr. Amy Reed and Dr. Hooman Noorchashm.  Both were Harvard Medical School faculty when Amy was treated for what was assumed to be a benign uterine fibroid.  The medical device used to treat her, a power morcellator, pulverized her fibroid, and with it, a hidden cancer.  They subsequently learned that Amy’s metastatic uterine cancer was not a “rare complication” of the device, and are working actively to warn patients and doctors, get morcellators off the market, and find a cure for uterine cancer.

We hope you will take advantage of this great opportunity to meet these inspiring women, previous Foremother honorees, and many of D.C.’s other movers and shakers. Lunch is from noon to 1:30, preceded by a champagne reception for honorees and patron guests.

Prices below are valid through April 1.  

Seats are limited and tickets are not available at the door.

Regular lunch tickets are available for a donation of $100 each. Patron Tickets ($175 per ticket) include a champagne reception with honorees at 11:30, priority seating, and a listing in the program.  A Patron table for 10 is $1,600. Sponsorships are also available, from $1,000-$5,000.

The National Center for Health Research is the leading national organization dedicated to improving the health and safety of all adults and children. Donations for this event support our Cancer Prevention and Treatment Fund helpline.

To reserve a ticket, you may donate online here (write “Foremothers Luncheon” in the comments box and be sure to provide contact information). Or, send a check payable to “NCHR,” to 1001 Connecticut Ave, Suite 1100, Washington, DC 20036.

For more info, contact Amelia Murphy at aam@center4research.org or (202) 223-4000.

By Diana Zuckerman, PhD and Brandel France de Bravo, MPH

March 10, 2015

480294317The President of the United States has expressed concern that one in five college women are being sexually assaulted. In response, pundits who have no statistical expertise are dissecting the accuracy of those numbers—instead of talking about the undisputed fact that too many college women are being sexually assaulted.

This year, 173 people in the U.S. came down with the measles, and that is being treated as an epidemic requiring urgent action. Surely, campus rape deserves at least as much public health attention.

Yet it seems that if only 1 in 7 college women are raped, or 1 in 10, or 1 in 20, then campus parties featuring date-rape drugs, gang rapes, and other types of forced sexual activity are of less concern than whether the president’s statistics are exactly correct.

We disagree with that premise. But as public health researchers, we’re taking a look at those statistics anyway.

We read the article by Christopher P. Krebs, PhD, and his colleagues, which was published in a peer-reviewed journal and based on a study funded by the National Institute of Justice, to find out more about the “1 in 5″ statistic. Then we called Dr. Krebs to find out more.

Dr. Krebs and his colleagues studied more than 5,000 women at two large public universities. They found that one in five of the seniors said they had been sexually assaulted at some point during college.

Critics have pointed out that the definition of sexual assault includes unwanted kissing and sexual touching, and there is debate about whether those behaviors are serious or just “boys will be boys” behaviors. But the statistics speak for themselves: Most of the women who reported experiencing unwanted, nonconsensual sexual contact in an anonymous survey had experienced rape—oral, vaginal, or anal—not just other types of unwanted touching.

About 1 in 7 female seniors (15 percent) reported being raped since entering college. Those rapes happened because the women were either physically forced or threatened, or because they were incapacitated and unable to give consent. Of the students who had been raped during college while incapacitated, a substantial minority said they had definitely or probably been given a date-rape drug without their knowledge.

Although Dr. Krebs and his colleagues never claimed that the study was representative of all colleges in the U.S., other studies conducted at colleges and universities across the country have yielded similar statistics. A 2004 study done by Harvard faculty at 119 colleges nationwide found 1 in 20 of the 24,000 women had been raped during that school year (in the previous seven months). Over the course of four years, that would likely be similar to 1 in 7, since the likelihood of being raped tends to be higher for younger college women.

The White House didn’t just quote Dr. Krebs’ research; White House staff talked to him to make sure they understood how the study was done and how it should be interpreted. “We all realize that more research is needed,” Dr. Krebs told us. “I’m in the process of working on a larger study, but the first step is to make sure that we are asking the right questions and asking them in the right way.” The team will survey approximately 20,000 undergraduate women and men at 10 schools that differ in size and geography, including public and private schools and two-year and four-year schools.

We are glad that a more comprehensive study is being planned, but clearly better data are not the answer. Whether the most accurate statistics of campus rape are 1 in 5, 1 in 7, or 1 in 20, remember that there are about 10 million women who are attending colleges in the U.S. Even 1 in 20 would mean 500,000 women who have been or will be raped before they graduate. Campus rape and other types of sexual assault are a huge problem for colleges and an enormous tragedy. Most colleges have done a terrible job of preventing them or ensuring justice for the students involved.

Too much media attention has been focused on individual victims, but the “he said/she said journalism” is missing the point. And so is the punditry challenging the exact statistics.

If any other traumatic event affected ½ million college students, we would be focused on finding a systemic solution. It’s long past time to do that to prevent campus rapes and bring justice to those involved.

Read original post here.

This article summarizes a commentary by the same name by Gregg Gonsalves and Diana Zuckerman, published in The BMJ on March 25, 2015.  The published article is available at: http://www.bmj.com/content/350/bmj.h1500

Will 20th Century Patient Safeguards be Reversed in the 21st Century?

Most physicians and patients assume that medications are proved safe and effective. Those standards from the US Food and Drug Administration (FDA) were born out of a series of 20th century tragedies that resulted in stronger laws to protect patients for unsafe and ineffective treatments.  The first effective challenge to the FDA’s growing authority came in the 1980s, as people with AIDS faced certain death and demanded that the FDA’s drug approval process be more responsive to their needs. AIDS activists pressed for faster drug approval and making experimental therapies widely available, and their successes helped shape FDA reforms.

AIDS activists soon realized, however, that speeding up the approval process had risks as well as benefits, as the first generation of antiretroviral agents were found to have no long-term clinical benefits. Fortunately, a new generation of AIDS drugs, protease inhibitors, were used in combination with the older medicines, and this resulted in dramatic reductions in illness and death.

Starting in the early 1990s, drug industry lobbyists sought to further weaken FDA standards, often citing the legacy of AIDS activists.  AIDS activists opposed those industry efforts, but Congress responding to industry pressure by gradually eroding drug approval and safeguards for patients: reducing the number of studies required to get new drugs on the market from at least two to one and reducing restrictions on the advertising and promotion of medical products.

This erosion has continued in the 21st century.  The FDA now offers four pathways to speed the approval process for many drugs and biologics as well as an easier approval pathway for drugs for orphan diseases (defined as affecting fewer than 200 000 patients in the US). The lower standards for most drugs approved through expedited pathways include smaller and shorter term studies; one study found an average of about 100 patients tested with new drugs that were approved through expedited pathways, compared with almost 600 for standard approvals.

As a result, patients today are relying on many new medications that are not clearly proven to be safe or effective.  Although additional research is often required after approval, it takes an average of 11 years after a drug is on the market for the FDA to institute new warnings, rescind approval, or require new risk information or contraindications be made public.

Medical devices are subject to even weaker approval criteria, with only 1% of devices reviewed through a process that requires clinical trials. With those lower standards, 90% of the thousands of new medical devices are cleared by the FDA for market within 90 days.  Even so, FDA has responded to political pressure by proposing a new faster approval process for devices.

Congressional efforts to reverse the patient safeguards of the 20th century continue. The 21st Century Cures draft legislation released by Republicans on the House health committee in January 2015 would dismantle the major components of the drug approval process in place for the last 50 years. While proponents say patients need these changes, they ignore the fact that patients need answers about the drugs and devices they put in their bodies, not just access to new ones.

If these legislative efforts are successful, it would roll back patient safeguards, and leave an FDA that looks more like the one that existed in the mid-20th century, not one worthy of the 21st.

The published article is by Gregg Gonsalves, lecturer in law at Yale University and a patient living with HIV, and Dr. Diana Zuckerman, president of the National Center for Health Research.

Division of Dockets Management
Food and Drug Administration
5630 Fishers Lane, Room 1061 (HFA-305)
Rockville, Maryland 20852

March 23, 2015

Comments of members of the Patient, Consumer, and Public Health Coalition on the draft guidance
“Transfer of a Premarket Notification (510(k)) Clearance—Questions and Answers”
[Docket No. FDA–2014-D-1837]

As members of the Patient, Consumer, and Public Health Coalition we support the draft guidance “Transfer of a Premarket Notification (510(k)) Clearance—Questions and Answers” with one suggested revision to Section V to help in clarifying who currently holds a 510(k) device.   Overall, this guidance will help to ensure that the public information in the FDA’s 510(k) databases are accurate and up-to-date, including the most current owner of a 510(k) device.

In 2012, the FDA began requiring that 510(k) numbers (premarket submission numbers) for cleared devices “be included with the device listing information.”1 This is important because many devices have the same name or very similar names and without a 510(k) number it is difficult or impossible to identify the exact device.

Now that device companies must provide the 510(k) number when they list their devices in the FDA’s Unified Registration and Listing System (FURLS), the FDA and other companies can quickly identify the owner of each 510(k) device.  The Food, Drug & Cosmetics Act requires that the listing information be updated at least annually, and the guidance states that there can be only one 510(k) holder for a device at a time.2

We suggest that Section V, part 2 of the draft guidance be modified. It states that if two people claim the same 510(k) number, the FDA “database will show the person who listed their device most recently until the issue is resolved.” To provide a more complete history of ownership, the database should list a timeline of 510(k) holders (owners), and this may help to eliminate any confusion over who currently holds the 510(k).

Members of the Patient, Consumer, and Public Health Coalition support this clear and concise draft guidance because the FDA “commonly receives notifications from individuals claiming that a 510(k)-clearance has been transferred to them.”3

American Medical Women’s Association
Breast Cancer Action
Center for Medical Consumers
Jacobs Institute of Women’s Health
MISSD
Mothers Against Medical Error
National Center for Health Research
National Consumers League
National Women’s Health Network
The TMJ Association
WoodyMatters

The Patient, Consumer, and Public Health Coalition can be reached through Paul Brown at (202)223-4000 or at pb@center4research.org

 

March 19, 2015

My name is Dr. Margaret Dayhoff-Brannigan and I am a senior fellow at the National Center for Health Research. Our research center scrutinizes scientific and medical data and provides objective health information to patients, providers and policy makers. We do not accept funding from pharmaceutical companies, and therefore I have no conflicts of interest.

Thank you for the opportunity to speak here today.

I completed my Ph.D. in Biochemistry and Molecular Biology at the Johns Hopkins School of Public Health. I bring a perspective as both a researcher and an advocate for public health here today.

Long-acting beta-agonists have a history of serious adverse events in asthma patients including a four-fold increase in asthma-related death.  So, let’s start with the assumption that we don’t want a new LABA on the market unless we have good evidence about safety and efficacy.

The data presented by GlaxoSmithKlein indicates that Breo Ellipta has a similar safety profile to other combination Inhaled Corticosteroid/long-acting beta-agonists. The sponsor submitted pooled analysis from 18 clinical trials for safety information.  However, only 5 of these trials had relevant treatment and control arms. Furthermore, two of those trials were only 12 weeks studies – less than half the time of the 26 week trials conducted for safety of previous LABAs. There were only 3100 patients across the three longer-term studies, which is significantly less than the 25,000 or more patients included in safety trials for one of the other approved LABAs, Salmeterol.

So we have less safety information about this new drug than we have about other LABAs.  It would be unethical to approve the product based on this data unless there were clear evidence that this product was much more effective and therefore met an urgent, unmet need.  So, let’s look at efficacy data.

Let’s start with children ages 12-17, because the data are clear.  Several trials of 12-17 year olds show that inhaled corticosteroids alone were more effective than Breo Ellipta, the new combination ICS/ Vilanterol product that you are considering today.  It would therefore be unethical to risk these children’s lives by giving them a drug with no proven benefit in asthma control.

So, to answer the question FDA has posed: there is no evidence that Breo Ellipta should be approved for children ages 12-17.

There is also a major concern about this drug for African Americans of all ages. Safety studies on other approved LABAs have shown an increased safety risk for African Americans.  For this new product, there are too few African Americans in any age group in the study to be able to say whether or not it is safe or effective.

African American children have the highest prevalence of asthma in the United States, and these children are more likely to have uncontrolled asthma. Asthma is also common among Black adults.  The lack of Black patients in these studies should be unacceptable to the FDA and to this Advisory Committee.  Given the potential risks and lack of data, you should recommend against approval of Breo Ellipta in the African American population of any age.

One of the studies compared Breo Ellipta to another already approved drug, Advair, and found no statistically significant difference in safety or efficacy between the two. However, the trend favored Advair providing better control of asthma.  Since Breo Ellipta is not more effective at treating asthma than already approved products and could be less effective, it certainly does not meet an unmet need.

Since the data provide very little information about safety, additional safety studies should be required by the FDA BEFORE approval for Breo Ellipta to prevent patients from being put at additional risk by this new drug that has no known advantages but has unknown risks.

In light of all these issues and unanswered safety questions, I respectfully ask you to recommend against approval.  It does patients no favor to approve a new drug with no known benefits and with unknown risks.  More information is clearly needed on the long term safety of Breo Ellipta as a combination product for asthma patients. This information must be obtained prior to approval.

However, if the FDA were to put patients at risk by approving this drug, Black box warnings and long term safety trials should be required, as they have been for other LABAs.  And, the black box warning for this product should be expanded to reflect the additional risks and lack of efficacy for African Americans.

In conclusion, we don’t know if this LABA works as well as others on the market.  There is no urgent unmet patient need for this drug, therefore appropriate safety and efficacy trials should be conducted before approval. We urge the FDA to require pre-approval studies lasting at least 26 weeks that are sufficiently powered to examine subgroups such as 12-17 year olds and African Americans for BOTH safety and efficacy.

Thank you for your time.

March 9, 2015

My name is Dr. Margaret Dayhoff-Brannigan and I am a senior fellow at the National Center for Health Research. Our research center scrutinizes scientific and medical data and provides objective health information to patients, providers and policy makers. We do not accept funding from pharmaceutical companies, and therefore I have no conflicts of interest.

Thank you for the opportunity to speak here today.

I completed my Ph.D. in Biochemistry and Molecular Biology at the Johns Hopkins School of Public Health.  In addition, my two-year-old has been diagnosed with moderate atopic dermatitis. I bring the perspectives of both a researcher and parent here today.

My child started to have eczema on his face, scalp, chest and back before he was 3 months old. It took months of new lotions, bath soaps, detergents, diet changes, allergy testing and prescription topical corticosteroids to finally get his eczema under control.  I am thankful we were able to treat him, but I understand the impact this disease has on patients with an unmet need.

However, it is critical to ensure proper clinical testing on all age groups before subjecting pediatric patients to treatment options that may not be safe or effective for children their age.

Eczema in children under the age of 2 is a very different disease than older children and adults. It covers a much larger portion of the body, and is often found on the chest, back and face. Eczema in this age group is often related to food allergies. For those reasons, it is inappropriate to extrapolate results from adult clinical trials to this age group.  In fact, subgroup analyses are important for all children.  Metabolism rates change considerably during childhood, so it is important to have clinical trials that analyze dosages for different age groups and weights.

Pediatric patients with eczema are at higher risk for allergic reactions to any exposure, which puts them at risk when trying new treatments. This elevated risk should be weighed when considering the risk-benefit ratio for any treatment.

The bottom line: Pediatric patients with severe disease that does not respond to topical corticosteroids might appropriately be enrolled in a clinical trial for an experimental treatment whether a new treatment or a current therapy that has inadequate testing. But these trials should not be open to pediatric patients that have not exhausted safer options such as lifestyle changes and topical corticosteroids.

We ask you to be cautious as you consider systemic treatments for atopic dermatitis in pediatric patients. Atopic dermatitis is non-life threatening, so while it impacts quality of life, children should not be exposed to a treatment that could cause any type of permanent or substantial harm, however rare.

Let’s consider the ethics.  Children are unable to make informed decisions, but it is also difficult to put parents in that position with therapies that haven’t been tested on large numbers of children over a long period of time.

One major problem is that drugs currently used off label to treat atopic dermatitis systemically all carry boxed warnings about side effects and risks, and the long-term effect of the treatments is unknown.  Despite the black boxes and warnings, these drugs are being used in pediatric patients where there is very little data on their safety and efficacy. Patients in these situations would be better served by participating in a clinical trial where parents are made aware of the risks and the patients are carefully monitored by doctors who are knowledgeable about the risks.  Under those very careful conditions, children could be randomized to receive a novel treatment using the standard of care as a control.

Parents may feel desperate to try treatments option for atopic dermatitis for their children, but they may not understand that previous research is often inadequate to prove how safe or effective a new treatment is for their children.  It is the FDA’s job to make sure that treatments are first proven to be safe and effective in animal models for all ages.  There should also be safety data from adults and older pediatric patients before it would be ethical to begin testing younger children.

If a systemic treatment for atopic dermatitis is approved by the FDA, it is essential that all labels should include safety and efficacy information for each age group tested. If a product has not been tested in pediatric populations the label should clearly state that.

Atopic dermatitis affects a very young patient population, so it critical to have safety information for all age groups to prevent dangerous off label use. This is a vulnerable patient population, and the benefits for the treatment must be proven to outweigh the risks.

We urge the FDA not to just grant pharmaceutical companies waivers for clinical trials on pediatric patients.

As a researcher, public health advocate, and mother, I thank you for your consideration of these important issues.

CoverDownload the PDF of the most recent NCHR Analysis of Impact of Device Excise Tax.


Is the Medical Device Tax Fair? Does it Harm Companies?

The purpose of the 2.3% excise tax on medical devices, which was implemented in January 2013, is to raise revenue to help support health insurance coverage for the millions of Americans who have been unable to afford it. By increasing the number of Americans who are covered by health insurance starting in January 2013, device companies are expected to be able to increase sales.

Questions have been raised about the fairness of the tax, and its potentially negative impact on sales, R& D spending, profit margins, and the fiscal health of large and small device companies. The Congressional Research Service concluded that the device tax has minimal impact on device companies because it is so small.4 CRS economists point out that since the tax is itself tax deductible for device companies, the actual cost of the tax is only approximately 1.4% if the company doesn’t pass on the tax to consumers.

To better understand the impact of the excise tax, the National Center for Health Research examined the stock prices, profit margins, sales, and R&D spending of the 12 largest device companies5 based in the United States that exclusively make medical devices, as well as 6 of the smallest US-based device companies that are publicly traded and therefore provide objective information to the public.

We also examined data from January 2014 and January 2015 surveys of US medical device executives by Emergo Group, a medical device industry consulting firm. The survey was completed in 2014 by 1,203 executives and in 2015 by 685 executives. They found that fewer than 9% said they reduced staff or employee headcounts in 2013 as did 14% of the smaller number of executives surveyed in 20156.  Notably, the smaller device companies (fewer than 10 employees) were the least likely (3% in 2013 and 7% in 2014) to report that they reduced their staff or employee headcounts. The percentages were slightly higher (8% in 2013 and 10% in 2014) for companies with fewer than 50 employees, which represent 80% of medical device companies. These data are more scientifically sound and meaningful than the results of Advamed’s 2013 and 2014 surveys, which were filled out by a scientifically unsound 10-20% of their members. In contrast, Emergo surveyed more than 20 times as many device executives, using a more objective survey on many different topics.

For our analysis, we compared stock prices on the day the law went into effect and on its two year anniversary.  For the 12 largest companies, we found that stock prices increased by 6% to 126%, with an average increase of 66%. Medical device makers strongly outperformed the New York Stock Exchange Composite Index, which increased by 25% during that same period, and also outperformed NASDAQ, which increased 52%. The device company stocks increased even more than stocks in the top 5 US-based pharmaceutical companies7, which increased 54% during the same two years.

Over the last decade, profit margins for the 12 largest device companies averaged between 9-17% (except in 2009)8, and the most recently reported 12-month profit margins averaged above 14%.9


12 Largest US-Based Device Companies

Company Close on 1/2/2013 Close on 1/2/2015 % change in last 2 years Net Profit Margin for the last 12 months*
Boston Scientific (NYSE:BSX) 5.89 13.22 124% 3.6%
St. Jude Medical (NYSE:STJ) 36.61 64.94 77% 17.0%
Allergan (NYSE:AGN) 94.04 212.75 126% 21.2%
Zimmer Holdings (NYSE:ZMH) 67.70 112.59 66% 15.4%
CareFusion (NYSE:CFN) 29.28 59.43 103% 12.0%
CR Bard (NYSE:BCR) 101.83 167.48 64% 8.9%
Medtronic** (NYSE:MDT) 41.88 71.88 72% 17.8%
Stryker (NYSE:SYK) 55.88 93.99 68% 5.3%
Hologic (NasdaqGS:HOLX) 20.47 26.38 29% 2.0%
Varian Medical Systems (NYSE:VAR) 72.47 87.02 20% 13.0%
Edwards Lifesciences (NYSE:EW) 92.14 127.72 39% 34.9%
Intuitive Surgical (NasdaqGS:ISRG) 497.52 525.57 6% 19.7%
AVERAGE 66.2% 14.2%
N.Y. Stock Exchange Composite Index 8,632.01 10,830.92 25%
NASDAQ 3,112.26 4,726.81 52%

*Data from nytimes.com (accessed on 1/7/15). Stock prices are adjusted closing values and profit margins represent trailing 12 months of data posted by the companies.
**Medtronic was US-based through FY2014.


Since the smallest device companies are not publicly traded, it is not possible to gather audited information about their sales and profits. Based on the list of AdvaMed members, we selected the 6 publicly-traded US-based companies that had at least one device approved by the FDA before 2010 and which had 2013 revenues under $200 million. Their 2013 revenues ranged from $1.4 to $175 million. Between the day the law went into effect and its two year anniversary, stock prices increased for 5 of the 6 companies, with increases ranging from 4% to 294%. One company’s stock decreased 71%. On average, stock prices for all 6 smaller AdvaMed companies increased 92%.


Publicly Traded Device Companies with Revenues below $200 million

Company Close on 1/2/2013 Close on 1/2/2015 % change in last 2 years 2013 Revenues (in millions)
TransEnterix Surgical
(NYSE Amex:TRXC)
1.4 2.95 111% $1.4M
Hansen Medical, Inc.
(NASDAQ GM:HNSN)
2.16 0.63 -71% $11.8M
Endologix Inc.
(NASDAQ GS:ELGX)
14.37 14.97 4% $132.3M
DexCom, Inc.
(NASDAQ GS:DXCM)
13.85 54.51 294% $157.1M
Quidel Corporation
(NASDAQ GS:QDEL)
19.87 28 41% $175.4M
ABIOMED, Inc.
(NASDAQ:ABMD)
13.69 37.31 173% $157.6M
AVERAGE 92% $105.9M
N.Y. Stock Exchange Composite Index 8,632.01 10,830.92 25%
NASDAQ 3,112.26 4,726.81 52%

**Adjusted stock prices (nytimes.com accessed on 1/16/15). Revenues obtained from SEC reports.


Sales10 have also steadily increased since 2005 for most of the 12 largest device companies, as has R&D spending (both as an absolute number and as a percentage of Net Sales). Profits and profit margins for these companies vary from quarter to quarter, and three companies showed dramatic changes in profits, but the trend shows profits are generally stable for most of these companies over time,11 and the device companies’ profit margins are high compared to most other industries. Stock prices and other economic indicators are influenced by many factors, including acquisitions and mergers, new blockbuster products, and recalls.  However, the trends are absolutely clear: the device companies are doing well (despite some expensive, well-publicized recalls of medical devices in recent years) and there is no evidence that the device tax had a negative impact on device companies when 2013 and 2014 indicators are compared to any of the last 10+ years.

Of the 6 smallest publicly traded device companies, 4 reported dramatic increases in net Sales in recent years and 2 reported Sales that were flat in recent years. We analyzed Net Sales data from 2005 when available, and more recently when it was not. R&D expenditures also increased for 4 of the smaller companies and remained flat for two. Net Profits and profit margins for the smaller companies were quite volatile over time, with no apparent overall trends.

More detailed information about the 12 largest and 6 smaller publicly traded device companies is included in the PDF of this report, which provide publically-available data from 2005 to the present.  The charts measure Net Profits, Net Sales and R&D expenditures in millions.

In summary, there is no objective evidence that smaller or larger device companies were harmed by the device tax.  Device companies are thriving because over 10 million Americans have obtained health insurance through the Affordable Care Act and millions more through Medicaid expansion.12  The ACA is greatly benefiting medical device manufacturers because baby boomers and others no longer have to wait for Medicare coverage in order to have diagnostic tests, joint replacements, cardiac surgery, and other surgeries and treatments that involve devices. Like the other levies in the ACA, the device tax was designed to ensure that the companies that are benefiting from the ACA will do their part to help support it.

What are the Benefits and Harms from the Device Tax?

According to the Joint Committee on Taxation, repealing the excise tax on medical devices would cost more than $29 billion over 10 years,13 which our economy cannot afford.  It is also worth noting that U.S. Taxpayers are paying a disproportionate share of the cost of medical devices, since the prices of devices in the U.S. far exceed the prices for the same devices sold in other comparable countries, and these costs contribute to the higher costs of health care in the U.S. compared to other countries with longer life expectancies.14, 15

As our charts show, the medical device industry is highly profitable and is thriving since they started paying the excise tax.  Whether or not the manufacturers increase the cost of their devices by 2.3% as a result of the tax, it has had or would have almost no impact on the cost of consumers’ health care or insurance, given the many other factors contributing to the high cost of health care.16  In fact, the cost of health care increased less from 2013 to 2014 than it has in the past 10 years.17

It is important to note that Congress designed the excise tax so that it applies equally to imported and domestically produced devices, and does not apply to devices produced in the U.S. for export, so there would be no benefit for manufacturers to shift production overseas.

March 4, 2015

My name is Dr. Margaret Dayhoff-Brannigan and I am a senior fellow at the National Center for Health Research. Our research center scrutinizes scientific and medical data and provides objective health information to patients, providers and policy makers. We do not accept funding from pharmaceutical companies, and therefore I have no conflicts of interest.

Thank you for the opportunity to speak here today.

I completed my Ph.D. in Biochemistry and Molecular Biology at the Johns Hopkins School of Public Health. I bring a perspective as both a researcher and an advocate for public health here today.

An effective flu vaccine is critical for public health. Antiviral medications have very limited efficacy, so for many people the flu vaccine is the best line of defense to protect against infection. The CDC’s latest report calculated a 19% vaccine efficacy this year. That is simply not good enough. More importantly, this is not just one bad year. Four of the last 10 years the vaccine has been less than 40% effective.

When the flu vaccine does not work well, people think they should not bother to get it. This is bad for both for the pharmaceutical companies who have unused doses of vaccine, and for the general public that is less protected.  It is important that we implement strategies to improve the efficacy of the influenza vaccine.

According to the briefing information, a new strain of influenza A(H3N2) was detected in March 2014, after last year’s vaccine production had already begun. Nothing was changed in response to these new data. We urge the FDA to consider changing the timeline for selecting strains for the vaccine to allow more time. We understand there are tight deadlines, but there should at least be a strategy for making a last minute change to one of the strains selected for inclusion, if it is found that there is a newer circulating strain within a certain time frame. In response to the 2009 H1N1 pandemic, vaccines were produced in an accelerated timeline, so we know that it is possible. While these strategies may cost more to implement, the increased cost is worth it if efficacy could be substantially improved. More effective vaccines will save lives, and will save money in reduced sick days taken, doctors visits, and hospitalizations.

Currently, there are few incentives for pharmaceutical companies to implement strategies to improve vaccine effectiveness. For example, military, health care and childcare workers will all be required to get the flu vaccine next season regardless of how ineffective the vaccines have been this season.

In addition, the FDA should look carefully at whether the live attenuated influenza vaccine (nasal spray) should still be approved, since for the second year in a row it has shown considerably lower efficacy than the standard flu shot. At the very least, the nasal spray labels should specify how ineffective they are compared to flu shots.

We urge the FDA to require new protocols to ensure that the best and most effective vaccine is produced each year.

Thank you for your time.

By Elizabeth Cohen, CNN

March 3, 2015

Exterior view of the Ronald Reagan UCLA Medical Center during their Ebola virus readiness drill (closed to the media) to test their ability to diagnose and treat Ebola patients in Los Angeles on October 17, 2014.  The United States and Canada announced stepped-up airport screening measures to look for passengers carrying Ebola, as the deadly virus killed a man in Texas and the worldwide toll has passed 4,500.             AFP PHOTO/Mark RALSTON        (Photo credit should read MARK RALSTON/AFP/Getty Images)

Exterior view of the Ronald Reagan UCLA Medical Center during their Ebola virus readiness drill (closed to the media) to test their ability to diagnose and treat Ebola patients in Los Angeles on October 17, 2014. The United States and Canada announced stepped-up airport screening measures to look for passengers carrying Ebola, as the deadly virus killed a man in Texas and the worldwide toll has passed 4,500. AFP PHOTO/Mark RALSTON (Photo credit should read MARK RALSTON/AFP/Getty Images)

(CNN) — CNN has learned that the manufacturer of the endoscope involved in two superbug deaths at UCLA never obtained permission to sell the device, according to an official at the Food and Drug Administration.

Olympus started selling its TJF-Q180V duodenoscope in 2010, but the FDA didn’t notice until late 2013 or early 2014 that the company had never asked for clearance to put it on the market, according to Karen Riley, deputy director of strategy for the FDA’s Office of External Affairs.

“Why didn’t we notice it? I don’t know,” Riley said.

“Can you imagine a prescription drug getting out on the market that didn’t go through the approval process?” asked Dr. Steven Nissen, the chief of cardiovascular medicine at the Cleveland Clinic, who’s testified to Congress about device safety problems. “Devices need to be regulated more vigorously. This is really disturbing.”

Mark Miller, a spokesman for Olympus, did not respond to calls and emails from CNN seeking comment for this story.

Outbreak started at UCLA

Seven hospital patients at Ronald Reagan UCLA Medical Center were infected with the deadly superbug CRE — also known as carbapenem-resistant Enterobacteriaceae — between October and January, according to hospital officials. Two of those patients died.

The patients caught CRE after routine endoscopic treatments. Hospital officials believe two medical scopes that still carried the deadly bacteria even after disinfection guidelines were followed were the cause of the superbug outbreak.

The medical center has contacted 179 others who had endoscopic procedures between October and January and is offering them home tests to screen for the bacteria.

In a separate outbreak on the other side of the country, 18 people contracted CRE in North Carolina, and one of those died.

Not safer

According to FDA rules, a manufacturer must seek clearance for a new model if it includes changes that “could significantly affect the safety or effectiveness of the device.”

The TJF-Q180V duodenoscope, used to check out ducts in the gastrointestinal system, includes a modification to the exact part of the device that’s been implicated in the superbug outbreaks.

With this new model, Olympus sealed up that part of the device, known as the elevator channel, hoping to make it more impervious to infection.

“The company clearly made these modifications to make the device safer, but it seems to be that it wasn’t safer,” Riley said.

Last year, at the FDA’s request, Olympus applied for permission to sell the scope. That application is still pending.

Riley emphasized that duodenoscope procedures can be lifesaving, so the agency doesn’t want to take them off the market.

“More than 500,000 of these procedures are done every year in the U.S., and the risk of bacterial transmission is actually really very, very low,” she said. “We believe the risks outweigh the benefits.”

Riley noted that the other two duodenoscope manufacturers, Pentax and Fujifilm, did apply for and were granted clearance to market models similar to Olympus’ TJF-Q180V.

Not clean enough

Now the FDA is asking all three companies to submit evidence that the scopes can be thoroughly cleaned — and so far it’s not going well.

Riley said twice the companies have submitted data that failed to show that cleaning could get rid of 99.9999% of all microbes on the scope — the FDA’s standard for disinfection.

“We’re still working with them to get good data,” she said.

Riley said she doesn’t know if the FDA will penalize Olympus for selling the device without permission.

Diana Zuckerman, a device safety expert, said they should.

“It’s like with kids. How do you teach your children to behave if there are no consequences when they misbehave?” she said.

See original article here.

Lobbyists have blanketed the U.S. Congress to demand a repeal to the 2.3% medical device tax.  The lobbyists claim that the tax is a terrible burden on medical device companies and is causing the companies to cut jobs – thus harming each Senator’s and Representative’s constituents.  As scientists, we decided to determine the facts behind these claims.

The tax is an essential component of the Affordable Care Act; the funds help to make this important legislation affordable, by offsetting the costs of health insurance for those who otherwise could not afford it.  Without the device tax, the subsidies would have $29 billion less in funding.

Our State fact sheets provide information on the total number of medtech jobs in the state and compares that to the total number of state residents who need key benefits of the Affordable Care Act.  The Fact Sheets are linked below:

Alabama

Alaska

Arizona

Arkansas

California

Colorado 

Connecticut

Delaware

Florida

Georgia

Hawaii

Idaho

Illinois

Indiana 

Iowa

Kansas

Kentucky

Louisiana 

Maine

Maryland 

Massachusetts 

Michigan 

Minnesota 

Mississippi

Missouri 

Montana 

Nebraska

Nevada 

New Hampshire

New Jersey

New Mexico

New York

North Carolina

North Dakota

Ohio

Oklahoma

Oregon

Pennsylvania 

Rhode Island 

South Carolina 

South Dakota

Tennessee

Texas

Utah 

Virginia

Vermont 

Washington 

West Virginia

Wisconsin

Wyoming

For additional information, see our report on the Device Tax.