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University of Minnesota Medical Technology Evaluation and Market Research Department of Healthcare Management Course: MILI/PUBH 6589 Spring Semester, 2012. Stephen T. Parente, Ph.D. $ $ Carlson School of Management, Department of Finance.
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University of MinnesotaMedical Technology Evaluation and Market Research Department of Healthcare ManagementCourse: MILI/PUBH 6589Spring Semester, 2012
Stephen T. Parente, Ph.D.$
$Carlson School of Management, Department of Finance
3. Payers must agree to cover the drug / device / procedure
4. Providers must be persuaded to use/proscribe the innovation
Patents given protection from direct competition for 20 years
FDA approval process can take 8 to 10 years
The effective patent life is then 12 to 10 years
After the patent expires, generics can enter
Abbreviated New Drug Applications (ANDA)
Need to be strategically aware of this time line
FDA does not have clear policies for addressing post-market drug safety
In response to the Vioxx case, the FDA has recently created the Drug Safety Oversight Board
However, there no systematic tracking of ongoing safety issues -- reporting of adverse events is voluntary
Legislation is likely to change this post-market monitoring by the FDA-- potential use of claims data
Does this mean that once FDA approval is secured it is easy street?
FDA approval is for treatment of a specific condition/disease
MDs can proscribe the drug for other conditions/populations
The case of Gabapentin
During the concept, patent, pre-clinical and clinical trial and FDA NDA approval process what non-clinical trial information might you want to collect at each stage of the process in order to make a “go/no go” decision?
Hypothetical drugs: 1) new treatment for bi-polar disorder; 2) a new weight-loss drug; 3) a new hypertension treatment; 4) a new treatment for Alzheimer's; 5) a new drug to treat heart attacks.
Blood pressure cuff v. pacemaker
More complicated than drugs
Devices are used in many different settings and the flow of payments are
A hospital may furnish a number of services to a beneficiary on the same day and receive an APC payment for each service
Beneficiary is responsible for 20% of the costs
Private Health Insurance either relies on the Medicare or a percent of changes structure
Why Does this matter for Device Manufacturers?