Evercore ISI analyst Joshua Schimmer upgraded Alnylam to Outperform from In Line and raised his price target to $110 from $87. In a research note to investors, Schimmer says he has been considering an upgrade for a few weeks, and notes that it is not due to this morning’s announcement of positive givosiran Phase 3 Envision topline results, nor is it timed to the ongoing Onpattro launch as near-term consensus numbers may be a “little” aggressive. Instead, he says his constructive view is more about the modularity of Alnylam’s RNai ‘bioengineering” platform and that the company is in a small group of companies positioned for sustainable growth.
https://thefly.com/landingPageNews.php?id=2875309
Wednesday, March 6, 2019
Tandem Diabetes under pressure after reporting software bug in CGM trial
Tandem says manifestations of the anomaly are rare and have not resulted in any reportable adverse events
Shares of Tandem Diabetes (TNDM) are slipping after the company said that it will use the company’s remote software update tool to fix a Control-IQ technology software anomaly identified during the ongoing DCLP3 phase of its IDCL clinical trial. After speaking with management at Tandem, Baird analyst Jeff Johnson said he believes the software bug in its Control-IQ clinical trial is small, has not impacted a single patient, is easy to fix, and may not delay launch of Control-IQ at all, or if it does it would be by a couple or a few weeks at most.
SOFTWARE ANOMALY IN CLINICAL TRIAL: Tandem Diabetes announced that it intends to use its remote software update tool, the Tandem Device Updater, to resolve a Control-IQ technology software anomaly identified during the ongoing DCLP3 phase of the International Diabetes Closed Loop, or IDCL, clinical trial. The company anticipates that the software update will be available to study sites before the end of March. The anomaly relates to how the t:slim X2 insulin pump with Control-IQ technology handles continuous glucose monitoring data under specific conditions, which could then impact the system’s prediction of future blood glucose values and automated insulin delivery. Manifestations of this anomaly are rare and have not resulted in any reportable adverse events; however, due to an increased risk of hypoglycemia, use of the Control-IQ software feature in the IDCL study will be temporarily suspended until the software update is available. The company is currently in discussions with the IDCL study investigators to evaluate any impact of the software update to the clinical or regulatory strategy for the t:slim X2 insulin pump with Control-IQ technology. Currently, approximately 120 out of 168 trial participants have completed the 6-month DCLP3 study. Tandem has also notified other clinical trial sponsors using Control-IQ technology of the anomaly and that a software update will be made available. The DCLP5 study, which is the pediatric arm of the IDCL study, will commence following availability of the updated software.
TRIAL ‘HICCUP’ SHOULD BE FIXED EASILY, QUICKLY: After speaking with management at Tandem Diabetes, Baird’s Johnson told investors that his understanding is that the software bug the company announced in its Control-IQ clinical trial is small, has not impacted a single patient, and is easy to fix. The issue may not delay the launch of Control-IQ at all, or if it does it would be by a couple to a few weeks at most, Johnson contended. The analyst noted that the issue was identified as something in the software that “could happen” under a very unique set of circumstances when a patient is either trending toward hypoglycemia or the CGM is mis-reading a hypo event. In essence, several unusual things would have to be happening, all at the same time, for the system to incorrectly calculate and/or provide an insulin bolus, he added. Overall, Johnson believes that with no adverse events tied to this issue, no patients needing to restart the 6-month Control-IQ trial due to this issue, and the trial only suspended a few weeks, the news should be seen as nothing more than a “small hiccup.” Noting that the selloff on this news appears “overdone,” the analyst reiterated an Outperform rating and $65 price target on the stock.
Gynesonics touts 5-year data from its uterine fibroid ablation treatment
2014 Fierce 15 company Gynesonics has unveiled long-term follow-up data, spanning more than five years, that tracks the durability of its incisionless ablation treatment for uterine fibroids.
The study showed that no surgical reinterventions were needed in the first 3.4 years following treatment with the company’s Sonata system, with an annualized reintervention rate of 2.2%. Cumulatively—over the study’s average follow-up of 5.4 years in 17 patients—the reintervention rate reached 11.8%.
In addition, scores of symptom severity and quality of life improved by an average of 37 points and 49 points, respectively. The full results were published in the Journal of Gynecologic Surgery.
Gynesonics’ Sonata system—the next generation of its VizAblate platform—combines a unique intrauterine ultrasound guidance and imaging system with a radiofrequency ablation device. The system received 510(k) approval from the FDA last August for the transcervical treatment of symptomatic uterine fibroids, also known as leiomyomas, including those associated with heavy menstrual bleeding.
“Such lasting results are even more impressive considering the low risk and quick recovery our patients experienced with the Sonata procedure, especially when compared to other fibroid treatment alternatives,” said study author Jose Gerardo Garza-Leal, M.D., of the Universidad Autonoma de Nuevo Leon in Monterrey, Mexico.
Previously, methods such as power morcellation were used to cut up fibroids and uterine wall tissue, but these practices could end up dispersing undetected cancer cells that had been hidden within some fibroids and causing the disease to spread.
According to the company, the Sonata platform also allows physicians access to a wide range of fibroid types, as well as those that cannot be treated with current hysteroscopy methods.
In early January, Gynesonics secured $75 million in equity financing, led by Bain Capital Life Sciences. The company’s previous investors also returned to back the company, including Abingworth, Advanced Technology Ventures, Endeavour Vision, HealthCrest, InterWest Partners, HBM Partners, Correlation Ventures and Hercules Technology Growth Capital.
Gynesonics said it plans to use the proceeds to help launch global commercialization efforts for its Sonata system, which has also received a CE mark.
The company projects a global market opportunity ranging between $3 billion and $4 billion, with more than $1 billion coming from the U.S. alone—with estimates of about 200,000 hysterectomies being performed in the U.S. annually, and more than 1 million fibroid procedures being performed globally each year.
Sanofi, boosted by partnerships, lays out connected tech ambitions in diabetes
Technology solutions are key to the future of diabetes—especially personalized, “smart” connected tech. So says Sanofi, which for the past several years has pushed digital, integrated diabetes efforts on its own, through its joint venture Onduo, and more recently with Verily and Sensile Medical. At the recent Advanced Technologies & Treatments for Diabetes (ATTD) meeting in Berlin, Sanofi updated its progress and outlined its ambitions for connected technology in diabetes.
Onduo, the joint venture between Sanofi and Verily begun in 2016, debuted its virtual diabetes clinic one year ago and now has more than 4,600 Type 2 diabetes patient users in the U.S. The effort looks to use technology to bridge the gap between doctor visits and help patients manage their diabetes daily with connected glucose monitoring devices, personal coaching, education and advice through its digital platform.
“It is not just about developing a platform supporting the daily management of diabetes, it’s about a test and learn process by bringing quickly to the people the support that they need, ensuring that the adoption process is easy for them and improving solutions as time goes,” Nicolas Kressman, Sanofi senior media relations officer, North America, said in an email interview.
In June, Sanofi unveiled another partnership effort, this time with Verily and Sensile Medical, to develop an all-in-one insulin patch pump. The pump is primarily for patients with Type 2 diabetes and will be the first patch pump on the market that significantly reduces the steps needed to get started.
Sanofi is also working on its own and with partners on a “complete portfolio of disposable and reusable connected insulin pens,” Kressman said.
“We believe that with the proper usage of technology, digital solutions, data and drugs we can improve the life of people living with diabetes if we succeed to integrate this solutions in the life of people with diabetes, in the practice of HCPs and in the healthcare system,” he said.
Sanofi isn’t alone in its connected tech efforts in diabetes. Novo Nordisk is set to debut its first connected pens that can sync dosing data with digital platforms under new deals with partners Dexcom, Glooko and Roche. Eli Lilly also announced its own push for smart diabetes devices more than a year ago.
Teva plant tagged with warning letter for issues making schizophrenia drug
For years now, Teva has had difficulty with the laser drilling of a schizophrenia drug so that patients get the right dose. The FDA, having finally tired of the company being unable to resolve the issues, has now slapped the plant in Florida with a warning letter.
The letter, posted Tuesday, acknowledges the company has already taken the agency’s advice to use an outside consultant, but faults it for repeat violations of problems pointed out during inspections of the Davie, Florida plant in 2013, 2016, 2017 and then again last year.
“These repeated failures demonstrate that executive management oversight and control over the manufacture of drugs is inadequate,” the FDA said.
A Teva spokeswoman in an email today said, “We are working closely with FDA to address its inspection-related concerns as quickly as possible.”
According to the warning letter, the problems at the Actavis plant in Davie predate, Teva’s $40.5 billion purchase of Allergan’s generics business in 2016. But the issues have continued for several years since, resulting in a recall of the paliperidone extended-release tablets in 2017, which started at the retail level but was then extended to the consumer level.
The company at the time acknowledged the dissolution issues tied to faulty laser drilling could reduce the drug’s effectiveness at treating a patient’s symptoms, “including suicidal thoughts and behavior, self-injurious behavior, mental hospitalizations, assaults, aggressive behavior, as well as vocal and motor tics.”
During a visit in August 2018, the FDA found issues with the visual inspection system and faulted the plant for not thoroughly investigating problems to find their cause, or of instituting fixes quickly enough. It raised questions about whether a single quality assurance inspector per shift would be able validate the “presence of a laser drilled hole that can be as small as 0.3mm” coming off the production line. The letter did not specify how many tablets that would be but when Actavis invested $40 million into the plant in 2013, it reported the facility produced about 2.2 billion immediate and extended-release units annually.
The buyout of Actavis in which Teva got the plant continues to be a drag on the Israel-based company. Last month Teva reported that 2019 would be more challenging than expected as generics eat away sales of its blockbuster multiple sclerosis drug Copaxone. The company forecast 2019 revenues between $17 billion and $17.4 billion, missing consensus forecasts of more than $18 billion. And it’s expecting non-GAAP earnings per share of $2.20 to $2.50 versus the consensus estimate of $2.77.
First targeted protein degrader hits the clinic, aimed at prostate cancer
As soon as Ian Taylor read a story in his local newspaper about how a young biotech firm was focused on developing targeted protein degraders, he was hooked. Whereas most small molecules inhibit a protein’s activity by blocking its active site, the company Arvinas was on the hunt for small molecules dubbed ‘PROTACs’ that could co-opt the cell’s degradation machinery to break the proteins down entirely. “I remember thinking to myself: wow, that would be awesome. You could really hit undruggable targets with this,” recalls Taylor, who was then at Pfizer Oncology. Now he is overseeing the first clinical test for this emergent modality as senior vice president of biology at Arvinas.
Arvinas is set to start recruiting patients into a phase I trial of ARV-110 in prostate cancer. Like other drugs in this modality, ARV-110 is a bifunctional molecule that uses one arm to bind a target — in this case the androgen receptor (AR) — and the other to bind an E3 ubiquitin ligase. The ligase then tags the target with ubiquitin, marking it for disposal by the cell’s proteasomal machinery. Later this year, Arvinas also plans to launch a breast cancer trial of their ARV-471, a targeted degrader that acts in the same way on the oestrogen receptor (ER).
Other companies are also nearing the clinic, including Novartis, which is on track to advance a targeted degrader into the clinic this year against an as yet undisclosed target.
“Everyone in the industry is waiting with bated breath on those first trial results,” says Jason Imbriglio, who works on targeted degraders at Merck & Co. “It has the potential to really change the way people think about this technology.”
Reflecting this potential, a host of biotechs including Arvinas, C4 Therapeutics and Kymera Therapeutics are wholly focused on honing targeted degrader chemistries. Big pharma groups are also investing heavily in this science.
“Every big pharma company and even every medium-sized biotech has either a collaboration in this space or internal efforts,” says Nello Mainolfi, CTO of Kymera.
While most of the focus is on bifunctional molecules that recruit an E3 ligase, a few firms are also exploring alternative degradation strategies (Box 1).
“2019 through 2021 will be big years for this space,” says Andrew Phillips, CEO of C4 Therapeutics.
Making degraders
Targeted degraders first entered the patent literature in 1999, when researchers from the biotech Proteinix submitted a patent for small-molecule compounds that could co-opt the ubiquitin machinery to degrade proteins of interest. Just 2 years later, Yale University’s Craig Crews and California Institute of Technology’s Raymond Deshaies published on a similar strategy, using a peptide-based approach to induce the ubiquitylation and degradation of the target methionine aminopeptidase 2.
While Proteinix never pursued the promise of this patent, Crews and colleagues kept tinkering away at their protein degraders, named proteolysis-targeting chimaeras (PROTACs), gradually turning chemical curiosities into a medicinal modality. By 2008 they had dropped the peptidic component of their molecules, designing a wholly small-molecule degrader that could bind and degrade the AR by bringing it into proximity with the E3 ligase MDM2. In 2013, Crews founded Arvinas to advance this technology to the clinic.
Around that same time, researchers were unravelling the biology of the immunomodulatory imide drugs, including thalidomide, lenalidomide and pomalidomide. After realizing that these engage the E3 ligase cereblon, it became clear that these might have utility as targeted degraders as well. In 2015, Jay Bradner, then at the Dana–Farber Cancer Institute and now president of the Novartis Institutes for BioMedical Research (NIBR), showed with colleagues that they could harness this activity to drive the targeted degradation of the BET family of proteins. Bradner and colleagues dubbed their degraders degronimids, and co-founded C4 Therapeutics that same year.
Whether drug hunters call their candidates PROTACs or degronimids, the leading targeted degradation strategies all operate somewhat like molecular glues: a bifunctional small molecule combines a target-binding warhead, a linker and an E3 ligase recruiter to bring a target protein into contact with an E3 ligase, enabling selective target ubiquitylation and subsequent protein degradation.
It wasn’t always clear that this approach could make it to the clinic, however. From the start, researchers worried that these large and potentially floppy compounds would be hard to optimize into bioavailable, selective, effective and tolerable drug-like compounds. With the first compounds headed to the clinic, things are looking up.
“These are unusual looking molecules — some might even say funny-looking molecules,” says Phillips. But work over the past few years has shown that “they have surprisingly normal pharmaceutical properties,” he adds. As yet confidential internal analyses, from multiple companies, suggest these compounds can solubilize well, can slip into cells, can be orally available, can resist metabolic processes and in some cases can even cross the blood–brain barrier.
“The big surprise for me — and this shouldn’t really be a surprise — is that our ability to predict chemical properties for new classes of molecules based simply on chemical structures is no better now than it was 5 years ago, and arguably no better than it was 30 years ago,” says Phillips.
Early hopes that targeted degraders might offer a sort of modular platform — in which any target-binding ligand can be paired with an off-the-shelf linker and E3 recruiter to generate a drug — meanwhile have not yet borne out.
Instead, there is growing appreciation that the properties of the ternary structure that forms between a target, a degrader and an E3 ligase are key. Even the slightest shifts in this structure can affect how the drugs work. In some cases, this can explain how promiscuous target-binding warheads can achieve super selectivity when transformed into a degrader. In others, minute changes to any component of the degrader can wipe out its activity entirely.
“It is not a plug and play system,” says Phillips. “Chemists like to pull systems apart to their constituent parts for reasons related to synthesis strategies. But what we have learned over the past hundred years again and again is that a system is not simply the sum of the parts. This is very much on point for degraders; they are not simply the sum of the parts,” says Phillips.
C4 Therapeutics’ strategy, as laid out in a review article last year, is consequently to optimize its compounds to activate the ubiquitin system, not just to bring the target and the ligase into proximity with one another. “You have to bring things together, but that alone is clearly not sufficient. You have to activate the process as well,” says Phillips. “There really is a need for a more holistic understanding of how degraders work.”
Mainolfi similarly adds that focusing only on ternary complex formation “is probably short sighted”. In some cases, even successful protein ubiquitylation doesn’t guarantee that a target is delivered to the proteasomal system for degradation. “There is a lot that we don’t know, or at least that is not disclosed out there,” he says.
This is true of the ligase landscape as well, in which an estimated 600 E3 ligases have unique activity profiles and distribution patterns throughout the body. Picking the right ligase to recruit to your target protein can make or break a programme, says Mainolfi. If a target can be knocked out across the body without adverse events — as perhaps shown by human knockout data — then Kymera’s team might choose to work with an ubiquitously expressed E3 ligase, he explains. But if they need a wider therapeutic window, they may focus on ligases that are preferentially expressed in a specific tissue type or cancer cell type. The E3 ligases also have different patterns of subcellular distribution, providing the opportunity to add other layers of selectivity into the mix.
Only five or six E3 ligases have been publicly validated for use in targeted degraders so far, says Mainolfi, but Kymera and others are working on validating other E3 ligases to add to their tool boxes.
Testing targets
One of the biggest theoretical benefits of targeted degraders is their ability to make once undruggable targets druggable. Whereas small-molecule inhibitors have to block catalytic sites or bind in well-defined pockets that impact protein function, targeted degraders can in theory bind any nook or cranny to drive degradation. “It opens up a subset of human biology that’s yet to be effectively targeted by drugs,” says Phillips.
But a limitation of this approach may have got lost in the noise, he cautions. “There are still a huge number of targets where there is just no ligand. And if there’s no ligand, I can’t build you a degrader,” says Phillips. Long-time appealing targets like MYC, despite hopes to the contrary, remain for now as intractable as ever, he says.
“Right now the most impactful parameter that I think the industry hasn’t solved for is: what are the ligandable targets?” says Mainolfi.
Bradner is optimistic that the field will open up most targets, eventually. “My instinct is that most proteins will prove amenable to small-molecule discovery chemistry, either by direct engagement with a small molecule or through a molecular-glue-like activity of a molecule crosslinking a protein of interest,” he says. “This is admittedly a hunch, but I think the high-hanging fruit is reachable with this chemistry.” Researchers at NIBR have already induced targeted degradation of over 40 targets, he points out, many of which would have otherwise been classed as undruggable.
Given the competitive nature of this field, companies are being tight-lipped about which targets they are working on, especially when it comes to previously undruggable proteins that might do the most to open up new disease spaces. But a few publicly disclosed degrader programmes — working on validated or at least known ligandable targets — highlight some of the lower-hanging opportunities these drugs can offer.
Arvinas’s two lead candidates act on the AR and the ER, respectively, both of which are clinically validated targets of approved drugs. This conservative strategy is by design, notes company CEO John Houston, and stands to ultimately simplify the initial development of the modality. Arvinas’s founders thought about testing their degraders against unvalidated targets from the get go, but worried that with a failure it would be unclear whether the target or the technology was at fault. With validated targets, by contrast, the compounds alone have the opportunity to shine or resign. “That was the thinking I inheriting when I joined, and I’m very glad they did that,” says Houston. And there is still plenty of room for these lead targeted degraders to go above and beyond the competition, he points out.
In the case of the AR target, for example, approved small molecules rely on occupancy-driven pharmacology to prevent activity, and so they lose their activity when they are flushed from the body or overwhelmed by replacement proteins. And most patients will acquire resistance to the AR antagonist enzalutamide, because cancer cells can increase their androgen or AR production levels or can pick up AR mutations such that they no longer respond to treatment.
ARV-110 — like many other targeted degraders — by contrast makes the most of an event-driven activity in which each compound efficienly catalyses the complete degradation of multiple protein constructs. Instead of needing more drug than there is target, which is the case with traditional inhibitors, Arvinas can dose less drug than target. And this lower dosing could translate into a better side effect profile, explains Taylor.
Another benefit of event-driven pharmacology is that targeted degraders promise sustained activity even after they are gone, for as long as it takes for a cell to resynthesize degraded proteins. “We have data from a number of programmes where PROTACs, because of their catalytic activity, can take care of all the additional protein that a cell is trying to make as part of a resistance mechanism,” says Taylor. In some cases, these drugs might as a result be able to delay the rise of resistance.
ARV-471 addresses other shortfalls of the approved ER-targeting drugs as well. The approved selective ER degrader fulvestrant — which drives degradation by making the ER more hydrophobic and therefore unstable, rather than by recruiting an E3 ligase — is not orally bioavailable, has poor systemic exposure and does not fully deplete its target.
When these trials wrap up, people will be watching closely for insights into how unconventional first-in-modality degrader compounds are absorbed, distributed, metabolized and excreted from the body, and whether they can live up to the expectations of oral dosing.
The field is also keen to see how low these drugs can knock protein levels down, how that compares with protein re-synthesis rates and whether those levels are in line with expectations from animal models.
“The promise with targeted degrader molecules is to dissociate pharmacodynamics from pharmacokinetics, meaning that brief exposure to a degrader can result in durable impact on a pathway,” says Bradner. “And so the pharmacokinetic and pharmacodynamic relationships will be very exciting to watch,” adds Bradner.
The team at Arvinas is particularly excited. “This year will tell us a lot about whether we truly have cracked the code for turning these things into small molecules with drug-like properties, and whether that will pan out through the rest of the platform,” says Houston.
And when the leaders in this space disclose the as-yet confidential structures of their drugs, researchers elsewhere will be keen to take lessons back to their own programmes. “I’m curious to see what the key parameters were that they optimized for in order to translate their preclinical programmes into the clinic and what their compounds look like, which to be honest I assume is quite different from what our molecules look like,” says Mainolfi.
“We hope the first clinical investigations of the first few compounds go really well,” he adds.
Other opportunities
Kymera’s targeted protein degrader of IRAK4 demonstrates another set of near-term opportunities for the targeted degraders. IRAK4 is a kinase with a key role in the innate immune system, and has been implicated in various cancers. But while small-molecule inhibitors can block IRAK4’s kinase capabilities, the protein also has a kinase-independent role as a scaffolding protein, enabling the assembly of the innate immune system’s myddosome protein complex.
“Based on genetic knockdown and knockout experiments, we hypothesize that we will be able to achieve completely unique and superior phenotypes than are possible with inhibitors,” says Mainolfi.
Kymera presented preclinical data for an IRAK4 inhibitor at the American Society of Hematology meeting last year, and plans to advance this programme into the clinic in the first half of 2020.
Similar principles could be applied to other scaffolding proteins, including RIP kinases that some degrader groups have been working on, as well as to other non-enzymatic proteins and transcription factors that can otherwise be hard to target.
Central nervous system targets are also increasingly on the table. Drug developers are already working on antibody, antisense and gene-therapy-based approaches to knock down tau and α-synuclein, for example, but given concerns about the brain-penetrating capabilities and administration profiles of these modalities, targeted degrader advocates hope that their drugs will offer a better way forward. Arvinas is already making progress with a tau-targeted compound that can cross the blood–brain barrier in in vivo models of disease, and the company is optimistic that they will be able to advance an oral or intravenous formulation of such a drug into the clinic. They are also working on an α-synuclein targeted degrader for the treatment of Parkinson disease.
C4 Therapeutics and Biogen partnered in January on Alzheimer and Parkinson disease as well, but they have yet to disclose targets.
And the broader opportunity is bigger still, says Mainolfi. “We have an opportunity to achieve broadly applicable body-wide knockdown in a way that oligonucleotide and CRISPR therapeutics cannot yet do. And we can do it with the flexibility and the scalability of small molecules. This really has the potential to be the biggest game changer in drug discovery.”
What Socialized Medicine Looks Like
Left-wing Democrats in Congress have decided on a new version of “Medicare for All.” Turns out its going to be nothing like the Medicare program seniors are used to. What they have in mind is what we see in Canada.
Everyone (except American Indians and veterans) will be in the same system. Health care will be nominally free. Access to it will be determined by bureaucratic decision making.
Here’s what to expect.
Overproviding to the Healthy, Underproviding to the Sick. The first thing politicians learn about health care is this: most people are healthy. In fact, they are very heathy – spending only a few dollars on medical care in any given year. By contrast, 50% of the health care dollars will be spent on only 5% of the population in a typical year.
Politicians in charge of health care, however, can’t afford to spend half their budget on only 5% of the voters, including those who may be too sick to vote at all. So, there is ever-present pressure to divert spending away from the sick toward the healthy.
In Canada and in Britain, patients see primary care physicians more often than Americans do. In fact, the ease with which relatively healthy people can see doctors is probably what accounts for the popularity of these system in both countries.
But once they get to the doctor’s office British and Canadians patients receive fewer services. For real medical problems, Canadians often go to hospital emergency rooms – where the average wait in Canada is four hours. In Britain, one of every ten emergency room patients leave without ever seeing a doctor.
A study by former Congressional Budget Office director June O’Neill and her husband Dave O’Neill found that:
- The proportion of middle-aged Canadian women who have never had a mammogram is twice the U.S. rate.
- Three times as many Canadian women have never had a pap smear.
- Fewer than 20% of Canadian men have ever been tested for prostate cancer, compared with about 50% of U.S. men.
- Only 10% of adult Canadians have ever had a colonoscopy, compared with 30% of US adults.
These differences in screening may partly explain why the mortality rate in Canada is 25% higher for breast cancer, 18% higher for prostate cancer, and 13% higher for colorectal cancer.
A study by Brookings Institution scholar Henry Aaron and his colleagues found that:
- Britain has only one-fourth as many CT scanners as the U.S. and one-third as many MRI scanners.
- The rate at which the British provide coronary bypass surgery or angioplasty to heart patients is only one-fourth of the U.S. rate, and hip replacements are only two-thirds of the U.S. rate.
- The rate for treating kidney failure (dialysis or transplant) is five times higher in the U.S. for patients age 45 to 84 and nine times higher for patients 85 years of age or older.
We can see the political pressure to provide services to the healthy at the expense of the sick in our own country’s Medicare program. Courtesy of Obamacare, every senior is entitled to a free wellness exam, which most doctors regard as virtually worthless. Yet if elderly patients endure an extended hospital stay, they can face unlimited out-of-pocket costs.
Rationing by Waiting. Although Canada has no limits on how frequently a relatively healthy patient may see a doctor, it imposes strict limits on the purchase of medical technology and on the availability of specialists. Hospitals are subject to global budgets – which limit their spending, regardless of actual health needs.
In addition to having to wait many hours in emergency rooms, Canadians have some of the longest waits in the developed world for care that could cure diseases and save lives. The most recent study by the Fraser Institutefinds that
- In 2016, Canadians waited an average of 21.2 weeks between referral from a general practitioner to receipt of treatment by a specialist – the longest wait time in over a quarter of a century of such measurements.
- Patents waited 4.1 weeks for a CT scan, 10.8 weeks for an MRI scan, and 3.9 weeks for an ultrasound.
Similarly, a survey of hospital administrators in 2003 found that:
- 21% of Canadian hospital administrators, but less than 1% of American administrators, said that it would take over three weeks to do a biopsy for possible breast cancer on a 50-year-old woman.
- 50% of Canadian administrators versus none of their American counterparts said that it would take over six months for a 65-year-old to undergo a routine hip replacement surgery.
Jumping the Queue. Aneurin Bevan, father of the British National Health Service, declared, “the essence of a satisfactory health service is that rich and poor are treated alike, that poverty is not a disability and wealth is not advantaged.” Yet, more than thirty years after the NHS was founded an official task force (The Black Report) found little evidence that the creation of the NHS had equalized health care access. Another study (The Acheson Report), fifty years after the NHS founding, concluded that access had become more unequal in the years between the two studies.
In Canada, studies find that the wealthy and powerful have significantly greater access to medical specialists than less-well-connected poor. High-profile patients enjoy more frequent services, shorter waiting times and greater choice of specialists. Moreover, among the nonelderly white population, low-income Canadians are 22% more likely to be in poor healththan their U.S. counterparts.
These results should not be surprising. Rationing by waiting is as much an obstacle to care as rationing by price. It seems that the talents and skills that allow people to earn high incomes are similar to the talents and skills that are useful in successfully circumventing bureaucratic waiting lines.
No Exit. The worst features of the U.S. health care system are the way in which impersonal bureaucracies interfere with the doctor-patient relationship. Those are also the worst features of Canadian medical care. In Canada, when patients see a doctor the visit is free. In the U.S., the visit is almost free – with patients paying only 10 cents out of pocket for every dollar they spend, on average. In both countries, people primarily pay for care with time, not with money. The two systems are far more similar than they are different.
In Britain, private sector medicine allows patients to obtain care they are supposed to get for free from government. Middle and upper-middle income employees frequently have private health insurance, obtained through an employer. A much larger number of Britons use private doctors from time to time. The rule seems to be, “If your condition is serious, go private.”
Canada, by contrast, has basically outlawed private sector medical services that are theoretically provided by the government. If doctors, patients and entrepreneurs think of better ways of meeting patient needs they have no way of acting on those thoughts.
This is where the U.S. system is so much better—even though, as in the Canadian system, U.S. Medicare pays doctors the same way it did in the last century, before there were iPhones and email messages. Many U.S. employer plans are just as bad.
But because U.S. employers are free to meet the needs of their employees rather than live under the dictates of a politically pressured bureaucracy, one of the fastest growing employee benefits is concierge care. For as little as $50 a month for a young adult, patients can have 24/7 access to a doctor by phone and email and all the normal services that primary care physicians provide.
Uber-type house calls, consultations by phone, email and Skype, cellphone apps that allow people to manage their own care and other innovations in telemedicine are taking some parts of the private sector by storm.
These are the kinds of innovations that would be outlawed if the congressional Democrats have their way.
For more on these and other issues, interested readers may want to consult my congressional testimony, delivered with Linda Gorman, Devon Herrick and Robert Sade.
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