Healthcare leads the way as US hits lowest unemployment mark in decades

• The healthcare industry gained 38,800 jobs in September, up from the amount added in August but largely on par with the average increase over the past 12 months, according to figures the U.S. Bureau of Labor released Friday.
• Ambulatory services saw the most gain with 28,700 jobs. Hospitals accounted for 8,100 positions while nursing and residential care facilities brought in 2,000.
• The number of healthcare jobs added in August was revised upward significantly to 37,200 from the initial estimate of 23,900. Hospital employment was revised up to 14,000 from nearly 9,000.

The numbers show healthcare employment “remains remarkably strong” as it continue to grow month to month, Jefferies analysts said in a note.
“We believe the combination of strong demand growth from healthcare employers and shortages of many clinicians (nurses, physicians) creates a positive set-up for the healthcare temp staffing industry,” the analysts wrote.
Healthcare job gains year-to-year have averaged 2.5% for 2019, up from 1.8% in 2018, the analysts noted.
Overall in the U.S., 136,000 jobs were added last month, sending the unemployment rate down 0.2 percentage points to 3.5%, the lowest it’s been since December 1969. Healthcare led the way, followed by professional and business services at 34,000, and government employment at 22,000.
Home healthcare job gains were down slightly in September at 5,700. Physicians offices added 5,200 jobs while outpatient care centers gained 4,800.
Although the jobs numbers are strong for the industry and hospitals, some individual systems are dealing with labor strife. Kaiser Permanente appears to be holding off a strike of nearly 85,000 nonclinical workers that had been planned this month after agreeing to annual wage increase guarantees and a defined benefit pension plan.
And last month, 65,00 nurses across a dozen Tenet hospitals took to the picket line after failing to reach a contract agreement with the hospital operator.
https://www.healthcaredive.com/news/healthcare-leads-the-way-as-us-hits-lowest-unemployment-mark-in-decades/564455/

Former FDA chief Gottlieb sees Trump-pitched pricing model easy to game

• As the international pricing index model slogs through the regulatory process, former Food and Drug Administration head Scott Gottlieb predicted Monday it will be “very hard to implement,” with drug companies likely to scheme around the controversial idea.
• About a year ago, President Donald Trump pitched the idea as a way to attack “global freeriding.” The proposal ties drug prices in the U.S. to foreign countries, starting with the Medicare Part B program. The Office of Budget and Management has yet to release the proposed rule despite more than 100 days of review.
• Gottlieb anticipated the rule will eventually come out but is skeptical it would achieve its goals, speaking at the Biopharma Congress in Washington. The former FDA chief added that companies could offer American-style rebates to Europe to keep foreign list prices equally high. “I don’t want to give too much away, because I’ll tell people how to game around this,” said Gottlieb, who now sits on Pfizer’s board of directors.

Despite a prolonged and ongoing regulatory review, Trump administration officials have reaffirmed their support for the IPI model, which has been criticized by PhRMA as importing foreign price controls.
Joe Grogan, director of the White House’s Domestic Policy Council, said Monday the administration is being “very conscious of getting policy right.” Grogan was the associate director of health programs at the Office of Management and Budget until February, when he moved over to the White House.
Grogan said the IPI model counteracts the unfairness to American taxpayers from pharma activities that benefit foreign countries. He described a typical model for companies as parking intellectual property in Ireland, manufacturing the drug outside the U.S. and then importing it at a premium price.
While acknowledging debate around the plan’s specifics, Grogan said the broader disparity between U.S. and foreign prices is “something that needs to be addressed somehow.”
But Gottlieb was more skeptical about the idea’s eventual effectiveness. As an FDA commissioner remembered for calling the pharma industry out on its “shenanigans” and “Kabuki drug-pricing constraints,” he anticipates more schemes coming to avoid the IPI model.
In addition to bring U.S.-style rebates to Europe to keep prices high, Gottlieb said drug companies could circumnavigate the rule if it includes an exemption for biosimilar competition.
“The rule itself now carves around settings where there is a biosimilar, so you can see branded companies settling with one biosimilar manufacturer, giving them a little bit of market share and getting them out of the IPI,” he said.
https://www.healthcaredive.com/news/fda-scott-gottlieb-ipi-model-easy-to-game-joe-grogan/564579/

U.S. says gene testing firm gets 25-year ban in $42.6 million kickback settlement

A New Orleans-based genetics testing company and its three principals will pay $42.6 million to resolve charges they defrauded the federal government by paying kickbacks for referrals and billing for medically unnecessary tests, the U.S. Department of Justice said on Wednesday.
UTC Laboratories Inc, which has also been known as Renaissance RX or RenRX, also agreed to a 25-year ban from participating in any federal healthcare program, the Justice Department said.
Wednesday’s accord resolved six whistleblower lawsuits accusing the company of violating the federal False Claims Act.
UTC will pay $41.6 million, while its three principals, including founder Dr. Tarun Jolly, will pay $1 million. The Justice Department said there was no admission of liability.
Lawyers for the defendants could not immediately be reached for comment. Jolly also could not immediately be reached.
The Justice Department accused the defendants of having paid physicians from 2013 to 2017 to induce them to order genetic tests, purportedly in return for involvement in a clinical trial to create a registry of people who underwent genetic testing.
It also said the defendants offered kickbacks to other entities and individuals, and billed Medicare for unnecessary genetic tests.
According to whistleblowers’ complaints, the “Diagnosing Adverse Drug Reactions Registry,” or DART trial, was intended to catalog the effects of genetic testing on the drug regimens and clinical outcomes for 250,000 patients.
The defendants were accused of having falsely represented that Medicare would cover testing that was a prerequisite for enrollment in the registry.
“Healthcare fraud, in any incarnation, hurts patients, honest medical practitioners, and all of the nation’s taxpayers,” U.S. Attorney Peter Strasser in New Orleans said in a statement.
The False Claims Act lets whistleblowers sue on behalf of the government, and share in recoveries.
On Sept. 27, federal agents raided a series of genetic testing laboratories and criminally charged 35 people over an alleged fraud that caused $2.1 billion of losses to federal healthcare insurance programs.
The government has also issued a consumer alert concerning genetic testing fraud.
https://www.reuters.com/article/us-usa-utc-labs/u-s-says-gene-testing-firm-gets-25-year-ban-in-42-6-million-kickback-settlement-idUSKBN1WO2TB

Insilico signs $200M AI drug discovery partnership with China’s CTFH

Shortly after publishing a paper demonstrating how its artificial intelligence programs could generate viable lead compounds in just a few weeks, Insilico Medicine has signed a dual-program discovery collaboration with Jiangsu Chia Tai Fenghai Pharmaceutical worth up to $200 million.
Focused on previously undruggable targets in triple-negative breast cancer, the deal includes an upfront payment along with potential milestones and sales-based royalties pegged to any eventual products.
“We are very pleased to establish the partnership with Insilico Medicine, entering the new era of AI-enabled drug development,” Wenyu Xia, general manager of the China-based pharma company, said in a statement. “We look forward to a long-term partnership with Insilico Medicine.”

The company is a joint venture between the Chia-Tai Group, also known as CP Pharmaceutical, and the Jiangsu Agriculture Reclamation Group. With its R&D, production and sales backgrounds, it has developed several finished dosages and active pharmaceutical ingredients spanning gastrointestinal, cardiovascular, respiratory, neuropsychological and oncology areas.

In early September, Insilico showed it could conceptualize 30,000 novel small molecules using its machine learning approach, narrow them down to six potential candidates for a fibrosis target and then test them preclinically in less than 50 days. The company’s paper was published in Nature Biotechnology.
Additionally, Insilico recently raised $37 million in a series B round to fuel more AI-based pharma partnerships from China-based Qiming Venture Partners alongside participation from Eight Roads, F-Prime Capital, Lilly Asia Ventures, Sinovation Ventures, Baidu Ventures, Deep Knowledge Ventures and more.
Insilico said it plans to use the proceeds to build out its senior management with biotech industry veterans to help drive collaborations in therapeutic programs covering cancer, immunology, fibrosis, nonalcoholic steatohepatitis and central nervous system conditions.

https://www.fiercebiotech.com/medtech/insilico-signs-200m-ai-drug-discovery-partnership-china-s-ctfh

Bayer forms drug discovery pact with Japan’s Riken Innovation

Bayer has entered into a drug discovery collaboration (PDF) with Riken Innovation. The agreement will give Bayer the chance to explore drug targets based on research at a leading Japanese scientific research institute.
Riken Innovation is a wholly owned subsidiary of the Japanese research institute from which it takes its name. The institute, called Riken, employs more than 3,000 researchers and has an annual budget of close to $900 million. Riken Innovation, which began operating last month, will work to bring the benefits of its parent organization’s research to the public by collaborating with industry.
Bayer is the first company to publicly sign up to work with Riken Innovation. The partners plan to use Riken research as the basis for joint explorations of potential drug targets and assessments of disease mechanisms. A road map is in place for drug targets that show promise.

“In cases where a path for novel drug target is identified for specific partnering opportunities, Riken Innovation will coordinate the advancement of the potential project,” the partners wrote in a joint statement.
Bayer’s Open Innovation Center in Osaka, Japan, will oversee the project, providing drug discovery capabilities to complement its new partner’s basic research. The collaboration opens up another front in Bayer’s efforts to connect with Japanese R&D organizations. Bayer already runs one of its CoLaborator startup collaboration centers out of the Japanese city of Kobe.
The Japanese facilities are part of a global network of sites Bayer hopes will form collaborations to boost its internal R&D group, which is adapting to a restructuring that axed 900 of its 8,000 workers.
For Riken, the partnership furthers its efforts to become a less insular organization. Last year, Riken opened an office in Belgium, in part to give its researchers opportunities to work with Europeans. Talking to Science Business at the time, Riken’s president Hiroshi Matsumoto said Japanese scientists are “inward looking,” adding that “this tendency has to change.”
https://www.fiercebiotech.com/biotech/bayer-forms-drug-discovery-pact-japan-s-riken-innovation

BioNTech cuts share offering and lowers proposed range to $15 to $16

BioNTech, a German biotech developing individualized immunotherapies for cancer, lowered the proposed deal size for its upcoming US IPO on Wednesday.

The Mainz, Germany-based company now plans to raise $155 million by offering 10 million ADSs at a price range of $15 to $16. The company had previously filed to offer 13.2 million shares at a range of $18 to $20. At the midpoint of the revised range, BioNTech will raise 38% less in proceeds than previously anticipated and would command a market value of $3.6 billion.
BioNTech was founded in 2008 and booked $149 million in revenue for the 12 months ended June 30, 2019. It plans to list on the Nasdaq under the symbol BNTX. J.P. Morgan, BofA Merrill Lynch, UBS Investment Bank, SVB Leerink, Canaccord Genuity, Bryan, Garnier & Co and Berenberg Bank are the joint bookrunners on the deal. It is expected to price on Wednesday, October 9, 2019.

Relevant Profile: BNTX

https://www.renaissancecapital.com/IPO-Center/News/65358/BioNTech-cuts-share-offering-and-lowers-proposed-range-to-$15-to-$16

Medical debt collectors barred from wiping out Californians’ bank accounts

A new California law signed by Gov. Gavin Newsom prohibits collection agencies from wiping out bank accounts to pay medical debts.
“People who are living paycheck to paycheck need the protection that this bill will provide to give them more financial security,” said Sen. Bob Wieckowski, who authored the legislation. “We do not want people living on the streets because debt collectors, who don’t have the greatest track record for accuracy, claim someone owes an old debt.”
Mr. Wieckowski says the legislation doesn’t erase debt, but “gives people the ability to pay rent, medical expenses and other daily costs while they pay down or contest the debt.”
Agencies will be required to leave $1,724 in a consumer’s bank account. Mr. Wieckowski said this amount is the lowest possible for a family of four to live in urban California, as determined by the state’s social services department.
Read the full text of the bill here.
https://www.beckershospitalreview.com/finance/medical-debt-collectors-barred-from-wiping-out-californians-bank-accounts.html