Misguided March-In: Perilous Proposal to Police Drug Prices, Threat to US Innovation

 The National Institute of Standards and Technology's (NIST) recent proposal to wield the "March-In Rights" under the 1980 Bayh-Dole Act as a tool for price-fixing drugs has ignited a firestorm of debate among stakeholders in the pharmaceutical, legal, and policy-making communities. At its core, this proposal seeks to expand the scope of “March-In Rights”—originally designed to ensure public access to inventions arising from federally funded research—to include considerations of the pricing of pharmaceutical products. This approach, however, is not just a deviation from the act's original intent; it is a leap into uncharted and potentially perilous waters that unnecessarily puts the economic and innovative future of the American pharmaceutical industry at risk.

The Bayh-Dole Act has been a cornerstone of American innovation policy for over four decades, fundamentally transforming the landscape of federally funded research. By allowing universities, small businesses, and non-profits to own inventions developed with federal funding, the Act catalyzed a wave of commercialization that has made the U.S. a global leader in biotechnology and pharmaceuticals. The proposed re-interpretation of “March-In Rights” by NIST to institute price fixing, represents a seismic shift in policy that could have far-reaching consequences.

The Bayh-Dole Act was designed to promote the utilization of federally funded inventions and encourage public-private partnerships. By introducing "March-In Rights" based on product pricing, the law is turned on its head. The Act was intended to strengthen property rights – the bedrock of a capitalist economy. This interpretation of the law, however, would weaken them by eroding the rights granted in patents. This not only distorts statutory intent but also sets a precedent for penalizing successful innovation and commercialization.

The pharmaceutical industry relies heavily on the certainty of patent protection to justify the significant investment required for drug development. Introducing uncertainty through the potential use of “March-In Rights” based on pricing considerations could deter investment, stifle innovation, and slow the development of new treatments and cures. The biopharmaceutical sector, known for its high-risk, high-reward research endeavors, could particularly feel the chill, jeopardizing future medical breakthroughs.

The biopharmaceutical industry is a vital engine of the U.S. economy, contributing billions in economic output and supporting millions of jobs, not to mention saving countless lives. Furthermore, weakening patent protections could diminish U.S. competitiveness on the global stage, particularly against countries like China, which are rapidly expanding their biopharmaceutical capabilities.

The complex, time-consuming, and costly process of drug development is underpinned by strong patent protections. These protections ensure that once a new treatment is developed, it can be commercialized and made available to patients. Interfering with market dynamics that drive drug pricing and availability could ultimately reduce the incentive to develop new treatments, adversely affecting patient access to innovative therapies.

The proposed use of "March-In Rights" for price control raises profound legal and constitutional questions. Patents are property rights protected under the U.S. Constitution. The arbitrary exercise of “March-In Rights” based on pricing could be viewed as a taking of property without just compensation, violating the Fifth Amendment. Moreover, such actions could be challenged as exceeding the authority granted by the Bayh-Dole Act itself, leading to prolonged legal battles and further uncertainty.

Rather than promoting access and affordability through innovation, this proposal threatens to undermine the very ecosystem that has made the U.S. a leader in medical research and development. It is imperative that policymakers seek alternative solutions that address drug affordability without compromising the foundational principles of innovation and private investment that have driven American success. Such proposals should focus on deregulation and unlocking the power of free-market competition rather than stifling it.

The insanity of using the "March-In" language of the Bayh-Dole Act to try and control prescription drug prices lies not just in the deviation from the Act's original purpose but in the potential to stifle innovation, deter investment, and undermine the U.S. economy and global competitiveness. As we stand at this crossroads, it is crucial to remember that the strength of the American innovation ecosystem lies in its ability to foster groundbreaking research and development through a balanced and supportive policy framework. We are caught in a crisis of our own doing as the price of prescription drugs reaches record highs. The solution, however, does not lie in misapplying a well-intentioned law in a way that could have unintended and irreversible consequences.

Courtland Culver is Assistant General Counsel of the CPAC Foundation, and a policy analyst with the CPAC Foundation’s Center for Regulatory Freedom.

https://www.realclearhealth.com/blog/2024/02/01/misguided_march-in_the_perilous_proposal_to_police_drug_prices_and_its_threat_to_american_innovation_1008875.html

Federal Bill Seeks AI Tools to Stop Medicare Fraud

 A new Senate bill would require Medicare to test two tools routinely used by credit card companies to prevent fraud: Artificial intelligence (AI)-trained algorithms to detect suspicious activity and a system to quickly alert Medicare patients on whose behalf payment is being sought.

Senator Mike Braun (R-IN) recently introduced the Medicare Transaction Fraud Prevention Act, which calls for a 2-year test of this approach.

The experiment, targeted to start in 2025, would focus on durable medical equipment and clinical diagnostic laboratory tests and cover Medicare beneficiaries who receive electronic notices about claims.

The legislation would direct the Center for Medicare and Medicaid Services (CMS) to test the use of predictive risk-scoring algorithms in finding fraud. The program would be modeled on the systems that credit card companies already use. Transactions could be scored from 1 (least risky) to 99 (most risky).

CMS would then check directly by email or phone call with selected Medicare enrollees about transactions considered to present a high risk for fraud.

Many consumers have benefited from this approach when used to check for fraud on their credit cards, Braun noted during a November hearing of the Senate Special Committee on Aging. Credit card companies often can intervene before a fraudulent transaction is cleared.

"There's no reason we wouldn't want to minimally at least mimic that," Braun said at the hearing.

Asking Medicare enrollees to verify certain purchases could give CMS increased access to vital predictive data, test proof of concept, and save hundreds of millions of dollars, Braun said.

Concerns Raised

So far, Braun has only one cosponsor for the bill, Senator Bill Cassidy, MD (R-LA), and the bill has drawn some criticism.

Brett Meeks, executive director of the Health Innovation Alliance, a trade group representing technology companies, insurers, and consumer organizations, objected to requiring Medicare enrollees to verify flagged orders. CMS should internally root out fraud through technology, not burden seniors, Meeks told Medscape Medical News.

Meeks said he has been following the discussion about the use of AI in addressing Medicare fraud. Had a bill broadly targeted Medicare fraud through AI, his alliance might have backed it, he said. But the current proposed legislation has a narrower focus.

Focusing on durable medical equipment, for example, could have unintended consequences like denying power wheelchairs to people with debilitating conditions like multiple sclerosis, Meeks said.

But Braun's bill won a quick nod of approval from a researcher who studies the use of AI to detect Medicare fraud. Taghi M. Khoshgoftaar, PhD, director of the Data Mining and Machine Learning Lab at Florida Atlantic University, Boca Raton, Florida, said he sees an advantage to Braun's approach of involving Medicare enrollees in the protection of their benefits.

The bill does not authorize funding for the pilot project, and it's unclear what it would cost.

Detecting Medicare Fraud

The federal government has stepped up Medicare fraud investigations in recent years, and more doctors are getting caught.

A study published in 2018 examined cases of physicians excluded from Medicare using data from the US Office of Inspector General (OIG) at the Department of Health and Human Services.

The OIG has the right to exclude clinicians from Medicare for fraud or other reasons. Chen and coauthors looked at Medicare physician exclusions from 2007 to 2017. They found that exclusions due to fraud increased an estimated 14% per year on average from a base level of 139 exclusions in 2007.

In 2019, CMS sought feedback on new ways to use AI to detect fraud. In a public request for information, the agency said Medicare scrutinizes fewer claims for payment than commercial insurers do.

About 99.7% of Medicare fee-for-service claims are processed and paid within 17 days without any medical review, CMS said at the time.

https://www.medscape.com/viewarticle/federal-bill-seeks-ai-tools-stop-medicare-fraud-2024a1000291

Biogen's Abandonment of Controversial Alzheimer's Drug 'No Surprise'

 Biogen's announcement On January 31 that it will discontinue development and commercialization of the anti-amyloid agent, aducanumab (Aduhelm), for Alzheimer's disease (AD) came as no surprise to many experts in the field. 

"Clearly, the drug was a commercial failure," Dave Knopman, MD, professor of neurology, Mayo Clinic, Rochester, Minnesota, told Medscape Medical News. "Despite the accelerated approval, the uncertainty of clinical benefits was transparent, and the public failed to generate any enthusiasm for the drug."

As reported by Medscape Medical News, aducanumab received accelerated approval from the US Food and Drug Administration (FDA) in June 2021 despite a recommendation by its own advisory panel not to approve the drug. Knopman was a member of that panel and one of three members who resigned after the agency's decision to approve the drug. 

"The decision by Biogen to cancel the aducanumab program was not surprising, as the company steadily withdrew their engagement in the program over the past year," Knopman noted. 

"This was a commercial decision — not so much a scientific decision," Howard Fillit, MD, founding executive director of the Alzheimer's Drug Discovery Foundation, told Medscape Medical News. 

"The process by which the [aducanumab] program was handled and some of the conflicting opinions at the FDA led to uncertainty about the efficacy of the drug, and it wasn't being prescribed," Fillit said. 

After its approval, the Centers for Medicare & Medicaid Services restricted coverage of aducanumab to patients enrolled in clinical trials, which experts say likely contributed to Biogen's decision to ditch the drug. 

It also limited the number of people living with AD who could get access to the treatment and "created significant confusion for patients and doctors," the Alzheimer's Association said in a statement on Biogen's decision. 

Biogen will also terminate the post-approval clinical trial known as ENVISION, which sought to confirm aducanumab's benefits in patients with early AD. 

Going forward, Biogen said that it will now focus on advancing lecanemab (Leqembi), the first anti-amyloid to receive traditional FDA approval.

"We have learned much from the mistakes and misjudgments that plagued aducanumab, but the field has moved on and is a little the wiser," Knopman said. "With the standard approval of lecanemab, which showed clear, albeit modest, clinical benefits, we are focusing on providing safe and efficient access to lecanemab." 

Biogen plans to accelerate the development of potential new treatment modalities. These include BIIB080, an investigational antisense oligonucleotide therapy targeting tau, and BIIB113, an oral small-molecule inhibitor of tau aggregation.

Fillit said that he's "very excited" about the current pipeline of AD drugs, starting with donanemab, which is currently under review at the FDA, and "looks like it has somewhat better efficacy data than lecanemab."

https://www.medscape.com/viewarticle/biogens-abandonment-controversial-alzheimers-drug-no-2024a10002aq

US Med License Board Discloses Cheating, Grads Say Problem Is Rampant

 The United States Medical Licensing Examination (USMLE) program is invalidating scores attained by some examinees after an investigation revealed a pattern of anomalous exam performance associated with test-takers from Nepal. 

In a January 31 announcement, the USMLE program said that officials are in the process of notifying examinees with results in question and that the examinees will be required to take validation exams. The program did not offer further details about its investigation or how the questionable performance was identified. 

"The USMLE program regularly monitors and analyzes examinees' test performances for unusual score patterns or variations, and other information that could raise questions about the validity of an examinee's results," the program said in a statement. "Highly irregular patterns can be indicative of prior unauthorized access to secure exam content."

Some medical graduates say the action against students cheating on the USMLE is long overdue. 

The selling and buying of USMLE questions online have become rampant in recent years, particularly by groups within the international medical graduate (IMG) community, according to multiple IMGs who shared their concerns with Medscape Medical News over the past month. Sellers operate under pseudonyms across social media platforms and charge anywhere from $300 to $2000 for questions, Medscape research shows. 

Facebook posts often advertise questions for sale, said Saqib Gul, MD, an IMG from Pakistan who has voiced concerns about the practice on social media. 

"People make up fake profiles and tell others to [direct message] them for recalls," he told Medscape Medical News. "There was a dedicated Facebook page that was doing this. In other cases, a couple of friends that took the exam remember a certain number of questions and write them down after the test."

Ahmad Ozair, MD, an IMG from Lucknow, Uttar Pradesh, India, said that he has come across many groups online sharing or selling USMLE recalls. He first became suspicious when he saw several students, all from a few medical schools in Nepal, posting on social media about scoring in the 270 and 280-plus range. 

"The statistical probability that you would have three or more candidates in the same year, scoring in the 99th percentile worldwide, belonging to a small geographical area is extremely low." 

Ozair, who now is studying public health at Johns Hopkins University in Baltimore, Maryland, said that the issue is important for "all stakeholders" who care about patient safety: "Would you want a doctor who has cheated on the medical licensing exam to take care of you?" 

In an interview, USMLE program spokesman, Joe Knickrehm, said that the program relies on multiple processes to detect and respond to claims that exam integrity is being compromised. The process includes monitoring performance data, an anonymous tip line for reporting suspicious behavior, and a thorough investigative process. 

"The USMLE program regularly monitors social media channels for comments relating to exam security and irregular behavior and will initiate an investigation if warranted," Knickrehm told Medscape Medical News. " The covert nature of this activity does not lend itself to a definitive statement regarding whether the problem has increased or decreased in recent years." 

Knickrehm said that the program's STOPit app allows people to report suspicious behavior electronically to the USMLE program. Since its launch in 2021, the program has received more than 80 tips per year through the app, according to Knickrehm. Security violations are investigated by USMLE staff and reviewed by the USMLE Committee for Individualized Review (CIR). Anyone found to have engaged in irregular behavior by the CIR for activities undermining exam integrity are typically barred from access to the USMLE for multiple years. 

How Easy Is It to Buy Recalls?

Two years ago, Dr B was approached by a former study partner who had just completed Step 2 of the USMLE. She asked whether Dr B wanted to buy recalled questions to help her pass. 

"She paid this guy almost $2000 for recalls and told me if I pay this money, he'll give me the recalls," said Dr B, who asked to remain anonymous for fear of being associated with students cheating on the USMLE. "I told her I was not interested, and she said the guy would lower the price. I broke contact with her."

Dr B, an IMG from Pakistan, was appalled. But she said that the episode was not the first time she has come across groups selling USMLE recalls or heard peers brag about having access to exam content. 

"I am baffled at how many [groups] post on social media and brazenly advertise their 'services,'" she told Medscape Medical News. "No one arrests them, their customers go on to score abnormally high on the boards, making it unachievable for people who take the honest route, plus giving IMGs a bad rep." 

Groups offering recalls are easily findable on sites such as Telegram and Signal. Telegram is a cloud-based messaging app that focuses on security, and Signal is an encrypted messaging service. 

The website recallmastery.com purports to offer a range of USMLE recall packages, from a free, unsorted version to Step 1 and Step 2 packages that include "fresh updates," and sections with "mostly repeated topics. Prices range from the free version to the $799 VIP package. 

Another site called MedPox.com boasts 2024 Step 2 recalls, advertising " actual exam questions to get HIGH scores." The website's owner states that the recalls were collected "by my friends," and to message the them to be added to the "recalls group."

A reporter was able to easily download a free version of alleged USMLE questions and answers from recallmastery.com. The document was a combination of typed and handwritten notes about medical questions, with red circles around recalled answers. 

J. Bryan Carmody, MD, who blogs about medical education, reviewed a copy of the document. He said that the content appeared "credible" and was in fact recalled USMLE questions. However, the extent of which the question stem was recalled was incomplete at best, and there was little production value to the document, said Carmody, a nephrologist and associate professor of pediatrics at the Eastern Virgina Medical School in Norfolk. 

The person selling the recall packages states on the website that the free version is not organized or sorted, but it allows viewers to "see how this works before paying for premium recalls." 

Knickrehm said that the program could not comment on the document, but that "whenever the USMLEprogram receives or locates information about a potential security violation, we investigate and take necessary action." 

When asked about the specific websites noted above, Knickrehm said that the program routinely monitors a wide array of websites, message boards, and chat rooms for USMLE-related materials. Though many sites advertise having USMLE recalls for sale, it's more likely they are selling non-USMLE content, he said. 

Using past content to cheat on medical exams is an old problem. In 2010, for example, the American Board of Internal Medicine suspended 139 physicians after they were caught cheating on the board exams. The scandal involved a vast cheating ring that included physicians memorizing questions and reproducing them after the tests. The board later sued a gastroenterologist for her part in the scandal. 

In 2012, a CNN investigation exposed doctors who were memorizing test questions and creating sophisticated recall banks to cheat on radiology boards. The Association of American Medical Colleges sued a medical student in 2017 for attempting to secretly record content on the MCAT using spyglasses. 

In recent years, Carmody said that he has received multiple messages and screenshots from concerned students and residents who were offered or encountered recalls. 

"One thing that's unclear is how legitimate the claims are," he said. "Many of these recalls may be faulty or outdated. It could be someone who took the exam yesterday and has a photographic memory or it could be some sparsely recalled or mis-recalled information. Unless you're willing to pay these people, you can't inspect the quality, or even if you did, you wouldn't know if the information was current or not."

'As an IMG, There Is So Much at Stake'

Whether recall sellers — and those buying them — are more frequently IMGs has fostered heated debate on social media. 

On a Reddit thread devoted to IMG issues , posters expressed frustration about being bombarded with recall advertisements and unwanted messages about buying USMLE questions while trying to find study materials. One poster called the practices a "huge slap to all those IMGs who are struggling day and night, just to get a good score."

In an X thread about the same subject, however, some self-described IMGs took offense to claims that IMGs might score higher because they have access to recalls. The allegations are "incendiary" and "malign hardworking IMGs," posters wrote. 

When Gul spoke out online about the "biopsy" culture, he received multiple private messages from fellow IMGs telling him to remove his comments, he said. 

"I received a lot of backlash on social media," he told Medscape Medical News. "Some IMGs asked me to take down my posts because they thought I was making IMGs look bad, and it might prompt authorities to take action or shut down international examination centers for IMGs."

Most of the IMGs who spoke to Medscape Medical News were afraid to be publicly identified. Several IMG advocates and IMG associations contacted for the story did not respond. One medical education expert said that his institution advised him to "steer clear" of commenting because the issue was "controversial." 

"As an IMG, there is so much at stake," Dr B said. "Any association with shady operations like these is an absolute suicide. I'm personally afraid of any repercussions of the sort."

USMLE officials declined to comment on whether the buying or selling of recalls appears to be more prevalent among the IMG community, saying it is "difficult to generalize this behavior as 'prevalent' simply due to the clandestine nature of this activity."

Cheat-Proofing the USMLE

The USMLE program has taken several steps intended to prevent cheating, but more needs to be done, medical education advocates say. 

For example, Carmody called the recent change in the attempt limit for taking USMLE exams from six to four times a good move. 

"The reality is, if you're taking a USMLE exam five-plus times, you're far more likely to be memorizing questions and selling them for shady test prep operations than you are to be legitimately pursuing U.S. residency training or licensure," he wrote on X. 

The 2022 move to make USMLE Step 1 pass or fail is another positive change, said Gul, who added that US programs should also put less weight on test scores and focus more on clinical experience. 

"Many programs in the US prioritize scores rather than clinical experiences in home countries," he said. "If program directors would remove these criteria, probably the cheating practices would stop. Clinical practice matters. When a doctor gets matched, they have to be good at seeing and treating patients, not just good at sitting in front of a screen and taking an exam."

Turning over questions more rapidly would help curb the practices, Carmody said. Another strategy is using math techniques to identify unusual deviations that suggest cheating, he said. 

A blueprint for the strategy was created after a cheating scandal involving Canada's Medical Council of Canada Qualifying Examination (MCCQE) in 2004. After learning which questions were circulated, MCCQE administrators evaluated exams by comparing answers of compromised questions with the answers of noncompromised questions. 

"For a person who was not cheating, the error of performance should be pretty similar on those two groups of questions," Carmody said. "But if you were given the questions in advance, you might have very poor performance on questions that had not been compromised, and very high performance on those that had been compromised. That disparity is very unlikely to occur just by chance alone." 

Based on his research, Ozair is working on an academic review paper about cheating on the USMLE and on the Medical Council of Canada Qualification Examination. He said that he hopes the paper will raise more awareness about the problem and drive more action. 

He and others interviewed for this story shared that the websites they've reported to the USMLE program are still active and offering recalls to buyers. 

"Even if they are not actually offering something tangible or true, appearance matters," Ozair said. "I think it's worth the USMLE sending cease and desist letters and getting these websites taken down. This would restore faith in the process and underscore that this issue is being taken seriously."

https://www.medscape.com/viewarticle/us-board-discloses-cheating-grads-say-problem-rampant-2024a10002aj

Canada braces for possible wave of business bankruptcies

 Thousands of Canadian small businesses face the risk of bankruptcy after the government ended pandemic-era support last month with the economy slowing at a time of high interest rates.

Small firms that employ fewer than 100 people are critical to the Canadian economy as they give jobs to almost two-thirds of the country's 12 million private workers. A spike in bankruptcies, which jumped 38% in the first 11 months of 2023, would weigh on economic growth, lobby groups and economists warn.

Last month, small businesses faced a deadline to repay interest-free loans of C$60,000 ($44,676) made available to each of them during the pandemic. Of the 900,000 who had taken the government support, a fifth have not yet repaid their loans, Finance Minister Chrystia Freeland said on Monday. The Canadian Federation of Independent Businesses (CFIB), a small-business lobby group, estimates a quarter missed the deadline.

Katherine Cuplinskas, a spokesperson for the finance minister said in an emailed response to a Reuters question that the Department of Finance did not expect there will be a negative impact on the economy on account of repayment of the loans given as support during the pandemic. She said loan recipients have long had full information on timelines and have been able to plan accordingly.

There were about 1.2 million small businesses with employees in Canada in 2021 and contributing over a third to the country's gross domestic product, according to the latest official data.

"There are tens of thousands, if not hundreds of thousands, of businesses that remain viable, but will not be able to outrun their debt," Dan Kelly, CFIB president, told Reuters, adding many debts could only be repaid by borrowing at a higher interest rate from banks.

Of those who repaid, CFIB estimates that about 225,000 took out a bank loan to do so, at a time when interest rates in the country are at 22-year high.

https://finance.yahoo.com/news/canada-braces-possible-wave-business-110548861.html

Largest Refinery In US Midwest Shuts Down After Power Outage

 The largest refinery in the US Midwest has been shut down after a power outage hit the facility Thursday afternoon.

BP's Whiting refinery, located in Whiting, Indiana, is the Midwest's largest refinery and largest globally for the British multinational oil and gas company. It can process 440,000 barrels of crude oil daily. 

BP issued this statement about the incident: 

"BP has notified the City of Whiting that they are in the process of safely shutting down the refinery after a suspected power outage.

"BP has activated their emergency response team and evacuated refinery office buildings out of an abundance of caution. Local fire departments are assisting with the evacuation by closing nearby roads. The safety of refinery staff and the community are our highest priority for the Whiting BP Refinery." 

Commodity analyst Giovanni Staunovo posted on social media platform X, "As a result of this power outage, additional product is being burned, which will cause additional flaring of the stacks. This flaring is a safety release to burn off the extra product and is a normal process during an event. BP is working to resolve the power outage as quickly as possible." 

Images of the flaring have been published on X. 

Gasoline futures have not reacted to the news of the refinery closure. 

There is no word on refining disruptions and or the cause of the power outage.

https://www.zerohedge.com/commodities/largest-refinery-us-midwest-shuts-down-after-power-outage

Autoimmune disease biotech Kyverna Therapeutics sets terms for $200 million IPO

 Kyverna Therapeutics, a Phase 2-ready biotech developing cell therapies for autoimmune diseases, announced terms for its IPO on Thursday.

The Emeryville, CA-based company plans to raise $200 million by offering 11.1 million shares at a price range of $17 to $19. At the midpoint of the proposed range, Kyverna Therapeutics would command a fully diluted market value of $731 million.

Kyverna Therapeutics is focused on developing cell therapies for patients suffering from autoimmune diseases. Its lead program is KYV-101, an autologous CD19 CAR T-cell therapy made from an underlying chimeric antigen receptor licensed from the National Institutes of Health that previously completed a Phase 1 trial in oncology. Kyverna is developing KYV-101 across two broad areas of autoimmune disease: rheumatology and neurology. Its initial rheumatology development focus is on lupus nephritis (LN) and systemic sclerosis (SSc). The company plans to conduct two trials of KYV-101 in patients with LN, and has also received IND clearance for a Phase 1/2 study in SSc. In neurology, Kyverna is focused on myasthenia gravis (MG) and multiple sclerosis (MS), and it has received IND clearance for Phase 2 studies in both diseases.

Kyverna Therapeutics was founded in 2018 and plans to list on the Nasdaq under the symbol KYTX. J.P. Morgan, Morgan Stanley, Leerink Partners, and Wells Fargo Securities are the joint bookrunners on the deal. It is expected to price during the week of February 5, 2024.

Relevant Profile: KYTX

https://www.renaissancecapital.com/IPO-Center/News/103066/Autoimmune-disease-biotech-Kyverna-Therapeutics-sets-terms-for-$200-million