Posts Tagged ‘FDA’

Big Pharma: Even Worse Than Used Cars as a Market for Lemons?

Big Pharma: Even Worse Than Used Cars as a Market for Lemons?

Courtesy of Yves Smith at Naked Capitalism 

Fruit at market

Some readers have wondered why this blog from time to time runs posts on the US health care system. Aside from the fact that it’s a major public policy problem in America, it is also a prime example of bad incentives, information asymmetry, and corporate predatory behavior. It thus makes for an important object lesson.

Reader Francois T pointed to an example, a commentary on a paper presented by Donald Light at the annual meeting of the American Sociological Association, “Pharmaceuticals: A Two-Tiered Market for Producing ‘Lemons’ and Serious Harm.” It still appears to be embargoed, but Howard Brody provides an extensive summary on his blog.

Light uses George Akerlof “market for lemons” as a point of departure. For those not familiar with the famed Akerlof paper, a “market for lemons” can occur when consumers are unable to distinguish product quality. The used car market is the paradigm, since the dealer has a much better idea than the buyer of whether a particular car is any good. Unscrupulous operators can stick a lot of hapless chump customers with overpriced clunkers. However, as crooked vendors become more common, buyers wise up a tad and are not longer to pay as much for cars they cannot evaluate. So while the prices buyers are now willing to pay are probably still too high for rattletraps, they are too low for decent cars. People with good merchandise start to look for other channels. Akerlof posits that the market eventually falls apart.

Note that used cars dealers did not set out to create lemons; the cars were bad deals by being overpriced (presumably, if they had been presented, warts and all, they still would have found purchasers, presumably people who thought they could repair them and those who wanted them for parts and scrap). Light contends, by contrast, that major pharmaceutical companies create bad products:

[T]he pharmaceutical market for ‘lemons,’ differs from other markets for lemons in that companies develop and produce the lemons. Evidence in this paper indicates that the production of lemon-drugs with hidden dangers is widespread and results from the systematic exploitation of monopoly rights and the production of partial, biased information about the efficacy and safety of new drugs…Companies will design and run their clinical


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After Avandia: Does the FDA Have a Drug Problem?

This could have been titled, "Does America Have an FDA Problem?"  My yellow highlighting and red comments. – Ilene

After Avandia: Does the FDA Have a Drug Problem?

MIAMI - JULY 14: A bottle of the diabetes drug, Avandia is seen on July 14, 2010 in Miami, Florida. Today, the U.S. Food and Drug Administration panel voted to recommend that GlaxoSmithKline PLC's (GSK) diabetes drug, Avandia, remain on the market despite concerns that the product could raise the risk of heart attacks. (Photo illustration by Joe Raedle/Getty Images)

By Massimo Calabresi with Alice Park, courtesy of TIME 

Five days before a 2007 article in the New England Journal of Medicine showed that the diabetes drug Avandia was linked to a 43% increase in heart attacks compared with other medications or placebos, a group of scientists and executives from the drug’s maker, GlaxoSmithKline (GSK), gathered in a conference room at the offices of the Food and Drug Administration in White Oak, Md. The GSK goal: to convince regulators that the evidence that the company’s $3 billion-a-year blockbuster drug caused heart problems was inconclusive. To do that, the GSK officials focused not on heart-attack data but on a broader, less well defined category of heart problems called myocardial ischemia. The most recent studies of Avandia, the GSK officials told the FDA, had "yielded information that is inconsistent with an increased risk of myocardial ischemic events," according to sealed court proceedings obtained by TIME.

What GSK didn’t tell the FDA was that on May 14, 2007, two days before the White Oak meeting, GSK’s Global Safety Board had noted that a new assessment of Avandia studies "strengthens the [cardiac-risk] signal observed in the [previous] analysis." Or that eight days earlier, the company’s head of research and development, Moncef Slaoui, had sent an e-mail to its chief medical officer saying Avandia patients showed an "increased risk of ischemic event ranging from 30% to 43%!" Or that the day before the meeting, the company had produced a preliminary draft report that showed patients on Avandia had a 46% greater likelihood of heart attack than those in a control group.

But the mixed-evidence argument GSK presented to the FDA worked. After months of deliberation, the agency decided to keep the drug on the market — a move worth billions of dollars to GSK but that also may have put millions of patients at risk.

Such examples of the drug industry’s outmaneuvering FDA regulators are disturbingly common, say both scientists and policymakers who follow drug approval and safety monitoring. More than 140 million Americans take at least one prescription drug in any given month, and they rely on the FDA to ensure those drugs are safe. That trust, the story of Avandia illustrates, is…
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Pfizer Caught Illegally Marketing Bextra, Feds Won’t Prosecute Because “Pfizer Too Big To Nail”

More twilight zone material: progress from the Pinto case stalled at the mercy of the "Too Big To Fail" doctrine. Undoubtedly backed by the misguided "rational human economic model."  In the Pinto case, punitive damages were awarded to prevent future corporate decisions to measure cost/benefits by putting a price tag on tag on human life….   Ilene

pinto Before the Ford experts left Washington to return to drafting tables in Dearborn they did one other thing. They managed to informally reach an agreement with the major public servants who would be making auto safety decisions. This agreement was that "cost-benefit" would be an acceptable mode of analysis by Detroit and its new regulators. And, as we shall see, cost-benefit analysis quickly became the basis of Ford’s argument against safer car design.

Cost-benefit analysis was used only occasionally in government until President Kennedy appointed Ford Motor Company president Robert McNamara to be Secretary of Defense. McNamara, originally an accountant, preached cost-benefit with all the force of a Biblical zealot. Stated in its simplest terms, cost-benefit analysis says that if the cost is greater than the benefit, the project is not worth it—no matter what the benefit. Examine the cost of every action, decision, contract part or change, the doctrine says, then carefully evaluate the benefits (in dollars) to be certain that they exceed the cost before you begin a program or—and this is the crucial part for our story—pass a regulation.

As a management tool in a business in which profits matter over everything else, cost-benefit analysis makes a certain amount of sense. Serious problems come, however, when public officials who ought to have more than corporate profits at heart apply cost-benefit analysis to every conceivable decision. The inevitable result is that they must place a dollar value on human life.

Ever wonder what your life is worth in dollars? Perhaps $10 million? Ford has a better idea: $200,000.  [Pinto Madness, Mother Jones, Oct. 1977]

Pfizer Caught Illegally Marketing Bextra, Feds Won’t Prosecute Because "Pfizer Too Big To Nail"

Courtesy of Mish

CNN Health has an interesting article detailing illegal marketing practices at Pfizer. However, government officials looked the other way because …
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Orphan Drugs Are Good! BioMarin Pharmaceuticals

Orphan Drugs Are Good! BioMarin Pharmaceuticals

Courtesy of Pharmboy

Sick child visited at

A rare disease, sometimes known as an orphan disease, is any disease that is not common. Typically, a rare disease has such a low prevalence in a population that a physician in a busy general practice would not expect to see more than one case a year. Most rare diseases are genetic--present throughout the person’s entire life, even if symptoms do not appear immediately. However, many rare diseases appear early in life, and about 30% of children with rare diseases die before reaching their fifth birthdays.

No single cutoff number has been agreed upon for which a disease is considered rare. A disease may be considered rare in one part of the world, or in a particular group of people, but still be common in another. In the United States of America, the Rare Disease Act of 2002 defines rare disease strictly according to prevalence, as any disease or condition that affects less than 200,000 persons in the United States, or about 1 in 1,500 people.

BioMarin’s (BMRN) core business and research is in enzyme replacement therapies for orphan diseases. They are the first company to provide therapeutics for mucopolysaccharidosis type I (MPS I), by manufacturing Aldurazyme (commercialized by Genzyme Corporation). BioMarin is also the first company to provide therapeutics for Phenylketonuria (PKU)

As of 2005, BioMarin commercialized arylsulfatase B (Naglazyme) as an enzyme replacement therapy for the treatment of mucopolysaccharidosis VI (MPS VI), and in 2007 a drug version of tetrahydrobiopterin (Kuvan), the first medication-based intervention to treat phenylketonuria.

On 11/30/09, BioMarin announced that the FDA has granted orphan drug designation for 3,4-diaminopyridine (3,4-DAP), amifampridine phosphate, for the rare autoimmune disease Lambert Eaton Myasthenic Syndrome (LEMS). 3,4-DAP has previously received orphan drug designation in the E.U. Also, in October 2009, the Committee for Medicinal Products for Human Use of the European Medicines Evaluations Agency adopted a positive opinion recommending approval of amifampridine phosphate for LEMS. If approved by the European Commission, amifampridine phosphate will be the first approved treatment for LEMS, thereby conferring orphan drug protection and providing ten years of market exclusivity in Europe. BMRN expects to meet with the FDA in early 2010 to determine the necessary regulatory path for
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Phil's Favorites

Can Trump make real change as president?

 

Can Trump make real change as president?

Courtesy of Sharece Thrower, Vanderbilt University

Based on his erratic behavior during the campaign, many fear what Donald Trump will do in office. Some believe that his strong personality could lead to disastrous policies that could negatively affect health care, nuclear warfare and other aspects of our lives.

As a scholar of presidential power, I’d suggest such concerns are likely overblown. Despite his distinct individuality, Trump faces the same institutional constraints as any other president. In the end, he may be a more predictable president than many would believe.

From individual to the institutional

Political scientists have long been...



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Zero Hedge

Senate Confirms Mattis (Defense) & Kelly (Homeland) On Trump's First Day

Courtesy of ZeroHedge. View original post here.

Just hours after President Trump was sworn into office, amid Chuck Schumer's jabs over HUD, the Senate has confirmed retired Marine General James Mattis as defense secretary and retired Marine General John Kelly as homeland security secretary. They were both expected to be confirmed easily, and were, but Democrats promised fights over several other nominees.

Mattis was the first to be confirmed by a vote of 98...



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ValueWalk

Europe Rose Because Of Jurisdictional Competition

By The Foundation for Economic Education. Originally published at ValueWalk.

During the dark ages, nations like China were relatively advanced while Europeans were living in squalid huts.

Governments were forced to adopt better policies because labor and capital had significant ability to cross borders in search of less oppression.

But that began to change several hundred years ago. Europe experienced the enlightenment and industrial revolution while the empires of Asia languished.

What accounts for this dramatic shift?

I’m not going to pretend there’s a single explanation, but part of the answer is that Europe benefited from decentralization and jurisdictional competition. More specifically, governments were forced to adopt better policies because labor and capital had significant ability to cross borders in searc...



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Kimble Charting Solutions

Mr. President you want this to hold, says Joe Friday

Courtesy of Chris Kimble.

Consumer Confidence of late has continued to move higher, now reaching above the highs hit back in 2007. Long-Term S&P 500 returns are far below historical norms, when confidence is this high. We are not saying that high consumer confidence means the market is at a top!

Below is a look at the Advance/Decline line on a short-term basis.

CLICK ON CHART TO ENLARGE

Joe Friday Just The Facts; It could be important for support to hold, of this bearish rising wedge above.

...

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Market News

News You Can Use From Phil's Stock World

 

Financial Markets and Economy

Oil and Trump: Russians full of optimism in Davos (Reuters)

Twelve months ago, the mood of the Russian delegation at the World Economic Forum in Davos was distinctly gloomy, with oil prices near 12-year lows below $30 per barrel and Western sanctions depressing their economy and financial markets.

The Mortgage Market’s $1 Trillion Pocket of Worry (The Wall Street Journal)

Bonds backed by certain risky single-family mortgages topped $1 trillion for the first time in November, crossing that threshold amid rising warnings for one corner of the housing market.

...



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Chart School

Small Cap Losses Accelerate

Courtesy of Declan.

Small Caps again took the brunt of the selling as Shorts took advantage of yesterday's small rally back to former support (turned resistance) to enter positions. With the 'bull trap' in full effect, the next target down for the index is 1,308. Of supporting technicals, only Stochastics [39,1] is left to break its bullish alignment,


The S&P took a modest loss, but not enough to break it out of its consolidation. Volume was also lighter. With the Russell 2000 on the way down, it's suggesting the S&P will follow suit....

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Members' Corner

How To Poop At Work?

Courtesy of Nattering Naybob.

Once again it's "in the Toilet Thursday" or "Thursday's in the Loo". 

In our last episode, How to Poop On A Date? we were graced with a delicate shituation: what ever to do when your finally back at her place, snuggling in for a little "brown chicken brown cow" and you get hit with "Love Potion #2".

This week in How to Poop At Work? ,what to do when your at a big fancy pants meeting, when out of nowhere, you need to download a brown load?



...

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OpTrader

Swing trading portfolio - week of January 16th, 2017

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Digital Currencies

China's Bitcoin Exchanges Suspend Margin Trading

Courtesy of Zero Hedge

China's bitcoin traders who use the most popular bitcoin exchange not only in China, but also the entire world, BTCChina, were met with an unexpected warning on Friday:

Starting from January 12th, 2017, BTCChina has suspended margin loan service. If you have any questions, please contact Customer Service: support@btcc.com.

BTCChina, which commands over 37% of global bitcoin trading...

... wasn't alone.

Fo...



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Mapping The Market

If we try it enough, it will work.

Via Jean-Luc

Brownback wants Trump to emulate what he did in Kansas because it worked so well:

Sam Brownback Calls on Donald Trump to Mimic His Kansas Tax Plan

By RICHARD RUBIN and  WILL CONNORS

Sam Brownback, the Kansas governor whose tax cuts brought him political turmoil, recurring budget holes and sparse evidence of economic success, has a message for President-elect Donald Trump: Do what I did.

In 2013, Mr. Brownback set out to create a lean, business-friendly government in his state that other Republicans could replicate. He now faces a $350 million deficit when the Kansas legislature convenes in January and projections of a larger one in 2018. The state’s economy is flat and his party is fractured...

...

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Biotech

The Medicines Company: Insider Buying

Reminder: Pharmboy and Ilene are available to chat with Members, comments are found below each post.

I'm seeing huge insider buying in the biotech company The Medicines Company (MDCO). The price has already moved up around 7%, but these buys are significant, in the millions of dollars range. ~ Ilene

 

 

 

Insider transaction table and buying vs. selling graphic above from insidercow.com.

Chart below from Yahoo.com

...

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Promotions

Phil's Stock World's Las Vegas Conference!

 

Come join us for the Phil's Stock World's Conference in Las Vegas!

Date:  Sunday, Feb 12, 2017 and Monday Feb 13, 2017.            

Beginning Time:  8:00 am Sunday morning

Location: Caesar's Palace in Las Vegas

Notes

Caesar's has tentatively offered us rooms for $189 on Saturday night and $129 for Sunday night. However, we have to sign the contract ASAP. We need at least 10 people to pay me via Paypal or we may lose the best rate for the rooms. (Once we are guaranteed ten attendees, I will put up instructions to call the hotel for individual rooms.)

The more people who sign up,...



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All About Trends

Mid-Day Update

Reminder: Harlan is available to chat with Members, comments are found below each post.

Click here for the full report.




To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

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Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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