Medical Device Daily Washington Editor

Supplies of molybdenum-99 (Mn-99), the precursor agent to the increasingly precious imaging agent technetium-99 (Tc-99) have become increasingly crimped over the past two years as two major suppliers have at least temporarily halted processing at reactors because of vessel leaks, but a major source of Mn-99, mainland China, is reported to be considering more severe controls on exports due to increasing domestic demand.

According to a Nov. 30 story at WealthDaily.com, China's Ministry of Land and Resources is working on a plan to develop a strategic reserve for a number of minerals, including Mn-99 and several other rare earth metals as a hedge against demand placed on those commodities by a stimulus package rolled out by Beijing toward the end of 2008 to the tune of 4 trillion renminbi. The story, penned by Luke Burgess, states that prices for molybdenum ores has jumped 14% “over the past four months“ to $14.75 per pound on the London Metals Exchange, but Burgess notes that the supply/demand mismatch could add as much as another $10 per pound sometime next year. Such a price, however, could spur development.

Some estimates of global molybdenum ore reserves peg the number at about 19 million metric tons (a metric ton is 2,200 lbs), with China holding nearly half that amount at 8.3 million. The U.S. is said to be sitting on another 5.4 million metric tons, but U.S. production has lagged and a piece of legislation intended to boost American production of the ore, the American Medical Isotopes Production Act of 2009, never made it to the White House due to a crowded legislative agenda.

Production has not been entirely moribund, however. A Nov. 30 article at the website for the International Molybdenum Association (London) states that global production rose from 119 million pounds in 2Q09 to 129 million pounds in 2Q10. China is said to have produced 44 million pounds, but held 39 million pounds for domestic use. North America is listed as having produced 41 million pounds while South America turned out another 29 million pounds.

U.S. usage is pegged at 17.5 million pounds, making the U.S. a net exporter, but net importers Japan and Europe devoured roughly 31 and 15 million pounds respectively. Governments are aware of the problem as a Sept. 15 report by the Nuclear Energy Agency at the Organization for Economic Cooperation and Development makes clear, noting that the current supply dynamic is “unsustainable.“

FTC testifies on antitrust enforcement

The Federal Trade Commission has weighed in from time to time on hospital mergers, such as the proposal in 2008 that Inova Health Systems (Falls Church, Virginia) would take over Manassas, Virginia's Prince William Hospital (Medical Device Daily, June 12, 2008), and the agency's role in overseeing healthcare business may become more conspicuous as a result of healthcare reform legislation.

A Dec. 1 FTC statement notes that the agency's Richard Feinstein, director of the FTC Bureau of Competition, testified last week before a U.S. House Judiciary Committee subcommittee on the FTC role in “how it protects and promotes competition ... to help make sure U.S. consumers get high-quality care at competitive prices.“ Feinstein is said to have informed the panel that “years of experience have shown us that continued effective antitrust enforcement is a necessary component of any plan to improve healthcare.“

Among the interests at FTC, Feinstein said, are anti-competitive tactics such as “pay-for-delay“ drug patent settlements, which the FTC statement alleges “delays patient access to less-expensive generic drugs and ... costs U.S. consumers $3.5 billion a year.“ He also mentioned the Inova/Prince William merger, which the two entities withdrew after FTC's objections were seconded by the attorney general of the Commonwealth of Virginia (MDD, May 13, 2008), but Feinstein also hinted that the proliferation of accountable care organizations (ACOs) would help keep the agency busy in the years ahead.

According to Feinstein's written testimony, providers are “more likely to integrate their care delivery for Medicare beneficiaries if they also can use the same delivery system for patients covered“ by private insurers, a prospect he said that suggests “antitrust guidance may be appropriate for ACOs.“ His testimony makes note of a workshop held in October in which FTC “learned a great deal“ and during which FTC chairman Jon Leibowitz is said to have indicated an interest in development of safe harbor mechanisms that would provide a channel through typical antitrust law. Feinstein also makes note of “an expedited review process for those ACOs that fall outside the safe harbors.“

Seoul, Washington come to terms on free trade

Tariff-free trade agreements have not exactly zoomed out of the gates since the North American Free Trade Agreement was signed by the George H. Bush administration in 1992, but the trade agreement between South Korea and the U.S., which has been in the works since 2007, finally seems to be coming to life. According to a Dec. 3 statement by the U.S. Department of Commerce, the governments of both nations have agreed in principal to the deal, which now must find its with through the legislative thickets in both capitals.

Gary Locke, the U.S. Commerce Secretary, said in a Dec. 3 statement that the agreement “will make America more competitive in a fast-growing market and help put tens of thousands of Americans to work right here at home.“ Locke said that the agreement means that “billions of dollars worth of American goods and services – ranging from cars and industrial equipment to delivery and telecommunications services – will be able to compete on a level playing field in the Korean marketplace.“ He noted that reducing trade barriers is “one of the key planks of President Obama's National Export Initiative, and I commend Ambassador Kirk and his team at USTR [U.S. Trade Representative] for negotiating a deal that will have immense benefits for American businesses and workers.“

A number of wire service reports last week indicated that the deal would bring $11 billion to the U.S. economy, but at least some of those reports appear to be based on an estimate published in 2007 by the U.S. International Trade Commission. Trade groups immediately rallied in support of the agreement, however, urging Congress to waste no time in bringing the agreement to a vote.

In a Dec. 3 statement, Thomas Donohue, the president/CEO of the U.S. Chamber of Commerce (New York) states that the White House “has done its part,“ adding, “it's time for the new Congress to make passage ... a top priority in January. We will do everything in our power to round up the votes,“ Donohue promised.

The Advanced Medical Technology Association (AdvaMed; Washington) sees the deal as important to the devices and diagnostics industries. In a statement, Steve Ubl, president/CEO of AdvaMed, congratulated “the U.S. negotiators who worked so hard to achieve this outstanding free trade agreement (FTA), which includes specific provisions that will improve access to this important market. Among the essential features Ubl cited were “fair reimbursement rates based on market prices, and rules for the transparent establishment of laws, regulations and procedures concerning Korea's reimbursement and regulatory matters.“ He states that AdvaMed “provided U.S. negotiators with recommendations for the FTA to address these industry concerns,“ adding that this agreement “is the first . . . to include such provisions.“

“We look forward to working with Congress to achieve approval of the KORUS as soon as possible,“ Ubl concluded.

Mark McCarty, 703-268-5690
mark.mccarty@ahcmedia.com