BB&Ts

The U.S. isn't the only nation that's in the process of healthcare reform. A report commissioned by Scientia Advisors (Cambridge, Massachusetts), shows that healthcare spending in China is expected to reach $600 billion by 2015 – a threefold increase from 2000. It's a change the company is saying will drastically alter China's healthcare landscape.

“We think the major driver behind this growth is that the Chinese government is becoming more aware that the current system just isn't [working],“ Harry Glorikian, managing partner for Scientia, told BB&T. “In China's three-year reform plan, a portion outlined guidelines for improvements and changes to healthcare services, infrastructure and regulation. These changes include the increase in funding for public hospitals and medical insurance, the development of rural clinics and county level hospitals, and increased regulation and oversight on the healthcare providers, medical institutions and industry participants such as pharmaceutical companies.“

Glorikian said these updates to China's healthcare system will solidify the nation's outdated system and have a tremendous impact on the economy. He added that increased funding opportunities for medical insurance will decrease the burden of out-of-pocket spending, allowing patients to refocus spending on disease prevention and health improvement instead of saving for “backup get-sick money.“

According to China's Ministry of Health, personal spending on medical services in China has increased from 21% in 1980 to 45% in 2007. The average urban savings rate has increased from 17% in 1995 to 28% in 2008. The role of medical devices in this also can't be ignored, the report says. The market for the sector already reaches $5 billion and can only grow according to the report. Medical devices will grow because 75% of conventional medical equipment used in Chinese hospitals is outdated.

Two other factors that will contribute to the growth of devices are the growing interest in patient monitoring equipment, which now represents 2% of the device market, and an initiative by China's government to cut drug prices and invest more in devices. Glorikian also said that he sees biopharma and the medical device sector continuing to grow.

“Both are likely to see growth,“ he told MDD. “Drug therapies will see growth due to increased access to these therapies by individuals previously without the means of obtaining them, but this will be limited by increased government regulation of hospital prescriptions. Medical devices will see growth from the increase in capital equipment expenditures for new hospitals and updates of current equipment.“

Major players such as GE Healthcare (Waukesha, Wisconsin) have already made what Scientia's report calls “significant advancements“ into China's device space. Glorikian said GE was already funding research and development in China. Health information technology (HIT) is also expected to increase. According to the report, China's HIT sector is projected to reach $4.1 billion by 2013.

As it stands, about 31% of hospitals have established health information systems. The report says that up to 80% of healthcare facilities in the region need upgrades, specifically for digital medical records and clinical support systems. But perhaps the biggest growth will come in China's $1.18 billion in-vitro diagnostics market. IVDs will grow because of hospital adoption of advanced technologies, the emergence of private labs and the willingness of the middle class to pay for health screenings.

The report shows that double-digit growth of the $100 million molecular diagnostics segment would be driven by a rise in infectious diseases such as HIV and by hospital acquired infections such as methicillin-resistant Staphylococcus. It also says that point-of-care diagnostics will benefit from the establishment of nearly 29,000 rural clinics and 2,000 county level hospitals.

But companies seeking to play a bigger role in China's healthcare market won't be able to waltz right in, Glorikian said. There will be harsh competition from emerging Chinese companies and there will be a whole different set of new rules and regulations to adhere to.

“There will be a lot of large opportunities, but med-tech companies have to understand that in realizing those opportunities they aren't in Kansas anymore,“ Glorikian said. “There are different rules, there's a different landscape.“

Stent grafts top balloon angioplasty for dialysis

Completing a randomized multicenter study is a bit like writing a screenplay in that it takes about the same amount of time, Ziv Haskal, MD, told BB&T.

That was one of the lessons Haskal learned while working on a published study of 190 patients at 13 centers that has shown the benefit of stent grafts over balloon angioplasty for maintaining function of dialysis access grafts in kidney failure patients. At six months, the stent grafts allowed dialysis patients to continue treatment with significantly fewer interruptions and invasive procedures, according to the study, published in the Feb. 11 issue of the New England Journal of Medicine.

Until now, no other therapy has proven more effective than angioplasty for these patients. “This is part of seven years of work, from concept to feasibility to finding an industry partner to designing a trial to educating the FDA that this was a high-need population that had an issue . . . and finally the editorial process [in the NEJM],“ said Haskal, vice chair of strategic development and chief of vascular and interventional radiology at the University of Maryland Medical Center (Baltimore).

Haskal said that when he started the study it was “incredibly controversial.“

“The idea that you could put a stent graft in this area – the hallowed space where only surgeries could occur – was really a bit of an educational battle,“ Haskal said. Hemodialysis is the leading treatment for more than 340,000 U.S. patients with end-stage renal disease or kidney failure, the researchers noted.

“Stent grafts are a game changer for dialysis patients, especially for those who suffer due to the repeated need for invasive procedures to maintain their ability to get dialysis,“ Haskal said. “This study – the first large prospective controlled study of its kind – shows that this novel therapy [stent grafts] provides clear improvement over balloon angioplasty by prolonging the function of a patient's bypass without surgery – helping individuals avoid additional invasive procedures and time in the hospital.“

Haskal, who is also professor of radiology and surgery at the University of Maryland School of Medicine, was the lead investigator and co-author of “Stent Graft Versus Balloon Angioplasty for Failing Dialysis-access Grafts.“

“Stent grafts overwhelmingly performed better than balloon angioplasty for maintaining access in dialysis patients, providing superior patency and freedom from repeat interventions. What we've done is arguably supersede the results of surgery by improving the flow dynamics beyond those achievable with an operation.“

Thirteen participating sites – including academic, community-based, inpatient and freestanding outpatient dialysis centers – enrolled 190 patients (69 men, 121 women) with failing arteriovenous grafts in this study. Ninety-seven patients received stent grafts, while 93 underwent balloon angioplasty. Nearly 51% of dialysis accesses treated with stent grafts remained open at six months, compared to just 23% of those treated with angioplasty. There was no difference in adverse events between the two approaches.

Predicate creep, resources driving FDA's 510(k) angst

February's 510(k) meeting with managers at the Center for Devices and Radiological Health at FDA gave industry two reasons to be discouraged about the program. One reason is that FDA staff indicated that the center's reviewers are swamped with applications and the other is that the “predicate tree“ described in data files at FDA are often either incomplete or have been truncated, leaving a dead end trail for anyone attempting to flesh out the current state of affairs for a device type.

While several members of industry addressed what they saw as inconsistencies in standards at FDA, others complained that some FDA reviewers are loathe to answer phone calls and e-mails. Industry also argued for a level playing field regarding the agency's treatment of 510(k)s, but FDA personnel hinted that they do not see this is an overarching consideration.

Jeff Shuren, MD, director of the Center for Devices and Radiological Health, noted that the internal review, led by Donna-Bea Tillman, PhD, director of the Office of Device Evaluation, will be summarized in a report due by the end of May and that any resulting changes will be in force by the end of September.

“We still have a way to go before the center makes any final decision regarding the program,“ Shuren promised.

Tillman debunked claims that the 510(k) process is a fast-track program, stating that the existence of a predicate “doesn't mean FDA just rubber-stamps that 510(k).“ However, she acknowledged a tension when a new indication seems to imply a new intended use. “Trying to walk that line is an area of challenge,“ she said. She warned that regulations must evolve and that regulatory evolution is “not going to be a one-shot deal“ because “as technology continues to advance,“ the regulatory scheme must morph as well.

Christy Foreman, deputy director for engineering and science review at CDRH, said there is a direct link between the latest device iteration and the ancestral form. “One thing we need to keep in mind“ is that “once we say it is substantially equivalent, it all traces back to that original device,“ she said.

Foreman said device makers “often lack sufficient information to select an appropriate predicate,“ in part because the agency often redacts materials that could be useful. FDA's documents “often lack critical details,“ she said, adding that a 510(k) statement “relies on a manufacturer offering a competitor“ critical information, hence the redaction.

Foreman asserted that manufacturers “may decide not to submit a 510(k)“ for incremental modifications for marketing advantage rather than for clinical superiority. A practice of crafting a predicate that is “not worse than“ its predecessor, Foreman continued, allows performance for that device category to deteriorate over time. “The newly cleared device leads to the next predicate,“ hence a chain of lessening performance numbers, she alleged.

Another dilemma is encountered when a string of unapproved changes puts FDA in a position such that “when a new 510(k) is filed,“ FDA has to play catch-up on “those 32 changes“ made in the meantime, Foreman said.

Heather Rosecrans, director of the 510(k) staff at the Office of Device Evaluation, checked off some of the difficulties encountered by her staff. “Our first challenge related to post-market“ considerations is that FDA's authority to mandate surveillance “is limited,“ she said.

Rosecrans pointed out that “unlike PMAs, we do not have explicit authority“ to require post-market studies as a condition of approval, although FDA can issue a 522 order after the fact. She also noted that the agency has limited authority to rescind a clearance, but added that while keeping playing field level “is an essential part of the 510(k) process,“ she said this is “challenging“ when evidence evolves.

Rosecrans also remarked that there is no reporting requirement for sale or transfer of a 510(k). “You can imagine how difficult it is for FDA to investigate“ adverse events when the owner of a 510(k) number is unknown, she observed.

Tension between predictability, adaptability

The last day of CRT (Cardiovascular Research Technologies) 2010, sponsored by the Cardiovascular Research Institute (Washington), included a session during which Jeffrey Shuren, MD, the chief of the Center for Devices and Radiological Health, explained where he expects to steer the Center in the next couple of years.

Shuren observed, “The landscape of device evaluation is always moving,“ but promised that “steps CDRH is taking,“ will result in “clear and predictable regulatory pathways.“ The rapid pace of evolution makes devices and diagnostics “unique among medical products“ and forces CDRH to “change our course accordingly,“ he said. Shuren seemed to forecast some continued unpredictability with the remark that he sees an “unavoidable tension between predictability and adaptability.“

Among the speakers during the following lunchtime session on healthcare reform was Sean Salmon, VP and general manager for Medtronic Cardiovascular (Minneapolis), who said reform is not necessarily kaput despite the seeming implosion in February. “It certainly looks like a tall hurdle for anything to pass in the near term,“ he acknowledged, adding that even industry realizes that “the system we have today is unsustainable.“

Salmon cited both the numbers of uninsured and healthcare's share of GDP as imperatives for reform, but described the current crop of reform proposals as “health insurance reform, largely.“ The issue of how to pay for it all “gets into some interesting NIMBY [Not In My Back Yard] issues,“ he observed, adding that for the device industry “that excise tax . . . on top of Medicare cuts“ will force lower prices, which he said is an almost a certain outcome in the long run in any event.

Another point of pressure for industry, Salmon stated, is that “it doesn't appear that the increased number of patients coming into the insured pool will offset“ the device tax and the proposed Medicare cuts.

Salmon said that bundling is a practice Medtronic supports “as long as we don't have a disincentive“ to use the appropriate technology as a result, and said that most devices offer a good economic argument. He said that that the cost of therapy for implantable cardioverter defibrillators “has come down dramatically,“ even as those units shrank physically.

Salmon observed that the driver for innovation has traditionally been “necessity or unmet need,“ but that innovation was always fueled by capital. “We can see record declines in venture funding,“ which he said translates into an environment in which “getting funding . . . is nearly impossible.“ He added that the National Venture Capital Association (Arlington, Virginia) recently reported a 27% reduction in venture capital for devices.

“I believe that medical devices can be part of the solution“ Salmon said of the healthcare spending problem, closing with the remark, “it's just a matter of using your imagination.“

Steve Nissen, MD, of the Cleveland Clinic (Cleveland, Ohio), highlighted “how bad a pickle we're in“ where U.S. healthcare spending is concerned. He said that a comparison with other Western nations shows that the U.S. spends $650 billion too much, adding that if healthcare reform “does put a chill in innovation, you have to understand we put ourselves [in this situation] by our behavior.“

Life expectancy comparisons do not suggest that Americans are getting much bang for the buck, Nissen hinted, adding that drug overspending comes to $90 billion a year. He pegged the figure for devices at $26 billion a year. “It's primarily over-utilization“ that drives excess healthcare costs, “and medical devices are part of the problem,“ he said, charging that Americans are “twice as likely to get“ percutaneous interventional treatments than the European average and “more likely to get knee replacements.“

“Why is there reform coming? Because we cannot afford to continue to do this and insure all our citizens,“ Nissen said. Reimbursement “is what drives over-utilization,“ he said, adding that cuts to Medicare spending are essential. The U.S. government, he claimed, “really has no other options.“

“I think that the regulatory system needs an overhaul,“ Nissen argued, claiming that “the vast majority of 510(k) approvals“ do not meet the regulatory standards for approvals, but offered no explanation for this statement other than to state that Congress “never intended the 510(k) program to be used the way it's used today.“

“Fundamentally, they have a back-door approval process,“ Nissen alleged, which he said has evolved “to the point where it's the primary way devices get approved.“ He argued that there is “considerable evidence that 510(K) devices are much more like to be recalled“ than PMAs, and made the case for an approach to new device development that would result in devices that are good enough rather than superlative.

Panelist Bill Maisel, MD, of the Medical Device Safety Institute (Boston) said of Nissen's remark about devices that are good enough: “The concept of [such devices] being the future of U.S. healthcare is not going to fly.“ He argued that no doctors “will purposely pick up a device that offers less for that patient,“ asserting, “we need to get better at bringing products“ to markets with less expense. “We need to do better with bench testing,“ for example, which will require “figuring out where it's useful and where it's not.“

Nissen said in response, “I think its great to have fancy and expensive devices that do more,“ but “where's the evidence? That's the reason for CE research.“ He called for “more studies on 'are there patients who will do just as well?'“ with the less expensive devices.

Imaging radiation dilemma takes center stage

The medical imaging radiation dilemma took center stage in February and March, but a hearing of the health subcommittee of the House Energy and Commerce Committee suggests that radiation technologists and other practitioners are the primary point of interest for policymakers and academicians.

One of the oft-heard recommendations during the Feb. 26 hearing, that of a schedule of standard, procedure-determined doses, may prove more difficult to forge than might be commonly appreciated inasmuch as variable factors, such as body mass, can decidedly torque the required radiation dosage for a procedure.

Rep. Frank Pallone (D-New Jersey) stated at the beginning of the hearing, “I was reading in the New York Times a front page story about a radiation oncology group that raised a lot of the issues.“ He stated further, “Particularly disturbing is the fact that this group practice apparently had physicians who were overseas and were billing on the assumption that those physicians were present“ while services were rendered.

Pallone acknowledged that medical radiation “has saved lives,“ but said he wanted “to examine what the driving factors are when things go wrong.“ He also remarked, “it is shocking to me that individuals in many states“ do not have to be licensed to perform radiological procedures. He also claimed that enforcement is sometimes lacking in states where licensure is mandatory.

“The problem could be that no single agency“ has jurisdiction over radiological practice, Pallone said, adding that he is unaware of any guidelines “especially in terms of radiation dosage and lifetime exposure.“

Pallone also highlighted the dilemma of duplicate scans, a subset of redundant procedures that are seen as a huge driver of excess healthcare costs. Referring to his mother's experiences during a bout with cancer, Pallone said providers routinely asserted that existing scans were useless. “Nobody would actually use the previous one. They always had a reason why they couldn't use it,“ he commented.

Pallone said at the end of the hearing that more hearings were likely inasmuch as the responses from the witnesses at the hearing left the committee “with more questions.“

Pallone made reference to the CARE (Consistency, Accuracy, Responsibility, and Excellence in Medical Imaging and Radiation Therapy) Act of 2009 (H.R. 3652), authored by Rep. John Barrow (D-Georgia), a bill the intent of which is to impose accreditation standards for all who practice imaging that is billed to Medicare.

One of the witnesses at the hearing was James Parks of Gulfport, Mississippi, who told the panel about his son Scott, who “died from an overdose of radiation by a team of inept therapists.“

“What was to be a minimally invasive procedure turned out to be a nightmare for the whole family,“ James Parks said, adding that his son “rapidly became blind and deaf, had constant pain and vomiting. His jaw was calcifying and his teeth were falling out,“ he added.

The elderly Mr. Parks said, “we are impressed with the machines,“ but remarked, “they're not as good as they could be.“ He recommended a “strong mandatory database“ and that “all medical institutions should report to the database“ for “all medical problems, not just radiation.“

Steven Amis, Jr., MD, of the American College of Radiology (Reston, Virginia), told the committee that “a formal accreditation process must be mandatory“ for all radiological services performed in hospitals and freestanding imaging facilities. These standards, he said, should “encompass all clinical settings and radiation therapy modalities,“ and he voiced support for the CARE Act.