Harold Hastings’s journal round-up for 16th July 2018

Every Monday our authors provide a round-up of some of the most recently published peer reviewed articles from the field. We don’t cover everything, or even what’s most important – just a few papers that have interested the author. Visit our Resources page for links to more journals or follow the HealthEconBot. If you’d like to write one of our weekly journal round-ups, get in touch.

Legal origins and female HIV. American Economic Review [RePEc] Published 13th June 2018

I made this somewhat unusual choice because the author Siwan Anderson draws an important connection between the economic and legal status of women across sub-Saharan Africa and the incidence of HIV. As summarized in the American Economic Review feature Empowering women, improving health, “Over half of all people living with HIV are women. Of all HIV-positive women, 80 percent live in Sub-Saharan Africa.” Anderson hypothesizes that regional differences in female property rights (lower in common law eastern and southern Africa than in civil law central Africa) may explain significantly higher HIV incidence in eastern and southern African women, especially relative to eastern and southern African men. Health economists have long studied how economic status affects access to health care; Anderson presents an important and interesting complementary argument for how economic (and legal) status affects health. In particular, improved legal status and access to legal aid may be a key step in improving women’s health.

Addressing generic-drug market failures — the case for establishing a nonprofit manufacturer. The New England Journal of Medicine [PubMed] Published 17th May 2018

We have recently seen shortages in many generic drugs, including generic injectables used in emergency, trauma and other hospital medicine. In many cases, there is only a single supplier, who can dramatically increase prices. One might expect others to enter the market in this case. However, frequently significant fixed start-up costs pose a barrier to entry and the single supplier, who has already made and in many cases paid for the start-up investment, can drastically reduce prices to make it difficult for the competition to cover these costs. Thus there is little incentive to enter a potentially low-profit market. The authors propose establishing a nonprofit manufacturer, essentially a pharmaceutical counterpart to a variety of national and nonprofit health systems, as a novel and a potentially successful way to address this issue.

An incomplete prescription: President Trump’s plan to address high drug prices. JAMA [PubMed] Published 19th June 2018

The prices of many drugs are significantly higher in the United States than in much of the rest of the developed world. President Trump proposes some market actions such as granting Medicare negotiating power; but the authors find these insufficient, making two interesting additional proposals. First, since much pharmaceutical development derives from NIH funded research (including chimeric antigen receptor T-cell immunotherapies which may cost $400,000 US per dose), the authors argue that the NIH and academic institutions could require US prices based upon independent valuations or not to exceed those in other industrialized countries. The authors also suggest authorizing imports where there is adequate regulation as a further mechanism for controlling drug prices; in my opinion a natural free-trade position. The pricing of pharmaceuticals remains complex and perhaps new economic models are needed to address the risk and cost of pharmaceutical development. Kenneth Arrow’s critiques of the limitations of economics to address health issues might provide interesting insights.

Cost-related insulin underuse is common and associated with poor glycemic control. Diabetes Published July 2018

I would like to conclude by citing a recent abstract providing a human side to the growing cost of pharmaceuticals. Darby Herkert (a Yale undergraduate) reported that a quarter of almost 200 patient responses to a survey of patients at a New Haven, CT, USA diabetes center reported cost-related insulin underuse. Underuse was prevalent among patients with lower income levels, patients without full-time employment, and patients without employer-provided insurance, Medicare or Medicaid. Patients reporting underuse had three times the incidence of of HbA1c >9%. These results cite the human costs of high insulin prices in the US. A Medscape review cites the high cost of typically prescribed insulin analogs, and quotes the lead author calling these prices irrational and describing patients living near the Mexican border crossing the border to buy their insulin.


Access to medicines and medical technologies for the global poor

The UN Secretary General’s High Level Panel on Access to Medicines recently published its long awaited report Promoting innovation and access to health technologies. The report explores and proposes some solutions to the well recognised problem of under-investment in research and development for new treatments for diseases that afflict the global poor. In the pharmaceutical market, innovation is directed to the areas that generate the highest returns. These market incentives explain why no new anti-tuberculosis drug has been developed since the 1960s. As a result, some of the WHO’s sustainable development goals (SDGs), such as to eradicate TB and malaria by 2030, look fanciful. To increase investment in research and development new incentive structures would need to be put in place.

Interventions already take place in the market to encourage R&D. Patents granting temporary monopolies are already widely used to allow companies to recoup the high costs of drug development. However, reported R&D costs, as we have previously discussed, are likely to be inflated to justify longer patent lengths. The UN report identifies other methods of ‘evergreening’ such as filing multiple patents for small variations of various drugs or patents for multiple indications of the same drug. The World Trade Organisation enforces strict US-style patent rights around the world, but it permits significant flexibility for granting patents. The report recommends punitive action against companies that pressure countries to use these flexibilities in their favour.

Relying on market incentives also leads to other adverse outcomes. The academic medical literature has become distorted. Industry funded research is more likely to find favourable outcomes. In some cases significant harms are not reported as the Vioxx scandal demonstrated. We have also previously reported on how policy uncertainty reduces pharmaceutical R&D. Thus, state involvement in the industry seems to be warranted.

Joseph Stiglitz proposed an international multi-billion dollar fund to reward drug innovations that did the most to improve public health. Other solutions proposed in the UN report are to prohibit patents on innovations resulting from publicly funded research, forcing private companies in the medical sector to disclose the true costs of R&D, and the public financing of biomedical R&D through transaction taxes and other mechanisms.

Some may worry that such restrictions and market distortions may significantly reduce private spending on medical R&D. But it should be noted that only around 14% of the industry’s budget goes towards R&D; a greater share is spent on marketing. However, as an editorial in the Lancet notes, these recommendations would require endorsement and adoption quickly as new legislation such as the trans-Pacific partnership (TPP) is gaining momentum, which will exacerbate the situation further.


Conference round-up: Medicine, Markets and Morals Network Meeting Three

Last October saw the first meeting of the Medicine, Markets and Morals Network. Today and yesterday I attended their third and final (for now) meeting in London. The network brings together researchers from across the social sciences and humanities to discuss issues relating to resource allocation in health care. A book is planned and the website will be maintained, so hopefully the Network has a future and will produce something more permanent. For now, here are some of the overarching themes that I saw being discussed at the conference.

To deliberate or not to deliberate?

I don’t know what it is about philosophers that enables them to talk so well without slides. The conference started with a prime example in the shape of Jonathan Wolff discussing alternative approaches to valuing health care. Should we consider preferences, experienced utility or capabilities? And whose? Jo suggested that there is no single best approach and argued in favour of a discursive, deliberative approach.

This became a recurring subject for the event, to which we returned on the final day with Ruben Andreas Sakowsky arguing that deliberative evaluation is a better way of eliciting individual preferences. To this end, he suggested that we ‘upgrade’ the way we do discrete choice experiments. Leah Rand argued that we need to upgrade the notion of ‘accountability for reasonableness’, which is at the heart of decision-making processes in health care. Leah argued that there is a need to ensure legitimacy in the process of decision-making and a requirement for fair consideration of reasons.

But deliberative processes present challenges. Do people know enough to make informed decisions about the allocation of health care resources? If they don’t then there is still an argument to be made that in a democracy it is the views of these people that should be acted upon. But can deliberation still be meaningful if the people involved have no understanding of the context or implications of their decisions?

Information – particularly who has it and which bits of it matter – was the major theme of the conference for me. I think a lot of what we discussed related to the incompatibility of evidence-based policy and democracy. I’ll come back to that later, once I’ve discussed some of the other speakers’ talks.

Systems, structures and marketisation

Another major subject was the Health and Social Care Act 2012 (HSCA). Richard Taunt discussed the HSCA, noting the tendency for people to view the apparent fiasco as undemocratic. Richard argued that this is not the case, but rather issues like this have “no salience in electoral politics”. Even if people say that NHS policy will determine which way they vote, in reality votes don’t correspond to what people say is important. One option is to build sustainable development into democracy, such as has been tried with the Well-being of Future Generations (Wales) Act or the Finnish ‘Committee for the Future’. But, Richard argued, we already have the Health Select Committee and plenty of think tanks; ‘upgrading democracy’ should not be about structures. Rather, we should focus on encouraging the right kinds of behaviours, such as humility and continual learning.

Later in the day, Allyson Pollock presented a quite different story about the Health and Social Care Act; as providing the mechanisms for the deconstruction of the NHS. Allyson explained that the Act does away with the duty to provide universal health care according to need, and that the closure of hospitals is the evidence of this possibility being realised. The risk presented was that we might end up with a US-style system of health care funding and provision.

Therese Feiler presented a theological basis for the use of economics-type thinking in health care, which took us all out of our comfort zone; a great thing! Therese suggested that the use of diagnosis-related groups (DRGs) is a part of the process of the commodification of health care.

Mary Guy discussed the legal situation in the UK and The Netherlands regarding the application of competition law to health care, which is key to the potential for marketisation of the NHS. The take home message is that whether or not the NHS could be subject to competition law (in its current organisation) is still to be decided in the courts.

Rudolf Klein gave a notably lo-fi talk on the need to ration expectations rather than treatments or procedures. He argued that the NHS agenda is determined by the state of the economy. While the NHS Mandate (which we were all encouraged to read) lists many goals, the top item on the list of NHS ‘must-do’s relates to financial stability. The question is, what are we willing to sacrifice from the long list of NHS goals? (There was support in the room for allowing longer A&E waiting times.) And what about the cost of transparency and statistics in order to maintain ‘anticipative accountability’, which is held to be very important? Can we sacrifice some of these costly processes which in turn help create more goals for the NHS mandate?

Evidence, narratives and democracy

Chris Newdick argued that bioethics hasn’t done us much good, in that the focus on autonomy has bolstered neoliberalism. He discussed the notion of public health ethics and asked why community is not the starting point for the ethical debate rather than the individual. In this sense, has the neoliberal agenda been more successful in the debate about health care, as well as more broadly?

I think this brings us back to the issue of information. The idea that autonomy and/or the free market is paramount is an a priori notion. The invisible hand is a nice story, and people are compelled by it. Evidence, on the other hand (the visible hand), is not compelling. One can always find evidence to support a claim and as such the non-expert may be inclined to distrust all evidence. A compelling story is more difficult to disregard.

In his closing remarks, Cam Donaldson mentioned Robert Evans’s notion of zombie policies. These are not usually evidence-based zombies but about stories. Cam presented Alan Williams’s old argument about the distinctiveness of health care as akin to a duck-billed platypus. This provides a nice analogy, but it still depends on evidence. This is why we see the ‘health care is just another good’ argument coming back time and time again; recently in the broccoli debate in the US.

The problem is that the basis for publicly provided health care requires a lot of thought and a lot of foundational understanding of how things work in a particular economic, political, legal, historical and ethical context. For example, to know that health care is not broccoli you need to understand moral hazard (etc), and that this has been observed. There is evidence. However, in order to support neoliberalism and a free market in health care you don’t need any of that. All you need is basic intuition and a compelling heuristic: leave people, institutions and corporations to do as they please and the invisible hand will sort it all out.

This at least partly explains why academics tend to think differently about resource allocation in health care. Rachel Baker and Helen Mason presented their work on eliciting public views about the allocation of resources at the end of life. Using Q methodology (for which we were given a brief tutorial) they have identified three different viewpoints that people tend to adopt. The first group support the notion of value for money, with no special cases; QALY-maximisers would fit into this group. The second believe that life is precious, and they are not likely to accept any restriction of health care due to costs. The third is a more nuanced group that value wider benefits while also acknowledging the importance of opportunity cost.

On the first day we attendees were presented with 18 statements, with 7-point likert scales to elicit our agreement. The same questionnaire was used in a large online survey of a representative sample of the UK. This survey is designed to elicit the prevalence of the different viewpoints. Viewpoint 2 was by far the most common in the general population. Meanwhile, in the room, viewpoint 3 was the leader. As for me, the stats showed that I was the strongest supporter of viewpoint 3. This discrepancy between the public and a group of academics may not come as a surprise, but it is noteworthy. Viewpoint 3 is the most nuanced position. It acknowledges the messyness of health care resource allocation decisions. The findings of the survey suggest to me that the public do not recognise this messyness, or at least employ a simpler decision process that ignores some of the messyness. They may be right to do so, but I suspect not. As academics we know more about what we do not know; we have more known unknowns. The general public on the other hand don’t – and can’t be expected to – understand all of the challenges of resource allocation in health.

One of the very last points to be raised in the concluding discussion was whether homeopathy should be funded on the NHS. Most of us agreed it shouldn’t, but Ruben bravely stuck his neck out and suggested that if people want it then who are we to deny it? I think there’s an analogy to be drawn here between homeopathy and free market health care. We know homeopathy isn’t good for people. We know market forces in health care (broadly speaking) aren’t good for people. But both of these assertions are empirical; dependent on understanding a long history of evidence and fundamental notions of how we determine what is good for people. The public don’t have this understanding. The ‘invisible hand’ and ‘like cures like’ make for far more compelling and easily attainable interpretations of reality. So people will vote for them. But that is not a good thing.