Sean Tunis, Former Medicare Guru, on What Biotechies Gotta Do the Next Five Years
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going to succeed.
X: Is there something in the healthcare reform that passed last year that really mandates this, or is it just a matter of common sense, that when you increase access to 40 million people, cost will have to come down at some point?
ST: There’s partly a common sense aspect to that. When you add 40 million people, it will put more pressure on affordability. It’s partly about what you see when you look at the spending trends. They are literally unsustainable. It’s not rhetorical. It’s real. There’s no way we’re going to spend 100 percent of our GDP on healthcare, and that’s what the healthcare spending trends say. One way or another, there will have to be changes that remove cost from the system. Once you have eliminated the simplicity of the past—barring poor people from the system, which is how we used to do it—presumably that part is now being fixed. So we have to get more efficient.
In terms of what’s actually in the healthcare bill, they don’t exist yet, but there’s a preliminary movement for payment reform through accountable care organizations. They are going to put clinicians and other providers into a situation where their compensation will depend on how efficiently they practice medicine. When you put providers in that kind of situation, they will want the industry to give them options to improve care and lower costs. That’s what the marketplace will demand.
X: Do you think the Big Pharma, biotech, and device companies really get this? Are they incorporating this realization into their clinical development plans?
ST: They are genuinely trying to do that. It’s not easy to actually make something better and cheaper. If it were easy, people would have been doing it. But from what I can see, most of the major pharma companies have gotten the message that right from Phase I, and through their portfolio management decisions, it all needs to be informed by an emerging recognition of the new marketplace.
X: How does this work in practice? If you’re the CEO of a biotech startup or the chief scientist at a bigger company, how do you alter your clinical trials now so that they yield kind of information that people will want to see five years from now?
ST: Depending where you are in the clinical process, it can depend on things like how you select a comparator. In the old approach, the assumption was … Next Page »