WASHINGTON – Former Advamed CEO Stephen Ubl discussed the need to create a sound regulatory and reimbursement environment for personalized medications in his new role as the head of the Pharmaceutical Research and Manufacturers of America (PhRMA), during a keynote at last week’s conference sponsored by the Personalized Medicine Coalition.
Ubl gained familiarity with personalized medicine at Advamed, where he launched AdvamedDx to represent the interest of makers of the diagnostic testing equipment that enables physicians to customize treatment to individual patients.
“I start off with the proposition that diagnostics are the least appreciated aspect of health care. Two percent of spending drives 72 percent of decision-making, but the magic happens somewhere else,” he said. “So if you go to the doctor’s office or you get a blood test, you don’t hear anything, hopefully, or if you do, you don’t appreciate how that blood sample got you to a treatment outcome.”
Ubl explained that molecular diagnostics and biomarkers can help improve clinical trials.
“On the FDA side, as has been discussed before, we think there are pragmatic steps that can be taken to more rapidly validate and qualify biomarkers, to use those biomarkers as surrogate endpoints, to harness the power of real-world evidence so that we don’t have to try to answer all the questions up front, but can keep learning as we go. These are steps that we think can lower development costs and enhance competition by bringing products to patients more quickly,” he said.
In addition, Ubl called for adaptive clinical trials that deploy biomarkers to assign patients to various arms, potentially eliminating the need for a placebo group. He noted that new FDA Commissioner Robert Califf is an expert on the topic.
Ubl devoted a substantial portion of his remarks to criticism of a proposed payment demonstration for Medicare Part B drugs that would curtail the reimbursement of high-cost pharmaceuticals. He touted diagnostics as an alternative means of cost-control and resource optimization. “We need diagnostics to make sure that we’re allocating resources appropriately in the health care system,” he said. “That is the right way to solve the cost challenge, not the wrong way like the Part B Demo, or gravitating towards price controls or what have you, but getting the right drug or the right intervention to the right patient at the right time.”
As the dad of a child with type 1 diabetes, Ubl said that industry needs to become more patient-centric. Although A1C levels are the main biomarker used to determine the severity of diabetes over time, that metric isn’t that useful on a day-to-day basis, he said.
“We have to get a lot better at understanding what patients really want and value, and right now that’s not happening.”
LEANING ON DEVICE INDUSTRY EXPERIENCE
The speech was peppered with references to lessons learned from Ubl’s days at Advamed, which ended in September after a 16-year term.
“One of the things that I bring from device experience to pharma is that there’s nothing that chilled investment like uncertainty. In the device space, over the last five years investment in start-up medical technology companies – the true early stage companies – fell by something like 72 percent,” he said.
Ubl blamed the poor state of medtech venture capital on uncertainty around medical device regulation and reimbursement, informing the audience of pharmaceutical company employees and other stakeholders of a fact that that’s well known in the device world: Medical devices are routinely approved in Europe years before they are made available in the U.S.
“My point is just that we shouldn’t take progress for granted,” Ubl said. “We need a robust policy ecosystem to continue to support innovation because investors and supporters of [the pharmaceutical] industry can move to other places, as they did in the device space, something that I know my former colleagues at Advamed are very focused on in terms of rehabilitating that particular ecosystem.”
He also cited an early study of angioplasty that found the now-routine procedure to be ineffective and uneconomical as justification for proceeding with caution when it comes to new payment models that could restrict the pricing of innovative medications. “My point is that new pharmaceutical interventions and innovations are [also] not all well understood at launch,” he said.
The pharma industry is ahead of the device industry in terms of real-world evidence generation and postmarket surveillance. The FDA’s device arm is putting increasing emphasis on the topics in an effort to catch up, and its drugs and biologics arm are pushing for more of both as well.
“I will say that on the device side [real-world evidence, or RWE, generation] it is a little more complicated because of the heterogeneity of the products involved and the complexity of getting the information captured, whereas on the drug side you have much more granular information that facilitates access to RWE in a more user-friendly way,” Ubl noted. “But I think that at the end of the day, both industries will benefit from having real-time capability of answering questions that can’t be answered up front.” He added that the issue could be addressed on the device side in the impending 21st Century Cures bill, or the upcoming FDA medical device user fee negotiations with industry.
Ubl also said the regulatory and legislative agendas of the two industries are broadly aligned and cited a number of initiatives on Capitol Hill that would benefit both sides, such as the Precision Medicine Initiative, the Cures bill and the National Cancer Moonshot Initiative.
As head of Advamed, Ubl used to routinely point to studies showing that medical devices account for a small portion of health care spending, and that the price of implants is growing substantially slower than the rate of health care inflation. There are few studies with similar findings to cite when it comes to pharmaceuticals and biologic drugs.
“We have to have headroom for innovation,” Ubl said, when asked about high drug prices. “We have to have incentives in the system so that we have an incentive for breakthrough innovations like PCSK9 inhibitors. I just think that relentless education about the way the marketplace has evolved [is needed].
“Today you have a situation where you have rapidly consolidating payers and PBMs [pharmacy benefit managers]. There’s absolutely fierce marketplace competition that’s driving down costs.”
He also said an “honest” discussion around the quality of insurance plans is needed so that patients have more transparency about costs and which medications are covered in-network.