It’s a reoccuring story. My name never shows up in the annual list of MacArthur “genius” grants. Then again, I don’t see any lawyers in this year’s list.

Bristol Myers Squibb took another one in the chops yesterday when a federal judge in New York City invalidated a key Imclone System’s patent associated with its colon cancer drug Erbitux (in favor of three Israeli scientists). BMS is the co-marketer of Erbitux, sales of which are expected to be around $1 billion this year. (It is worse news for Imclone as Erbitux is its only marketed drug, and Amgen is poised to receive FDA approval of a competitor drug. Which company is more snake bit — BMS or Imclone (founder Sam Waksal in prison for securities fraud, etc.)?

September 17 is Constitution Day, the day on which in 1787 the members of the Constitutional Convention, chaired by George Washington, signed our Constitution, subject of course to ratification by the states. OPM has produced a website about its Constitution Initiative project to educate federal employees about the Constitution. I would like to have Constitution Day capped off with a Redskins win over the Cowboys.

According to a study published in the New England Journal of Medicine and its UK cousin The Lancet, a large clinical trial called DREAM indicates that a GlaxoSmithKline drug called Avandia (rosiglitazone) may prevent Type 2 diabetes in high risk individuals. Avandia is labeled for use to treat Type 2 diabetes, which is considered an epidemic in the U.S. and many other parts of the world. However, the study also raised a concern that preventive use of Avandia may cause heart failure. A Lancet editorial cautioned that “The high cost of therapy and the lack of long-term data mean that healthcare funders are unlikely to see rosiglitazone as an appropriate agent” particularly when diet and exercise programs also are effective prophylatics for this population.

The study also revealed that another drug thought to prevent Type 2 diabetes — ramipril — has a minimal impact on the disease.

Forbes.com observes that

Still, the results are a scientific win because they show that it is possible to develop drugs that prevent diabetes. An entirely new class of treatments is racing to market in the form of Januvia and Galvus, experimental pills developed by Merck and Novartis, which work in a new way. The FDA is expected to approve or reject Januvia in mid-October and Galvus in November. It’s possible that Merck and Novartis could find a way to walk through the door that Glaxo has already opened.

“The popularity of health savings accounts (HSAs) coupled with high-deductible health plans is equally distributed across consumers aged 25 to 54, with demand also coming from all income and education segments of the population, according to a new survey released today by the Blue Cross and Blue Shield Association (BCBSA).”

According to the Wall Street Journal and other press reports, “The World Health Organization, conceding that widely used malaria-fighting methods have failed to bring the catastrophic disease under control, plans to announce Friday that it will encourage the use of DDT even though the pesticide has been banned or tightly restricted in many parts of the world.” According to MSNBC.com, “the U.S. government already has decided to pay for DDT and other indoor insecticide use as part of President Bush’s $1.2 billion, five-year initiative to control malaria in Africa.” (It’s interesting to note on the WHO web site that European countries are experiencing “epidemics” of heart disease and diabetes similar to the U.S.)

The Centers for Medicare and Medicaid Services (“CMS”) have announced the 2007 Medicare deductibles and premiums for Parts A and B. The monthly Medicare Part B premium will increase $5.00 from $88.50 to $93.50 and for the first time the premium amounts will be higher for Medicare beneficiaries with over $80,000 in taxable income (single taxpayer) or $160,000 for those filing jointly. Part B covers physician’s and related medical services and supplies, such as diagnostic testing.

CMS explains that

The single most important factor driving the 5.6 percent Part B premium increase is the growth in traditional fee-for-service Part B spending per capita, as opposed to spending growth in Medicare Advantage. The phase-out of “budget neutrality” adjustments in Medicare Advantage payments helps account for the limited Medicare Advantage payment increase. The largest contributors to the 2007 premium increase by type of service are outpatient hospital services, physician-administered drugs, and ambulatory surgical center (ASC) services. Spending for outpatient hospital prospective payment services is growing rapidly and is projected to increase by 11.6 percent per capita in 2007. This is mainly due to an expected 7.9 percent increase in the volume and intensity of these services. In addition to the higher premium costs caused by this growth, it also results in a projected 6.5 percent increase in per capita beneficiary coinsurance payments (beneficiary coinsurance for hospital outpatient services can be as high as 40 percent). However, the 2007 premium increase is held down by a provision in current law that, if unchanged, will require a reduction in fees paid by Medicare to physicians of about 5 percent. Congress has acted to prevent such physician fee reductions from occurring in each of the last four years. Even with the fee reduction, however, the volume and intensity of physicians’ services is projected to increase by 4.9 percent in 2007, resulting in projected continuing pressure toward rising costs. As CMS has said repeatedly, the rapid growth in utilization of services and the wide variation across providers and geographic areas in the use of these services shows that Medicare needs to move away from a system that pays simply for more services, regardless of the quality of those services or their impact on beneficiary health. Medicare payments should provide better financial support to doctors and other health professionals in their efforts to achieve better health outcomes for Medicare beneficiaries at a lower cost. CMS is working closely with medical professionals and Congress to increase the effectiveness of how Medicare compensates physicians and other health care providers. CMS is also conducting demonstrations and pilot programs that pay providers more for better quality, better patient satisfaction, and lower overall health care costs

Of course, the medical community is fighting to restore the fee reduction that helps to control the Psrt B premium.The Medicare Part B deductible will increase from $124 to $131, the same percentage as the premium increase.Finally CMS explains that

Medicare Part A pays for inpatient hospital, skilled nursing facility, hospice, and certain home health care. The $992 deductible, paid by the beneficiary when admitted as a hospital inpatient, is an increase of $40 from $952 in 2006. The Part A deductible is the beneficiary’s only cost for up to 60 days of Medicare-covered inpatient hospital care in a benefit period. Beneficiaries must pay an additional $248 per day for days 61 through 90 in 2007, and $496 per day for hospital stays beyond the 90th day for lifetime reserve days. This compares with $238 and $476 in 2006. The daily coinsurance for the 21st through 100th day in a skilled nursing facility will be $124 in 2007, up from $119 in 2006.

On September 13, the House Federal Workforce and Agency Organization subcommittee approved by voice vote the Manager’s amended version of H.R. 4859, the Federal Family Health Information Technology Act, and sent it on to the full Government Reform Committee for its consideration. As previously reported in the blog, this bill would require Federal Employees Health Benefit Plans to provide their menbers with electronic health records. According to press reports, America’s Health Insurance Plans , a major industry trade association, had asked the Subcommittee chairman, Rep. Jon Porter (R-NV) to delay the legislation until health insurers develop standards for EHRs and the systems used to store and transmit them.”

Following up on his September 1 subcommittee hearing, Rep. Jon Porter (R Nev) will hold a meeting of his House Federal Workforce and Agency Organization subcommittee to markup and vote on H.R. 4859, the Federal Family Health Information Technology Act. The meeting will be held tomorrow at 2 pm. The Federal Times reported on the meeting earlier today.

Embattled Bristol Myers Squibb CEO Peter Dolan and (gasp) his company’s general counsel Richard Willard were terminated today based on the recommendation of retired Federal Judge Frederick B. Lacey who is monitoring the company’s compliance with its deferred prosecution agreement with the federal government. Mr. Dolan was under shareholder fire for his mishandling of the Plavix patent dispute discussed in the Drug Wars Updates, among other issues. The Wall Street Journal notes that Mr. Dolan is the third major U.S. drug company CEO to be shown the door in the past 16 months.

Merck & Co., Whitehouse Station, N.J., last year pushed then-CEO Raymond Gilmartin into early retirement after withdrawing the painkiller Vioxx from the market in 2004. Pfizer Inc., the world’s biggest drug maker, ousted Henry McKinnell in late July, replacing him with a former lawyer. As at Bristol-Myers, the stocks of both companies have been battered in the past two years.