Forest Laboratories won the latest round in the legal fight to preserve its Lexapro anti-depressant drug patent into 2012 (and the stock market responded today with a 16% increase in the company’s stock price). Forest Labs has good reason to be pleased as the Wall Street Journal reports today that

Generic competitors to [Merck’s statin] Zocor [whose patent protection expired on June 23, 2006] are grabbing a big share of new prescriptions for cholesterol-lowering drugs and already putting pressure on Pfizer Inc.’s Lipitor, recent data show. After copycat versions of Zocor became available during the last week of June, they captured 49% of new prescriptions in the U.S. for the medicine known generically as simvastatin. Despite price cuts taken by Merck & Co. to keep Zocor competitive, the brand-name drug’s market share slipped to 51% of new prescriptions during the week that ended June 30, according to data from WoltersKluwerHealth. Patent protection for Zocor in the U.S. ended June 23.

CVS, which is the largest pharmacy chain in the Washington, D.C., area and has 5,400 pharmacies in 37 states, has bought MinuteClinic. There are 83 MinuteClinics in ten states, including 66 located inside CVS pharmacies, including one in my hometown, Bethesda, MD. According to the CVS press release, “MinuteClinic locations, which are staffed by certified nurse practitioners and physician assistants, offer treatment for common family illnesses, such as strep throat, ear infections, poison ivy and pink eye. They also provide some common vaccinations.” Clearly CVS has room for expanding this convenient service. Will other pharmacies follow CVS’s lead?

Steve Barr reports in today’s Washington Post about an Inspector General report on the massive Veterans’ Administration security breach. What a dysfunctional agency!

The U.S. Senate today amended by a 68-32 vote the Homeland Security appropriations bill to prohibit Customs and Border Protection officers from from preventing an individual not in the business of importing a prescription drug from importing an FDA-approved prescription drug from Canada into the United States.

The Centers for Medicare and Medicaid Services released two fact sheets today on Medicare and Medicaid spending. Medicaid spending is below budget projections, but Medicare spending is above those projections:

Medicare Part D expenditures are now projected to be $34 billion lower over 5 years (2006-2010) than in the President’s Budget, and $110 billion lower than in the Mid-Session Review one year ago. The average Part D premium is almost 40 percent lower than had been projected a year ago as a result of strong competition, and 90 percent of Medicare beneficiaries are receiving prescription drug coverage. Medicare Part A and Part B expenditures are higher, primarily because of continuing rapid growth in the use of Medicare services. Part A projected expenditures over 5 years (2006-2010) are $17 billion higher and Part B projected expenditures over 5 years are $30 billion higher than in the President’s Budget. Rapid growth in physician-related services and hospital outpatient services are the main factors responsible for a projected increase in the Medicare Part B premium of 11 percent for next year. The continued rising costs in Medicare Part A and Part B highlight the need for reform of the original Medicare program to pay more accurately and especially to pay more for better care, not simply more services. The President’s Budget proposed building on MedPAC’s recommendations for more accurate payments to health care providers, and the adoption of performance-based payment systems.

On June 20, CMS released another fact sheet which provides more details on why CMS finds Part D prescription drug program spending is substantially below projections.

On June 28, the House Ways and Means Committee held a hearing on health savings accounts / high deductible health plans (HDHPs). Karen Ignani, AHIP’s President, gave interesting testimony on consumer acceptance of HSA/HDHPs. A recent GAO report on first year FEHBP experience with HSA/HDHPs concluded that “FEHBP HDHP enrollees were younger and earned higher federal salaries than other FEHBP enrollees.” Ms Ignani reported about

Two other studies – one by the Employee Benefit Research Institute (EBRI), another by the Blue Cross Blue Shield Association (BCBSA) – have demonstrated that the health status of individuals with HSAs is comparable to the health status of those with other types of coverage. The EBRI study[4] found that 86 percent of individuals with HDHPs and 87 percent of individuals with non-HDHP coverage reported their own health status as very good or good. The BCBSA study[5] yielded similar results, with 77 percent of individuals in both categories – those with HDHP coverage and those with non-HDHP coverage – describing their health status as very good or good. The EBRI study also found that the income distribution is fairly similar for persons with HDHP coverage and with other types of coverage. According to EBRI, 31 percent of HDHP enrollees and 27 percent of non-HDHP enrollees have annual household incomes below $50,000. Similarly, Assurant Health found that 29 percent of enrollees in its HDHPs have annual household incomes below $50,000. Other data[6] from Assurant indicate that 43 percent of HDHP applicants did not have prior health coverage and, additionally, that 69 percent of HDHP purchasers are families with children and 62 percent are over the age of 40.

In connection with this hearing, the Joint Committee on Taxation staff issued an illuminating report on the tax benefits of various health benefit arrangements that are available to federal employees and other citizens.

Ben Butler of Crowell & Moring call my attention to this excellent overview of PHR initiatives from Modern Healthcare. I was interested in learning that

On June 30, the CMS awarded contracts to perform feasibility studies on creating PHRs using claims data from existing Medicare fee-for-service programs. One of the winners was Capstone Government Solutions, Nashville, a for-profit consortium formed in 2004 by Blue Cross and Blue Shield of Tennessee and Cigna Government Services, an arm of publicly traded Cigna Corp. ViPS, a business unit of Elmwood Park, N.J.-based Emdeon Corp., formerly WebMD Corp., was awarded the second PHR pilot contract.

There’s not much news, however, about the status of the major House health information technology bill, HR 4157, which probably means that there’s a lot going on in the proverbial smoke filled rooms on Capitol Hill. The current AMA News does report that the medical community joins the insurance community in opposing to Rep Nancy Johnson’s 10/09 ICD-10 mandate in the Ways and Means version of HR 4157.

The Kaiser Family Foundation has posted its June 2006 report on prescription drug trends. “The updated fact sheet shows that while spending on prescription drugs had been rising more rapidly than for other types of health care, its rate of growth has slowed somewhat recently and now is rising at about the same pace as spending for hospital and physician services.” Presumably that trend will continue due to the recent spate of expiring patents on iconic brand name drugs such as Zocor and Zoloft.

Fun facts to know and tell from that report:

• In 2005, about three-quarters (74%) of workers with employer-sponsored coverage had a cost-sharing arrangement with 3 or 4 tiers, over 2½ times the proportion in 2000 27%).
• Co-payments for nonpreferred drugs (those not included on a formulary or preferred drug list) have doubled from an average of $17 in 2000 to $35 in 2005.
• Copayments for preferred drugs (those included on a formulary or preferred drug list, such as a brand name drug without a generic substitute) increased by 69%, from $13 in 2000 to $22 in 2005.

The HHS Office for Civil Rights, which enforces HIPAA’s Privacy Rule, has released guidance for covered entities and business associates to describe information flows in the event of an emergency, such as Hurricane Katrina. Covered entities should consider incorporating this guidance in their Privacy Policies and Procedures.

Last week, HHS sponsored a Nationwide Health Information Network (NHIN) Forum. The NHIN will be the backbone of the Nation’s developing electronic medical records system. 500 people attended (the admission charge was only $50). Government HIT magazine reports that the attendees had a lot of questions and comments. The National Committee on Vital and Health Statistics will be considering these comments as it develops a privacy and security oriented requirements document for the NHIN over the summer. In addition, four HHS-contracted consortia — are developing and assessing different NHIN models. For what it’s worth, I have been most impressed by the Connecting for Health Common Framework model developed in partnership with CSC. For more details, Oracle has created a NHIN Watch.