Our Take: Coronavirus concerns ripple throughout the industry
Mar 09, 2020
HIMSS conference is canceled
For the first time in 58 years, the HIMSS Global Health Conference & Exhibition, scheduled to take place this week in Orlando, has been canceled. The Healthcare Information and Management Systems Society (HIMSS) said last Thursday that it was “clearly necessary” to cancel the event based on recent reports by the World Health Organization and the Centers for Disease Control and Prevention (CDC) about the new coronavirus.
“The advisory panel recognized that industry understanding of the potential reach of the virus has changed significantly in the last 24 hours, which has made it impossible to accurately assess risk,” HIMSS noted. “Additionally, there are concerns about disproportionate risk to the health care system given the unique medical profile of Global Conference attendees and the consequences of potentially displacing health care workers during a critical time, as well as stressing the local health systems were there to be an adverse event.”
The organization said it was unlikely that the conference would be rescheduled to later this year.
Senate passes coronavirus funding bill
Also on Thursday, the Senate passed a bill, H.R. 6074, that provides $8.3 billion in emergency funding for federal agencies to respond to the coronavirus outbreak. Of that amount, $2.2 billion was designated to help federal, state, and local public health agencies prevent, prepare for, and respond to the virus. That includes money for lab testing, infection control at local levels, and efforts to identify people who may have had contact with those who are infected.
More than $3 billion of the bill’s funding was allocated to the research and development of vaccines, therapeutics, and diagnostics to prevent or treat COVID-19, the disease the coronavirus causes. Government officials have said a vaccine probably would not be available for at least another year.
The bill, which President Trump signed Friday morning, does not specifically address reimbursement for providers that treat uninsured patients who are infected with the virus, but it does allot $500 million for waivers that would temporarily lift restrictions on where Medicare telehealth services can be provided.
Lab testing continues to be problematic
The CDC developed a new lab test kit to be used in testing specimens for the coronavirus that causes COVID-19, but “performance issues” were found last month, soon after the CDC started distributing the kits to designated laboratories. The agency developed a new protocol to allow the original test kits to be used until newly manufactured kits could be distributed.
The New York Times reported last Wednesday that the FDA’s new commissioner, Dr. Stephen Hahn, said approximately 2,500 test kits could be available by the end of the week. Each test kit can test about 500 people, for a total of 1.25 million. Administration officials estimated that about 1 million tests per week could be manufactured after that.
However, according to the same Times article, a spokesman for the Department of Health and Human Services said last Monday that public health labs could test up to 75,000 specimens by the end of last week. The executive director of the Association of Public Health Laboratories was even less optimistic. He said if all public health labs were operating at full capacity, they could conduct about 10,000 tests per day, but as of last Monday fewer than half of the labs were able to do so.
CMS prioritizes infection control during inspections
On Wednesday, CMS issued guidance to state survey agencies and accrediting organizations directing them to focus exclusively on “issues related to infection control and other serious health and safety threats … beginning with nursing homes and hospitals,” until further notice. The step is intended to allow inspectors to focus on addressing the spread of COVID-19, the agency said.
In addition, CMS asked that all health care providers review their procedures to make sure they’re complying with the agency’s infection control requirements and CDC guidelines.
Use of telehealth services likely to increase
Companies that offer telehealth services, such as Teladoc and American Well, are likely to see a surge in business as COVID-19 spreads. While virtual visits could assist with assessment and containment efforts, in-person visits would still be necessary for testing. Still, if the outbreak induces more people to try using telehealth services, it could bode well in the long term for companies that offer them.
In fact, Teladoc, which offers its services in 130 countries, has been working with the CDC to help track the coronavirus outbreak globally. After experiencing a 57% increase in virtual visits in 2019, the company said it has seen an uptick in virtual visits this winter because of the flu. Teladoc has yet to turn a profit, but the coronavirus could change that.
Two more drugmakers work to develop treatments
Takeda Pharmaceutical Co. announced Wednesday that it has initiated development of a hyperimmune globulin (H-IG), known as TAK-888, for high-risk individuals with COVID-19. Takeda said H-IGs are plasma-derived therapies that have demonstrated effectiveness in treating severe acute viral respiratory infections. The company is also evaluating its existing therapies, both on the market and in the pipeline, to see if any of them can be “repurposed” to treat COVID-19.
Also on Wednesday Alnylam Pharmaceuticals and Vir Biotechnology said in a press statement that they were expanding their collaboration to include development of RNAi therapeutics to target the coronavirus.
According to Genetic Engineering & Biotechnology News, there are now more than 35 active drug development programs in North America, China, and Europe in response to the coronavirus outbreak.
First drug shortage reported
The FDA reported the first instance of a coronavirus-related drug shortage, attributing the shortage to a problem with the manufacture of an active pharmaceutical ingredient used in the drug. The agency said it didn’t identify the drug or the company that makes it because that information was deemed to be “confidential commercial information.” In a letter dated March 3, the consumer advocacy group Public Citizen took the FDA to task for its lack of transparency. The group said that “important public health interests must take precedence over any purported industry interest in keeping such information secret.”
What else you need to know
Gilead Sciences will pay approximately $4.9 billion to buy Forty Seven, an immuno-oncology company based in Menlo Park, Calif. The two companies signed a definitive agreement, and their boards unanimously approved the transaction. With the acquisition, Gilead will gain the rights to magrolimab, an investigational therapy that Forty Seven has been developing for several types of cancer, including myelodysplastic syndrome, acute myeloid leukemia, and a form of lymphoma. The companies said in a press release that magrolimab, which is still in early-stage clinical trials, eventually could be a first-in-class drug. The acquisition is expected to close in the second quarter, pending regulatory approvals and the satisfaction of customary closing conditions.
Humana will make value-based payments to Ochsner Health providers for steps they take to address nonmedical health risk factors that affect the insurer’s members. The Social Determinants of Health Value-Based Program is an initiative Humana launched to encourage “a more holistic approach to patient care,” the company said, noting that the program would focus on addressing four social determinants in particular: food insecurity, social isolation, loneliness, and housing instability. Providers will be compensated for greater coordination of care centered on patient screenings, documentation of assessment findings, and connecting patients to appropriate resources, Humana said. Ochsner is the program’s “inaugural participant,” according to a press statement, suggesting that the initiative could be extended to additional providers in the future.
Amazon is partnering with Michigan insurer Priority Health to create an Amazon storefront where Priority Health commercial group or individual health plan members can shop for and order eligible items, and then pay for them using their health savings account (HSA) or flexible spending account (FSA). To streamline the reimbursement process, members will have the option of adding their HSA and FSA debit cards to their Amazon account, Priority Health said in a press release.
Drug prices increased 3.5 times the rate of inflation from 2007 through 2018, even after rebates and discounts, a recently published study indicates. Using list prices for 602 drugs, researchers from the University of Pittsburgh calculated the drugs’ net prices by estimating rebates and discounts offered to payers, including Medicaid. They found that the drugs’ list prices increased 159% during that 11-year period and the net prices increased 60%, or 4.5% annually. “[M]ean increases in list and net prices were substantial, although discounts offset an estimated 62% of list price increases with substantial variation across classes,” the researchers wrote. The study, published March 3 in the Journal of the American Medical Association, did not take out-of-pocket costs into account. (Subscription required to access the full study.)
Bristol Myers Squibb (BMS) will phase out the Celgene brand as the company revamps its own brand with a new logo and website (and the removal of the long-standing hyphen in Bristol-Myers). BMS completed its $74 billion acquisition of Celgene last November. “If you look at the new BMS today, we really are an entirely different company because of the Celgene acquisition,” said Kathryn Metcalfe, BMS’ executive vice president of corporate affairs, in an article published by MM&M. “The new look … differentiates us in our first year together, and it helps unify our employees behind a single vision,” she added.
What we’re reading
Responding to Covid-19 — A Once-in-a-Century Pandemic? NEJM, 2.28.20
Coronavirus Could Force Teams to Work Remotely. Harvard Business Review, 3.5.20