Beware the Pitfalls of Misdirected Cost-Cutting

Makers of biologic therapies, such as disease-modifying treatments for MS, are in a fight to protect their patents from generic competitors. The upside of generic competition is lower costs for patients, but generics may not always provide the same benefits to patients that innovator products do. If this is the case with traditional formulations, imagine the margin for error in the complex and sensitive process of producing biologically-based products. Some neurologists insist that their epilepsy patients stick with branded formulations because they have witnessed first-hand the effects of break-through seizures attributed to generics. How many specialists want to risk break-through disease activity for a degenerative disease like MS?

Innovator products, especially biologics, are expensive for several reasons. Sure manufacturers/marketers seek to make money, but they also invest a wealth of resources into the discovery, development, testing, and approval of these agents. Those who look to generics as the cost-cutting solution to drug prices fail to look at the big picture. It's possible to cut drug costs by revamping the development approach, rethinking burdensome regulations, and streamlining approval processes and associated costs.

Neurologists know what it's like to be the focus of misdirected cost-cutting strategies, especially in the case of emergency hospital coverage (see our cover story on p. 26). Somewhere along the way, some hospitals decided that when it comes to emergency neurological services, specialists ought to donate their time and expertise whenever asked. Yet these same hospitals aren't typically donating their resources. The majority of patients who present to the hospital will rack up a significant bill from the facility. If a patient receives tPA for acute stroke, the hospital will charge for the drug and its administration, the associated hospital stay, required testing, ER staff and nursing staff, and any additional drugs administered to the patient while admitted. They'll even charge—directly or indirectly—for the neurologist's assessment of the patient.

Once payment comes in, the hospital pays for its drugs and supplies, puts the appropriate percentage toward payroll, and otherwise "distributes the wealth." Does it seem fair that in many locales, the neurologist won't receive to any remuneration for his/her time and expertise?

Neurologists don't have the lobbying power of pharmaceutical and biologic manufacturers/marketers. To the contrary, they have a tendency to be apolitical. But the stakes are high enough now that the specialty ought to come together on the issue of reimbursement for on-call coverage. Other specialties have organized and secured reimbursement for their time and expertise. It simply makes sense for neurologists to follow suit.