Author: Jacob Goldstein

The owner of the Heart Attack Grill — home of the quadruple bypass burger pictured at right — is suing the owner of Heart Stoppers Sports Grill.

U.S.A.! U.S.A.! U.S.A.!

Heart Stoppers, in Delray Beach, Fla., opened a few weeks ago. Heart Attack Grill, in Chandler, Fla., has been around for years, according to the Phoenix New Times.

Here’s what the lawyer for the Heart Attack Grill guy told the South Florida Sun Sentinel:

Heart Attack Grill is the originator of the medically themed hamburger grill and restaurant. … It sells high-calorie food products and we have had very extensive media coverage, including numerous shows on the Travel Channel and the Food Network. In my mind, we are just as well known as McDonald’s.”

Just as well known, he says!

Apparently, the Heart Stoppers people were in talks to open a Heart Attack Grill franchise in South Florida, before they went their own way. But Heart Stoppers theme “is completely different,” the lawyer for the restaurant told the Sun Sentinel. “They didn’t steal the same trademarked Single Bypass, Double Bypass burger … .”

Photo: Ken Epstien, Heart Attack Grill; Hat Tip: WSJ Law Blog

In 2005, Illinois passed a law to cap noneconomic damages in medical malpractice suits. Today, the state’s Supreme Court struck down the law.

The court said the law that established caps — $500,000 in cases against doctors, and $1 million in cases against hospitals — violated the separation of powers clause in the state’s constitution.

Two previous laws imposing malpractice caps had previously been struck down by the state’s high court, the Chicago Tribune notes. State lawmakers had tried to narrow the law this time, to give it a better shot of withstanding judicial scrutiny, the Trib says. The court struck down the previous caps law in 1997.

“Without a cap on non-economic damages from 1997 to 2005, Chicago physicians saw their liability premiums increase an average of 10 to 12 percent each year,” the president of the AMA said in a statement today. “When the cap was reinstated in 2005, premiums for Chicago physicians stabilized and even began to shrink.”

Image: iStockphoto

GlaxoSmithKline is going to cut R&D and other expenses as part of an effort to lower costs. The company wouldn’t specify how many jobs will be lost.

But CEO Andrew Witty said that the figure in the U.K., where Glaxo is based, would likely be in the hundreds, Dow Jones Newswires reports.

The Times of London and the Financial Times reported a few days back that GSK was planning to cut 3,000 to 4,000 jobs.

In its fourth-quarter earnings release today, the company said it is proposing the “cessation of discovery research in selected areas including depression and pain,” and looking to establish a new unit for research into rare diseases.

The company says it plans to save an extra £500 million a year by 2012 by cutting from R&D as well as sales and administrative expenses, with 70% of the savings going to the bottom line and 30% being reinvested.

Just yesterday, Pfizer outlined plans to cut billions of dollars in annual research spending. And AstraZeneca said last week that it planned to cut 8,000 jobs.

The U.S. spent $2.472 trillion on health care last year, according to a paper out today in the journal Health Affairs. That’s $282 million an hour.

Health spending as a percent of GDP — a key metric that shows how much of all U.S. spending goes to health care — rose from 16.2% in 2008 to 17.3% in 2009, far higher than any other industrialized country. That’s the largest one-year increase since 1960, when the feds started closely tracking national health expenditures.

The figure went up so much because health spending continued to rise, even as the overall economy shrank. The aging population accounted for a small part of this rise, but two other factors were more important: rising prices and increasing use. Health-care prices rose by 3.2% in 2009, according to the Health Affairs paper, significantly faster than prices rose for the overall economy. Utilization, which includes both volume and intensity of health-care services, rose by 1.5%.

The share of health-care spending paid for by the government (through programs such as Medicare and Medicaid) is also rising, and is projected to cross the 50% threshold soon. A story in this morning’s WSJ looks at what the government’s rising share of health costs means for the health-care debate in Washington.

Photo: iStockphoto

Things are tough all over: Bristol-Myers Squibb is freezing employee salaries for the year.

A Health Blog tipster told us the word went out today. Health Blog colleague Jonathan Rockoff checked in with the company, and a spokeswoman confirmed:

the elimination of annual salary increases in 2010 for Bristol-Myers Squibb employees worldwide, except where these practices cannot be eliminated based on legal mandate or contractual obligation.

The freeze won’t affect bonuses, the company said.

Bristol said earlier this week that its sales rose by 6% in 2009. But the company’s biggest selling drug, Plavix, will face generic competition in the U.S. in 2012. The company has been shedding nonpharmaceutical assets, and has built up a $10 billion war chest it can use for acquisitions and licensing.

Photo: iStockphoto

Pfizer’s China strategy came up a few times today in the company’s earnings call with analysts.

In some ways, the approach sounds like pharma’s strategy in the U.S. a few years back, when the industry was swimming with sales reps and companies were aggressively wooing “key opinion leaders” — top physicians who could influence other docs.

Here’s how Ian Read, president of Pfizer’s drugs business, framed the Chinese market and Pfizer’s strategy in the country, according to a transcript from Thomson Reuters:

… in large part it is an out-of-pocket market, so brand loyalty and quality is really important. … our total portfolio is growing, and it is not as impacted as the United States or Europe is by [generic competition]. So this requires what I would call a traditional investment thesis, feet on the street, field force, relationships with physicians … invest with key opinion leaders

Last month, Pfizer said it planned to increase its sales force in China to 3,200, from about 2,300 now. That comes as the company makes some significant cuts to its total global workforce.

Plenty of drug makers are moving in this direction. Eli Lilly’s also hiring sales reps in China, and GlaxoSmithKline has been busy bulking up its sales force in “emerging and Asia Pacific markets,” according to the company’s CEO.

Dow Jones Newswires has more from Pfizer’s conference call.

Map: iStockphoto

Pfizer spent $2.8 billion on R&D in the fourth quarter of last year, according to today’s earnings announcement from the company. But R&D spending is about to fall pretty sharply, according to estimates from the company.

This is no surprise — the big spending in the fourth quarter was largely the result of the company’s acquisition of Wyeth, which closed on Oct. 15, and Pfizer has said cuts are on the way.

Still, the company’s numbers today include some specific R&D spending targets that are worth noting.

For 2010, Pfizer expects to spend between $9.1 and $9.6 billion on R&D, a bit less than some Wall Street analysts had expected, and well below the $11 billion in combined R&D spending from pre-merger Pfizer and Wyeth.

And the cuts will continue: Pfizer said it sees R&D spending falling to between $8 billion and $8.5 billion by 2012.

R&D cuts are common in the industry these days, as companies face the loss of patents on blockbuster drugs. Pfizer’s Lipitor, still the company’s best selling drug by a mile, is expected to face generic competition late next year.

Dow Jones Newswires has more on Pfizer’s earnings.

Photo: Associated Press

There’s been plenty of hand-waving in Washington about bringing generic versions of biotech drugs to market in this country. But rather than wait for all that to get worked out, Teva, the Israeli generics giant, went ahead and ran clinical trials on a biotech drug that’s a whole lot like Amgen’s Neupogen, a $900 million drug used to stimulate the growth of white blood cells.

The FDA has agreed to take a look at Teva’s application. But, as Dow Jones Newswires notes, Teva and Amgen are also duking it out in court, with Amgen arguing that the Teva drug infringes on an Amgen patent.

The case brings to mind the long, colorful court battle between Amgen and Roche over Roche’s Mircera, an anemia drug that a court ruled infringed on Amgen’s patents. Mircera never made it to market in this country.

Even if Teva’s Neupogen-like drug were to make it to the U.S. market, it would face some tough circumstances. For one thing, unlike traditional generics, it wouldn’t be substitutable — doctors would have to write a prescription for the Teva drug, Dow Jones Newswires notes. For another, Neupogen itself has been losing market share to Neulasta, Amgen’s longer-acting version of the drug.

Image: iStockphoto

Dan Vasella just gave up the CEO job at Novartis. Merck CEO Dick Clark will the company’s mandatory retirement age (65) next year. And since 2005, Pfizer, GlaxoSmithKline, Sanofi-Aventis, AstraZeneca and Eli Lilly have all found new CEOs, Dow Jones Newswires notes.

Robert Essner, who was Wyeth CEO from 2001 to 2007, gave the Newswires his take on the new generation of pharma chiefs: “The executives growing up in the industry now are doing so in an environment that is radically different than what I grew up in, in the ’80s and early ’90s,” he said. “It’s a much tougher environment. It’s in some ways a more punishing one, more cost-conscious and productivity-oriented.”

Merck hasn’t yet said who will replace Clark. Nor has Bristol-Myers Squibb said how long Jim Cornelius, 66, will be running the company. Two guys who might be in the running for those jobs, if the companies look outside for candidates: Fred Hassan and Bernard Poussot, the former chiefs of Schering-Plough and Wyeth, which got swallowed up in last year’s megamergers.

Loyal Health Blog readers may remember our Pharma CEO survival poll from a few years back. We asked you which pharma CEO would last the longest. More than 12,000 votes were cast; Abbott CEO Miles White edged out Genentech’s Art Levinson as the top vote getter. White is still CEO; Levinson left the CEO job after Roche bought the balance of Genentech.

Photo: iStockphoto

It’s been more than a decade since the Lancet published a study that looked at 12 children and suggested a possible link between autism and the vaccine for measles, mumps and rubella.

Today, the Lancet formally retracted the paper, a few days after a British panel said the lead author’s conduct was “irresponsible” and “misleading.”

In its retraction, the Lancet said the paper’s claim that the patients had been “consecutively referred” to physicians was false. Instead, blood was taken from children at a birthday party, and they were paid £5 each, according to the panel.

Also, the lead author received £50,000 in research funding from solicitors acting for parents who believed that their children had been harmed by MMR. But the author, Andrew Wakefield, didn’t disclose that funding as a potential conflict of interest, the Times of London notes.

“I am extremely disappointed by the outcome of today’s proceedings,” Wakefield said last week after the panel reached its conclusion, according to the Times. “The allegations against me and my colleagues are unfounded and unjust and I invite anyone to examine the contents of these proceedings and come to their own conclusions.” He didn’t immediately return a call from the WSJ today.

The question of whether autism spectrum disorders are linked to vaccines has largely been settled in the scientific community; “studies continue to show that vaccines are not associated with ASDs,” the CDC says.

Photo: iStockphoto

Medcare payments to doctors were supposed to fall by 21% at the start of this year, but Congress passed a last-minute, two-month patch to block the cuts. Now, a five-year patch could be on the way.

In the past several years, short-term patches of scheduled Medicare pay cuts to doctors — usually of one year — have become standard operating procedure. The AMA and the AARP want Congress to permanently repeal the payment formula that keeps calling for the cuts, but doing so would require Congress to confront some ugly truths about the budget — without the cuts, the nation will spend hundreds of billions more on Medicare over the next decade.

The Senate recently passed a pay-as-you-go law that would require balancing all new spending with tax increases or spending cuts. But, as the Hill noted yesterday, that legislation included a loophole of sorts: Congress can allocate an additional $82 billion for physician payments without having to find new sources of revenue or savings. That’s not enough to scrap the current payment system altogether, but it could be enough to block scheduled pay cuts for five years, the Hill says.

A bill to permanently block the cuts failed in the Senate last year, in large part because senators couldn’t figure out how to pay for it.

Photo: Associated Press

President Obama’s budget is still in the news this morning, and there’s plenty of interesting health stuff in there. But it’s worth pausing to note that the big drivers are mandatory spending on Medicare and Medicaid — huge, rapidly growing costs that are outside the purview of Obama’s (or any president’s) annual recommendations for discretionary spending.

Take a look at the table on pages 5-7 of this PDF, which explains Obama’s proposed funding of the Department of Health and Human Services.

Total discretionary outlays (funding for CDC, NIH, that sort of thing) are $82.8 billion. Sure, that’s a lot of money. But mandatory outlays for Medicare under existing law are $489.3 billion; the figure for Medicaid is $264.5 billion.

Under current law, spending on Medicare and Medicaid is set to rise by $58 billion between 2010 and 2011. Throw in the extra $25.3 billion in Medicaid funding proposed by the president, and just the year-over-year growth for Medicare and Medicaid is comparable to all of the HHS discretionary spending combined.

Photo: iStockphoto

Boston Scientific said today that it will pay Johnson & Johnson $1.7 billion (with a “b”!) to settle some longstanding patent disputes over stents.

One interesting way to put that number in context: J&J’s total sales of drug-eluting stents last year amounted to $919 million, according to this SEC filing. We haven’t seen full-year figures for Boston-Scientific, but the company reported $411 million in world-wide sales of drug-eluting stents in the third quarter.

The stent world has been working through lots of patent-infringement issues — Boston Scientific and J&J announced a separate, $716 million settlement last fall, and Medtronic last year agreed to pay Abbott $400 million to settle their patent battles.

Today’s settlement isn’t the end of it. As Dow Jones Newswires notes, litigation between the companies continues a lawsuit regarding Boston Scientific’s Promus-brand stents — the same stents that are sold by Abbott under the brand-name Xience.

Photo: iStockphoto

President Obama’s new budget isn’t due out until later today, but there’s already a bunch of coverage looking at what’s coming. Here are a few things to expect on health spending:

The budget includes an extra $25 billion in Medicaid funding for states, the WSJ reports. States share the cost of Medicaid with the feds; the budget includes a six-month extension of the Medicaid funding increase that was part of last year’s stimulus bill. Many states had planned on receiving extra Medicaid funding from the Dems’ big health-care bill, but the future of that legislation has been murky since the Democrats lost their supermajority in the Senate.

Funding for the Department of Health and Human Services will increase “in the range of inflation or less,” according to Politico. But NIH funding would grow by about $1 billion, or 3%. Community health centers, Head Start and a teen pregnancy program would also see increases, Politico says.

On global health, the budget will “devote new funding to reducing deaths from complications related to pregnancy or childbirth, poor nutrition and common treatable illnesses that kill millions every year, particularly women and children,” the WSJ says. The budget will continue to fund global AIDS programs, but will try to allow more integration of health-care programs, so patients don’t have to go to one clinic for HIV treatments and another for, say, prenatal care.

Of course, the big health-care spending is locked in by core funding of Medicare and Medicaid. The Senate recently voted against creating a bipartisan commission that would look at funding for Medicare, Medicaid and Social Security as part of a broader effort to rein in the deficit. But Obama is still pushing for such a commission.

Photo: Associated Press

The cuts keep coming from U.K. pharma. Just a few days after AstraZeneca said it would eliminate thousands of jobs, the London papers reported this weekend that GlaxoSmithKline is about to announce some big cuts of its own.

The Times of London said Glaxo will cut “up to 4,000″ jobs; the Financial Times put the figure at “more than 3,000.”

The cuts — which the FT says will include will include “manufacturing, sales, administration and research staff” — are expected to be announced on Thursday, when Glaxo reports annual results. The move is part of the company’s continuing strategy to diversify beyond its core pharma business in Western markets with a push into other business lines and other regions.

Glaxo CEO Andrew Witty touted this shift last fall, when the company reported its third-quarter results. Witty said the company had cut more than 2,000 sales staff in established Western markets and added a comparable number of sales staff in emerging Asia Pacific markets. “We are reallocating resources to go for growth,” he said.

This sort of thing isn’t just happening in the U.K. Giants in the U.S., including Pfizer, Eli Lilly, Johnson & Johnson and Merck, are making cuts as well, particularly in largely stagnant established markets in the U.S. and Western Europe.

External fixators — like the rig pictured at right — can work wonders for fractures.

But in post-earthquake Haiti, a fixator can also be a liability. A few days ago, a patient showed up at a field hospital near the Port-au-Prince airport with an advanced infection around the pin sites in a fixator in his leg. The leg had to be amputated at the knee.

The patient had received the fixator at another facility. Cases like that one are why the field hospital hasn’t been discharging its post-op patients with fixators, said David Pitcher, a University of Miami orthopedic surgeon who is working at the hospital.

“We’re not going to drop these people with external fixators and have them walking aroud Port-au-Prince with metal sticking out of them for three months — that metal gets infected,” Pitcher told us in a phone interview this afternoon. “We don’t see the possibility of saying, ‘Go home.’ To what home?”

There’s a trade-off, though: Keeping the post-op patients at the hospital means the doctors there can’t treat as many new patients. Ultimately, Pitcher said, they hope to set up a rehab facility that can be run by local staff.

More on health in Haiti: The WSJ describes the effort to rebuild an AIDS clinic that has been a central pillar in Haiti’s health-care system.

Photo: iStockphoto

Because they can.

Some Massachusetts hospitals charge private insurers twice as much as other hospitals. It’s not because they deliver higher quality care or treat sicker patients. It’s not because they treat a different mix of uninsured, Medicare, Medicaid and private-insurance patients.

It’s because they have market leverage and can negotiate higher prices in their contracts with insurance companies.

That’s the finding of a report out today from the office of Massachusetts AG Martha Coakley. (The report was in the works long before the recent special election that made Coakley a national figure, by the way.)

Health-care prices are notoriously opaque for patients; list prices are basically irrelevant, and hospitals negotiate deals with insurance companies. A little more than a year ago, the Boston Globe reported that the way one large group of doctors and hospitals was getting paid far more than other providers in the same area.

Today’s report from the AG’s office found that hospitals gain leverage in negotiations with insurers because of …

variables such as: size, geographic location, ‘brand name,’ and/or niche or specialty service lines offered. Providers use leverage strategically to obtain higher payment rates and more favorable contract provisions.

The report also found that:

Price variations are not correlated to (1) quality of care, (2) the sickness or complexity of the population being served, (3) the extent to which a provider is responsible for caring for a large portion of patients on Medicare or Medicaid, or (4) whether a provider is an academic teaching or research facility. Moreover, (5) price variations are not adequately explained by differences in hospital costs of delivering similar services at similar facilities.

Among other things, the report recommends increasing transparency by publishing the total medical expenses for all providers.

We called and emailed the Massachusetts Hospital Association to ask for their take, but they did not immediately respond. We’ll update this post when we hear back from them.

Photo: iStockphoto

Bill Gates, whom you may know as the author of a popular Twitter feed, said today that his foundation would spend $10 billion on vaccine delivery and R&D over the next 10 years.

Even for a $34 billion foundation, that’s a big chunk of money. “Because of the impact we’re seeing from vaccines we’ll actually spend a higher percentage on vaccines,” Gates told the WSJ.

Gates devoted a chunk of his annual letter, published earlier this week, to vaccines; one of the projects he mentioned struck us as particularly interesting.

It’s called an advance market commitment — basically, a promise to help buy a vaccine that meets certain criteria. The Gates Foundation, along with a handful of governments and NGOs, last year promised $1.5 billion for a pneumococcal vaccine for poor countries. Pneumococcal diseases cause meningitis and pneumonia, and kill some 800,000 children every year.

To claim a share of the money, manufacturers have to commit to sell vaccine for $7 per dose — an order of magnitude less than the current price for the vaccine in the developed world.

“We expect that manufacturers will commit to building factories much earlier than they would otherwise in order to compete for this money,” Gates wrote in his letter this week. “During 2010 the negotiations with manufacturers should come to a conclusion. We believe this will make a big difference in how quickly this vaccine gets to poor children and show how this approach can be applied to other medicines.”

Photo: Associated Press

The magnet in “magnetic resonance imaging” is no joke: A patient on a metal gurney got sucked into an MRI with so much force her leg and foot were fractured.

We saw a brief mention of the incident in the L.A. Times, and it piqued our curiosity about this sort of thing. Hospitals are pretty good about keeping metal away from MRIs, but a post on the MRI Metal Detector Blog pointed us to some reports in an FDA database that describe some nasty stuff. A few gory details:

A pair of scissors flew out of an attendant’s pocket and into the MRI technician’s head. They had to be surgically removed.

Somebody moved a flat-screen monitor into the vicinity of an MRI. It got sucked into the machine and hit a research volunteer in the face, causing serious injuries that required surgery.

A patient had a knife strapped to his ankle. The knife got sucked out of its sheath and cut the patient in the abdomen, requiring stitches. Before he was taken to the MRI, the patient was screened for objects that would be attracted to the magnet. He reportedly “stated that his pockets were empty.”

Bonus Scan: The metal-object-sucked-into-the-MRI trope also showed up on TV, in season 15 of ER.

Photo: Associated Press

Correction: An earlier version of this post used the incorrect phrase “magnetic resistance imaging.”

More than 350 people who were hurt in the Haiti earthquake were evacuated to hospitals in South Florida.

The U.S. military is still evacuating some people for medical treatment, but now they’re being waved off from South Florida and sent farther north — in part to make sure emergency rooms in and around Miami are ready to handle additional traffic that could come from Super Bowl crowds.

An Army major told the Miami Herald that Haitian evacuees are being “diverted elsewhere … because of the rising numbers of evacuees and the need for the region to be prepared for upcoming events such as might result from the large crowds at the Pro Bowl and Super Bowl.”

As of Wednesday, 136 Haiti evacuees were still hospitalized in Broward, Palm Beach and Miami-Dade counties, the Herald said. Many patients will require long-term rehabilitation after they are out of critical care, and it’s unclear where they might get that care. “We hope they will have some place to go back home,” a top dean at the University of Miami Medical School told the Herald.

Some of the injured have been evacuated from Haiti to Tampa this week; Florida Gov. Charlie Crist has asked the feds to activate a national system that would route Haitian evacuees to hospitals in other states.

Photo: Associated Press