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hsa500_w8_c11.pptHealth Services Organization and Management
HSA 500
The Pharmaceutical Industry
Williams, S. J., & Torrens, P. R. (2008). Introduction to Health Services (7th ed.). New York: Cengage Delmar Learning.
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Welcome to Health Services Organization and Management.
In this lesson we will discuss the pharmaceutical industry.
Please go to the next slide.
Objectives
- Upon completion of this lesson, you will be able to:
- Explain the impact that policy, social and financial forces have on health care access and quality of care in the United States
- Explain the major components of the U.S. health care system, their functions, and the relationships among these components
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Upon completion of this lesson, you will be able to:
Explain the impact that policy, social and financial forces have on health care access and quality of care in the United States.
Explain the major components of the U.S. health care system, their functions, and the relationships among these components.
Please go to the next slide.
Pharmaceuticals and Health Promotion
- Pharmaceutical and health gains
- Biotechnology and pharmaceuticals
The 15 years between 1938 and 1953 have been known as the Age of Antibiotics as the result of the introduction of an unprecedented number of new anti- infective agents. More recently new medicines have generated 40 percent of the 2 year gain in life expectancy achieved in 52 countries between 1986 and 2000. Antibiotics and vaccines figured importantly in the near eradication of syphilis, diphtheria, whooping cough, polio, and measles.
More recently, attention has turned to the development of biotechnology medicines, using the products of molecular biology and genetics to develop and entirely new array of treatments that approach disease conditions in entirely different ways; the new treatments arise from a great expansion of our fundamental knowledge of what happens inside cells and how to alter disease processes from the inside. As many as sixty-three new biotechnological products are already on the market for treatment of many conditions previously considered untreatable in the past.
Please go to the next slide.
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Regulatory, Legal Issues and Drug testing
- Food and Drug Administration
- Preclinical safety assessment
- Preapproval safety assessment in humans
- Safety assessment during FDA review
- Postmarking safety surveillance
- Clinical studies
The United States Food and Drug Administration play the major role in regulatory and legal oversight of the pharmaceutical industry and in the development and sale of its products. Drug sponsors and the FDA share an overriding focus to ensure that medicines are safe and effective. More clinical are trials being conducted than ever before. As a result The FDA and the pharmaceutical industry follow scientific procedures to ensure safety in four distinct stages: -Preclinical safety assessment;-Preapproval safety assessment in humans;-Safety assessment during FDA review and -Postmarking safety surveillance.
Clinical studies in the development of new drugs and pharmaceuticals are conducted in three stages: Phase I. studies: drugs are evaluated for safety in health volunteers in small initial trials Phase II. studies: the efficacy of the drug is the focus of the second-stage studies which are conducted with patients, not with healthy volunteers. Phase III. studies: these large trials evaluate safety and efficacy in groups of patients with the disease to be treated-after the clinical trials are completed and the drug is approved for production and sale, strict regulatory supervision is exerted over drug labeling, advertising, promotional claims, comparisons and the like.
Please go to the next slide.
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Check Your Understanding
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Research and Development
- Research-based pharmaceutical
- Pharmaceutical Invention
Last year pharmaceutical research companies spent $33 billion on research to develop new and better medicines, a 7 percent increase from the previous year. Pharmaceutical manufactures invest a higher percentage in research and development than virtually any other industry. Approximately one-third of this total investment is devoted to evaluation of promising drug compounds in human clinical trials. On average it takes 10-15 years and costs more than $800 million (and up to $1.2 billon for a biologic) to advance a potential new medicine from a research idea to a treatment approved by the FDA.
Since 1990, pharmaceutical research company scientists have invented and developed more than 300 completely new medicines, vaccines, and biologics approved by the FDA to treat more than 150 conditions, ranging from infectious diseases to chronic diseases affecting millions of patients to those afflicting less than 200,000 people.
Please go to the next slide.
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Utilization of Drugs
- Access
- Pricing and Patent issues
Many Medicaid programs have instituted preferred drug list (PDLs), which specify the reimbursable medicines physicians can freely prescribe. Drugs not on the PDL are reimbursed only if a patient’s doctor first obtains special permission from the insurer to prescribe the drug (know as “prior authorization”). Although the intent of this mechanism is to control costs, the result has been less access to needed medicines for patients. Access restrictions are particularly onerous for low-income patients, who lack the resources to pay for innovative medicines out of pocket. Patient-focused disease management programs promote appropriate use of pharmaceuticals and medical resource utilization. In these programs, patients receive more intensive education, assistance, and monitoring in following a treatment plan tailored to their needs.
The way in which health care is delivered and paid for in the United States is undergoing, rapid, market-driven change, and the pharmaceutical industry is directly affected by it. The increasing trend toward managing drug benefits has spawned specialized companies called pharmacy benefits managers (PBMs), organizations that were virtually nonexistent before the late 1980s and that now provide managed-pharmacy benefits for approximately half the insured population in the United States. There are approximately 40 pharmacy benefits management companies in the United States today, but the top five companies account for more than 75% of the market. The ability for patients without insurance coverage to access medicines is essential to maintaining health. Pharmaceutical research companies employ a number of programs-discount cards, supporting clinics, donated medicines-to help patients gain access to the medicines they need. In 2003, an estimated 6.2 million patients received prescription medicines through these programs.
Please go to the next slide.
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Check Your Understanding
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Summary
- Pharmaceutical and health promotion
- Regulatory, Legal Issues and Drug testing
- Research and Development
- Utilization of Drugs
We have reached the end of this lesson. Let’s take a look at what we have covered.
Discussed first was pharmaceutical and health promotion. Antibiotics and vaccines figured importantly in the near eradication of syphilis, diphtheria, whooping cough, polio, and measles. As many as sixty-three new biotechnological products are already on the market for treatment of many conditions previously considered untreatable in the past.
Next we discussed regulatory, legal issues and drug testing. The United States Food and Drug Administration plays the major role in regulatory and legal oversight of the pharmaceutical industry and in the development and sale of its products. Drug sponsors and the FDA share an overriding focus to ensure that medicines are safe and effective. More clinical trials are being conducted than ever before.
Next we Research and development. Pharmaceutical manufactures invest a higher percentage in research and development than virtually any other industry. Approximately one-third of this total investment is devoted to evaluation of promising drug compounds in human clinical trials. Since 1990, pharmaceutical research company scientists have invented and developed more than 300 completely new medicines, vaccines, and biologics approved by the FDA to treat more than 150 conditions, ranging from infectious diseases to chronic diseases affecting millions of patients to those afflicting less than 200,000 people.
We concluded the lesson with utilization of drugs. Access restrictions are particularly onerous for low-income patients, who lack the resources to pay for innovative medicines out of pocket. Patient-focused disease management programs promote appropriate use of pharmaceuticals and medical resource utilization. In these programs, patients receive more intensive education, assistance, and monitoring in following a treatment plan tailored to their needs.
This concludes this lesson.
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