Monthly Archives: February 2011

Prediction: Pharmaceutical Litigation

Pharmaceutical litigation is where huge lawsuits are common. I predict that this will change and the change will reduce the damage to the bodies and lives of patients, reduce the cost of healthcare, and speed up the process of moving new medications from the laboratory to patients. What will cause that change?

Historically, the pharmaceutical manufacturers have been responsible for the collection, analysis and distribution of data related to benefits and side effects of new medications. Data collection has been an extra cost of doing business. Like all costs, there is pressure to minimize these costs. If, and when, publicly available data including anecdotal evidence begins to point at a serious problem, the plaintiff’s bar also begins to develop data about risks and damage.

The cost of data collection using today’s methods imposes economic limits on the amount of data gathered by manufacturers. Cost control argues for the smallest amount of data that will likely be required, but how much is that? The smaller the data sample the less likely it is that a risk will be identified early in the life of a new medication. If a risk is limited to just some patients, a small total sample makes it unlikely that a risk to a sub-set will be identified, e.g., males over 70. If the total sample is statistically small, a sub-set will be even smaller and less reliable as an indicator of both the need for action and as a guide to appropriate action.

The push by the federal government for healthcare providers to shift from paper records to electronic healthcare records (EHRs) has been seen as a potentially slow process. The common model assumes EHRs will be implemented first in hospitals and then spread to private practices because of two factors: first, the cost and complexity of the required computer systems, and second, the lack of the standards required to move meaningful data from system-to-system for consolidation and analysis.

The maturation of the Internet in terms of processing and security now means that data can be safely moved and stored. Cloud computing—remote data processing and storage—now allows service providers to grow new services rapidly without large up-front investments. The net result is a dramatic reduction in cost for the service provider and users, e.g. physicians. As an example, one company, Practice Fusion, provides a full function EHR to private practices totally free. Step one in the changes that are occurring is unexpected reductions in cost.

Hospitals generally have short term relationships with patients whereas private practices generally have longer term relationships. Private practices monitor more patients over longer periods of time than hospitals. Step two is a shift from hospitals first to private practices first for widespread implementation of EHRs which will provide better longitudinal data about the effectiveness and risks of new medications.

The original model for EHRs envisioned small libraries of patient data sitting on the hard drives in the offices of thousands of doctors. Solutions for the nightmares associated with moving and consolidating all of that data are still on the drawing boards. Rather than “stand-alone” systems, the Internet and cloud computing allow the use of a common set of databases and a single set of standards. As an example, Practice Fusion now has seven million patient records from 70,000 medical professionals in their database. That is nearly 10% of all of the doctors in the US and growing rapidly. The data from thousands of doctors is being monitored as it is received. The data is all in a common format and is available for analysis and reporting in near-real-time. Step three is the availability of large databases with one set of standards that dramatically reduce the time and cost required to convert data to useful information.

The data that was formerly collected by the manufacturers as an additional cost of doing business is now being collected as a routine part of patients’ visits to their healthcare providers. There is little or no extra cost to track a new medication. The data is being collected by nurses and doctors trained in diagnosis and documentation as a normal part of their medical practice. Step four is further lowering of costs; step five is better quality data.

The availability of more, better, and cheaper data at lower cost offers opportunities to reduce the risks associated with new medications and may allow regulatory agencies to approve new products with less research subject to close tracking and third party analysis of results. Lower cost of research and earlier to market could represent significant cost savings for new medications.

As a new medication enters the market feedback about its effectiveness and risks will begin to flow very shortly thereafter. Manufacturers who chose will be able to measure and document effectiveness and will also be able to identify risks. As the patient population using the medication grows, the sample being tracked will also grow. This means that that as risks become significantly large—however significance is determined—the data base will be growing to support both risk assessment and mitigation. Manufacturers, if they chose, will have new opportunities to minimize damage by providing additional information to the medical community and patients and to develop specific responses to specific problems. Timely action will reduce compensatory damages and responsible action will reduce punitive damages. Timely responsible action will reduce damage to the brand in the marketplace.

Manufacturers who chose not to participate in the analysis and application of this data will probably find that plaintiffs’ attorneys are using the data to find opportunities for litigation. The plaintiffs’ attorneys will probably argue that the reluctance of manufacturers to make effective use of the data justifies demands for increased punitive damages.

My prediction: more, better, faster, and cheaper data will speed up the process of moving new medications from the laboratory to patients, reduce the cost of healthcare, and reduce the damage to the bodies and lives of patients who have adverse reactions to new medications. Changes in the way that healthcare data is being collected, processed and stored will reduce both compensatory and punitive damages related to pharmaceutical litigation.

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