Archive for September 23rd, 2008

Congress to Scrutinize Device Ads

September 23rd, 2008 | No Comments | Source: Associated Press, NY Times

The Senate Committee on Aging will soon hold a hearing about direct-to-consumer ads for medical devices.

Herb Kohl (D-Wisc), Chairman of the committee, indicated the hearing was necessary to decide whether the FDA ought to ramp up its oversight of device promotions to match what it already does for drug ads. “The medical device industry is just beginning to get into the game,” he said.

DTC advertising for medical devices nearly doubled between 2005 and 2007, to approximately $193 million. This is peanuts compared to the $5 billion spent annually on prescription drug promotions, but some people believe medical device advertising can have a disproportionately large impact on consumers. Surgery is after all usually required to implant medical devices and the devices remain in situ for years.

Currently, TV promos for medical devices are not required to address risks and benefits as are those for pharmaceuticals.

Johnson & Johnson promotes its artificial hips with ads featuring iconic Duke basketball coach Mike Krzyzewski. The ad shows people jumping rope and surfing, among other things. In spots for its competing product, Biomet features former Olympic gold medalist Mary Lou Retton.


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Rotten Eggs, Rotten Tomatoes

September 23rd, 2008 | No Comments | Source: Wall Street Journal

When food prices surged this year, experts attributed the run up to increasing demand, higher energy costs and drought. It turns out there may be another explanation as well-rampant price fixing and collusion in the food industry.

Federal prosecutors announced yesterday that they have started separate criminal investigations of large egg producers and California tomato processors to determine whether such activities have occurred. The Feds recently also opened similar price fixing investigations in the dairy, fertilizer and citrus fruit industry.

The price of tomatoes rose 16% this year, nearly three times more than the overall rise in food prices. Domestic egg prices rose by 40% earlier this year after the 3 largest domestic egg producers began exporting small amounts of eggs to the Middle East and Europe.

It will be awhile if ever, before the Feds are ready to make their case. Even now though, analysts are predicting that the food industry will not deny allegations of price fixing but argue instead that their behavior is legal under obscure antitrust exemptions like the Capper-Volstead Act, which was promulgated in 1922 to help small farms negotiate with large food processors.



Health Spending Declines

September 23rd, 2008 | 1 Comment | Source: Wall Street Journal

Conventional wisdom is that the health care sector is recession-proof. That isn’t the case right now.

The number of prescriptions filled has fallen more than 2% in the last year for example, while overall physician office visits declined 1.2% and Ob-Gyn visits declined 6% during the same period. Nearly 22% of individuals responding to a survey by the National Association of Insurance Commissioners indicated that deteriorating family finances have caused them to use fewer health services in the last year.

Among uninsured Americans, drop-offs in health services utilization s are particularly dramatic. Quest Diagnostics, Inc. reports that there has been an 8% decline in lab testing for such people.

But those with health insurance are cutting back as well, probably because out-of-pocket expenses have grown dramatically in recent years. According to the Kaiser Family Foundation, average annual family plan deductibles are nearly $760 for HMOs and $3,600 for high-deductible plans. These figures are twice as high as they were 7 years ago.

Then there’s the cost of gasoline. For some, an 80 mile round trip to get blood sugars checked is simply out of the question even if the visit is covered.


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