The problem is not that newer treatments never work. It is that once they become available, they are often used indiscriminately, in the absence of studies to determine which patients they will benefit...

Once the F.D.A. approves a test or device, Medicare rarely demands evidence that it benefits patients before agreeing to pay for it. But last year, Medicare officials raised questions about the benefits of CT heart scans and said it would demand more studies before paying for them. But after heavy lobbying by cardiologists, Medicare backed down.

One thing The Times fails to highlight is the factors driving the decision on behalf of the doctors. Not only will they be paid as a result of running the test, they're absolved of potential liability of not running the test. It was our experience in the Ortho world that MRIs and CTs were ordered "just to be safe," lest they be questioned on what could have been found in future malpractice proceedings.

Obviously, medical decisions should be based on statistically sound evidence, but there's a fundamental paradox to gathering sufficient evidence before reimbursement: who pays for all of those scans while the data's collected?

More from the New York Times...

For the well-insured, obtaining health care in the United States is like dining in a sumptuous restaurant that has menus without prices. A price-free menu encourages diners to ignore cost when making their selections. Similarly, well-insured patients usually don't know the prices of medical services at the time they receive them. Even for common procedures, few hospitals list their charges, much less the accompanying professional fees and the out-of-pocket costs; these are only revealed weeks or months later, when the explanation of benefits statement arrives.

Not a new concept or argument, but Garber does his best to back up the thesis...

By 2005, per capita expenditures were 92% greater than in Canada, 90% greater than in France, 95% greater than in Germany, and 135% greater than in the United Kingdom. Measures of population health have improved no more in the United States than in these countries, offering little comfort to those who presume that uniquely high expenditure is purchasing better health.

A point of contention with the previous paragraph would be the absence of a citation for that claim. It might be in one of the referenced articles, but a point so central to the argument should be cited right there.

As a non-MD member of the Medgadget staff, this Medgadgeteer is more involved with expanding the costs of healthcare with innovative new devices. While effective management of reimbursement is obviously critical to financial sustainability of any system, it does tend to dampen innovation. Innovative new devices are typically the product of small startup companies who don't have the funding to run years and years of cost-effectiveness studies to prove their product is better than the woeful status quo.

As fans/practitioners/creators of medical technology, we should be wary of (or offer alternatives to) solutions that could dramatically deflate the motivation to innovate.

...ok, he doesn't say that (even if it is true). The real analysis is as follows...

The medical device market is about 50 percent of the world pharmaceutical market in terms of relative size, but is also growing faster than its drug counterpart. It is dominated by U.S. companies (16 of the 25 companies are U.S.- based) with 72 percent of the revenue. MX estimates that the medical device market will reach sales of $336 billion in 2008. Assuming similar growth to that of 2007, this means that the market last was in excess of $300 billion.

According to MX, although the top 25 companies represent the lion's share of sales (almost 60 percent), there are an estimated 20,000 medical devices companies around the world. Only one company showed a decline (however slight) in growth, and two companies had flat sales. The remaining 22 companies all posted positive growth with 15 companies showing double-digit growth. Not mentioned, but with substantial sales and growth, are companies like Toshiba Medical Systems, Hitachi Medical Systems, and Gambro.

The medical device industry faces a number of challenges in addition to the technology convergence factor mentioned earlier. In general, this industry is at lower risk than its pharmaceutical/biotech drug counterpart for a couple of reasons:

• Shorter product development times (about 33 to 50 percent of drug development time).

• Less regulatory (Food and Drug Administration) approval risk.

Additional factors favoring the growth of this industry include the greater physician need for better and more precise diagnostics and imaging to guide them on patient disease status and proper disease management, whether surgical or pharmaceutical (or both).

There's more analysis of the challenges facing medical devices, with the biggest issue being reimbursement.

Snarky commentary aside, we would venture that medical device development does lend itself to more predictable product development cycles than pharma. Engineering project management and "gizmo" development is at least a century old, and medical devices are just a small subset of other devices, meaning there's tons of common knowledge regarding engineering project management. Drugs are a lot more of a biochemical craps-shoot, taking years of effort before you can even begin targeting production.

Full story: Global medical device market outperforms drug market growth...

Image credit: Wellcome images: Surgery by robot...

The latest blow came Wednesday when Valencia-based MannKind Corp.'s stock lost almost 60% of its value after pharmaceutical giant Pfizer Inc. said a study showed that its failed version of inhaled insulin might increase the risk of lung cancer.

After dropping much of this year, MannKind shares lost an additional $3.50 on Wednesday, closing at $2.35.

Mann remains undeterred. In an interview, the chief executive was upbeat about his company's drug Technosphere, which combines a concentrated insulin powder with an inhalation device the size of a deck of playing cards. It is superior to rivals' efforts and will be a blockbuster when it arrives on the market as early as 2010, he said...

Mann has invested $566 million in the company and is the controlling shareholder. He has agreed to lend it hundreds of millions more, raising his total stake to $916 million.

When you've got billions to spend (lose?), you can afford to be stubborn if the payoff for being right is tens of billions (as is easily the case with inhaled insulin). Of course, sometimes things just aren't meant to be.

Time will tell if this is one of those cases.

More from the LA Times and from MannKind Corp.

From the New York Times:

Wal-Mart has leased space to about 80 clinics in stores across the country, including the CheckUps clinics now closed. They are all operated by independent firms, including 13 by RediClinics, a unit of Steven Case's Revolution Health company, and two by hospital companies in Wisconsin and Florida.

While some of the Wal-Mart clinics are headed by doctors, most are run by nurse practitioners who are limited to providing routine medical care like giving flu shots or prescribing drugs for sore throats. Operators say their main clients are mothers with small children, and that about 30 percent do not have a family doctor.

Wal-Mart said it hoped the CheckUps clinics would not stay vacant for long.

From American Medical News:

Among Wal-Mart's first expansions will be in its home state of Arkansas, where St. Vincent Health System will own and operate four clinics in Little Rock scheduled to open in April.

At least half of the 400 new clinics will be opened through a deal with RediClinic, a chain owned by AOL co-founder Steve Case's Revolution Health. RediClinic will seek commitments from hospital systems as partners for Wal-Mart clinics, starting in Atlanta and Dallas. Hospitals could be contracted as strategic partners without an ownership stake. Or they might split a stake in the facility, such as RediClinic and Memorial Hermann do in 11 H-E-B grocery clinics in Houston.

More at the New York Times...

Read on at AMNews...

Hard working members of the trucking community will now find convenient medical services on their way thanks to Roadside Medical Clinics, a company based in Alpharetta, Ga. The company plans to introduce its chain of roadside clinics coast to coast, offering its services "in various subscription packages for an average of $15 to $30 a month," according to Bob Perry, Roadside Medical vice president, who is quoted in eTrucker.com.

Don't wait until you get home to get medical care. With Roadside Medical at Pilot Travel Centers, it's like we're a house call for truckers:

Minor Trauma Care

General Medical Care

Digestive Disorder Treatment

Sleep Disorder Screening

Respiratory Conditions

STD Testing & Treatment

Chest Pain & Heart Conditions

Chronic Care

Vaccinations

Muscular-Skeletal Diagnosis and Treatment

Medication Management

Head, Ear & Eye Conditions

Roadside Medical ...

(hat tip: Kevin, M.D.)

Read: For Mann and mankind ...

Analysts were forecasting blockbuster annual sales of $2bn (£1.01bn, E1.49bn) for the insulin spray. It delivered just $4m in the second quarter of 2007 - the first time Pfizer disclosed sales of the product.

In July, Pfizer launched a massive television and print ad campaign in the US to jump-start sales. Reducing the number of inhalers produced is a clear indication management are unsure their next campaign will have much impact on sales.

The cutbacks are spelt out in a report filed with the US Securities and Exchange Commission by West Pharmaceutical Services, the American drug technology firm that makes about 60% of the device.

It said: "We expect Pfizer's high inventory levels and slower-than-expected demand will affect our fourth-quarter 2007 and full-year 2008 sales levels. In coordination with our customer, Nektar, we have reduced production to one shift per day at our dedicated facility beginning in the third quarter of 2007."

Perhaps the diabetics feel self conscious pulling out what looks like a bong in the middle of a restaurant, and taking a hit.

More from The Business...

Exubera website ...

(via KevinMD, and PharmaGossip)

Now comes a stinging editorial from Regina E. Herzlinger, at the Washington Post, that everyone should read:

America's physicians are the most trusted and valuable resources in our health-care system. Yet doctors' professionalism and incomes have taken a terrible beating recently. The American Medical Association, which received $286 million in revenue last year to protect the profession, has served physicians poorly.

Physician incomes, when adjusted for inflation, declined 7 percent from 1995 to 2003, while those of professional and technical workers rose. But unlike other professionals -- lawyers, architects, authors and economists -- doctors' work is dictated by the policies of insurers and governments. Increasingly, independent physicians, accountable only to their patients and the Hippocratic oath, have been replaced by salaried doctors who are accountable to the hospitals or insurers that employ them...

You might expect that the AMA would fight the insurers, hospitals, government bureaucrats and ivory tower academics who have diminished physicians' incomes, besmirched their ethical reputations and compromised their professionalism -- but you would be wrong. No, instead, at its annual meeting last month, the AMA declared war on retail medical clinics, located in places such as CVS and Wal-Mart.

Read the whole thing, and consider joining some of us in quitting the AMA in protest, for the sake of our profession. Even if you are a medical student, with a free membership, make a statement by rejecting this organization with a great past but a questionable future.

(hat tip: Kevin, M.D.)

Flashbacks: Urgent Action Needed! ; How AMA and Other Societies Abrogate Their Responsibilities; American Medical Association: No Doctors Day Celebrations?

In the first quarter of this year, seed investors put $1.1 billion into such businesses, a quarterly record for the medical-device industry, and a 60 percent increase over the same period in 2006, according to the National Venture Capital Association, a trade group.

"The venture-capital-backed boom in medical devices has delivered extraordinary new technologies," said David Cassak, an editor at In Vivo, a monthly publication for the medical-device field. "There's virtually no sector of medical devices that hasn't been given a tremendous boost."

Medical investments are by nature high risk, and devices take time and millions of dollars to develop. They must also be tested for safety and usefulness and then receive regulatory approval. It is a business that generates sales of $15 billion to $20 billion a year, and the venture capitalists are betting on its expanding into new niches.

Part of the lure, analysts and executives said, is that medical devices feel like a smarter gamble than investing in computer technology, which has fallen out of favor with public-market investors. Interest by these investors is critical for venture capitalists who want to profit by selling shares of their start-ups on Nasdaq.

At the same time, venture capitalists and entrepreneurs who are attracted to life sciences are wary of investing in pharmaceuticals, which can typically take 10 years and cost several hundred million dollars to come to market. Devices typically can be developed in half the time and for much less.

For this Medgadgeteer, the cool thing about medical devices is the relatively linear path from recognizing a need to implementing technology to fix it. Consumer electronics have devolved into a melee of convenience features and silly trends. Pharma's development cycles are too expensive and risky...not to mention the work is tremendously boring.

More from Matt Richtel's New York Times Article...