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To: Tom Johnson who wrote (7867)	10/17/2001 1:27:35 PM
From: Jim Merz	Read Replies (1) \| Respond to of 14101

Maybe I can offer a little insight into the "smart" drug topic. I work in employee benefits and one of the single most scrutinized aspects, over the last several years, is the ever increasing cost associated with the provision of prescription drugs. I just got back from a benefits conference that had some seminars around the genomic research and it's potential applications. My layman's take on this, is that smart drugs are going to stem from genomic research that will be able to target specific propensities to conditions. The smart drugs will be expensive to produce and have limited applications, ie, only applicable to specific conditions that can be traced to people with specific propensity for the ailment, so limited markets. Blockbuster drugs, like Viagara, have historically paid for research into these condition specific drugs. They are coming, maybe even arthritis focused but they are a long way out there. So the delivery system that DMX offers is still leading edge, in my opinion, especially as an arthritis sufferer...what I would like to do, is sample the stuff...how can I do that...Vancouver resident?

To: Tom Johnson who wrote (7867)	10/17/2001 4:15:44 PM
From: Jim Merz	Read Replies (1) \| Respond to of 14101

I'm trying a cut and past from an email, hope this works. What's Enbrel? Globe & Mail 17/10/01 By VIRGINIA GALT WORKPLACE REPORTER Wednesday, October 17, 2001 - Print Edition, Page B3 TORONTO -- Drug plan costs could double in the next five years as employers pick up the tab for a new generation of prescription drugs, some costing as much as $65,000 a year for each affected employee, says Toronto-based consulting firm William M. Mercer Ltd. Enbrel, for arthritis, costs $19,000 a year; Todmodal, for cancer, costs $37,000 a year; and Remicade, for Crohn's disease, costs $65,000 a year, benefits consultant Marg French told a meeting of employer representatives in Toronto yesterday. "When most employers introduced their drug plans, no one imagined prices of this magnitude. A single claim could be damaging to one company's program costs." Most employers do not want to alienate employees by imposing limits -- indeed, they believe they benefit from their investment in employees' health, she said. Nonetheless, drug plans that now account for roughly 2 per cent of payroll on average will account for 4 per cent of payroll within five years if costs are not contained, Ms. French said. Most expensive are the new breakthrough drugs that are generally the first of a kind to treat a particular illness or provide a substantial improvement from an existing product. However, these represent 5 per cent of new products entering the market. Roughly 52 per cent of the new drugs entering the market are "me too" drugs, often a slight modification to an existing product, but more costly. Another 42 per cent are reformulations of existing products, such as drugs modified with time-release aspects. "While the blockbuster drugs make the headlines, smaller but steady incremental rises in costs are hitting a lot more employer plans," Ms. French said. Employees often want, and doctors often prescribe, the newest drug on the market when a less costly alternative is just as effective, she said. "We have to develop a better perspective." Rather than imposing caps, more employers might consider listing the drugs that a plan will cover, substituting lower-cost generic drugs when there is no risk involved in doing so. For this they would need credible outside advice because, currently, the recommendations for new products come from the pharmaceutical manufacturers "who, naturally, have a vested interest in adding as many of their products as possible to the list," Ms. French said. Most employees do not realize that the outside firms hired to handle their company drug benefit plans are generally providing administrative services, she said, adding that employers pick up all of the drug costs, except in cases where they have co-payment arrangements with employees. William M. Mercer is now pushing the insurance industry to treat the high-cost drugs, such as Remicade, in a different manner than the more routine claims filed by most employees. "One approach to the high-amount claims might be an insurance arrangement whereby a group of employers not willing to take the risk of a high-amount claim would pool and pay a premium to a reinsurer to assume the risk," Ms. French said. "You could retreat from drug benefits altogether," she said. "But, to be realistic, employers have to be competitive and they need to keep employees on the job. Drug benefits are valued and they are a tax-effective way of protecting and rewarding a work force."