Long but important article from Biocentury this week. Worth the read.
Gone But Not Gone
By Steve Usdin
Washington Editor
President Bush’s decision to transfer one of his most talented and likeable players from heading FDA to leading
the Centers for Medicare & Medicaid Services reflects the
White House’s reelection goals more than its interest in
public health. However, the shift also promises to cement the importance of CMS to the biopharmaceuticals industry, and the increasing role it will play in stimulating
or inhibiting innovation. If he stays at CMS long enough, Mark McClellan could use the government’s role as the largest purchaser of healthcare products to advance some of
the goals he pursued at FDA: emphasizing the role of generic competition in containing overall drug costs while rejecting controls on the prices of new products; fighting the reimportation of drugs; and expanding the scope of the
government’s public health mission to include stimulating the creation of new therapies.
And just as he maintained strong ties to the White House from FDA’s headquarters — advising the president on
Medicare policy — McClellan will take with him the strong relationships he forged with the biopharmaceuticals industry. Going forward, the industry therefore
is likely to focus on the fate of McClellan’s initiatives on three fronts:
regulatory time to market, regulatory science and the economics of innovation.
In the first two cases, FDA’s management looks positioned
to stay the course. The agency reorganization announced
last week elevated the individuals most responsible
for formulating and implementing the policy changes that
McClellan has announced during his short tenure, making it more likely that the agency will stay on track.
In the latter case, McClellan is almost certain to find CMS a far bigger stage to showcase his ideas.
The political life The White House’s decision to shift
FDA Commissioner McClellan to CMS shouldn’t come as a surprise. President Bush, slipping in the polls and vulnerable to Democrats on domestic issues, is anxious
to wring maximum political advantage from the Medicare drug benefit it demanded from Congress last year.
To help sell the Medicare package to the voters in the months leading to the election in November, the president or his advisors have decided that the country
needs an attractive CMS head who gives great speeches and has bipartisan support. Apparently, the White House concluded that McClellan was the only— or best — person for the job, and that helping the campaign is more important than continuity at FDA.
McClellan will certainly be a striking contrast to his predecessor at CMS, Tom Scully, who brought an acerbic
style, arrogance and penchant for lobbing verbal grenades at opponents. The fact that the Bush White House primarily views FDA through a political prism may be disappointing to a biotech industry that enthusiastically embraced
McClellan after the years of leadership vacuum at the agency. But it also shouldn’t be surprising. One of the
administration’s first acts, taken on the eve of Bush’s inauguration, was to evict Jane Henney from her perch as FDA commissioner.
Suspicions that Henney was fired because she approved the RU-486 abortion pill, and not because the White House wanted a more dynamic commissioner, were reinforced by the decision to pass over Acting Commissioner Michael Friedman, who had the talent, but not the requisite political credentials, to lead the agency. The political machinations were reinforced by the almost two-year delay in appointing Henney’s replacement, a hiatus that pitted the White House against Sen. Edward Kennedy (D-Mass.), who
promised to block any nominee with industry credentials.
Despite this environment, McClellan has managed to dodge or deflect political controversy. When three Christian
conservatives who have publicly opposed contraception and abortion were appointed to the Reproductive Health
Drugs Advisory Committee, opponents’ outrage was directed at the White House, not McClellan. And just last week, McClellan deferred for 90 days the final approval decision for OTC marketing of Plan B, an emergency day-after contraceptive from Barr Laboratories Inc. (BRL, Pomona, N.Y.). It probably isn’t a coincidence that this means his fingerprints won’t be on a decision that, whichever
way it goes, will be highly controversial and is likely to be an issue in the campaign. “A” for effort
For the most part, biopharmaceutical CEOs have put McClellan on a pedestal because he speaks their language — the combination of medicine and economics that defines the industry — and because, unlike most of his predecessors,
he has been accessible.
The initiatives FDA has launched in
the past year target some of the industry’s most important and persistent complaints about the agency. These include
the lack of consistency in review policies among divisions and centers, gaming user fee deadlines by initiating multiple review cycles, and an outmoded, heavy-handed approach to current good manufacturing practice (cGMP) enforcement. McClellan also has launched efforts to build on FDA’s strengths, pressing for the development of guidance documents outlining approval pathways in collaboration with academic and medical groups, prioritizing the identification and validation of surrogate endpoints, and forging closer relationships
with NIH to help design and conduct post-marketing trials to foster accelerated approvals, especially of cancer
therapies. FDA also has started pilot programs
that are designed to make it more of a partner in the drug development process, and an innovative proposal for the
agency to collaborate with the biotech industry on the application of pharmacogenomics to drug development and
regulatory decision making.
It is true that some of the initiatives announced since McClellan’s November 2002 Senate confirmation were the
product of the 2002 reauthorization of the Prescription Drug Act, and thus were under development before he arrived
at the agency. FDA staff proposed others. McClellan’s key role as a change agent has been to select from menus of
policy options proposed by senior officials, and to instill a sense of urgency about their implementation. If he leaves a legacy at FDA, it will be changing FDA’s sense of its mission from protecting Americans to improving the nation’s health.
McClellan tried to expand the scope of FDA to fit his personal interests, especially to get it involved in thinking and policy formulation on pricing issues, both domestic and international. It is unlikely that this will stick. Neither Acting Commissioner Lester Crawford nor future commissioners are likely to have a passion for economic issues. But even if the attention to pricing
issues doesn’t stick, McClellan has made the agency much more conscious of the cost of R&D. Some career agency officials seem to have embraced the idea that imposing unnecessary costs can cause companies to abandon projects
that might have provided meaningful medical benefits.
On the other hand, there is a possible downside to McClellan’s use of FDA’s bully pulpit to lobby the rest of
the world to pay its fair share for innovative medicines. If the Democrats win in November, a commissioner favoring
reimportation will be able to point to McClellan’s precedent and some of his speeches asserting that pricing and access are public health goals appropriately in FDA’s purview as justification for opening the way to backdoor price controls.
New management structure It is also true that if the seeds planted at FDA over the last year are attractive, few if any have borne fruit. This now is in the hands of competent, if less flamboyant, senior managers. The management structure announced last week was clearly designed to maximize the chances that the McClellan-era initiatives are continued.
Crawford, a veterinarian and pharmacist, knows the agency and has been involved in planning and implementing most of the initiatives that have come out of the commissioner’s office since he served as acting commissioner for nine months prior to McClellan’s confirmation.
Indeed, before McClellan’s name emerged, Crawford was in line to get the top job at the agency. He was passed
over not because of antipathy toward him in the White House, but because HHS Secretary Tommy Thompson committed
the faux pas of publicly announcing that Crawford would get the job before President Bush signed off on the
decision. Despite initial skepticism in the biopharmaceuticals industry that Crawford’s expertise and interest were centered on ag and veterinary issues, he
took a step that arguably was as important to biotech as anything McClellan has undertaken. The transfer of most
therapeutic products from the Center for Biologics Evaluation and Research to the Center for Drug Evaluation and Research addressed the top complaint biotech companies had about FDA over the last decade: disparities between the
policies at the two centers, and a perception that CBER was slower and more erratic than CDER.
The CBER/CDER realignment demonstrated that Crawford took the “act” part of “acting commissioner” seriously,
and that he understands the agency’s politics. He announced the change as a fait accompli, robbing CBER’s leadership of the oxygen required to mount an effective counter-attack. Crawford also demonstrated that, although he took the industry’s concerns seriously, he made decisions independently. Industry didn’t suggest the reorganization, nor was it informed in advance. Crawford isn’t expected to give great speeches like McClellan, but that might not be so important for the day-to-day running of the agency. It is virtually certain that under Crawford, FDA will ontinue to meet its PDUFA deadlines,
perhaps its most important task from idustry’s perspective.
Under the new troika of acting deputy ommissioners, Janet Woodcock, who is highly respected as an effective manager,
will be deputy commissioner for operations, effectively the agency’s COO. In October 2003, Woodcock left her spot as director of CDER ostensibly for a six-month temporary assignment, to help McClellan with several initiatives
that cut across the centers. Her new position provides added authority to ensure the smooth execution of science-
based issues: an overhaul of cGMP regulations; the pharmacogenomics voluntary voluntary data submission program; follow- on biologics draft guidance; and a
new translational research program. As deputy commissioner for special programs, Murray Lumpkin will be responsible
for pediatrics and international programs.
Amit Sachdev, who has been responsible for FDA’s relations with Congress as senior associate commissioner for legislative affairs since September 2002, will become deputy commissioner for policy.
Scott Gottlieb has been promoted from senior advisor for medical technology to director of medical policy
development, with direct responsibility for coordinating the Office of the Commissioner’s policy initiatives with
CDER, CBER and the Center for Medical Devices and Radiological Health (CDRH).
The healthcare economist While the biotech industry may wish McClellan’s tenure at FDA had not been so short, it’s at CMS where his appetite for regulatory innovation ultimately may be more consequential to the industry. That is because Medicare provides a far bigger stage for McClellan to define the trade-offs between healthcare costs and the rewards needed to stimulate biomedical
innovation.
McClellan’s resume, which includes hands-on experience in creating the administration’s Medicare prescription drug proposals as a member of the Council of Economic Advisors, as well as academic research on healthcare economics,
makes him a logical choice for CMS administrator. The agency, suffering from chronic poor management and a wholesale defection of senior staff, and facing enormously
challenging deadlines to launch new Medicare prescription drug programs, clearly needs the kind of energetic management McClellan could provide.
In a memo to FDA staff last week, McClellan paid due heed to CMS’s mandate to quickly institute an interim drug
discount program under the new prescription drug law, and put in place the regulations required to implement the full
Medicare prescription drug benefit.
But he also made a more portentous comment by pledging to use the new law to develop “better evidence on safety and
effectiveness of medical treatments.” As an expert on the cost-benefit analysis of healthcare technologies,
McClellan is likely to take this opportunity seriously. He wrote several academic papers quantifying the savings to
the healthcare system from new technology. And in his regulatory role, he opposed Scully’s imposition of a “functional equivalence” standard to tie reimbursement for Amgen Inc.’s Aranesp darbepoetin alfa to Johnson & Johnson’s Procrit epoetin alpha.
Depending on how much time he has, McClellan thus could put into place a post-marketing regulatory framework that
will define the economic benefits of innovation. Time, of course, again is the big question. If Bush loses in November, there may not be room in the Democrats’ tent for a Bush family loyalist. If Bush wins, it’s widely considered likely that McClellan will take over the top job at HHS to replace the outgoing Thompson, who has wanted out of the post since the beginning.
At that point, with four more years, one can only imagine what McClellan might seek to accomplish sitting on top of
both FDA and CMS. |
