PhRMA threatens to withdraw support of health overhaul: MedCity Morning Read, Jan. 18, 2010

Highlights of the important and the interesting from the world of health care:

PhRMA threatens to pull support of health overhaul: PhRMA, the trade group representing big U.S. drugmakers, is threatening to pull its support of federal health overhaul in a dispute about patent protection of biotech drugs. The trade group secured 12 years of patent protection for biotech drugs in both the House and Senate versions of the legislation, but PhRMA now fears that the final bill could knock that number down a few years. Leading the charge to reduce the protection to seven years is Rep. Henry Waxman, D-Calif., and chairman of the House Energy and Commerce Committee. Most troubling to Big Pharm may be that Waxman looks to have President Obama’s support. The possibility of a reduction of Big Phama’s 12-year monopoly is obviously a big deal to the drugmakers: The longer they have protection, the longer generic drug makers would have to wait to be able to sell cheaper verions of the drugs in question.

If PhRMA does in fact reverse support for health overhaul, the question then becomes: So what? Would that really be enough to get some Democrats to change their votes, in what would amount to a rather naked giveway to Big Pharma, another example of putting profits before patients? Sadly, the answer may very well be “yes.”

FDA under industry’s thumb: Remember this any time you hear investors, lawyers, executives or anyone else remark how difficult it is for drug or device makers to get get anything approved by the FDA. Jim Dickinson, who edits an industry newsletter called FDAWebview that follows enforcement issues, says the “the pro-industry infiltration of FDA’s culture is firmly entrenched,” according to The HealthCare Blog. Dickinson should know. He’s been following the FDA since the Carter administration, according to the blog.

Dickinson says the shift in culture accelerated after the 1992 passage of the Prescription Drug User Fee Act, which made the agency dependent on industry funding. He concludes there’s nothing that Margaret Hamburg, the new commissioner, and Joshua Sharfstein, her deputy, can do about it.

Last year worst for VCs since 1993: Numbers from the National Venture Capital Association confirm what many of us probably suspected: Venture-capital fundraising plummeted last year. In terms of the number of funds raised, the numbers were the worst since 1993, and in terms of overall dollars, last year was the weakest since 2003, PE Week reports. VCs raised $15.2 billion for 120 funds last year, down from $28.5 billion for 223 funds in 2008. The largest overall fund in 2009 was New Enterprise Associates at $2.5 billion. The largest new fund of the year belonged to Andreessen Horowitz, at $300 million.

Of course, VCs are an optimistic bunch, and for once, at least, that optimism for 2010 seems well-founded. A number of firms that were scheduled to raise funds last year wisely took a step back and waited the year out. They likely won’t have that option this, so it’s a pretty fair bet that as the economy picks up, fundraising will too, making 2009 only an ugly memory.

The numbers behind health overhaul: The Washington Post puts some numbers behind the health overhaul in perspective. For example, its estimated cost of $900 billion is spread out over 10 years, yet that number still sounds pretty big. But is it really? Not so much, considering that total health spending in the U.S. last year was $2.3 trillion. The overhaul’s annual cost is just 4 percent of that, the Post estimates. When it comes to cost control, although that component of the overhaul has been talked up a lot, it’s the same story. ”The savings amounts to no more than a rounding error given the tens of trillions of dollars we’re going to spend over that period,” the Post says.