On of the nation’s largest insurance companies, Aetna, Inc. changed its reimbursement guidelines this month for ESA treatments for Amgen’s Epogen and Aranesp, following Medicare’s example. Analysts say that it is likely that other insurance companies will follow Medicare and Aetna’s example. Over the summer Blue Shield of CA changed its reimbursement guidelines, but had to reverse those changes shortly thereafter following complaints from doctors and others. However, Aetna has made it clear that it does not plan on rescinding its decision; even though the guidelines are more restrictive than they previously were, they are still not as severe as those adopted by Medicare.

“Aetna Changes Reimbursement Policy on Two Amgen Drugs”

Amgen, Inc., manufacturer of ESAs Epogen and Aranesp which help to treat chemotherapy-induced anemia in cancer patients by reducing the need for risky blood transfusions, has begun to lay off workers as part of its company restructuring in the wake of all the scrutiny that its top drugs have been under in 2007 after studies have shown that their over prescribing has led to heart attacks, strokes, blood clots, and premature death. Amgen, which employs over 20,000 workers worldwide, announced in August that it would have to cut 12-14% of its total workforce—roughly 2,600 jobs. Involuntary layoffs have begun in several locations: 675 of the 8,200 workers in Thousand Oaks, CA; 50 of the 1,100 workers in Bothell and Seattle, WA; and 23 of the 1,250 workers in Longmont and Boulder, CO. In addition to involuntary layoffs, roughly 700 workers worldwide accepted voluntary buyouts. Severance packages for laid off workers include cash (a minimum amount of 24 weeks of pay), company-paid health insurance through the end of 2008, and career transition services which offer workshops, a job bank and job fairs. A number of companies have expressed interest to Amgen in hiring laid off workers who have a certain level of expertise in their field.

The Thousand Oaks, CA location is Amgen’s headquarters and it, along with offices in Rhode Island, bore the brunt of the 1,500 layoffs.

In Washington, not only have workers started getting laid off, but plans for facility expansion have been postponed; just last year plans for expansion were underway, which could have doubled the workforce in WA, but the company has felt grave effects of the scrutiny over the ESAs.

Ventura County Star: “Layoffs at Amgen Begin”

Seattle Post-Intelligencer: “Amgen Lays Off 50 in Seattle, Bothell”

The Denver Post: “Amgen Lays Off 23 Colo. Workers”

Amgen and Johnson & Johnson continue to lobby in Washington to get Medicare’s strict reimbursement guidelines overturned. The companies—manufacturers of the anemia treating erythropoiesis-stimulating agents (ESAs) Epogen and Aranesp, and Procrit, respectively—have been trying to get Medicare’s guidelines overturned since they feel that the guidelines restrict doctors’ ability to provide adequate care to cancer patients who suffer from chemotherapy-induced anemia. According to the Medicare guidelines, ESA treatment coverage begins with patients whose hemoglobin (red blood cell) levels fall below 10 g/dL, since studies have shown that treatment at higher hemoglobin levels increases patients’ risk of heart attack, stroke, blood clots, and even death.

In early September the US Senate passed a non binding resolution calling on Medicare to reconsider its strict reimbursement guidelines. Since that time, California Democratic Rep. Anna Eshoo and Michigan Republican Rep. Mike Rogers introduced a “resolution of disapproval” that, if passed by both Congressional houses and signed by the President, would force Medicare to reverse its reimbursement policy. The Eshoo-Rogers resolution is a “Congressional Review Act joint resolution…that allows Congress to overturn regulatory decisions made by federal agencies.” Unlike the Senate’s non binding resolution, this resolution would be binding on Medicare. However, sources say that it is unlikely that such a resolution will be passed, and Rep. Rogers was quoted as saying that even though he will continue to push the bill, he and his colleagues are hoping that their efforts will “encourage CMS to reconsider it’s policy without legislation.”

Proponents of the bill, including the American Society of Clinical Oncology (ASCO), the American Society of Hematology, and cancer treatment center companies such as US Oncology, argue that CMS’s guidelines are completely baseless as they are not supported by scientific evidence. Being the case, they argue that such restrictive guidelines impose upon doctors’ ability to provide adequate care to cancer patients, which jeopardizes patients’ health. One subsidiary of J&J, Ortho Biotech, said that CMS is “disregarding substantial scientific evidence and setting ‘a serious policy precedent of inferior coverage of cancer treatments of Medicare beneficiaries.’” Amgen further claims “the policy ‘undermines clinical judgment,’ could mean more blood transfusions, and ‘effectively removes physicians’ ability to make decisions.’”

Medicare has rebutted these claims with the contention that its guidelines regulating ESA reimbursements for cancer patients is “based on the best science to date and is consistent with FDA labelling and warnings.” The FDA has backed Medicare on this last statement, finding that the guidelines are consistent with prescribing information for ESA use.

Associate Press (in Forbes): “Lawmakers Pursue Anemia Drug Long Shot”

The Hill: “Lawmakers Seek to Aid Anemia-Drug Producers in Dispute With Medicare”

The Star-Ledger: “Fed Up Allies Take On Medicare”

The European Medicines Agency’s Committee for Medicinal Products for Human Use has proposed that certain anemia drugs—including Amgen’s Epogen and Araresp and Johnson & Johnson’s Procrit—receive amended prescribing guidelines. The proposed restrictions are less severe than US restrictions: previous guidelines allowed for coverage of ESA treatments when patients’ hemoglobin levels fall between 11-14 g/dL; however the proposed new guidelines allow for coverage to begin when hemoglobin levels fall below 12 g/dL—or in the 10-12 g/dL range—which is more conservative than the 10g/dL that is required in the US. Also, the committee has proposed that a special warning be placed on the label explaining that “clinical trials have shown an unexplained increase in death when hemoglobin levels rise higher than 12 [g/dL].” Another proposed warning concerns the fact that the ESAs have not been proven to “improve the overall survival or risk of tumor progression in patients.”

The committee and drug manufacturers are still discussing the amendments and it is expected that final prescribing information will be available in early 2008.

Reuters: “Europeans to Tighten Guidelines on Anemia Drugs”

CNNMoney.com: “EU May Amend Aranesp Label”

Los Angeles Business Journal: “European Panel Mulling Drug Warnings”

Los Angeles Times: “EU May Warn on Drugs for Anemia”

Pharmaceutical Business Review: “EU to Consider Greater Warnings for Anemia Drugs”

According to Reuters, CMS (the Centers for Medicare and Medicaid Services) sent a letter to doctors and others who were trying to pressure it into reviewing its newly revised strict reimbursement guidelines for Amgen’s Aranesp and Epogen and Johnson & Johnson’s Procrit used to treat chemotherapy-induced anemia in cancer patients, which stated firmly that in the absence of scientific evidence to the contrary, it felt that its new reimbursement guidelines for ESAs are in the best interest of the patients and founded upon the results of clinical studies. Amgen, along with a coalition of doctors, organizations and health centers, contends that the new reimbursement guidelines compromise the quality of care that doctors can offer their patients. Arguing that CMS’s guidelines have no scientific basis, opponents claim that the guidelines could in fact hurt patients by making hemoglobin levels to drop to dangerously low levels before allowing treatment coverage. CMS denies the claims made by the opposition and says that unless it gets some questions answered within the next 30 days, its reimbursement guidelines will remain as they are. Two specific questions that CMS wants answered are: (1) is it a requirement that chemotherapy patients’ hemoglobin levels are above 10g/dL? and (2) is ESA treatment a superior alternative to blood transfusions in order to maintain the 10g/dL level?

As it stands now, CMS will only cover ESA treatment for cancer patients who suffer from chemotherapy-induced anemia when those patients’ hemoglobin (red blood cell) level is below 10g/dL because studies have shown that treatment at higher hemoglobin levels can increase the patients’ chances of suffering heart attacks, stroke, and premature death. Until new evidence is introduced to CMS, these guidelines will remain in place not only for cancer patients but also for those undergoing kidney dialysis treatment, of which it maintains similar reimbursement guidelines for ESA treatments.

Opponents to the CMS guidelines include doctors, the American Society for Clincial Oncology (ASCO), the American Society of Hematology, US Oncology (cancer treatment center company), and other for-profit cancer and kidney treatment centers.

Reuters: “Medicare Seeks Evidence to Support Anemia Change”

Boston.com: “Medicare Unlikely to Reverse Cuts in Anemia Drug Payments”

Los Angeles Times: “Medicare to Keep Limits on Anemia Drugs”

“Medicare to Stand by Limits on Anemia Drugs Unless ‘New Evidence’ Is Submitted”

CNBC: “Medicare: We Want Proof On Anemia Drugs”

On September 11, 2007 the U.S. Food and Drug Administration heard from an advisory panel of 19 on the question of whether or not to limit the hemoglobin (red blood cell) level of kidney-failure patients (both those who are and who are not undergoing dialysis) to not exceed 11 grams per deciliter [g/dL]. In a 14 to 5 split, the panel voted against setting a specific target level of 11 g/dL, stating that it was uncomfortable with setting a specific target in the absence of evidence proving that a level of 11 g/dL was safer than 12 g/dL. The panel explained that it was more in favor of leaving it up to the doctor’s discretion about how to treat each individual patient, and felt more comfortable with advising the FDA that a range of 10-12 g/dL was more appropriate since doctors could treat patients up to 12 g/dL (even though 9 out of 19 panelists were in favor of an 11-11.5 g/dL maximum).

The panel’s implied target range is exactly the range that Amgen and Johnson & Johnson had hoped for. The two drug companies manufacture and market ESAs to treat kidney disease and cancer patients suffering from anemia. Amgen’s Epogen is used to treat most of the 350,000 U.S. kidney disease patients undergoing dialysis, while it’s Aranesp along with J&J’s Procrit are used to treat cancer patients as well as most of the 250,000 kidney disease patients who are not undergoing dialysis. For patients undergoing treatment with these ESAs, proper hemoglobin levels are vital to maintaining their health. Studies—for example the Normal Hematocrit Cardiac Trial and the Correction of Hemoglobin and Outcomes in Renal Insufficiency (CHOIR)—have shown that improper ESA dosages can increase hemoglobin levels in excess of 13 g/dL which has lead to death, heart attacks, strokes, heart failure and blood clots in patients. However, if prescribed properly, the ESAs can help patients maintain suitable hemoglobin levels which eliminate the need for risky and inconvenient blood transfusions. From these studies, the FDA has determined that 11 g/dL would be a proper hemoglobin level. Panelists, however, are reluctant to set an 11 g/dL target level because of testimony that it heard explaining that setting too high a limit could cause some patients to go under treated, which could result in their suffering from debilitating anemia or more blood transfusions.

Amgen and J&J are working together with the FDA to reach a consensus on which hemoglobin level (or range) is appropriate to place on new warning labels. The health risks that have come to light in the past few months have prompted the FDA to make changes on warning labels and, in determining which level should appear on the label, the FDA called this panel. Even though the FDA is not required to follow the advice of its panels, it generally does so. This could mean that a 10-12 g/dL range could be adopted by the FDA for its warning labels, which could affect both the way that doctors prescribe the ESAs as well as how the U.S. Medicare Insurance program reimburses the drugs. The Centers for Medicare & Medicaid Services has recently revised its reimbursement guidelines, which some private insurers are likely to follow. A change to the levels on warning labels could affect these guidelines.

Click the following links to read the full version of articles that contributed to this posting:

Associated Press (in Forbes): “FDA Panel: Widen Target for Anemia Drugs”

The Boston Globe: “Panel Says Anemia Drug Doses OK As Is”

Reuters: “Amgen Defends Anemia Drugs Before U.S. Panel”

AHC Media LLC: “FDA Panel Vote on Anemia Drugs Gets Mixed Reviews”

“Amgen and Ortho Biotech Breathe Collective Sigh of Relief After FDA Panel Vote”

“FDA Panel Votes Against Anemia Drug Restrictions”

Reuters: “US Panel Rejects Anemia Drug Limit in Non-Dialysis”

“FDA Hemoglobin Target for Amgen, J&J Anemia Drugs Too Narrow”

Reuters: “US Advisers Against Anemia Drug Restrictions”

The New York Times: “F.D.A. Advisory Panel Opposes Curb on Anemia Drugs”

The Wall Street Journal: “FDA Panel Vote Is a Win for Amgen, J&J”

The following are related articles:

“Amgen Bulls Running Wild”

Los Angeles Business Journal: “Panel Says Anemia Drug Dosage OK”

Reuters reports that the U.S. Senate has joined in the battle over CMS guidelines and how they are affecting both Amgen and the doctors that Amgen reimburses. On Tuesday, September 4, 2007, the U.S. Senate “passed a nonbinding resolution urging [CMS] to immediately reconsider payment limits for use of anemia drugs by elderly and disabled people with cancer. This move by the government positively affects Amgen and its shareholders as its shares have recently risen. Amgen continues to step up its lobbying efforts with the help of U.S. cancer doctors. Bear in mind, however, what reconsideration of the guidelines could mean for the patients who will be affected by the drugs.

Reuters: “Amgen Shares Up As Lawmakers Enter Anemia Drug Row”

Related Articles:

CNNMoney.com: “Amgen Stock Rises on Senate Move”

Los Angeles Times: “Senators Aid Amgen’s Claim with Medicare”

An article published in Forbes discusses the findings of studies confirming that the anemia drug epoetin alfa (Amgen’s Eopgen and J&J’s Procrit) does not, in fact, decrease the need for blood transfusions. The anemia drug is made as a substitute for blood transfusions, as it is supposed to increase the body’s red blood cell level. However, studies by Dartmouth-Hitchcock Medical Center (NH) and Texas A&M Health Science Center College of Medicine resulted in the following findings: “we didn’t reduce blood transfusions, although [epoetin alfa] still increased hemoglobin levels” and in “medical and surgical non-trauma patients, it did not improve survival.”

The studies consisted of 1,460 medical, surgical and trauma patients after 48-96 hours of being admitted to the ICU. Half of the patients received epoetin alfa, while the other half received a placebo, for three weeks and researchers followed their conditions for 140 days. In terms of blood transfusions, there was no difference in the number of blood transfusions needed among the group that received the placebo in comparison to the group that received the epoetin alfa, nor was there a difference in the number of red-cell units that were transfused.

The only difference was in the number of deaths: there were fewer deaths among trauma patients in the group that received the epoetin alfa, however, researchers are looking at other beneficial mechanisms as the cause of this than the stimulation of red blood cells. Researchers say that the drug has “other effects in addition to making blood cells” and they feel that one of these other affects is what is the cause of the decreased mortality rate among trauma patients.

[Study findings are published in the Sept. 6 New England Journal of Medicine]

Forbes: “Controversial Anemia Drug Doesn’t Cut Need for Transfusions”

Related Article:

“Results from Study Evaluating Procrit in Intensive Care Unit Patients Published in New England Journal of Medicine”

Reuters: “Blood-Buster Helps Critically Ill Patients: Study”

The Huffington Post reported that the House version of the children’s heath insurance bill is being used to profit big drug companies while putting patients at unnecessary health risks. The Bush administration has expressed its opposition to expanding the program but it has not stopped earmarks from funneling hundreds of millions of dollars to special interests, including the “Quality Incentive Payments in the End Stage Renal Disease Program.” Over the next three years $300 million will be earmarked to clinics treating patients with kidney disease and kidney failure so long as the clinics can raise at least 92% of patients’ hemoglobin levels to 11g/dL or higher. The incentive for more ESA use comes at a greater cost to patients: for patients with hemoglobin levels of 12g/dL or higher, ESA use can result in increased heart attacks and premature death.

The bill was passed even after the FDA issued its black-box warning on Amgen’s Epogen and Aranesp as well as Johnson & Johnson’s Procrit. Further scrutiny of the ESAs can be seen in the numerous studies administered to investigate the health risks to patients as well as the Center for Medicare and Medicaid Services’ revisions of their insurance coverage for such patients. In spite of these warnings, the bill was passed essentially because of Amgen’s lobbying efforts on Capitol Hill. Amgen has spent over $10.2 million in recent years for its lobbyists to spread the word on Capitol Hill that studies have shown an increased energy and overall feeling of patients with higher hemoglobin levels. Armed with the results of these studies, organizations such as the Renal Physicians Association, the National Kidney Foundation, and the American Association of Kidney Patients have helped to spread the word. What’s most telling is not the conclusions of the studies (which have recently been rebutted), but rather the interests of these organizations. The Renal Physicians Association has strong financial ties to Amgen and the National Kidney Foundation, along with the American Association of Kidney Patients, has received substantial funding from the drug manufacturer. Amgen has also enlisted the aid DaVita and Fresenuis in their lobbying scheme, both of which are major dialysis clinic chains that receive kickbacks “for every dose of Epogen they administer.”

While Amgen is trying to win over Capitol Hill the health safety of the patients receiving its drugs are being lost in the battle. Recent studies have shown that, in fact, higher hemoglobin levels have not lead to increased energy and overall feeling. The mortality rate is increasing and there is really no overall benefit. Moreover, EPO use is doubling (in violation of FDA warnings) with the cost to taxpayers increasing.

The Huffington Post: “The Most Costly Earmark in S-CHIP”

To read more about Amgen’s lobbying efforts in Washington, including the political contributions that it has made in the name of shaping healthcare policy, click on the link below.

Los Angeles Times: “Amgen Boosts Capital Lobbying”

Questions regarding the future of biotech giant, Amgen, have begun to swirl, especially in light of its recent announcement that it will cut 12-14% of its workforce. Various articles are addressing general concerns over what might be expected to happen within the next few months, sources in including CNBC.com, AHC Media LLC, and the International Herald Tribune. The FDA’s Cardiovascular and Renal Drugs Advisory Committee has scheduled a meeting for September 11, 2007 where anemia treatments for kidney disease will be assessed. With the hearing looming, investors are split as to the question of whether or not they should buy or sell. While some have decided to get out while they can, others are willing to look past the company’s current difficulties and offer continued support, while still others are looking to base their decision on the committee’s findings next month.

Further, questions regarding federal restrictions on the company’s anemia blockbusters Aranesp and Epogen are still circulating. How will these restrictions continue to affect sales? How will they affect the patients? Erythropoiesis-stimulating agents (ESAs, such as Aranesp and Epogen) are created as alternatives to blood transfusions and representatives for Amgen, as well as some doctors, are concerned that the restrictions on ESA use will result in an increased need for blood transfusions among patients. Another concern for Amgen is whether private insurers follow CMS’s lead (the Centers for Medicare & Medicaid Services), and put the trigger point for coverage at the hemoglobin level of 10g/dL? Blue Shield has already revised its coverage guidelines according to CMS’s decisions and even though Amgen contends that private investors won’t follow suit, the possibility is definitely still there.

In addition to concerns regarding federal restrictions and resulting insurance policy changes, Amgen has spent over $9 million since the beginning of the year lobbying Washington in the hopes that politicians will reverse the policies.

Click the following links to access the full articles.

CNBC.com: “Amgen’s Full-Court Press”

AHC Media, LLC: “Amgen’s Moves Gain Praise as Firm Faces ‘Uncertainties’”

International Herald Tribune: “What next for Amgen?”

Amgen Seeks to Ease Investor Concerns as Staff Cuts Loom”

“Amgen: Anemia Franchise Faces Challenges Despite Reassurances”