Addressing Obesity in America: Economics & Impact on Diverse Patient Communities

The Partnership to Fight Chronic Disease

10.22.13 | By John Castellani

The Partnership to Fight Chronic Disease
Addressing Obesity in America: Economics & Impact on Diverse Patient Communities
John J. Castellani, President & CEO, Pharmaceutical Research and Manufacturers of America
Los Angeles, CA
October 22, 2013

Thank you, Ken, for that kind introduction.

My thanks also to the Partnership to Fight Chronic Disease for inviting me to be here today.  Believe me, it is wonderful to leave the gloom and doom of Washington, DC, behind, if only for a few days.

More importantly, at PhRMA we’re proud of the fact that we were “present at the creation” of PFCD and we continue to be strong supporters of the work you do.  Anyone who takes a close look at the state of the nation’s healthcare understands how important that work is.

Right now in America, cancer, diabetes, heart disease, stroke, obesity and other chronic conditions are killing more than 1.7 million people every year.  That’s more than 70 percent of deaths overall.  Chronic diseases are also responsible for over 85 percent of the costs In Medicaid and Medicare. 

More than any other organization, PFCD is bringing policy makers, insurers and the public face-to-face with these facts.  And it is leading the way in mobilizing Americans to demand that the nation provide effective healthcare for our citizens by detecting, preventing and managing chronic diseases and encouraging healthier living.

I’m also very grateful for the opportunity to share this podium with such a distinguished array of experts on obesity and its effects, all committed to taking on one of the nation’s most pressing and difficult chronic disease challenges.  Today’s program is a tribute to PCFD’s unique ability to not only raise awareness of the number one cause of death, disability, and rising healthcare costs, but also to foster meaningful solutions.

As Ken said in his introduction, PhRMA represents the country’s leading biopharmaceutical researchers and biotechnology companies.  I’m proud to say that our biopharma sector leads the world in investment in new research.  As a result, we’re the world leaders in creating new medicines and therapies to treat, cure and help patients.

When it comes to obesity and other chronic diseases, we share the same objectives as every member of PCFD, and every organization represented here today:  providing patients with the highest quality care available and helping them get access to the medicines and treatments they need to prevent, treat and cure disease.

To reach those goals, our members have invested more than half-a-trillion dollars in R&D since 2000.  According to data from the National Science Foundation, that investment accounts for the single largest share of all business R&D in the nation, representing nearly 20 percent of all U.S. business R&D.

An enormous portion of that investment is centered on finding better ways to treat, cure and prevent many of the chronic conditions the PFCD and everyone here is confronting – whether it is diabetes and cancers, heart disease and stroke, or obesity and its effects – we share your goals.

This enormous and ongoing investment has led to some remarkable advances in medicine and patient care – declining cancer and cardiovascular death rates; new medicines that have transformed HIV/AIDS from a death sentence to a treatable chronic disease; innovative breakthrough treatments for rare diseases, etc.  It also fuels the pipeline of potential new medicines both here in U.S. as well as globally.

However, looking back at how far we’ve come also underscores how far we still have to go – especially when it comes to the epidemic we’re talking about today – obesity. 

You’ve heard the grim facts about obesity eloquently described by the speakers earlier today – the staggering toll the epidemic is taking on health care spending; how it is hitting underserved minority communities disproportionately hard; and how devastating it can be to the lives of our children and loved ones.  The disease not only takes a serious toll on physical health – cardiovascular disease, diabetes, hypertension and other conditions – it is also becoming clear that obesity is linked to depression and anxiety.  The most worrisome fact, of course, is that trends in obesity and its related diseases are moving in the wrong direction.

Experts from government, business, nonprofits, and academia are searching for solutions.  The public is clearly worried, too.  A poll PhRMA commissioned this year found that obesity, diet and weight management topped the list of Americans’ biggest personal health concerns.

Moreover, obesity is a chronic disease unlike almost any other.  It is a disease that can come from both genetic and lifestyle factors.

Changing one’s life style can be a wonderful way to treat obesity.  Unfortunately, that doesn’t mean it is easy.  Anyone who has struggled to lose those 5 to ten pounds after Christmas, and has heard a smug friend say, “just exercise more and eat less,” has an inkling of how difficult it can be to modify behavior.  And the challenge of changing habits and lifestyle is infinitely greater for people who have wrestled with obesity for years or decades, or have never had the chance to learn about healthy eating and lifestyles.  And the complex genetic causes of obesity are just beginning to be understood.

The unique challenges obesity poses, combined with the soaring damage the disease is doing to health and healthcare spending, make it absolutely vital that all elements of the healthcare ecosystem work together to find solutions.  Scientists, health care providers, community, business and labor organizations – we all need each other.  Research, treatment, prevention and wellness services are all critically important parts of developing effective treatments. 

For the next few minutes I will focus on one piece of the puzzle, one aspect of meeting the obesity challenge – medical research.  PhRMA companies are developing a wide range of new medicines for chronic diseases, and especially for obesity-related conditions such as heart disease, stroke, high blood pressure, diabetes and more.

For example, we have more than 215 medicines now in development for heart disease and stroke that offer real hope for patients.  There are also more than 220 medicines for Type 2 diabetes in the pipeline.  And, of course, I know how excited everyone here today, along with everyone in the larger PFCD community, is about the FDA’s approval of two promising anti-obesity drugs last year.

As exciting as these breakthroughs are, they could be just the tip of the iceberg, opening the ways to even more innovative and effective ways to treat and prevent obesity and obesity related conditions.  However, notice I said they could open the way for even more exciting breakthroughs.

The bad news is that, as we meet here today, our researchers face some real barriers to seizing those opportunities.  In particular, their work is often hampered because they’re trying to do 21st Century research in a healthcare system that in many respects is 40 years out-of-date.

In particular, to foster breakthroughs that will make patients’ lives better, researchers need an environment where innovative medicines and treatments are properly valued.  Otherwise they can’t afford to make the huge investments and take the serious risks needed to innovate.

Think about this:

  • Only one of every 5-10 thousand medicines makes it from a discovery in the laboratory to treatment for a patient.
  • The costs are staggering: an average of $1.3 billion to develop and get a potential medicine through FDA and approved for patient use; and
  • It takes a long time:  10 to 15 years to develop an approved medicine.

In the current health care environment, however, the focus has overwhelmingly been on the short-term cost of treating an immediate medical condition, not the value of a breakthrough that delivers prevention, treatment and cures over years or even decades.

In part this is due to the incentives in our health reimbursement system.  As you know all too well, insurers find it much easier to calculate and cover the short-term cost of expensive acute services; getting coverage for medicines or behavioral programs that prevent or have a long-term benefit for patients with chronic disease is a struggle.

When it comes to federal funding, the sequester effect and the continuing self-induced budget crises have tilted the system even more heavily toward short-term costs at the expense of long-term value.

 

Let me give you an example.  As Ken said in his presentation, the aggregate annual cost of obesity is $192 billion, and that number is rising.  Supposing our pharmaceutical companies develop more anti-obesity drugs that could help reduce those costs dramatically over time?

But what if new treatments for obesity come with a high, short-term price tag?  Suppose its one-year cost to the healthcare system approaches $11 billion, the all-time annual price tag for a single medicine.

Under the current system in the United States, my fictitious $11 billion per year would be viewed only as a cost to the system—a huge cost.  As Congress and the Administration wrangle over the budget and agencies cope with the sequester and government shut-down, you can bet that budget hawks in Congress would put a huge bulls-eye on an $11 billion price tag.

This preoccupation with the short-term cost value discourages the risk taking on which innovation depends.  No nation can afford to do that.  No nation should ever dis-incentivize innovative therapies by ignoring the long-term value of innovative treatments for obesity and other chronic diseases.

This focus on the short-term is not just a problem for those developing new medicines for obesity.  We, as a nation, need to properly value treatments for obesity.

While America’s biopharmaceutical companies want to do all we can to research and develop new medicines to treat obesity, we’re very aware that reversing the dangerous obesity trends requires a working coalition of a broad range of people.  We need experts in wellness such as dietitians, health coaches, and personal trainers.  We need specialists on human behavior and on the emotional side of obesity – social science researchers, psychologists, counselors, therapists.  And we need a broad range of health care providers, trained in obesity treatment, throughout our healthcare system.

But let’s not forget that the fight against obesity is not just a matter of getting patients to change their behaviors.  We need to get politicians to change, too.

State, local and national leaders must change the way they think about obesity, to bring our health care reimbursement system into the 21st Century, and make sure that it recognizes long-term value.

We need to help them understand that comprehensive behavior programs led by a wellness professional work much better than a single visit to a doctor’s office.  They need to learn that community-based weight loss programs for people 60 and older could save Medicare between $7 billion and $15 billion, and could prevent the system from financial collapse.  And much, much more.

That’s why the work of PCFD is so important – by bringing together experts and raising public awareness, you are bringing hope to every patient struggling with obesity and other chronic diseases.

I began by saying I was glad to be out of the gloom and doom of Washington.  Let me close by offering my perspective of what the partisan divide might mean for the prospects of progress in the fight against obesity and chronic disease more broadly. 

The 18th Century British philosopher and astute observer of America, Edmund Burke, once said: “All government – indeed, every human benefit and enjoyment, every virtue and every prudent act – is founded on compromise and barter.”

Unfortunately, the situation in Washington today is much better described by a 20th Century philosopher – Groucho Marx.  He said, “Politics is the art of looking for trouble, finding it everywhere, diagnosing it incorrectly, and applying the wrong remedies."

Why is Groucho right?  Because the political climate in the Capitol is both politically polarized and focused on short-term fiscal issues without considering how today’s decisions could affect other critical foundations of our health and economy.

One result is that huge policy challenges, such as healthcare, jobs, fiscal policy, are no longer seen as national problems that must be solved by our leaders.  Instead they are seen as tests of ideological purity and part of a zero sum game between the forces of good and evil.  “Compromise” –instead of being Burke’s foundation of virtue – has become an epithet.  

That attitude makes it very difficult for lawmakers to agree on the kind of changes to the healthcare system that could help the fight against obesity.  The Affordable Care Act provides coverage for obesity screening and counseling.  Will that provision get a fair trial?  Will Congress be able to change the Medicare Part D program so that it covers obesity drugs?  These issues could be caught up in the rigid partisan divide. 

Despite the current deadlock, I remain an optimist.  The burden of obesity is simply too great for our political leaders to ignore it.  The opportunities to make a difference in people’ lives are too great for us to let them slip through our fingers.  The nation’s biopharmaceutical companies will continue to work with PFCD to reverse the dangerous trends in obesity, and bring hope to all patients confronting chronic disease.

 

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