Study: Medical Device Tax Could Cost Jobs, Stifle Innovation

WASHINGTON,D.C. –The medical device tax, if implemented, could cost tens of thousands of jobs, almost double the industry’s total taxes, raise the effective tax rate to among the highest in the world, and harm U.S. competiveness, according to a study released today by the Advanced Medical Technology Association (AdvaMed).  The new study, “Employment Effects of the New Excise Tax on the Medical Device Industry,” by Manhattan Institute senior fellow Diana Furchtgott-Roth and Hudson Institute senior fellow Harold Furchtgott-Roth, outlines a number of economic harms likely to result from the tax.Continue reading

President Sander visits the University of Arizona’s Research Parks

University of Arizona President Eugene Sander Tours U of A Research Park on August 29, 2011(Tucson, Arizona)  On August 29, University of Arizona President Eugene Sander toured the University’s Research Parks.  The Office of University Research Parks supports the University of Arizona’s mission of education, research and outreach by utilizing research parks and business incubators to advance technology development, commercialization and business attraction. 

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Tips on Writing Powerful Public Comment Letters Regarding Proposed Regulations

By: Michael T. Hull – Managing Director, InVent Life Sciences  (Former Regional Advocate for the U.S. SBA Office of Advocacy)

The federal government proposes and finalizes approximately 4,000 new rules every year. In general approximately 800-1,000 will directly affect small business. A 2008 study by the U.S. Small Business Administration’s Office of Advocacy estimated that the cost of complying with federal rules and regulations exceeds $1.75 trillion per year with small businesses spending approximately 36% more per employee than their large business counterparts.Continue reading

Luceome Biotechnologies Receives $1.9 Million in Phase I and Phase II SBIR Funding to Advance its High Throughput Screening Platform

TUCSON, AZ – LUCEOME BIOTECHNOLOGIES a privately held biotechnology company focused on the discovery and development of its innovative proprietary assay platform today announced the award of $1.6 million in grant funding from The National Institutes of Health to further their research in high throughput screening using the KinaseSeeker™ technology. Earlier this year, Luceome was awarded a grant for $287K for research in the area of poly(ADP-ribose) detection.

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The FDA When There’s An App For That

There is a lot happening on the medical device front these days around MDDS (Medical Device Data Systems) and the FDA is paying close attention with new regulations, guidance and requests for comment. 

With the  April 2012 compliance deadline less than 8 months away, AZBio Member John C. Hoffman of QMR is paying close attention too and keeping our community in the loop via the AZBio  Resource Network Group on LinkedIn.  If you and your team are working in the MDDS space, you’ll want to get connected and join the discussion.

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Opportunity to Partner with the US Air Force– Deadline to apply is 08 31 2011

Source: Air Force Medical Support Agency

Deadline: August 31, 2011

Awards:  $49,500,000/5 years by awarding 10-20 awards per year with the estimated value of each award being $100K to $1M annually, with total contract values of up to $3M over 3 year periods.

Requirements & Process: Submit 3-page white paper and 1-page quad chart following Air Force template that aligns with research in these five medical modernization areas below. Companies must have active Central Contractor Registration (CCR) prior to submitting an application or proposal and provide DUNS number when submitting. Within 45 days, those selected as meeting Air Force needs will be asked to submit a technical and cost proposal. The awards are expected to be made in the May-July 2012 timeframe.

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Life Sciences in the Fast Lane

MP900438890[1]This year at the AZBio Awards and Expo our theme is all about forward motion.  Specifically, how  we move forward…faster.

From global innovations like IBM’s WATSON on Thursday night October 13, 2011 to panels of CEOs and leaders along with  nationally recognized thought leaders who will take the stage Friday October 14, 2011,  the conversations are geared up to deliver  the information and ideas  we  need to move our industry and our economy forward…faster.

A single accelerator? Continue reading

AZBio Writes to Congress regarding changes to Medicare Part B

Letter sent to members of our Arizona Congressional Delegation:

In one way or another cancer will touch each of us during our lifetime.  According to the 2011 report by the American Cancer Society, approximately 31,550 Arizonans will be diagnosed with cancer this year alone.  Here in our home state, thousands of Arizonans battle cancer while many more work tirelessly to help
them through state of the art cancer centers including the Mayo Clinic, the Arizona Cancer Center, Cancer Centers of America and our network of some of the finest hospitals in the country.

In keeping with the Arizona BioIndustry Association’s commitment to monitor key issues and to share key information on areas that affect our community, our state and our nation, the following points are offered to assist you on how best to control healthcare costs while serving the best interests of millions of  mericans and tens of thousands of Arizonans who are touched directly or indirectly by cancer and other serious diseases each year.  We urge you to work with your colleague, Rep. Lance Leonard (R-New Jersey), who
highlighted these points in a letter to Speaker Boehner and Leader Cantor in a July 21, 2011 letter.

  •  Medicare Part B coverage of drugs provides an invaluable route of access for cancer patients and other patients facing grievous illnesses. Part B provides an important pathway for patients to access a narrowly defined, limited number of provider-administered products (e.g., those that are injected or infused under the direction of a physician). Furthermore, the patients served under Part B are often those in greatest need. Disrupting how the care of these patients is delivered and paid for would do a great disservice to the sickest patients fighting devastating diseases.
  • Part B drugs require physician supervision to deliver. Unlike pills that patients can
    take themselves at home, Part B drugs paid as part of a physician or hospital visit require a physician to supervise administration.   For this reason, Congress authorized the Centers for Medicare and Medicaid Services (CMS) to cover these special products under Part B. Unlike products that patients pick up in retail pharmacies, these products are purchased by physicians from manufacturers or their distributors. Physicians then bill these products to Medicare along with the other services that they provide to patients during their office visits.
  • Providing Part B drugs to patients requires physicians to follow complex procedures. Many Part B products are injected or infused directly into the patient’s bloodstream; involve treatment regimens that call for ongoing clinical monitoring and patient education; require detailed clinical knowledge to determine appropriate dosing, to mix, and to deliver in sterile conditions; and
    have special handling and complex storage requirements mandated by the U.S. Food and Drug Administration (FDA) as part of their product labeling.
  • The cost containments activities relative to these drugs were already addressed when the Medicare Modernization Act (MMA) was enacted.  A few years ago, Congress revised the payment rates for Part B drugs as part of the MMA and introduced a new system called Average
    Sales Price. Part B drug reimbursement was reformed and payment amounts were dramatically reduced as part of the MMA. Payments are now set using market-based Average Sales Price (ASP) data, which reflect the actual prices paid by physicians and other drug purchasers. ASP is a market
    driven reimbursement mechanism that works well and has driven down Medicare costs. The goal of ASP was to bring Medicare payments for Part B drugs in line with the average costs to providers. This reform has worked, as the Medicare Payment Advisory Commission (MedPAC) noted, “As intended by the policy, payment rates for drugs were reduced to levels closer to provider purchase prices and payment rates for drug administration increased.”
  • Congress set the reimbursement rate for most Part B drugs at ASP+6%. The +6% was added to the average sales price for several important reasons, such as the following:
    • A product’s acquisition cost is just one aspect of the overall costs incurred by a physician. Other costs that physicians must bear commonly involve (1) shipping fees, (2) the costs of supplies used in handling and preparing the products for administration, (3) overhead costs for storing the products, (4) staff time to negotiate prices for and order the products, (5) staff time for clinical monitoring and education of patients; and (6) state taxes on the drugs.
    • Acquisition costs vary. Physicians in large practices or who commonly use Part B drugs may get discounts on drug prices based on purchasing volumes. Smaller physician offices especially those in rural areas are less likely to have significant purchasing volumes and, therefore, the prices that they pay would reflect that fact.
    • ASP is – by definition – an “averaging” system. As is the case in any system built on averages, there will be some providers whose costs will be higher than the average. As noted above, it is also often the case that these providers are in small practices with low patient volumes and /
      or those in rural localities. The additional reimbursement of 6% above ASP reduces the likelihood that these providers will face reimbursement below their acquisition costs. Without the 6% above ASP many of these small rural providers could be put at risk causing serious disruptions for extremely ill Medicare beneficiaries.
    • MedPAC notes that, for most physicians the difference between
      ASP+6% and their costs for drugs is “slim.” MedPAC also reports that “there are
      some drugs they cannot purchase at the payment rate,” meaning that the Medicare
      reimbursement rate is less than their acquisition cost.
    • A recent study in the Journal of Clinical Oncology found that
      “many practices pay prices above ASP+6% reimbursement for key products” and
      concluded that the “economic strain combined with inadequate reimbursement limits
      patient access to care when practices are forced to turn away patients or go
      out of business.”
    • As part of the legislative negotiations on ASP, MedPAC cautioned
      Congress that physicians need an additional percentage above ASP and
      specifically said that the percentage “should be set high enough to cover the
      costs of an efficient provider.”

As I shared in the beginning, thousands of Arizonans and millions of Americans will be touched by cancer and other diseases where lifesaving physician administered treatments fall under Medicare Part B.  Further cuts to Part B and ASP (a market driven system that works well) could well  jeopardize access for cancer patients and other patients facing grievous illnesses, especially since MedPAC and others have found that physicians already have problems obtaining some products at or below the current ASP+6% rate.  If we cut
this program more severely than we already have, those Arizonans and Americans along with their friends and loved ones pay the ultimate price.

On behalf of the Arizona BioIndustry and our community, I thank you for taking the time to read this letter and for doing what is best for all of us.


 Joan Koerber-Walker
President and CEO
AZBio, The Arizona Bioindustry Association
1475 N. Scottsdale Road
Phoenix, AZ 85257

Advancing Science and taking a LEED position

Dr. Jack Dean, Dr. Ken Wertman, Joan Koerber-Walker, and Mike Capaldi with Sanofi US LEED GOLD emblem. Photo courtesy of Sanofi US.  All Rights ReservedOn Tuesday July 12, 2011, I traveled to Southern Arizona to join Dr. Ken Wertman and the team at Sanofi US as they celebrated another milestone. This time it is not for groundbreaking advancements in human and animal health. Instead we were recognizing the team’s achievement of  LEED Gold Certification at their home in Oro Valley, Arizona and congratulating the team that made it happen. Laboratories are very difficult to certify because of demands posed by air handling and other challenges in an environment where scientific experimentation is taking place. Sanofi-aventis U.S. strives to limit the environmental impact of their business and the team is proud of having achieved a Leadership in Energy and Environment Design (LEED) certification.

LEED is a building rating system that was developed by the US Green Building Council in 2000 and is a nationally accepted benchmark for design, construction and operations of high performance “green buildings”. The 110,350 square-foot site was constructed in Oro Valley Innovation Park with the grand opening held on January 13, 2010. Of all the buildings in the U.S. that are LEED certified, only two percent are laboratories. Sanofi  US  operates two of those laboratories, one in Cambridge, MA and the one here in Oro Valley just north of Tucson, Arizona.

Another highlight of the trip was getting to spend some time with Dr. Ken Wertman and learning more about his journey, why Sanofi  US chooses Arizona, and what they do here.

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