New research by Duke Health Sector Management Director Kevin Schulman and Fuqua alumnus Seth Glickman was featured in this week’s New England Journal of Medicine, and also covered by the Wall Street Journal and New York Times.

DURHAM, N.C. – Top-tier U.S.-based pharmaceutical companies are moving their clinical trials overseas at warp speed, raising questions about ethics, quality control, and even the scientific value of their findings for people back in the U.S.

Many of the trials are taking place in developing countries in Eastern Europe and Asia where study participants are often poorer and less educated than are study participants in the U.S., according to researchers at Duke Clinical Research Institute (DCRI).

“The FDA is supposed to provide oversight for such trials, but it simply wasn’t designed to handle this kind of situation,” says Kevin Schulman, M.D., the senior author of the report appearing in the New England Journal of Medicine. Schulman says the number of Food and Drug Administration investigators based outside the U.S. has grown by 15 percent every year since 2002, while the number of U.S.-based investigators has fallen just over 5 percent during the same period.

Schulman and a research team led by Seth Glickman, M.D., a senior scholar at Duke’s Fuqua School of Business, used the clinicaltrials.gov registry to examine recruitment patterns in industry-sponsored Phase 3 trials in 2007. Phase 3 trials are typically the largest and most meaningful trials, often involving thousands of patients. They found that about a third of the trials (157 of 509) were being solely conducted outside the U.S. They also discovered that over half the study sites (13,521 of 24,206) lay outside U.S. borders. Read the rest of this entry »

As we ring in the new year, millions of people are expected to make resolutions to improve their lives. A Duke University researcher says the consequences of some personal decisions provide important reasons to stick to those vows in the coming year.

New research conducted by Fuqua Professor Ralph L. Keeney concludes that personal decisions lead to more than one million premature deaths annually in the U.S.

Keeney’s work, published in the current issue of the INFORMS journal Operations Research, shows that personal decisions are the leading cause of death in the U.S. if one takes into account the role of obesity and smoking in creating heart disease and cancer, the primary causes of death in the U.S.

“Previous researchers have identified the main causes of heart disease and cancer as smoking and being overweight, each of which results in over 400,000 deaths annually,” Keeney said.

With the number of personal choices made in a given day, many individuals don’t take a step back to look at the long-term implications of those choices, Keeney said. From having unprotected sex to not buckling the seatbelt before driving, many of these decisions can eventually result in death. Other personal decisions that lead to significant premature deaths include overconsumption of alcohol, reckless driving, homicide and suicide.

Keeney’s results showed that more than 55 percent of all deaths for individuals aged 15 to 64 can be attributed to personal decisions that have readily available alternatives. Read the rest of this entry »

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This is the second entry in a new series from Duke Strategy Professor Will Mitchell.

PART 2 – SOLUTIONS

Yesterday, we discussed competitive disadvantages that established US businesses face compared to younger firms and foreign competitors as a result of the US approach to employment-based health insurance. Today, let’s consider solutions to the competitive disadvantages.

Let’s start with a couple of solutions that will not work.

Non-starter 1: Convince other countries to change? One approach is to ask the US government to try to force other countries to reduce their health insurance coverage, which would at least address the disadvantages relative to foreign competitors in developed markets. I know this sounds silly (at least I hope it does), but I recall serious suggestions to this effect about Japan during the 1980s, when the Japanese economy was booming and US firms were struggling to compete. It is not hard to imagine how badly it would be received if one of Hillary Clinton’s first actions as Secretary of State was to try to convince Canada, Japan, Germany, France, and the UK to roll back their national health insurance systems.

Non-starter 2: Ratchet down expectations? A second approach would be to try to convince US employees that extensive health care coverage is a luxury that they cannot afford, rather than a necessity and right. Again, I hope this sounds silly. But I recall a conversation with a senior executive from an established business that faced serious competitive disadvantages because of health care costs, in which this came up as a serious (I think it was serious – it was late, and maybe it was just fatigue and frustration that produced the point) suggestion. I think it is unlikely that Tom Daschle would make such a proposal the cornerstone of his policies as Secretary of Health and Human Services.

Now that we’ve disposed of the silliness, let me suggest a starting point for a solution that would work.

Read the rest of this entry »

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This is the first entry in a new series from Duke Strategy Professor Will Mitchell.

Most criticism of the US health care system focuses on its high costs, variable quality, and limited access. These criticisms are often apt, but they miss an increasingly important issue – which is that the US healthcare system creates disadvantages for established US businesses compared to younger firms and to foreign competitors. This two part series outlines the problem and suggests a starting point for solutions.

PART 1 – PROBLEMS

US health care – high costs, variable quality, limited access: The US health care system regularly faces attacks for having high costs and variable quality, while offering only limited access when compared to health care systems in most other developed countries. The usual criticisms focus on the large number of people in the country who have little or no health care insurance, while common measures of health quality, such as mortality rates, lag many countries in Europe, Asia, and elsewhere, despite the fact that the costs of health care have grown to more than 15% of Gross National Product (the OECD reports that the US spent about $6,700 per capita on health care in 2006, more than 1.5 times the next highest country, Norway). Analysts regularly question whether even the current cost level is sustainable, an issue that has come to the fore again during the current recession.

Brief aside: In anticipation of criticisms from my colleagues in outstanding US hospitals and other health care providers – I am deeply aware of the incredible strengths in innovation and care that are available in many parts of the US health system. And a large part of the population enjoys access to outstanding care, even if the costs are high. There are powerful parts of the system that we need to cherish and preserve. But there are fundamental flaws in cost, quality, and access that we need to address, or they will pull down the towers of strength.

Read the rest of this entry »

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Duke Strategy Professors Arie Lewin and Marco Huesch urge managers to invoke ancient wisdom when responding to the current economic crisis.

In these tumultuous economic times, even the most modern business strategists may benefit from the (literally) stoic calm of an ancient leader like Marcus Aurelius. “Never let the future disturb you,” he advised, “You will meet it, if you have to, with the same weapons of reason which today arm you against the present.”

Let’s take those weapons of reason out and sharpen them for a moment.

Read the rest of this entry »

A Duke Clinical Research Institute team including Kevin Schulman, director of Fuqua’s Health Sector Management Program, and Fuqua alumni Larry Diener and Ana Valverde, has some interesting findings on the effects of government policy on funding for health care ventures. Here’s a nice overview from the journal Health Affairs.

Federal public policies can have an important impact on the flow of venture capital that helps fuel innovation in biotech, pharmaceuticals, medical devices, and other health care sectors, according to an article by Duke University’s Clay Ackerly and coauthors published today on the Health Affairs Web site.

When Ackerly’s team surveyed twenty venture capital fund managers, they found evidence that changes in the level of regulatory and reimbursement risk have “a major impact on the investment strategies of venture capital funds. Approximately two-thirds of respondents said that increases in risk would lead them to shift investments within or across health care sectors or to reduce health care investments altogether,” the researchers report. “Therefore, given venture capital’s important contributions to innovation in health care, policymakers should make a concerted effort to better understand the link between their policy levers and the venture capital industry,” they add.

Bloomberg reported yesterday that several pharmaceutical companies are working on new treatments to combat neglected diseases, illnesses occurring primarily in impoverished regions of the world.

The companies’ interest in developing these treatments is due in large part to the work of Duke faculty members Henry Grabowski, Jeff Moe, and David Ridley. Two years ago the Duke trio proposed a plan to encourage companies to develop these less-profitable treatments by offering a voucher for priority FDA review of another, more lucrative treatment (priority review means FDA reviews paper work sooner, so drugs reach the market four or more months earlier). The Duke team estimated each voucher could be worth more than $300 million per drug.

The Duke proposal was published in the journal Health Affairs. At the recommendation of a reporter, the authors contacted Senator Brownback, who contacted Senator Brown, and together they used the Duke idea as part of the basis for a bill that was voted into law in 2007. In a world where progress sometimes seems painstakingly slow, it’s great to see a smart idea not only published in an academic journal, but also turned into law and acted upon by companies, all in less than 3 years.

Recent investigations by Congress and the media have focused on doctors’ financial ties to companies whose products they use or prescribe. Duke Professors Aaron Chatterji, Kira Fabrizio, Will Mitchell and Kevin Schulman set out to learn more about cases where doctors invent new products that are then developed and marketed by private companies with which the inventor doctors typically have some sort of financial relationship.

The group found that physicians are responsible for nearly 20% of all new medical device inventions patented in the U.S., leading them to caution that excessive regulation could potentially squash innovations that could help patients. Read more about the results, and the researchers’ take on the delicate balance between innovation and patient care, here.