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Federal funding for comparative drug studies not in US budget
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     Heavy lobbying by the US drug industry has, for the time being, held up studies comparing the clinical efficacy of prescription drugs. The Centers for Medicare and Medicaid Services (CMS), which administers Medicare, has been effectively prevented from using evidence of functional equivalence when deciding whether or not Medicare should approve a particular drug for coverage and Medicaid programmes.

    The drug companies argued, prior to legislation being passed, that attempts to determine equivalence between older and most likely cheaper drugs, would discourage manufacturers from developing new and possibly better products, even though they were likely to be more expensive.

    Last year Congress considered legislation requiring such comparisons (BMJ 2003;327:642). By the time the President signed into law the new Medicare legislation in December, however, the funding for comparative studies had been eliminated from the President抯 proposed 2004-5 budget.

    The law also said that the CMS did not have the right to determine functional equivalence between two drugs. It ruled that only the Food and Drugs Administration had the right to do so.

    A spokesman for the centres said: "We have never based our decision on price alone. That抯 not to say that cost is not a factor, but it抯 not the primary consideration. It抯 something we are aware of, but that抯 as far as it goes."

    "We want to be certain that what we抮e doing is making sure that beneficiaries continue to get the right drug at the right price. If tests show that a more expensive drug is superior to another for treating the same condition then the answer is not to use the cheaper drug but the more appropriate drug. There may be occasions when the more expensive drug is in fact the appropriate drug."

    Nevertheless Dr Sean Tunis, director of the CMS抯 Office of Clinical Standards and Quality, says that when Medicare approves coverage for a new drug it is necessary to establish that it provides significantly improved care over an older and perhaps less expensive drug. While prescription drug coverage under Medicare does not take effect until 2006, the agency does currently cover drugs administered in a doctor抯 office such as IV procedures and chemotherapeutic agents.

    Dr Tunis has been under criticism for making coverage decisions solely on cost, a charge he denies. But at the same time he points out that when the agency is considering reimbursing for a product that has the potential to significantly increase Medicare spending, then cost as well as effectiveness does enter into consideration.

    The issue throws light on an interesting development in the United States. The pharmaceutical industry is putting considerably greater effort now into getting approval from the Centers for Medicaid and Medicaid Services for coverage, than it used to. Not only do manufacturers now need Food and Drug Administration approval for the efficacy and safety of a new drug, but they also need approval from the centres that it will be reimbursed for the drug. This is going to become increasingly important, now that new drug benefits for individuals have been incorporated in the Medicare legislation (BMJ 2003;327:1250 News Extra). Indeed, some companies now try, and even one has succeeded, to get CMS approval for coverage even before the FDA has approved the new drug application.

    Meanwhile the original Congressional proposal, requesting $25 million for the National Institutes of Health and $25 million for the Agency for Healthcare Research Quality to conduct comparative cost and effectiveness studies on prescription drugs is by no mean dead.

    Consumer organisations, insurance and health care provider groups that pushed for the original proposal, have the backing of Republican Senator Bill Frist, who, it is said, wants to provide some funds for comparative studies. It would bring the United States in line with most other nations who already conduct such studies.(Washington Charles Marwic)