Results-based vs. Therapy Compliance

Results-based vs. Therapy Compliance

According to an article posted on the FiercePharma web site;

“Pay-for-performance arrangements aren’t commonplace, but they’re growing more so as pharma rolls out pricey, next-gen drugs and payers look for ways to control their spending on them. About 14% of U.S. payers have at least one pay-for-performance pricing arrangement, up from 10% in 2014, according to a new specialty reimbursement report from EMD Serono. Another 30% of plans say they’ll have an outcomes-based deal in place within 12 months.”

As regular readers of Diabetic Investor know we have long maintained that in the future outcomes will truly matter, as outcomes will impact reimbursement and formulary position. Simply put a drugs financial performance will be tied to outcomes. The same can be said for all these way cool whiz bang cloud enabled devices.

In many respects diabetes is the posterchild for outcomes based reimbursement. Although there are some minor differences between the American Diabetes Association (ADA), American Association of Clinical Endocrinologists (AACE) and the European Association for the Study of Diabetes (EASD) as to what constitutes good control, there is more agreement than disagreement. Even better the metrics used to measure good control are well accepted and verifiable. Metrics such as HbA1c, triglycerides, cholesterol, etc. come from standard blood panels. This is the good news.

Now comes the bad news, ask almost any physician who treats patients with diabetes, primary care or endocrinologist, what the biggest obstacle is standing between their patients and better outcomes. It’s not lack of good drugs or poor devices, it’s therapy compliance. Yes, we could have better drugs and better devices but these better drugs and better devices aren’t worth squat if the patient does not use them as intended.  A patient being compliant with their therapy regimen is by far the number one reason cited by physicians as the reason more patients aren’t achieving better control.

This is one reason Diabetic Investor believes that diabetes drug and device companies will have to find some way to incentivize the patients who use their drug and/or device to be compliant with their therapy regimen. The fact is and we have said this many times it is next to impossible for any of these way cool whiz bang cloud enabled devices to draw a straight line between using their way cool whiz bang cloud enabled device and better patient outcomes. Can such a device help, for sure, is it THE reason for better patient outcomes, that’s a big MAYBE.

It’s for this reason we can see some interesting hook ups between diabetes drug companies and makers of these way cool whiz bang cloud enabled devices. In the old days’ alliances between drug and device companies were like trying to mix oil and water. Anyone remember the InDuo from when Novo Nordisk (NYSE: NVO) hooked up with Johnson and Johnson (NYSE: JNJ). Or what about that way cool now way dead iBGStar from our wine drinking friends in France, was that a winner or what? The reality is these hook ups between diabetes drug and device companies haven’t exactly worked out all that great.

Yet in today’s world diabetes drug and device NEED each other more than ever. Think of it this way, Lilly (NYSE: LLY) has the most complete portfolio of diabetes medications everything from A to Z. What would happen if Lilly hooked up with Dexcom (NASDAQ: DXCM) to develop better dosing algorithms for their line of insulin’s. Oh and did we mention that Dexcom is hooked up with Google who just happens to be pretty good at data analytics.

Yet this alliance could go well beyond just insulin but also expand to Jardiance or Trulicity. Think of it this way data from patients wearing the Dexcom/Google disposable sensor could be transmitted not just to Lilly but also to the patients’ physician who as we noted earlier this week could make faster adjustments to the patient’s therapy regimen or offer words of encouragement for a job well done. Yes, we know there are some HIPPA issues here but given the army of lawyers employed by these companies we don’t see that as an obstacle.

This has always been the promise of interconnected diabetes management (IDM), that patients would achieve better outcomes. Yet the problem with IDM as we have noted many times is not just getting the damn data but transforming all this damn data into patient relevant patient actionable data. Well a disposable patient friendly easy to use CGM takes care of the glucose data problem. A smart insulin pump or insulin pen or cloud enabled pre-programed patch pump adds more data for those patients using insulin. And just an FYI if an insulin pen can send data to the cloud so can a GLP-1 pen.

Throw in a FitBit, Misfit, Garmin or plain old app that measures patient activity and more data is added. And just for grins and giggles how about a cloud enabled scale that gathers even more data.

Are we beginning to see why the future of diabetes management and data analytics are joined at the hip? Someone has to take all this damn data, analyze it, make sense of it all and then apply it to the patient to transform it into patient relevant patient actionable information. Oh and should we mention they have to do this without pissing off the patient’s physician who believes they should be the one who is helping the patient not some piece of software.

Like it or not this is the future of diabetes management. A future which will see some interesting hook ups between drug and device companies. Two worlds which have not worked well together in the past. Yet two worlds that must work together if either is going to win in the future.