Medical Device Regulatory, Reimbursement and Compliance Congress. Steve Ubl President and CEO AdvaMed
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1 Medical Device Regulatory, Reimbursement and Compliance Congress Steve Ubl President and CEO AdvaMed March 28, 2007
2 Overview of Remarks About AdvaMed The Public Policy Environment AdvaMed s Priorities for 2007
3 About AdvaMed World s largest medical technology association 1,300+ member companies and subsidiaries Members produce 90% of sales in domestic market, 50% of sales in global market 70%+ of member companies have less than $30 million in annual revenue 70 staff with global expertise, bi-partisan backgrounds 45 member Board of Directors (BD, Siemens, Philips, Medtronic, Johnson & Johnson, GE, Boston Scientific, Roche, etc.)
4 AdvaMed s Daily Focus Appropriate Regulation + Adequate Reimbursement + Access to Global Markets = Patient Access to Benefits of Medical Technology
5 Defining AdvaMed s Role Design Clinical Review Coverage Payment Coding Idea through FDA: 2-6 yrs Cov & Paymt: 0-6 Japan Canada UK Korea Mexico India Germany China France Think Tanks
6 Policy Environment
7 Policy Environment
8 Policy Environment, cont d The Legislative Front More industry oversight Critically important legislation pending Federal budget proposal with deep Medicare cuts SCHIP Physician Fee Fix Consideration of MDUFMA, PDUFA, drug safety, others will mean major FDA bill
9 Priorities for 2007
10 Regulatory Policy MDUFMA Reauthorization Issues with MDUFMA I Unpredictable and unexpectedly high fee increases from yearto-year Clock-stopping behavior due to cycle goals FDA focused on goals rather than interacting with applicants Outlook for MDUFMA II Agreement in principle reached with FDA Reduced fees across the board for applications Sets forth a user fee structure that instills more predictability in to the year-to-year increases in fees Provides important performance goals to significantly reduce application review times while ensuring safety and efficacy
11 Regulatory Policy, continued Post Market Regulation Inappropriate comparison between drugs and devices AdvaMed working to Assist FDA in streamlining and connecting the dots with adverse event reports Establish clearer criteria for communicating risk Limit use of recall to appropriate situations Develop flexible approach to Unique Device Identifiers (UDI)
12 Key Payment Rules Inpatient Round II Severity weighted diagnosis related groups (DRGs) Hospital-specific relative values (HSRVs) Charge compression adjustment possible Competitive Bidding Potential for cheapest is best approach to technology Inappropriately group different technologies together for bidding purposes Could deny patients access to best care
13 Value-based Purchasing Legislative initiatives likely demonstrations ongoing advocated by key health policy makers / analysts If done correctly Improves quality Enhances diffusion of innovative technologies Rewards quality and efficiency If done incorrectly Efficiency can become code for cheapest is best Freezes technology in place Value = Price + Quality
14 Key Legislation Remote Monitoring Prime example of payment policy not keeping pace with technology Offers physicians real-time, remotely accessed patient information Provides homebound and rural patients 24/7 link to health care Legislation would eliminate disincentives in current Medicare rules that only provide payment for face-to-face meetings between patients and their doctors. Courtesy: Philips Patient using an ECG/Rhythm strip recorder, a blood pressure cuff and a TeleStation that sends data via modem from the telestation to a server, then on to the care manager.
15 Key Legislation, cont d Diagnostics Lab tests account for >70% of treatment decisions, but are less than 2% of Medicare costs Horse and buggy payment policy in the age of molecular medicine Legislation establishes new payment mechanism for molecular diagnostic tests based on resource use and value
16 Health Reform Principles Shaping the future instead of being shaped by it. Expand health coverage to all, so that every American can have access to the best medicine has to offer Improve the efficiency and quality of health care Quality of care highest priority Control cost the right way: lift the burden of disease and improve efficiency Prevention Quality Efficiency Medical innovation
17 International Top Line Nascent health care economies: China, India Japan: Foreign reference pricing EU: DRGs and procurement policies Europeans have followed US model for hospital payment based DRGs (France, Germany, UK, Italy)
18 Build Industry Reputation Industry Reputation Compliance and Code of Ethics Increase outreach and education Firmly establish logo license as compliance icon Develop other tools / programs to help ensure appropriate HCP relationships Value of Technology Increase volume and frequency to solidly embed core messages Broaden channels through partnerships Partnership Development Enhance partnerships with patient, physician, and hospital groups to enhance advocacy efforts Integrity of FDA Post market reg. Value of FDA risk-based approach
19 Telling our story
20 Medical Device Regulatory, Reimbursement and Compliance Congress Steve Ubl President and CEO AdvaMed March 28, 2007
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