Brooks Blog

Tuesday • February 13, 2018

Healthcare MarketWatch Update February 2018

Drug Pricing: Policy proposals from the White House designed to encourage lower drug costs for patients made headlines in early February. This is just days after an op-ed published in Health Affairs argued that Novartis’s oncology CAR-T therapy tisagenlecleucel was overpriced, even when the cost of research and long-term gains are considered. The headline said it all: “Drugs Don’t Work if People Can’t Afford Them.” The $475K price tag for a single infusion was nearly triple the “value” it offered, according to the authors (which included two potential recipients of the life-saving drug).

Amazon Healthcare? After Amazon made headlines in 2017 for obtaining wholesale pharmacy licenses in several states, it made early 2018 headlines for teaming up with the largest bank and the largest hedge fund in the country to form a healthcare company to manage healthcare for their employees. However the line between what Amazon does for employees first and for the public later has been drawn by its history developing Amazon Web Services, which started as a cloud storage system for employees before going public. Whole Foods makes envisioning Amazon healthcare clinics nationwide easy enough.

Brand Awareness Blues? With recent research published arguing that when people are asked how they base their treatment decisions they say they base it on outcomes rather than on brands, the industry that spent nearly $6B on Direct to Consumer advertising in 2016 might have a few studies of its own showing otherwise.

M&A: CVS CEO Larry Merlo said in early February that the acquisition of Aetna, a strategic move largely seen as a response to Amazon’s potential disruption of the healthcare space, should be complete by the end of 2018. This was in response to the Department of Justice’s decision to extend its review of the acquisition for another 30-day waiting period before making a final decision.

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