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    Perspectives from Todd Hobbs, MD

    07 June 2017

    Our Chief Medical Officer has diabetes and a child with diabetes. 

    We talk with Todd Hobbs, vice president and chief medical officer for Novo Nordisk in North America. Todd brings a unique perspective to his job title – he was diagnosed with type 1 diabetes nearly 30 years ago and one of his sons has been a type 1 since the age of 5.

    In this first of a series of posts with Dr. Hobbs, he digs into what he believes innovation in diabetes means. 

     

    Q1: As a diabetes patient, provider, Chief Medical Officer, and also a parent of a child with diabetes, you bring so many different perspectives to the table. What does innovation in diabetes care mean to you?

    Because I live with diabetes each day, I can easily put myself in the shoes of the patient. When we’re talking about innovation, I don’t think about the science alone. I look at what this will practically mean to patients on a daily basis. In 2017 and beyond, I think of innovation in diabetes as coupling the advances obtained from new medications along with the explosion in digital technology, allowing individualized care for all patients with diabetes to become a reality.  

    Q2: In the next 10 years, where do you see diabetes innovation heading?

    We have a lot of near-term opportunities to increase innovation in both type 1 and type 2 diabetes.  These advances will look very different but the overall success for each will be dependent on how easily these new innovations can be adapted by patients.

    Currently there is still a lot to learn about the underlying process in how patients develop type 1 diabetes. I think we have recently seen advancements in glucose sensors as well as pump technology that will allow for a fully automated closed-loop (artificial pancreas) system within the next few years. Clearly our research in this area as well as development of improved or faster insulin will help drive this innovation.   In more of the 5-10 year range, advances such as islet cell encapsulation, immune modulation of the process that triggers type 1 diabetes, and glucose-responsive insulin can move closer to becoming a reality.

    Innovation in type 2 diabetes may look a little different. Because type 2 diabetes is such a multifaceted disease process, highly influenced by the patient’s own lifestyle and other comorbidities, we have to be innovative in how we think of improvements to the treatment of this disease.  Certainly advances such as a possible weekly incretin and oral GLP-1 agents will allow for significant numbers of type 2 diabetes patients to reach treatment targets, but these therapeutic advancements must be coupled with the necessary tools to educate and motivate both patients and providers so they can achieve the best outcomes possible.   Innovation here can be around understanding a patient’s specific barriers to treatment, truly understanding their mindset and why some don’t actively participate in their care and others do. And what roles can we as a company play? Our efforts need to be centered on earlier diagnosis and treatment of type 2 diabetes, and also improving adherence to therapies once patients are diagnosed.  

    Q3: The diabetes scientific community has made so many clinical advances in diabetes treatments in the last 20 years – where do we still need to improve?

    I’ll go back to adherence here. I think it’s safe to say that patients have a strong selection of diabetes medications they can choose from. Yet, adherence remains a profound problem. As an example, we know primary care physicians are not using GLP-1 agents as often as they should for type 2 patients, and that once initiated on either GLP-1 agents or insulin, many type 2 patients do not stay on these therapies for very long.  We have to do more to understand the reasons behind this, and to work hard so that patients can benefit from these remarkable therapies and the ones to come in the near future. 

    Q4: What’s your take on technology when it comes to personalizing diabetes treatment?

    I’d sum it up with that word ‘personalization.’ There is a very wide range of acceptance in use of technology for diabetes care. Acceptance varies by generation obviously, but also by type of diabetes, whether patients are taking insulin or not, and certainly by their overall engagement in the use of smart phones and aps on a regular basis. Some people welcome technology and others simply don’t embrace it. What we’ve got to continue to focus on is how to use multiple methods to reach patients either with high or low tech options, in order to meet their individual needs and preferences. 

    Q5: If you had unlimited funding to put toward diabetes research, what would you use the money for and why?

    Certainly I would immediately invest more in those areas mentioned above for type 1 diabetes, as I do think we are on the cusp of finding a truly radical advancement for this disease in the way of prevention or accelerating the efforts around closed-loop systems or islet cell transplants, etc.  

    For type 2 diabetes, hands down, I’d direct the majority of the funding toward educational efforts. If we’re ever going to make a dent in type 2 diabetes, we have to prevent it. This starts with tackling issues such as childhood obesity, access to healthy foods, and encouraging a healthy lifestyle for those families at risk for developing diabetes. We can continue to invest in all facets of R & D for innovative diabetes medications, but it’s just as important to put this same level of effort and rigor toward prevention. This is the only way I think we will make a lasting impact. 

    I do think it is important for me to embrace this mentality personally as well. I am sure patients are frustrated to be told by their providers to make improvements in their lifestyle and yet see their own providers not follow this advice. Granted, nobody is perfect, but I believe I need to set a good example even now for those who may look to me for advice on living with diabetes, especially my very own son and other friends and family members.

     


    Our perspectives on pricing and affordability

    30 November 2016

    We hear from more and more people living with diabetes about the challenges they face affording healthcare, including the medicines we make. We take this issue seriously and have been thinking about what we can do to better support patients. This has become a responsibility that needs to be shared among all those involved in healthcare and we’re going to do our part. 

    As a first step, we‘ve taken a position on affordability, outlining three tenets that will be our focus. One is creating more pricing predictability so customers like pharmacy benefit managers (PBMs) and payers can effectively anticipate and budget for our price increases. We will support that by limiting any potential future list price increases for our medicines to no more than single-digit percentages annually. This is one action we are taking immediately. 

    A second area of focus is transforming the drug pricing system, which is incredibly complex and has resulted in a lot of confusion around what patients pay for medicines. News reports on drug prices have left the public with an impression that companies like ours realize all the profits from the “list price” increases we’ve made over the last decade. In other words, a list price increase by XX percent leads to an automatic XX percent profit for the drug maker. We believe that is misleading and here’s why: As the manufacturer, we do set the “list price” and have full accountability for those increases. However, after we set the list price, we negotiate with the companies that actually pay for the medicines, which we call payers. This is necessary in order for our medicines to stay on their preferred drug list or formulary. The price or profit we receive after rebates, fees and other price concessions we provide to the payer is the “net price.” The net price more closely reflects our actual profits.

    In the graphic showing our insulin, NovoLog®, you’ll see the difference between list price, which increases a lot after 2010, and the net price. The list price increases after those negotiations and concessions translated year-over-year to mid-single-digit net price increases for all our insulins, even when you don’t account for inflation.  And when you do, those net prices were closer to the Consumer Price Index – Urban, a common measure of the average price of goods.

    So that probably prompts two questions: what does that mean for patients? And, what’s the point of increasing the list price if the drug maker is not necessarily realizing that profit? 

    For patients, the reality is that many of the insured may benefit from the net prices payers negotiate (on average, insured patients pay a co-pay for Novo Nordisk insulins between $1 - $1.40 per day) while others may not. Uninsured patients or those in certain insurance plans may be subject to list price. More on that below.

    For Novo Nordisk, those price increases were our response to changes in the healthcare system, including a greater focus on cost savings, and trying to keep up with inflation. PBMs and payers have been asking for greater savings – as they should. However, as the rebates, discounts and price concessions got steeper, we were losing considerable revenue – revenue we use for R&D, sales and marketing, education, disease awareness activities and medical information support.  So, we would continue to increase the list in an attempt to offset the increased rebates, discounts and price concessions to maintain a profitable and sustainable business. We also monitored market conditions to ensure our prices were competitive with other medicines as part of our business model.

    All in all, we’ve simply tried maintaining a profit margin that has been dropping significantly since health policy changed in the US. With that, we also need to work together to improve the system and create more transparency.

    While we can debate who pays what in different scenarios, it doesn’t change the fact that many patients simply can’t afford the medicine they need. We currently offer several options for eligible patients including a Patient Assistance Program and co-pay cards to defray costs. Patients can also get our human insulin – sold as ReliOn® through Wal-Mart and as Novolin® in community pharmacies – which might be an affordable option for some patients.  However, new issues are surfacing that require more solutions.  For instance, there are a growing number of people enrolling in high-deductible health plans that are facing higher costs at the pharmacy counter.  In our view, high-deductible health plans are becoming a greater part of the affordability issue requiring attention.  That’s one of the reasons why our third commitment is focused on reducing the burden of out-of-pocket costs to patients. 

    As a leader in diabetes care, we recognize patients need more. We are poised to do more, but can’t do it alone. We need a partnership approach involving PBMs, insurance companies, employers, patient organizations and policy makers – to help find sustainable solutions.  With these three tenets top-of-mind, we will work in collaboration to support those who face affordability challenges.

    We plan to talk more about these issues in the coming months.  Please stay in touch by connecting through @NovoNordiskUS if you’re not following us already.