Wednesday, May 6, 2009


Title Revision 2

I will go ahead and copy the report on this study word for word as I think it is important to see.

Your thoughts on this are appreciated.

Removing Medical Device Preemption Impacts Jobs, Health Care Costs, Patient Access

BOSTON, May 6 /PRNewswire-USNewswire/ -- In a white paper released today by Ernst Berndt and Mark Trusheim of the Massachusetts Institute of Technology, research shows that eliminating FDA's preemption protection would decrease patients' access to life-enhancing medical devices, increase health care costs and reduce medical device industry employment.
The paper, "The Economic Impact of Eliminating Federal Preemption for Medical Devices on Patients, Innovation and Jobs," comes as Congress considers legislation that would remove Federal preemption of state rules and litigation that exists for a small percentage of medical devices that undergoes the most rigorous FDA review. The report highlights the damaging economic, health and societal impacts the legislation would have on patients, medical device industry innovation and employees, and the public health.
"As economic and health care researchers, we felt it was important to examine how this regulatory change could harm innovation, and ultimately impact the patients who rely on these treatments and the people who are employed by the device industry" said co-author Ernst Berndt, Ph.D., Louis E. Seley Professor in Applied Economics, MIT Sloan School of Management. "Congress should carefully weigh any policies that could increase health care costs and reduce high-paying jobs, particularly during an economic downturn."
The authors' research highlights the consequences to multiple stakeholders - patients and the public health, medical device inventors and manufacturers, their employees and the government - if medical device preemption were eliminated. For example,
Patients' access to medical devices and the benefits they provide would be reduced; as prices increase, products may be withdrawn, and fewer new products will be developed.
Physicians will increasingly practice defensive medicine to avoid litigation and expose patients to added risks of otherwise unnecessary procedures.
For those employed by the medical device industry, the increased manufacturers' costs would discourage investment in medical device development, reducing the R&D pipeline of innovative new products created and brought to market, and lead to layoffs of high-paying jobs.
Medical innovation would be affected, as decisions about health care products shift from expert, science-based regulators to untrained, non-expert juries, creating a duplicative, fragmented and inconsistent national framework administered by state and federal courts.
The government would experience increased costs, as Medicare and Medicaid spend more than they otherwise would due to fewer new product innovations, and government pays for increasing judicial system, tort and duplicative state regulatory costs.
"The question is not whether eliminating preemption will reduce innovation, but rather by how much and how rapidly," said co-author Mark Trusheim, Visiting Scientist at the MIT Sloan School of Management. "High levels of tort risk discourage investment in new technology. Eliminating preemption substantially alters the benefit/risk ratio of complex medical devices, increases the costs for all stakeholders, and negatively affects patients' future access to treatment options."
"Given these findings, and current economic circumstances, Congress should carefully consider any change to current law as the ramifications could substantially harm patient choice and health," Trusheim concluded.
The report was made possible by a grant from the Advanced Medical Technology Association. The views expressed are those of the authors only, and do not necessarily reflect views of the sponsor or MIT.
SOURCE Berndt Associates



    This is NOT an "MIT report." Note the source o--it is a release from "Berndt Associates." Among the clients of Berndt Associates are Medtronic, Baxter, Abbott, et. al. So that is the context from which Ernest Berndt writes, whatever his link with MIT (which may deserve a little more exploration). So also the sponsor, "the Advanced Medical Technology Association." Who are they? MIT itself specifically distances itself.

    Co-author Trusheim worked for industry throughout his career. He is currently "visiting" at MIT.

    Does the source discredit the conclusions? Obviously not in itself. But we should at least diclose what the source is, and be clear what that may mean.

    As listed, the arguments are essentially identical to those used against preemption in the drug arena--negative impacts on costs, innovation, utilization, defensive medicine, etc.. In the absence of supporting data (which never seemed to show up when the same arguments were used re: drugs), it is impossible to assess such claims.

    Except to call them claims with which we are already very familiar when industry has tried to prop up preemption elsewhere.

  2. A little more background.

    It is unclear whether Ernest Berndt has a direct link with Berndt Associates, which is based mainly in the midwest. His research appears to come out, in part, of the "law and economics" tradition, which has generally favored low regulation, market self-regulation, and the like. Recent papers of Prof. Berndt generally favor PDUFA and DTCA, although with some qualificatios about the latter.

    The Advanced Medical Technology Association (AdvaMed) which sponsored this paper is a trade organization for device comapanies and related. Among their policy priorities is listed:

    "Maintain the supremacy of federal science-based determinations relative to device safety, effectiveness and use."

    That's preemption as spoken in Euphemism.

    Again, though, what we really need is not an abstract but the paper itself, and what supporting data it contains for the assertions it makes. Otherwise, there is no substantive way to respond beyond noting that its sponsor favors preemption and that one of its authors does, indeed, teach at MIT, but this is not an "MIT study."

  3. But wait, there's more....

    It turns out Berndt Associates _is_ the creation of Prof. Berndt. According to the person who wrote the release, he chose to send it under that rubric rather than MIT. Berndt Associates apparently does not have its own website, so the one I found was for a _different_ Berndt Associates.

    The writer of the release herself works (or at least has an email address) for APCO. APCO, associated with the law firm, Arnold and Porter, has had particularly close links with the tobacco industry. It has been a major sponsor of the American Tort Reform Association--the most powerful anti-lawsuit organization in the country--as well as of various "Citizens Against Lawsuit Abuse" groups around the country--astroturf groups that pursue the ATRA agenda locally.

    Wonderful where the internet and a few phone calls can lead.

    Again, I look forward to the actual "white paper." But, as things stand, what we appear to have is the preemption/device defense lobby linked with sympathetic consultants/KOLs (whether or not paid).

  4. Once again, the contact person for the story has an email at APCO Worldwide. Here is some of what Sourcewatch writes on that organization:

    "APCO and the tobacco industry

    Philip Morris hired APCO to organize the front group TASSC (The Advancement of Sound Science Coalition) in October, 1993 to help fight public health efforts to control Environmental Tobacco Smoke that occurred in the wake of the U.S. Environmental Protection Agency's ruling that secondhand tobacco smoke was a Group A human carcinogen. APCO recommended that Philip Morris form a European TASSC group to: "Preempt unilateral action against the industry." [4]

    A 1993 memo written by Tom Hockaday of APCO Associates lists individuals that could be approached on behalf of Philip Morris to lend their names to pre-written, favorable-to-tobacco opinion-editorial pieces on the subject of Environmental Tobacco Smoke. One of the people APCO considered approaching was Peter Samuel, whose qualifications included the fact that he had "developed a book proposal to address unsubstantiated scares including alar, dioxin, DDT, ETS, asbestos and others." (Dioxin, the primary toxic component of Agent Orange, was found at Love Canal in Niagara Falls, New York and was the basis for evacuations at Times Beach, Missouri. Asbestos, a toxin and known carcinogen, causes the lung disease asbestosis and a cancer of the pleura called mesothelioma. DDT, a dangerous pesticide that can persist in the environment for up to 15 years, was banned in the United states in 1972.)[5]

    [edit]APCO and Tort Reform

    Philip Morris also hired APCO to manage a massive national effort aimed at altering the American juducial system to be more hostile towards product liability suits ("Tort Reform"). Tort reform was an internal corporate program of Philip Morris, who led other companies into the plan. According to a 1995 Philip Morris Tort Reform Budget, the industry paid APCO Associates almost $1 million in 1995 to implement behind-the-scenes tort reform efforts. APCO's job was to create chapters of "grassroots" citizens' groups called Citizens Against Lawsuit Abuse (CALAs).(2047648299/8307) The budget shows the tobacco industry alone budgeted $21.8 million to fund the tort reform effort in the single year of 1995.[6]

  5. Thanks Justice,

    What a clever way to manipulate Congress. Like you say this report, on an as of yet unknown study, has all the same presumptions presented with no data which is typical of the Free Industry From Accountability (FIFA) crowd.

    The new twist was to put Massachusetts Institute of Technology (MIT) in the first sentence in a last ditch effort to sway Congress away from their appointed duty of returning proper rights to the consumer. I hope that they won't be so easily fooled.

    Summing it all up in one sentence from the "report" then -

    "For those employed by the medical device industry, the increased manufacturers' costs would discourage investment in medical device development, reducing the R&D pipeline of innovative new products created and brought to market, and lead to layoffs of high-paying jobs."

    The thing is if you have enough money and no accountability or responsibility you could make chicken wire look like a miracle device. What innovation that would be. Think of the jobs it would create, and talk about low cost! Oh wait, maybe that's already been done.

  6. I really loved “Good Will Hunting” and really hate that this misguided study came out of MIT. Their saving grace is, “The views expressed are those of the authors only, and do not necessarily reflect views of the sponsor or MIT.”

    As stated, “The report was made possible by a grant from the Advanced Medical Technology Association,” which happens to be a national trade association of medical technology manufacturers. As a U.S. Chamber of Commerce member they, along with other such groups, “recommend Chamber policy on association-related issues, propose programming, foster networking and collaboration, and encourage involvement in Chamber activities.” - U.S. Chamber of Commerce - Association Committe of 100 Members

    Quite plainly, these folks support corporate America over those injured by defective medical devices. They also think it is a good idea for citizens to give up their right of legal recourse.

    In response to the authors of this deceptive study, all I can say is, ”don’t break a leg.”

  7. If anyone stumbles across this "White Paper" I hope they can share it with us. I've Googled it and nothing shows up.

    After years of hearing the presumptuous arguments for preemption, I've yet to hear any supporting data, the absence of which is telling. After all, given the technical depth and monetary resources of the pharmaceutical industry wouldn't you think we would have at least a few nice charts and graphs to look at that show real facts?

    Isn’t it funny that now - after the preemption argument has been lost for drugs – we have a “study” that proves that preemption is bad for us? Did somebody forget to do this kind of study 2 years ago as we began the Preemption v. Accountability case?

    Come to think of it, could the defeat of Preemption be the cause of the demise of the Incan civilization? We’ll have to wait for the white paper.

  8. I will also try to get a copy of the actual paper. Prof. Berndt has certainly published some legitimate studies, even if I would interpret the results differently. But it is interesting that he apparently went out of his way _not_ to suggest that this came from MIT, even as a faculty member there.

    So, in absence of data, the conclusions should probably taken as having the same credibility as much of what we heard from the tobacco industry in those days.

  9. This press release is taking the game of "smoke and Mirrors" to an entirely new level....

    Reminds me of something attributed to P.T. Barnum: "If you can’t dazzle them with dexterity, baffle them with bull."

  10. There are a number of things that this report obviously doesn't consider which tends to highlight the bias that the reporters had. Why not consider the affect of preemption on theses issues?
    1. The increase in the number of Adverse Events related to "new, innovative" drugs and devices.
    2. The increased cost of care caused by defective and poorly designed products.
    3. The overall increase in the number of new products and the relative actual benefit that they provide.
    4. The affect of litigation on corporate behavior or the level of unethical behavior in the industry with and without preemption.
    5. The issue of eliminating the consumer's right to bringing complaints to a court of law and how that eventually would play out. (ask the citizens of Michigan)
    6. The long term difference in the perceived trust that the consumer has in the pharmaceutical industry with and without preemption and the resulting affects.
    7. The amount of new information about drugs and devices that has been brought forth through litigation; information that would not have been known otherwise.
    8. Others?

  11. This is not a report but an opinion piece and, as has been pointed already, this report just rehashes the same arguments for preemption in general.
    Following this report to its logical conclusion one could therefore argue that since drugs have not enjoyed the same protection against preemption the pharmaceutical industry should not presently exist.
    Of course to back up the premise of this report the pharmaceutical industry could announce that because of their fear of litigation none of their new products are truly innovative.

  12. I have received a copy of the white paper but I've not yet read it.

    For others who are interested, it can be gotten through a message to:

  13. re: David's post, of course, we always go around in these circles.

    Preemptors talk about all the great products that never happenn (just as deregulators, their forebearers, did).

    Anti-preemptors talk about all the not so great products that do appear when civil liability is taken off the table.

    And there are a host of other arguments on both sides, that are usually aligned to push the safety/efficacy question in one direction or other.

    It is still relevant, though, that Milton Friedman--the high priest of deregulation and allowing market forces to prevail--viewed potential liability as a critical component of those market forces.

    Today's preemptors want both a minimalist FDA (in terms of actual enforcement) and zero liability.

    In my view, a nightmare scenario.

  14. After skimming through the White Paper I was struck by a couple of things.

    First - there were 66 instances of the words "likely" or "could" in the 22 pages of the report (not counting the appendix) that would be 3 per page. Basically every point was prefaced by these words. So this is more of an opinion piece rather than hard facts. The authors apparently don’t feel comfortable making statements that would “likely” turn out to be false. Smart move.

    The request that the authors make then is we need to totally eliminate the right of the consumers to complaint in a court of law because bad things could happen if we don’t. Sorry, I need definitive facts before I agree to a sacrifice of this kind.

    Next was the fact that we've had 6 decades of non preemption existence in the pharmaceutical industry but very little or no reference to that period of pharmaceutical history was presented. It would have been very simple to say – This is what it was like before preemption ---- This is what it was like after preemption enforcement by the Supreme Court three years ago.

    I don’t know, maybe I’m missing something but why go to all the trouble of comparing other industries or similar situations when you can easily see the before and after picture.

    I suspect that preemptors would rather forget that they ever had to live without preemption and would really not like the rest of the world to know that they did indeed survive quite nicely without it for 60 years.

    Could it be that they see a huge potential for profit without accountability and will do and say anything to make it happen? I think that's a fact.

  15. Butts for HealthMay 7, 2009 at 8:00 PM

    My impressions are the same as Jaynesday's. This appears to be a propaganda piece without substance, brought to us by the Friends of Big Tobacco.

  16. I would encourage folks to read about apcoworldwide, which appears to have coordinated the release of this "white paper."

    See the site,

    Some of the material on apco's relationship with tobacco was funded by the American Legacy Project, part of the settlement tobacco reached with 47 states. As I understand it, part of the deal here was to "come clean."

    What emerges is that apco has been involved in most of the issues threatening to pharma, tobacco, and industry more generally. They specialize in creating "astroturf" groups and tarring their opponents in various ways.

    They are, apparently, the originators of the phrase, "junk science," used to discredit those warning of the dangers of second-hand smoke. This appears to have been one of their actions against "environmentalists" more generally.

    Not surprisingly, "tort reform" has also been central in their efforts, and various ways to create the impression of a "lawsuit crisis" of which the piece referenced above appears to be an example.

    I should perhaps not be surprised, but their board includes former Senator Don Riegel from Michigan and former Rep. Steven Solarz from New York.

    I suppose everyone really does have their price.

  17. Have I missed something? Has MIT given a public release to disassociate themselves from this paper?

    If not, can we expect something to be forthcoming?

    If I was at MIT I would be outraged....

  18. Former, good question.
    The authors did state that their opinions were not those of MIT but still their association with the university is highlighted in the first sentence. MIT therefore lends its credibility to the authors regardless of what they say. The net result in my mind is a lowering of the credibility of MIT.

  19. Justice,
    A little more information about APCO and their tentacles... Here’s the link to a Pharmalot article (4/2008) on a lobbying effort by BIG Pharma for looser off label restrictions. Of note is that it is reported that APCO is represented by none other than the father of Preemption - Dan Troy.

    The gist of the story is quoted here -

    "Ten drugmakers, including Pfizer, Bayer Corp, AstraZeneca and Johnson & Johnson have formed a coalition to push for looser off-label restrictions and will submit their arguments today to the FDA, which has been soliciting comments on its proposed off-label promotion guidelines. They are represented by former FDA Chief Counsel Daniel Troy, who is working with public-relations giant APCO Worldwide."

    Does this mean that MIT and APCO have some kind of relationship?

  20. I know, that's stretching it a might.

  21. I think what it means is what we know. That the following have been part of the same essential agenda for a long time--

    1. "Tort reform" as in broadest possible preemption.

    2. Deregulation, especially of off-label promotion.

    3. Discrediting "environmentalists," "junk science" accusations, etc., as convenient.

    4. The various alliances of convenience between tobacco, pharma, and construction (especially in Texas) around these issues. (Ever learn who funded the "Swiftvets"?)

    4. The connections between various "think tanks" (Hoover, WLF, Federalist Society, ATRA, et. al., these industries, and hard right family foundations.

    This is no "vast right-wing conspiracy." All of it is available quite publicly. It is power politics from that side of the discussion.

    The initial release clearly differentiated what came from Berndt associates with what may or may not be the views of MIT or APCO. I see no problem with that. The fact that ways of phrasing may end up suggesting whatever; well, that's why it's called phrasing, I guess.

    Public relations ain't public education. It's Carnegie Hall--winning friends, and influencing people.

  22. Speaking of Texas, click on Alliances...

  23. One thing we can probably be sure of--even though there were the requisite disclaimers by MIT and apco on this essentially self-published (with AdvaMed funding) "white paper," it will be cited by others as an "MIT study" or similar. That's how PR works--get something on paper out there, and then get others to cite it as though it were something else.

    It works. And full deniability (e.g., "We can't control how others use or cite something.") Of course, often enough those "others" will be some of the same team.

    Nifty, huh?

  24. I worry that a company that does not clearly stand behind their product would ultimately loose sales because people tend to be wary of companies who do not stand behind their products. For example, vaccine companies are exempt from liability. I worry that this might be one of the reasons that some doctors will not provide vaccinations (potential med mal issue/increase?) and worry that this might be the reason that some people who might benefit from certain vaccines refuse to get vaccinated.

    Over the long term, is this ultimately bad for vaccine manufacturers because of the potential to decrease sales and increase marketing expense?

    In this case, if device manufacturers cannot be held liable under preemption, does the liability pass down to the pharmacies, hospitals and physicians who are involved with these devices?

    Also, if devices are not covered under preemption, are these American jobs more apt to be outsourced to foreign countries in part due to the decreased liability? Outsourcing is a very popular way to cut costs. In other industries, the benefit of the decreased costs need to be weighed against the potential increased logistics, transportation and defective product count increases. It does not seem like the potential increase in logistics and damaged goods pose any problem for device manufacturers who are protected under preemption, so what's stopping them?

  25. Just a clarifying point--the vaccine preemption is very limited. It covers only a dozen or so mandatory vaccines. And patients do not lose the right to bring suit if they choose to and/or do not accept the verdict of the "vaccine court."

    Thus, relative to preemption via Riegel, there is no comparison.

    I don't know the numbers, but my guess is that most of the manufacturing of devices is already outsourced. In the meantime, even if the whole company moved, that would not prevent U.S. citizens from bringing suit--as they now do agaist GSK, AZ, and other companies headquartered outside the U.S.


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