Faculty
Professor Donald P. Conway
Objectives
This course focuses on the current state of the Healthcare Industry worldwide with very specific emphasis on the state of Healthcare in the U.S. The central premise of this elective is that due to demographic changes (aging of the population, immigration, etc.) and political developments (Medicare Part D), there will be unique stress on the industry over the next ten years.
Within this changing environment the challenges of discovery, development and approval of new medical devices, drugs and biotech products will be studied.
Some estimates project healthcare in the U.S. to account for 20% of GDP by 2011. The increased demand for services will maintain consistent upward pressure on utilization of products and services. This will have increasing pressure on local and regional budgets and could force a “crisis situation” in many sectors.
There is an urgent need for current management skill sets to address these pressing needs with cost effective solutions. And of this situation, disruptive technologies with the promise of improving care and cutting costs will emerge. These will result in new efficiency, new profit centers and new IPOs.
Learning Objectives
The first part of the course describes the current state of the Healthcare System and the Regulatory requirements of FDA and EMEA. The decision-making criteria of the health authorities will be described and debated. Specifically, the Risk/Benefit Ratio, which is weighed for approval of each new health technology.
The second section of the course will examine how the stresses on the healthcare system now require unique new solutions. Data demonstrating the impact of a technology on disease progression, quality of life, and cost effectiveness soon will be formal requirements for commercialization. This will also mean substantial new opportunities for emerging technologies and services.
Overall the course is intended to prepare managers for success in a healthcare system which is in a state of flux.
Requirements
Course Administration and Evaluation
Class Preparation
The course pack contains the prescribed readings and cases. Classroom time will predominantly revolve around the class presentation and associated readings. For the class to work well, and for you to benefit from it to the greatest possible extent, preparation for each class meeting is essential. All students are expected to arrive at class prepared to discuss the readings and case(s) assigned for that day.
Materials
CASES and Readings.
NOTE: CASES and ALL STARRED(***) articles/readings are REQUIRED READING.
The remaining readings are OPTIONAL.
ATTENDANCE
Since the material in this class builds session by session, attendance at each session is important. Please notify me before class by any means available if you are unable to attend a session due to illness, family emergency, or an unavoidable conflict. If you must miss a class session for an interview, please notify me by e-mail in advance of class.
TUCK HONOR CODE
The Honor Code applies to this course.
OFFICE HOURS
My office hours for the month of January are Wednesdays, 12:00 noon to 5:00 pm and Thursdays 9:00-5:00 pm. You can also make an appointment to meet with me at another time by contacting me directly via email, phone, or at the end of class.
Grading
Optional Student Choice: Either Final Exam OR Group Project - 50%
The project is targeted at applying the concepts and principles you learn in class to real world situations in which you have a stake. This could be a topic or therapeutic area that you are driven to for personal or professional reasons. Also, it can be an assessment of a sector of healthcare and a specific firm. This would first highlight the particular variables important to healthcare investing and then drilling down to a deeper level of granularity in assessing those variables as they apply to a specific firm in which you are interested. Executive summaries / project proposals are due by Close-of-Business on Thursday, January 15th, 2009.
Final Projects are due Thursday, January 29th, 2009. The project should be a maximum of 3,000 words and submitted to the box located outside the office of my Assistant, Marcia Diefendorf in 310 Woodbury Hall by close-of-business, Thursday, January 29th, 2009.
Class Participation - 50%
The classroom is an experimental laboratory for you to test and challenge new ideas and concepts. Class participation will be evaluated on the quality and intellectual integrity of the discussion. As students in this class have valuable backgrounds in healthcare – every question, no matter how simple, is encouraged.
Optional Final Exam - 50%
TheFinal Exam percentage weight will be 50% (should you choose this instead of a Group Project)
Schedule
Class 1
Thurs. 1/08
Overview of the U.S. Healthcare System and Managed Care Organizations
OBJECTIVE: To frame the challenge of managing in the evolving health care environment.
TOPICS: Industry Analysis; Quality; Supply & Demand Setting; United States; Health Care Industry
***CASE: "The Challenge Facing the U.S. Healthcare System," (Richard Bohmer and Carin-Isabel Knoop)(HBS 9-606-096)
Alice Park, “America’s Health Checkup,” TIME, [Science] December 1, 2008, pp. 41-68.
(See the TIME listed weblink)
NOTE:
Two (2) hard copies of TIME magazine are on 2-hour loan at Course Reserve Desk at Feldberg. See the Librarian.
A color PDF of Alice Park article has been put on Electronic Reserves by Feldberg Library:
Follow Directions to electronic reserves:
1. Go to The Dartmouth College Library Website at
this website address: http://library.dartmouth.edu/
2. Click: "Reserves"
3. Search by instructor's last name - Conway, Donald
(Link is called: "Time Articles")
Jeff Goldsmith, “Obama’s Health Policy Options: 3 Scenarios,” HEALTH AFFAIRS. [The Policy Journal of the Health Sphere], [Blogsite], Nov. 5, 2008 See weblink:
Jonathan Gruber, (Op-Ed Contributor)“Medicine for the Job Market,” The New York Times, December 4, 2008 (1 page).See weblink:
John Iglehart, “Obama and Health Policy: Campaign Successes and Governing Plans,” HEALTH AFFAIRS [The Policy Journal of the Health Sphere], [Blogsite], Nov. 5, 2008
See weblink:
***U. Reinhardt, “Is There Hope for the Uninsured,” Health Affairs (Web exclusive), Aug. 27, 2003 , W3-405-414; W3-376-390. See weblink:
***“The High Cost of Health Care,” The New York Times, EDITORIALS/LETTERS, November 25, 2007 See weblink:
Richard Wolf, “Social Security Hits First Wave of Boomers,” USA Today, Tuesday, October 9, 2007, See weblink:
Milt Freudenheim, “Employers Offer Workers Fewer Health Care Plans,” The New York Times, B1, B9, November 15, 2008 See weblink:
W. Miller et al, “Covering the Uninsured: What is it Worth?,” HEALTH AFFAIRS, Chevy Chase, Jan-Jun 2004,: pg. W157,(11 pgs). See weblink:
Class 1 cont'd
Thurs. 1/08
Overview of the U.S. Healthcare System and Managed Care Organizations
Julie Rovner, “Health Care Back in the National Spotlight,” (HEALTH CARE REFORM), NPR March 19, 2007 See weblink:
***[Letters to the Editor], “Health Costs: Symptom or Disease?,” The New York Times, [OPINION], Sunday, June 10, 2007. See weblink:
***David Leonhardt, “Health Care As if Costs Didn’t Matter,” The New York Times, Wednesday, June 6, 2007. (Graphics available on weblink). See weblink:
Milt Freudenheim, “Mayo Clinic Recommends Universal Health Insurance Plan,” The New York Times, September 15, 2007 See weblink:
***Reed Abelson, “Health Plan Used by U.S. Is Debated As a Model,” The New York Times, Saturday, October 20, 2007 See weblink:
Bob Herbert, “It’s Not Just the Uninsured,” The New York Times, [OP-ED,] November 17, 2007 See weblink:
Tom Ashbrook, “The Business of Healthcare,” NPR (National Public Radio) [PODCAST], Tuesday, May 08, 2007. LISTEN at weblink site:
Class 2
Fri. 1/09
CASE: Discovering the Future: R&D Strategy at Merck (HBS 9-601-086)
***“How New Drugs Move through the Development and Approval Process,” See weblink:
“A Methodology for Counting Costs for Pharmaceutical R&D” See weblink:
D. Carpenter, “The Political Economy of FDA Drug Review: Processing, Politics, and Lessons for Policy,” HEALTH AFFAIRS. [The Policy Journal of the Health Sphere], Jan./Feb. 2004, vol. 23, No. 1, pp. 52-63. See weblink:
J. Hoadley, “The Continued Need for Independent Research on Prescription Drugs,” HEALTH AFFAIRS. [The Policy Journal of the Health Sphere], Jan./Feb. 2004, Vol. 23, No. 1, pp. 244-249. See weblink:
***“Biotechnology Advances Have Improved R&D Success Rates, According to Tufts CSDD,” See weblink:
“Innovative R&D Strategies Remain Key to Developing New Medications” See weblink:
*** Milne CP, Reichert JM, Kaitinj KI, Fadan L, “The Impact of FDA Initiatives to Improve Drug and Biological Product Development and Approval,” (in progress), Outlook 2004, TUFTS CENTER FOR THE STUDY OF DRUG DEVELOPMENT, Tufts University, 2004.(Short general description) See weblink:
Class 3
Wed. 1/14
CASE: Product Team Cialis: Getting Ready to Market (HBS 9-505-038)
***M. Ginsburg, “Cost-Effectiveness: Will the Public Buy It Or Balk?” See weblink:
***Alex Berenson, “Minky Viagra? Pfizer Doesn’t Want You to Understand It, Just Buy It,” The New York Times, April 30, 2007. See weblink:
Gardiner Harris, “Senators Seek Public Listing Of Payments To Doctors,” The New York Times, September 7, 2007. See weblink:
***Daniel Carlat, “Dr. Drug Rep,” The New York Times Magazine, November 25, 2007, pp. 64-69. See weblink:
Class 4
Thurs. 1/15
CASE: Abbott Laboratories and HUMIRA: Launching a Blockbuster Drug (Stanford OIT-44)
Andrew Pollack, “Broader Financial Turmoil Threatens Biotech’s Innovation and Cash,” The New York Times, [A CRISIS IN FINANCE: The Money Hunt] B6, October 29, 2008. See weblink:
A. Burles et al, “Commissioning for Rare Diseases: View from the Frontline,” BMJ, October 29, 331(7523), 2005, pp. 1019-1021. See weblink:
***DiMasi JA, Grabowski HG. “Economics of New Oncology Drug Development” Journal of Clinical Oncology, Vol. 25, No 2 (January 10), 2007: pp. 209-216 © 2007. DOI: 10.1200/JCO.2006.09.0803), See weblink:
***James J. Cramer, New York Magazine, “Crash Insurance,” THE BOTTOM LINE, March 12-19, 2007, pp. 42, 44. See weblink:
Alex Berenson and Andrew Pollack, “Doctors Reap Millions For Anemia Drugs,” The New York Times, Wednesday, May 9, 2007, pp. A1, C4. See weblink:
***Heather Won Tesoriero and Avery Johnson, “Suit Details How J&J Pushed Sales of Procrit,” Wall Street Journal, May 10, 2007. See weblink:
***Andrew Pollack, “Duel Over a Monopoly,” The New York Times, October 17, 2007. See weblink:
Class 5
Thurs. 1/22
Hurdles to Market
CASE: EXUBERA and NICE (Stanford OIT-80)
***G. Anderson et al, “It’s the Prices, Stupid: Why the United States is So Different from Other Countries,” HEALTH AFFAIRS. [The Policy Journal of the Health Sphere], May/June 2003, Vol. 22, No. 3, pp. 89-105. See weblink:
***Malcolm Gladwell, "HIGH PRICES," New Yorker, 10/25/2004, Vol. 80 Issue 32, pp. 86-90. See weblink:
Michael D. Rawlins and Anthony J. Culyer, [Éducation and debate] “National Institute for clinical Excellence and its value judgments,” BMJ 2004, Vol. 329 224-227 (24 July) (doi:10.1136/bmj.329.7459.224) (5 pgs). See weblink:
Gardiner Harris, “British Balance Gain Versus Cost of Latest Drugs,” The New York Times International, [Health] A1, A16; December 3, 2008. See weblink:
Ole Frithjof Norheim, [Analysis] “Clinical priority setting,” BMJ, 2008-337-a1846 (4 pgs). See weblink:
Appleby, Devlin & Parkin, [Editorials], “NICE’s cost effectiveness threshold,” BMJ, 2007-335-358-359-25August (2 pgs. See weblink:
Jonathan A. Michaels, “Improving NICE’s social value judgments,” [Analysis and Comment/Health Policy], BMJ, 2006, Vol. 332, pp.48-50 (7 January). See weblink:
Jammi N. Rao, “NICE and its value judgments. Favourable appraisal amounts to compulsory purchase order,” [Letter], BMJ, 2004, Vol. 329, pp. 740-741 (25 September). See weblink:
Richard Smith, [Editor’s choice], ”The triumph of NICE,” BMJ, 2004, Vol. 329 (24 July) (2 pgs). See weblink:
Class 5 (cont'd)
Thurs. 1/22
Hurdles to Market
Michael D. Rawlins, “NICE Work – Providing Guidance to the British National Health Service,” NEJM, Vol. 351, September 30, 2004, pp. 1383-1385. See weblink:
Class 6
Fri. 1/23
Topic: In-Licensing - Corporate M&A and ICEs (Improved Chemical Entities)
Guest:
Anne Sullivan T’95
Director of Business Development
Sepracor, Inc.
Marlborough, MA
Anne M. Sullivan has been with Sepracor since 1998 and is currently Director of Business Development. In this role, she is responsible for out-licensing and establishing strategic relationships such as co-promotion deals on Sepracor's drug candidates. She also manages the in-licensing of new products and enabling technologies. Ms. Sullivan has been instrumental in Sepracor’s transition to a fully integrated pharmaceutical company, with involvement in both strategic marketing and product development activities.
Prior to joining Sepracor, Ms. Sullivan held management positions in marketing, market research, and sales at Abbott Laboratories. Ms. Sullivan is a certified public accountant and previously held positions in audit and international finance at KPMG Peat Marwick and Wang Laboratories.
Anne earned her A.B. in Economics and Accounting from the College of the Holy Cross, located in Worcester, Massachusetts in 1988, and her MBA from the Tuck School in 1995.
Class 7
Wed. 1/28
Topic: Medical Devices Development
CASE: Fred Khosravi and Access Closure (HBS 9-806-044)
***Endius Inc.: Alternatives for Developing a New Medical Device (DMI011)(HBS)
***A.V. Kaplan, D.S. Baim, J.J. Smith et al, “Medical Device Development. From Prototype to Regulatory Approval,” Circulation, June 29, 2004, pp. 3068-3072. See weblink:
R. Mehran, M.B. Leon, D.A. Feigal et al, “Post-Market Approval Surveillance. A Call for a More Integrated and Comprehensive Approach,” Circulation, June 29, 2004, pp. 3073-3077. See weblink:
A. Berenson, “Just 20 New Products Are Approved, Despite Biotechnology’s Hope,” [Drugs in '05: Much Promise, Little Payoff], The New York Times, January 22, 2006, pg. C.1. See weblink:
Barnaby J. Feder, “Artificial-Joint Makers Settle Kickback Case,” The New York Times, September 28, 2007, pp. C3. See weblink:
***Barnaby J. Feder, “First, A New Artery Stent Study; Now, Questions About What It All Means,” The New York Times, Wednesday, March 28, 2007, pp. C5. See weblink:
***Arlene Weintraub, “Ís the Hip Bone Connected to a Fee?,” BusinessWeek, [NEWS], December 3, 2007. See weblink:
Jeffrey C. Lerner, Daniel M. Fox et al, “The Consequence of Secret Prices: the Politics Of Physician Preference Items,” HEALTH AFFAIRS. [The Policy Journal of the Health Sphere], , Vol. 27, No. 6, November-December (2008), pp. 1544-1565. See weblink:
Mark V. Pauly and Lawton R. Burns, “Price Transparency For Medical Devices,” HEALTH AFFAIRS. [The Policy Journal of the Health Sphere], , Vol. 27, No. 6 (2008), pp. 1544-1553. See weblink:
Class 7 (cont'd)
Wed. 1/28
Topic: Medical Devices Development
Susan Dentzer, Editor-in-Chief, “Medical Technology & Spending: The Next Market Bubble?,” HEALTH AFFAIRS. [The Policy Journal of the Health Sphere], Vol. 27, No. 6, 2008, pp. 1464-1465. See weblink:
Julie Appleby, “The Case of CT Angiography: How Americans View and Embrace New Technology,” HEALTH AFFAIRS. [The Policy Journal of the Health Sphere], Vol. 27, NO.6, 2008, pp. 1515-1521. See weblink:
Class 8
Thurs. 1/29
Topic: Medicare Part D
Guest:
Greg Butz T’06
Morgan Stanley
Investment Division
Greg is an Associate in Morgan Stanley's Western Region Healthcare Practice. He joined Morgan Stanley in 2006 and focuses on the biotechnology, emerging pharma and medical technology sectors. Prior to Morgan Stanley, Greg was a Senior Equity Research Associate at Banc of America Securities and Robertson Stephens, where he followed mid cap and large cap biotechnology companies. In addition, Greg worked in Specialty Biotherapeutics Commercial Strategy at Genentech. Greg has a degree in Economics from Williams College and an M.B.A.in 2006 from the Tuck School of Business at Dartmouth.
***“Medicare Rules Set Off a Battle on Drug Choices,” (R. Pear), The New York Times, September 26, 2004, pp. 1-3. See weblink:
“Priorities in the Pharmaceutical Industry” HEALTH AFFAIRS. [The Policy Journal of the Health Sphere], Jan/Feb 2004. See weblink:
***“Designing a Prescription Drug Benefit” HEALTH AFFAIRS. [The Policy Journal of the Health Sphere], Jan/Feb 2004. See weblink:
***“How Much Should Medicare Pay for Drugs?,” (J. Newhouse), HEALTH AFFAIRS. [The Policy Journal of the Health Sphere], Jan./Feb. 2004, Vol. 23, No. 1, pp. 89-102. See weblink: See weblink:
Robert Pear, “Studies Say Private Medicaer Plans Have Added Costs, for Little Gain,” The New York Times,” B2, November 24, 2008. See weblink:
“Efforts to Reduce Medicare Advantage Plan Payments,” EmaxHealth. See weblink:
“Medicare’s Too Costly Private Plans,” The New York Times, EDITORIAL [Opinion], November 29, 2008. See weblink:
“The Challenges of a Medicare Drug Benefit” HEALTH AFFAIRS, Jan/Feb 2004. See weblink:
“Physicians’ Views of Formularies: Implications for Medicare Drug Benefit Design,” HEALTH AFFAIRS. [The Policy Journal of the Health Sphere], Jan/Feb 2004. See weblink:
Class 8 (cont'd)
Thurs. 1/29
Topic: Medicare Part D
***R. Pear, “Medicare Law’s Costs and Benefits are Elusive,” (R. Pear), The New York Times, December 9, 2003, pp. 1-3. See weblink:
*** “Deciphering the Drug Benefit (12/08/2003)” (TABLE), The New York Times, December 9, 2003. See weblink:
J. Lee et al, “Medicare Payment Policy: Does Cost Shifting Matter?,” HEALTH AFFAIRS.[The Policy Journal of the Health Sphere, Jul-Dec 2003. See weblink:
“Medicare ‘Pay for Performance (P4P)’ Initiatives,” Centers for Medicare & Medicaid Services
See Weblink for January 31, 2005:
(continued)
. . . “Medicare ‘Pay for Performance (P4P)’ Initiatives,” Centers for Medicare & Medicaid Services. See second Weblink:
Class 9
Wed. 2/4
Topic: STUDENT PRESENTATIONS
***A. Garber, “Cost-Effectiveness and Evidence Evaluation as Criteria for Coverage Policy,” HEALTH AFFAIRS. [The Policy Journal of the Health Sphere], May 19, 2004. See Weblink:
