Orphan drugs : future viability of current forecasting models, in light of impending changes to influential market factors

Thesis (S.M.)--Harvard-MIT Division of Health Sciences and Technology, 2011.Cataloged from PDF version of thesis.Includes bibliographical references (p. 58-61).Interviews were conducted to establish a baseline for how orphan drug forecasting is currently undertaken by financial market and industry analysts with the intention of understanding the variables typically accounted for in such a model. A literature search formed the basis of subsequent interviews conducted with experts from industry, payers, providers, legislators, patient groups, and the FDA. Discussion then focused on elements of the market which are poised to change in the short-term, how such changes might be reflected in existing models, and/or how these models may instead need to be modified to adapt to the new environment. We hypothesized that impending changes in the healthcare sector would indeed impact the legitimacy of current forecasting models, and that significant changes would need to be introduced to account for these new market forces. Our hypothesis, however, was not confirmed, in that although much of the literature and, indeed, public outcry over rising healthcare costs in general and drug prices in particular make a strong case for implementing changes in the orphan market via payers, government, or other actors, an assessment of healthcare experts regarding market changes over the next five years revealed a general consensus that meaningful change will likely not occur during this timeframe for orphan products, with the exception of a possible increase in pharmacoeconomic requirements for drugs which are only marginally effective. Thus, current orphan drug forecasting models constructed for use by financial and industry analysts correctly avoid discounting for these potential changes, as they will likely not face significant changes in the US until closer to a ten year time horizon. Potential exceptions to this conclusion depend on implementation and regulatory treatment of the fields of personalized medicine and gene therapy, as developments in these areas may closely interact with existing orphan drug legislation. Our results have significant implications for all companies and stakeholders entering or currently operating in the orphan market, and open the door for further quantitative and qualitative analysis.by Joshua Gottlieb.S.M

Urban Resurgence and the Consumer City

Cities make it easier for humans to interact, and one of the main advantages of dense, urban areas is that they facilitate social interactions. This paper provides evidence suggesting that the resurgence of big cities in the 1990s is due, in part, to the increased demand for these interactions and due to the reduction in big city crime, which had made it difficult for urban residents to enjoy these social amenities. However, while density is correlated with consumer amenities, we show that it is not correlated with social capital and that there is no evidence that sprawl has hurt civic engagement.

Begin Again

Page 6

Burial Rights

Pages 69-7

Medicare’s payments system affects the whole US healthcare sector

The cost of bargaining and billing leads private players, usually much smaller, to use Medicare's model, write Jeffrey Clemens and Joshua Gottlie

Deepwater Drilling: Law, Policy, and Economics of Firm Organization and Safety

Although the causes of the Deepwater Horizon spill are not yet conclusively identified, significant attention has focused on the safety-related policies and practices—often referred to as the safety culture—of BP and other firms involved in drilling the well. This paper defines and characterizes the economic and policy forces that affect safety culture and identifies reasons why those forces may or may not be adequate or effective from the public’s perspective. Two potential justifications for policy intervention are that: a) not all of the social costs of a spill may be internalized by a firm; and b) there may be principal-agency problems within the firm, which could be reduced by external monitoring. The paper discusses five policies that could increase safety culture and monitoring: liability, financial responsibility (a requirement that a firm’s assets exceed a threshold), government oversight, mandatory private insurance, and risk-based drilling fees. We find that although each policy has a positive effect on safety culture, there are important differences and interactions that must be considered. In particular, the latter three provide external monitoring. Furthermore, raising liability caps without mandating insurance or raising financial responsibility requirements could have a small effect on the safety culture of small firms that would declare bankruptcy in the event of a large spill. The paper concludes with policy recommendations for promoting stronger safety culture in offshore drilling; our preferred approach would be to set a liability cap for each well equal to the worst-case social costs of a spill, and to require insurance up to the cap.Deepwater Horizon, BP oil spill, safety culture, government policy, liability caps, financial responsibility, insurance

The Economics of Place-Making Policies

place-making policy, macroeconomics, welfare, income, Empowerment Zones, productivity

The Economics of Place-Making Policies

Should the national government undertake policies aimed at strengthening the economies of particular localities or regions? Agglomeration economies and human capital spillovers suggest that such policies could enhance welfare. However, the mere existence of agglomeration externalities does not indicate which places should be subsidized. Without a better understanding of nonlinearities in these externalities, any government spatial policy is as likely to reduce as to increase welfare. Transportation spending has historically done much to make or break particular places, but current transportation spending subsidizes low-income, low-density places where agglomeration effects are likely to be weakest. Most large-scale place-oriented policies have had little discernable impact. Some targeted policies such as Empowerment Zones seem to have an effect but are expensive relative to their achievements. The greatest promise for a national place-based policy lies in impeding the tendency of highly productive areas to restrict their own growth through restrictions on land use.