By Laura Thill
As generic devices prove to be as reliable as brand name products, more IDNs will be amenable to using them.
The future is in generics, says supply chain consultant Chris Baskel, former system director of supply chain management at Spectrum Health. Particularly as standard devices, such as shoulder anchors and hip replacements, come off patent, more manufacturers are expected to offer generic copies, he says. And, they’ll work just as well as the originals. Baskel is so certain of this, he currently is educating healthcare systems on the value of adopting generic technology and substantially reducing costs – sometimes by as much as 50 to 75 percent. “If a generic shoulder anchor costs $100, compared to $350 for a brand name device – and assuming an average of four anchors are used per case – that would add up to $1,000 savings for the hospital,” he says.
“The emerging generic market is creating exact replicas of the stable name brand products hospitals have used for years,” Baskel says. “However, there will be little to no movement toward a generic market until physicians’ behavior begins to change. There is a tight bond between many physicians and name brand companies based on relationships that have developed over time. Thirty years ago, the idea and introduction of a generic pharmaceutical market would have raised a lot of eyebrows. Today, it’s a given.”
Convincing IDNs and their physicians to adopt generic technology could be a hard sell, he continues, and not without good reason. “First and foremost, where would healthcare be today without the life-saving new technology developed by innovative manufacturers over the course of time?” he says. Traditionally, IDNs have worked hard to be early adopters of new products and devices. But, taking a wait-and-see approach just might be the best way to go. For one, it’s prudent and safer to employ products that have a proven track record over time. A quick Internet search will explain why, he adds.
Intuitive Surgical’s da Vinci robotic surgical system, for example, was designed to provide surgeons greater visibility and control when performing certain invasive procedures. “This robotic system performs as advertised when it is used correctly,” says Baskel. “But, it is another example of a technology rushed into use by some hospitals before physicians were properly trained to use it.”
Indeed, several patients who underwent surgery with the assistance of the da Vinci received tissue burns and electrocutions that resulted in organ damage, infection, severe bleeding and other complications. In at least one case, a piece of the da Vinci system broke off during surgery and lodged in a patient’s pelvis.
Along the same lines, there were cases where bioabsorbable suture anchors broke with screw-in insertion, as well as reports of inconsistency in the quality of the bioabsorbable material. (“Bioabsorbable Anchors in Glenhumeral Shoulder Surgery,” 2009, Shane J. Nho, M.D., M.S.; LCDR Matthew T. Provencher, M.D., MC, USN; Shane T. Seroyer, M.D.; and Anthony A. Romeo, M.D.) “In many cases, the smart move may be for hospital administrators and purchasing executives to take a wait-and-see approach as others use new technology, and see how successful it is and what the pitfalls might be,” says Baskel. “Given what we know today, what would the best choice be? To switch to the new technology, or a stable generic technology that has worked admirably for years?”
“The first opportunities will be in orthopedics – spine implants, shoulder anchors and eventually hip/knee replacements,” he says, adding that for-profit hospitals and clinics likely will be the early adopters. But, in time, he believes Medicare and Medicaid will encourage hospitals to follow suit. “Until this happens, there may not be [a lot of] incentive for hospitals to make the switch to generics,” he says. “But, one way or another, these are savings they are missing out on.
“Currently, it is very difficult to convince physicians to change from working with brand hip and knee companies,” he continues. “Yet, there is no medical-based evidence to support a clear leader in the market place. There are five major hip manufacturers selling three types of hips: low-demand hips for elderly patients; medium-demand hips; and high-demand hips for young and active adult patients.” In theory, these products have always been sold based on medical research and outcomes, he says. “In reality, they are commodities sold based on physician preference and long-standing relationships. Can you imagine the difficulty [this will cause] changing to generic products when they hit the market?”
Nevertheless, as healthcare reform moves forward, more physicians will choose to join larger healthcare systems, he continues. Several years from now, when these physicians are working for an IDN that is advocating generic implants and anchors, they will have to come on board, he says. As more health systems come under pressure to publish the prices of their implant and device procedures, and physicians and patients become more aware of the savings to be had by using generics, interest will grow, he adds. “And, slowly but surely, the cost of implants will become more transparent to both the hospitals and consumers,” he says. “There is no excuse. All hospitals and IDNs should publish their prices because it’s the right thing to do.” His former employer, Spectrum Health has done so for some time, he adds.
“History is repeating itself,” says Baskel, referring to the movement from brand name pharmaceuticals to generics in the 1980s. “Manufacturers are fighting this like crazy, and hospitals and physicians are scared of lawsuits and bad publicity.” But, just as generics now drive the pharmaceutical market, as IDNs and physicians become better educated on the value and savings to be had, generic devices and implants will quickly catch on.
Editor’s note: For more information, contact Chris Baskel at cmbaskel@comcast.net.