Economist Heidi Williams, Genius Award Winner, On Invisible Drug Industry Incentives

Last week, as she was sitting in her office at MIT, 34-year-old economist Heidi Williams got an unexpected phone call. It was from the John D. and Catherine T. MacArthur Foundation, telling her that she had just been awarded a so-called “Genius Award” — a no-strings-attached $625,000 grant that celebrates “the creative potential” of its fellows.

Williams, an assistant professor of economics at MIT, researches how invisible economic incentives affect the kind of cures that the medical industry produces. Her research has found that researchers are more likely to develop cures for late-stage cancer patients than early-stage patients, for instance, and that intellectual property law can limit innovation in genome research.

Radio Boston’s Anthony Brooks spoke with Williams about her research and her award (the interview airs in an upcoming show). Their conversation, edited:

AB: Tell us how you got the news about this award, and your reaction to it.

HW: I got a phone call from an area code that I recognized as a Chicago number. And I was just completely speechless when I answered the phone and talked to them. I’m very early in my career, and I was just completely overwhelmed to hear that I had received a fellowship.

Talk to me about these invisible economic incentives that affect the cures that the medical industry produces. Can you explain how this works?

Researchers working on drug treatments often come up with a lot of ideas, but if you talk to them, many of those ideas just never reach patients. Sometimes you hear anecdotes about the reason why those products never got developed — because of misaligned incentives in the patent systems or because of misaligned incentives in the policy system more generally. I try to explain why some promising scientific leads never get developed into new drugs or medical technologies that consumers or patients actually have access to.

Why are there incentives for late-stage cancer treatment for example, but few for early-stage cancer, or even cancer prevention? What incentives control that?

When new drugs come to market in the U.S., they need to show the U.S. government evidence that the drugs are safe and effective by showing evidence that the drug improves survival. When you need to show that a drug improves survival for patients that are very sick and will die relatively quickly, you can show that in a randomized clinical trial much more quickly than if you need to show evidence that a drug improves the survival of patients that have a longer life expectancy.

Longer clinical trials take more time and cost more money, but also, biotech and pharmaceutical companies almost always file for patent protection before they start their clinical trials. And so every additional amount of time that they’re spending in clinical trials is less time that they have for their patent to actually be generating profits for them once their drug is on the market. Continue reading

Researchers Try To Measure How The Great Recession Hurt Our Health

In this June, 2010, photo, Frank Wallace, who has been unemployed since May of 2009, is seen during a rally organized by the Philadelphia Unemployment Project. (AP Photo/Matt Rourke)

(Matt Rourke/AP)

When you pull the economic rug out from under people, what happens to their health? I’d never thought of the Great Recession as one big clinical trial, but that’s the perspective of Harvard researchers in “Failing Economy, Failing Health,” a sweeping new look at efforts to measure the health effects of the recession just out here.

Bottom line: We don’t really know what economic downturns do to health yet, but it doesn’t look good. The researchers featured in the piece are exploring potential links to “a growing list of physical and mental health ills, from heart attacks to obesity to depression.”

Losing a job appears to raise your risk of premature death and new health conditions. And here’s a particularly striking chunk about a 2010 poll:

The survey found that many people with heart disease, diabetes, or cancer believed that the downturn was hurting their health and that these negative impacts would only worsen over time. Among the facts unearthed by the poll: About a third of those with heart disease or diabetes and a fifth of those with cancer blame the economic downturn for forcing them to use up their savings to deal with medical bills, co-payments, and other expenses related to their illnesses. More broadly, according to the poll, some 4 in 10 Americans with heart disease or diabetes and 1 in 5 with cancer said the downturn had made it more stressful for them to manage their illnesses, a scenario that in itself may have exacerbated existing health problems.

Read the full piece for a broader exploration of how America’s heavily employer-based health insurance system could interact with a recession to raise stress and hurt health.

But let’s not end on a depressing note: There’s also been some interesting research on drops in death rates during downturns, possibly — according to one theory — because high unemployment sends more workers to nursing homes, which helps save elderly residents’ lives.

Nobel For A Pioneering Founder Of Kidney Exchange Program

If you want to understand the work of Alvin Roth, of Harvard and Stanford, and Lloyd Shapley of U.C.L.A., who share this year’s Nobel Prize in economics for their work on markets and matching theory and specifically, “for the theory of stable allocations and the practice of market design” watch Roth’s 2007 Google Tech Talk here:

In it, he touches on, among other things, why eating horse meat in California is illegal (but eating cockroaches isn’t) as well as his pioneering work as a founder of The New England Program for Kidney Exchange, a registry and matching system that helps connect compatible kidney donors and recipients.

On his blog, Market Design today, Roth notes that blogging may be temporarily delayed: “Count me as surprised…”

Why Recessions Are Good For Your Health: Nursing Home Staffs?

nursing home xmas


It’s an odd phenomenon: More people tend to die during good economic times than bad.

A paper just posted by the The National Bureau of Economic Research offers an interesting explanation: When the economy is better, the labor market gets tighter and staff shortages in nursing homes get worse, so the inferior care leads to more deaths.

As the analysis notes, there are many theories that purport to explain the recessionary drop in deaths. Maybe when you work more, you eat worse and exercise less. Maybe when you work more, you drive more, leading to more pollution and accidents. Maybe (my favorite) work is just bad for you.

But the key seems to lie with older women, argue the authors of “The Best of Times, the Worst of Times: Understanding Pro-cyclical Mortality.” They note that “women age 65 plus account for 55% of the roughly 6,700 additional deaths (across all ages and genders) that are predicted to result from a 1 percentage point drop in unemployment.” Continue reading

WSJ: Foreclosure Is Bad For Your Health

Losing your home is stressful, of course, but here’s new data from a pair of economists that foreclosure actually results in more visits to the emergency room and increases in hypertension and diabetes, among other health problems. The Wall Street Journal reports:

New research by Janet Currie of Princeton University and Erdal Tekin of Georgia State University shows a direct correlation between foreclosure rates and the health of residents in Arizona, California, Florida and New Jersey. The economists concluded in a paper published this month by the National Bureau of Economic Research that an increase of 100 foreclosures corresponded to a 7.2% rise in emergency room visits and hospitalizations for hypertension, and an 8.1% increase for diabetes, among people aged 20 to 49.

Each rise of 100 foreclosures was also associated with 12% more visits related to anxiety in the same age category. And the same rise in foreclosures was associated with 39% more visits for suicide attempts among the same group, though this still represents a small number of patients, the researchers say.

Teasing out cause and effect can be delicate, and correlation doesn’t necessarily mean foreclosures directly cause health problems. Financial duress, among other issues, could lead to health problems—and cause foreclosures, too.

Economists Enter Legal Fray In Defense Of Health Reform

David Cutler of Harvard and Jonathan Gruber of MIT are just two of the 35 renowned economists who have signed an amicus brief in support of the national health reform law, which currently faces a constitutional challenge as part of a multi-state lawsuit underway in Florida. At issue is the health law’s requirement that most individuals get health insurance.

The group of economists, including three Nobel laureates, “say they have an interest in ‘assisting the Court in its understanding of the underlying economics that are at the heart of the minimum coverage provisions” of the law,’ writes NPR’s Julie Rovner in a blog post on the federal lawsuit today.

How do they want to help? Well, the economists want to make sure Judge Vinson understands that, despite the claims of the law’s opponents that requiring individuals to carry health insurance could lead to unprecedented federal intrusion in people’s lives, “the unique economics of health care distinguish it from virtually every other business and demonstrate that upholding the constitutionality of that provision will not serve as a basis for unlimited expansion of the federal government’s powers.”