By Leah Gannon, MBA
The acquisition of radiopharmaceuticals, used in molecular or nuclear imaging, has entered into an unpredictable era with long term price increases for various reasons, including new manufacturing requirements. Medical diagnostic imaging with 99m Technetium (99mTc) radiopharmaceuticals represents 80% of procedures performed each day in the US.
The foreign medical reactors 99mTc is derived from are undergoing a conversion of their source material away from highly enriched uranium (HEU), which has been known to be used in nuclear weapons, to alternative non-HEU sources. US government mandates were promulgated to assist in global threat reduction from nuclear weapons, as well as the development of a domestic 99 Mo and 99mTc production and supply. Included in these mandates were provisions for Full Cost Recovery, which will increase cost to the US as the foreign subsidies by these host nations are phased out. Therefore, pricing must include the recovery for the full cost of production to ensure economic sustainability and a long term secure supply. However, these costs will ultimately be passed along the supply chain directly to hospitals, cardiology clinics, and imaging centers.
Compounding the issues related to the price of the 99mTc, a perfect storm awaits the cost of the non-radioactive portion (ligand) of the radiopharmaceutical. Over the last decade we have seen a divestiture of many low cost pharmaceuticals and consolidation of the industry to single source: proprietary manufacturers. Ultimately, this has led to unprecedented product availability and price increases in the market, which has continually impacted healthcare organizations.
In addition to the price pressures mentioned above, the recovery of these greater than traditional price increases continues to lag behind the current reimbursement models, and theoretically in its current methodology, could shift the nuclear medicine departments of healthcare organizations from profit centers to cost centers as we enter the new era of uncertainty. I will be speaking more on these issues during my session, “Impact on Cost in Nuclear Medicine related to New Technology, Government Intervention and Collapsing Reimbursement Structures” on Wednesday, August 3 at 2:00 PM at the 2016 AHRA Annual Meeting in Nashville, TN.
Leah Gannon, MBA is the senior portfolio executive, contrast media and nuclear medicine at Vizient in Irving, TX. She can be reached at firstname.lastname@example.org.