Mervyn Turner, Merck's senior vice president for worldwide licensing, told the Deutsche Bank's 30th Annual Health Care Conference in Baltimore the company has used its product-licensing strategy to enter the oncology research arena, which historically has not been a strong suit.

Turner said the industry had not seen Merck, which had a strong biological capability it was not ready to use, as a player in the oncology market. "They got no sense of commitment (on our part)," he said. "We were considered reluctant ... and generally risk averse."

When Merck bought geonomics company Rosetta Inpharmatics of Seattle in 2001, it laid the foundation for its entry into the oncology venue through molecular profiling - what Turner said has evolved into "the driver for our oncology strategy."

The technology digs to the genetic level to determine which patients respond to which therapies. That signature information then drives the basic research.

"We're committed to oncology because there is a significant unmet medical need for virtually all cancers," Turner said. "We have a strategy to grow the oncology franchise."

Merck already owns Enmend, approved for chemotherapy nausea, and Cancidas, an anti-fungal used in cancer therapy. Also in development is Gardasil, a vaccine for preventing cervical cancer, which so far as shown promising results in clinical trials.

Peter Dolan, chairman of BMS, told a Web cast shareholder meeting his company also continues to focus on areas of unmet needs, including cancer. Sales of its 2004 entry for metastatic colorectal cancer, Eribtux, total some $350 million and Dolan said the drug "also represents an important bridge to our promising oncology pipeline."

Eribtux was approved by the U.S. Food and Drug Administration in February 2004 and is marketed under an agreement with ImClone Systems.

Taxol, the company's biggest anti-cancer offering, has begun to feel the financial effects of generic competition in major European markets, as has Paraplatin, which saw sales drop significantly in 2004 because of generics.

Dolan noted expected declines from generic competition in the coming five years, but he called the company's exposure modest. He said the pharmaceutical industry is in transition, with policy debates underway on pricing and access.

"The industry must have a voice that is respected and listened to," he said, adding "many of our leading scientists believe we are on the verge of a truly golden age of medicine."

Gains in biotechnology research are expected to produce more-effective and less-toxic targeted therapies, Dolan said.

Mcclellan: P4P Hospital Demo Shows Improvements

Early returns from year one of a pay-for-performance demo involving 270 hospitals show improvements in quality of care in all areas, Dr. Mark McClellan told the American Hospital Association's annual meeting in Washington on Tuesday.

McClellan, head of the Centers for Medicare and Medicaid Services, said hospitals are improving care regardless of the quality they provided before the demonstration began.

The three-year Premier Hospital Quality Incentive Demonstration tracks 34 processes and outcomes in five clinical areas - including the 17 criteria the reporting hospitals must perform to receive full payment from CMS.

Preliminary analysis shows improvement in all five clinical areas being tracked. The analysis was done by Premier, whose member hospitals participated in the demonstration.

Quality scores rose for treatment of heart attack, coronary artery bypass graft, heart failure, hip and knee replacement and pneumonia - all major cost drivers for Medicare.

CMS is awarding high-performing hospitals some $7 million extra per year during the demo project. That is expected to be offset by lower Medicare claims for the targeted areas.

Hospitals that do not perform well could face financial penalties in the third year of the project.

Uninsured And The Battle Over Payment

How hospitals bill the indigent and uninsured is a healthcare hot button and part of the discussion during Cover the Uninsured Week activities nationwide. The week is a project of The Robert Wood Johnson Foundation and seeks to put a face on the 45 million uninsured Americans as a way to spur a reluctant Congress to take action.

Indigent-care payment issues recently have been driven by lawsuits filed by Mississippi attorney Richard Scruggs. He has sued dozens of non-profit hospitals, as well as the American Hospital Association, seeking damages for allegedly failing to provide free care to the poor in exchange for their tax-exempt status.

Before Scruggs, however, came Consejo de Latinos Unidos or Council of United Latinos, a non-profit advocacy group that helps Hispanics and the uninsured. In 2002 the council took on Tenet Healthcare over what it called "aggressive billing practices" and succeeded in forcing the nation's second-largest for-profit hospital chain to make changes in billing for the uninsured.

Tuesday, during a National Press Club news conference in Washington, Judith Montilla Vega talked of coming to Florida from Venezuela with dreams her son, Rodney, would receive an education and the medical treatment only the United States could offer.

The 5-year-old's brain tumor had returned in 2004 and doctors had given the child only two weeks to live.

"The first question they (the hospital) asked was 'Did Rodney have insurance?'" Mrs. Vega said. "I told them, 'No' and their next question was, 'Do you have the money to pay?'"

Vega did not have the money for hospital or physician expenses, so hospital officials said they could not help Rodney. She turned to the Consejo de Latinos Unidos and said within two days they had made arrangements for Rodney's surgery.

K.B. Forbes, director of Consejo, called hospital claims that the uninsured are unwilling to pay "malarkey," because most are working poor - making too much money to qualify for Medicaid, but not enough to purchase health insurance.

Thanks to UPI's Andrew Damstedt in Washington

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