Are people on financial assistance really able to request costly brand name drugs over generics?

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How can we afford to be offering people on financial assistance the ability to choose a brand name drug over a generic if not specifically prescribed by a doctor?  Apparently this is happening.  People on financial assistance are able to choose brand name drugs to fill their prescriptions rather than generics and don’t have to pay a co-pay.  What’s the problem?  Brand name drugs tend to cost substantially more than the generic equivalents and in most cases have the same effect.  People who have their prescriptions covered via financial assistance should be required to use generics unless a brand name is specified by a doctor.  We simply can’t afford it otherwise.

In 2015/2016 we spent $55 million on financial assistance, that’s nearly $900 for every single Bermuda resident.  That’s no small amount of money.  While it is necessary that we give a helping hand to those at the bottom of society, we need to eliminate extravagant waste. Cutting down on waste and abuse in the form of generics vs. brand name prescriptions is one such area.   People on financial assistance are eligible to have their prescriptions covered 100%, generic or brand name without a co-pay.  A co-pay discourages people from unnecessarily choosing a brand name but when a co-pay doesn’t exist there’s no incentive to choose the cheaper option.

So brand name or generic medication, whats the difference?  If you had a headache and you were offered the choice of Tylenol or Acetaminophen which would you prefer? It shouldn’t matter.  Tylenol is simply the brand name used to market the common medication acetaminophen.  When a drug is originally produced it is subject to a patent and marketed under a brand.  Later after the patent expires, other companies are eligible to manufacture and sell it under other brand names which are commonly referred to as generics.

Let’s use another common example.  You’ve likely heard of Viagra but probably never heard of Sildenafil. They’re effectively the same.  It is commonly known as a treatment for erectile dysfunction but was originally created to treat pulmonary hypertension, but it’s a well known example so we’ll stick with it for this case. Viagra costs about 50 times more than Sildenafil and yet they’re effectively the same drug.  In the US, generics are not available yet.  However since we can import from the EU, we are able to acquire generic versions vs. the brand name.  Should we be requiring people on financial assistance to use the generic rather than the more expensive brand name?  

(No idea if people on financial assistance are getting viagra, it is just a laymans example)

Wait, is there a time when generics don’t work?  Yes, generics are not always an exact copy of the original drug and can have slightly different interactions with other drugs or symptoms in people.  Thus there are occasions when a doctor or pharmacist will specifically advise the use of a brand name drug due to known side effects or conflicts of a generic with other medications.  Thus there are occasions when a brand name is specifically prescribed by a medical professional vs. a generic.  So, if a brand name is specifically prescribed, it does make sense to dispense it and is justifiable for people on financial assistance.

Should people on financial assistance be able to be dispensed brand name drugs if a generic exists and they weren’t specifically prescribed the brand name?  It certainly would mean a considerable cost difference.  The tax payer is ultimately the one footing the bill and we can’t afford to be wasteful.  People on financial assistance should be required to take generic versions of medications if available unless a brand name is specified by a medical professional.

Disclaimer: I’m not a medical professional and had a chat with a pharmacist regarding details on this piece.  None of this constitutes medical advice and you should consult a doctor or pharmacist for any medical needs or concerns.

Is Bermuda experiencing an expanding debt crisis?

A question came up on facebook about Bermuda’s debt liabilities in reference to this article.  Namely, is Bermuda experiencing an expanding debt crisis in relation to personal loans?  The article suggests there are risks that auto loans and leases are increasingly being repackaged and collateralized like was done with home mortgages in the 2008 crash and the reader wondered if Bermuda has similar risks. I hadn’t looked at the deposit vs. loan profile data in years so I thought I’d take a look.

To my knowledge the government doesn’t track or publish auto loan data.  The best approximation is the BD$ Deposit vs. Loan Profile data published by the Bermuda Monetary Authority which consolidates all bank loan data.

Here’s what the last few years look like.


What does this tell us?  Unfortunately not much about car loans specifically.  What it tells us is the condition of the local banks in terms of how many Bermuda Dollars they have deposited vs. how many they loaned out. I’m not aware of any cases where Bermuda’s loans are repackaged into securities like happened in the US.  Our market is a bit small for that so it is more a question of direct loan liabilities than collateralized ones which is of far less risk to destabilizing banks as they’re relatively transparent and well known.

From what we can see, historically in terms of Bermuda dollars, local banks loaned out less than they took in deposits.  Around 2005 that trend shifted and back in 2008 this writer expressed concerns about the impact 100% financing and interest only loans were having and whether the excess was driving a housing bubble.

It was clear to some that our economy was in for a crash.  Our government and banks had their foot pressed firmly on the accelerator at a time when we needed to be hitting the brakes.

Banks get over confident, lend far too much money to people who can’t afford to pay it back and eventually strain our economy with inflated valuations and ultimately bad debt. This kind of bad debt encumbers banks where they’re stuck having loaned out money for properties that won’t be paid back.

In order to free up that undervalued capital they either have to take a loss by selling the assets at firesale prices or come up with a creative scheme to shift bad debt.  Shifting bad debt was the theme behind the whole “sub-prime crisis” of 2008 and locally you can see examples with what Clarien appears to be doing with BHC.

So welcome to 2017 where we can see what happens after loans peaked through 2009-2011 and then began a decline.  We’re in a process called “deleveraging” which is where banks took on too much and have to gradually reduce their loan books to return to a normal value.  If you’re wondering why it is extra hard to get a loan these days this is why.  The banks simply have far too much money sunk into bad loans in a market that was overinflated that they’re still trying to sort out.

Does mean Bermuda is experiencing an expanding debt crisis?  Not from what I can see.  If anything its a good sign that we’re renormalizing after a period of irrational exuberance.  Hopefully we’ll see the local markets stabilize, we’ll gradually return to a period of strength and growth and people won’t forget that time we got too overconfident.  Though I wouldn’t hold your breath on it.


Time for the PLP to regroup and restrategize and for the OBA to reflect

As suspected, the opposition to the airport deal dried up The PLP overplayed the Airport Card and the OBA has run a relentless campaign of public outreach, feedback and awareness building.  Public support has now shifted from opposing the airport deal to supporting it.  Likely the PLP will have to regroup and re-strategize and the OBA will reflect on what worked.

Many, like this writer, likely have just gotten tired of the airport deal.  Ultimately its an airport, we get it back in 30 years and if it truly proves to be a bad deal, that’s 30 years the OBA won’t be able to dodge the blame for it.  It is really too bad that we’ll be spending a fortune to create a non-Bermudian looking monstrosity, but it certainly isn’t worth tarnishing our reputation of stability or disrupting America’s Cup over it.

The question is, what next?  I put together longer term stats from the Royal Gazette’s polls going back over the last few years to get a better idea of the context of the momentum of each party.  I’m not really sure why the Jul 2015 number was so different but it did foretell the shift in momentum.  Ultimately, the PLP were on a successful run up until the Genevieve-Tweed crusade with the OBA sliding.  They were neck and neck, possibly with a shift in momentum approaching.

The PLP will need to shift focus and start thinking about the upcoming election.  They’ve done a good job at opposing the government but haven’t really laid out a plan for what they’d do as government.  This will be the time they start capitalizing on the OBA’s forgotten election pledges and setting the tone.  Given the loss of momentum and the approaching hype of the America’s Cup we may see them shift to a more mature stance.  Perhaps trying to highlight the lessons learned from being removed after their first stint in power and how they have learned from their mistakes and starting to signs of reinventing themselves under their new and capable leader.

The OBA may get complacent and take forgranted this recent win of support or they may take the time to take a step back and really evaluate what they’ve acheived.  They very clearly invested a tremendous amount of effort in public outreach, educating the public, consulting (sort of), leveraging social media and generally attempting to involve the people like never before.  Is the OBA finally shifting away from most used play in their playbook?  It’s hard to say.

The odd one out who perhaps has suffered the most in this is “The President of the BIU” Chris Furbert.  After people didn’t heed his call to turn out to protest the airport he attacked the people for lack of support rather than inflecting on what he might have done to kill support.  It is likely that investing heavily in Reverend Genevieve-Tweed when he wasn’t by any definition a “Son of the Soil” and threatening America’s Cup likely evaporated support for his cause.  Fundamentally people tend to go back to asking themselves “How will this benefit and impact me?” and “President” Furbert didn’t deliver compelling answers to those questions.  One can wonder if Chris Furbert will survive this and still be President of the BIU not long from now.  Certainly attacking the people for his missteps in leadership doesn’t seem like a very good strategy.

So what’s next?  What strategy will the PLP pivot to and will the OBA learn the value of involving the people in the process?  Likely we’ll have to wait and see.

#WhereDidTheJobsGo? – taking a look at cumulative changes in job numbers

Continuing on my analysis of the Employment Report statistics I thought I’d take a look at cumulative changes in jobs by major occupation and see what that looks like.

This gives a much clearer of the absolute number of jobs lost by Bermudians in the last few years.  For example, Clerks (aka. Secretarial positions) suffered a substantial decline from 2011.

An interesting point of note is the spike in Service worker jobs from 2011 – 2013 along with a minor spike in professional jobs which seemed to buck the trend.

The question is what caused this spike? My current hypothesis is that this is related to the hospital project but we’ll likely get a better idea if we dig further into the breakdowns of the jobs within individual categories.

If we look at the same data but for non-Bermudians (excluding spouses and PRCs) we see quite a different picture

There were more aggressive declines and larger numbers of overall jobs lost in the Professional, Service worker and Trades worker categories.  Notably there was no upwards spike for 2011 to 2013, only a slight change in rate of decline in a few occupational types.  Also interesting is the switch from heavy decline to an uptick right around 2014 which coincides with the ending of the term limits.


Note: the charts are based upon summing the cumulative yoy changes in job numbers


Where did the jobs go? – taking a look at major occupational groups

So far in our attempt to answer the question of “Where did the jobs go?” we’ve seen that since 2008 a significant number of both Bermudian and non-Bermudian jobs have declined. Let’s start digging a bit deeper to see what the data can tell us.

Of note, the data from the Employment Survey Tables provided by the Department Of Statistics unfortunately had a change in occupational category groupings from pre-2008 to post so I’m only going to show data from 2008 for now.

Also note, only Bermudians and non-Bermudians (not including Spouses of Bermudians and Permanent Residents) are being considered here.  Simply because the the other numbers don’t vary enough to warrant detailed analysis at this time.

So, let’s take a moment to examine what happened with Bermudian jobs when grouped by major occupation.

This tells an interesting story of which Bermudian job occupational types were most impacted by the job losses over the last 8 years.  Notably jobs in the “Clerk” role (these are effectively Secretarial positions and the like) were heavily impacted.  Most except service workers experienced declines.  Technicians and agriculture workers seem to have been un-impacted. It is interesting to note that the declines are fairly steady with a bit of an acceleration in the job losses in the clerk role from 2011.  Thankfully from 2014 to 2015 most roles stabilized.

As a contrast, let’s take a look at non-Bermudians (not including Spouses and PRCs).

For non-Bermudians, most roles experienced heavy declines.  Professionals were the largest in losses with nearly 1/3 of roles disappearing.  Service workers and trades worker jobs were also very heavily impacted.  Notably there has been an ever so slight uptick in a few of the roles.

What is the cause of these declines?  It is hard to say at this point. What we do know is that the term limit policy was introduced in 2007 and ended in 2013 and that could have had an impact. In order to get a better idea we’d likely have to review work permit statistics in depth, if such information is even available at a granular level. There was also a global recession during that time period. Clearly was is obvious from these graphs is that non-Bermudians roles were eliminated earlier and significantly faster than Bermudian roles when looking on a basis relative to the total numbers of each.


Marijuana legislation going up in smoke

To be honest it is rather amusing to watch the PLP catch the OBA off guard announcing that they’ll put forward a bill to decriminalize marijuana this Friday.  The OBA’s response of “oh, oh, we’re already working on that” goes to show that they haven’t been great at keeping the people in the loop at what they’re working on (if they’re actually working on it) and were forced into making a statement to save face.

Attorney-General Trevor Moniz said,

“I am pleased to hear that the Progressive Labour Party is onboard with the Government’s plan to decriminalize possession of small amounts of cannabis.”

The Government committed to doing so in last November’s Throne Speech and has initiated consultations with the Department of Public Prosecutions and the Bermuda Police Service to develop appropriate legislation.”


As far as I remember, the government committed to consulting on decriminalization, not actually doing it.  Hold on a sec, let me check.

The Government will consult with respect to the decriminalization for possession of small amounts of cannabis. To that end, Government reforms will preserve police powers to confiscate cannabis and to test whether road users are under the influence of cannabis. These reforms will complement our efforts to educate our youth about the dangerous effects of drug use, balancing the need to reduce the consumption of cannabis while avoiding the unnecessary criminalization of our young people.

Hmm, no specific timelines or commitments mentioned so it seems the PLP have jumped on this by introducing a bill.  It’s hard to say what “consultation” really means. It’s kind of like conscription, sure it’s going to end… hopefully sometime… after a long transition period of prodding the regiment to do more to íncentivize volunteers rather than lazily relying on conscripts.  Then… of course, eventually… it’ll be phased out.  Like marijuana prohibition…  give it time.

But clearly the OBA already has things in motion.  Don’t worry, the wheels of bureaucracy are turning.

“Also in 2016, we allowed the use of “medical marijuana” and pledged in November’s Throne Speech to further reform for more medical treatment options through the importation of herbal supplements containing Cannabinol.

Of course, yes, medical marijuana.  That’s great, except that when speaking to a pharmacist friend one learns that apparently no one has a license to actually be able to import it.  So.. congratulations, you can get a prescription for medical marijuana to treat your cancer pain but don’t expect your pharmacist to be able to fill it.

Sometimes politics is amusing, quite thankfully, as it’s been a dreary few months with the whole “obstruction of democracy and tarnishing our global reputation of stability” thing.

Where are the financial details?

I’m confused.  Opposition leader David Burt claims that the financial details of the airport deal still haven’t been released.

As reported by Politica on Jan 29th, Finance Minister Richards on the Shirley Dill radio show assured Opposition Leader Burt that he would be provided with the financial details that were missing.

There is a very clear recording of Finance Minister Richards saying that the financial details would be provided and he is surprised that they weren’t.  He assured the opposition leader that the details would be provided. That was 3 days ago.

What is going on here?