FDA approves new targeted breast cancer drug


WASHINGTON (AP) — The Food and Drug Administration has approved a first-of-a-kind breast cancer medication that targets tumor cells while sparing healthy ones.


The drug Kadcyla from Roche combines the established drug Herceptin with a powerful chemotherapy drug and a third chemical linking the medicines together. The chemical keeps the cocktail intact until it binds to a cancer cell, delivering a potent dose of anti-tumor poison.


Cancer researchers say the drug is an important step forward because it delivers more medication while reducing the unpleasant side effects of chemotherapy.


"This antibody goes seeking out the tumor cells, gets internalized and then explodes them from within. So it's very kind and gentle on the patients — there's no hair loss, no nausea, no vomiting," said Dr. Melody Cobleigh of Rush University Medical Center. "It's a revolutionary way of treating cancer."


Cobleigh helped conduct the key studies of the drug at the Chicago facility.


The FDA approved the new treatment for about 20 percent of breast cancer patients with a form of the disease that is typically more aggressive and less responsive to hormone therapy. These patients have tumors that overproduce a protein known as HER-2. Breast cancer is the second most deadly form of cancer in U.S. women, and is expected to kill more than 39,000 Americans this year, according to the National Cancer Institute.


The approval will help Roche's Genentech unit build on the blockbuster success of Herceptin, which has long dominated the breast cancer marketplace. The drug had sales of roughly $6 billion last year.


Genentech said Friday that Kadcyla will cost $9,800 per month, compared to $4,500 per month for regular Herceptin. The company estimates a full course of Kadcyla, about nine months of medicine, will cost $94,000.


FDA scientists said they approved the drug based on company studies showing Kadcyla delayed the progression of breast cancer by several months. Researchers reported last year that patients treated with the drug lived 9.6 months before death or the spread of their disease, compared with a little more than six months for patients treated with two other standard drugs, Tykerb and Xeloda.


Overall, patients taking Kadcyla lived about 2.6 years, compared with 2 years for patients taking the other drugs.


FDA specifically approved the drug for patients with advanced breast cancer who have already been treated with Herceptin and taxane, a widely used chemotherapy drug. Doctors are not required to follow FDA prescribing guidelines, and cancer researchers say the drug could have great potential in patients with earlier forms of breast cancer


Kadcyla will carry a boxed warning, the most severe type, alerting doctors and patients that the drug can cause liver toxicity, heart problems and potentially death. The drug can also cause severe birth defects and should not be used by pregnant women.


Kadcyla was developed by South San Francisco-based Genentech using drug-binding technology licensed from Waltham, Mass.-based ImmunoGen. The company developed the chemical that keeps the drug cocktail together and is scheduled to receive a $10.5 million payment from Genentech on the FDA decision. The company will also receive additional royalties on the drug's sales.


Shares of ImmunoGen Inc. rose 2 cents to $14.32 in afternoon trading. The stock has ttraded in a 52-wek range of $10.85 to $18.10.


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Investors face another Washington deadline

NEW YORK (Reuters) - Investors face another Washington-imposed deadline on government spending cuts next week, but it's not generating the same level of fear as two months ago when the "fiscal cliff" loomed large.


Investors in sectors most likely to be affected by the cuts, like defense, seem untroubled that the budget talks could send stocks tumbling.


Talks on the U.S. budget crisis began again this week leading up to the March 1 deadline for the so-called sequestration when $85 billion in automatic federal spending cuts are scheduled to take effect.


"It's at this point a political hot button in Washington but a very low level investor concern," said Fred Dickson, chief market strategist at D.A. Davidson & Co. in Lake Oswego, Oregon. The fight pits President Barack Obama and fellow Democrats against congressional Republicans.


Stocks rallied in early January after a compromise temporarily avoided the fiscal cliff, and the Standard & Poor's 500 index <.spx> has risen 6.3 percent since the start of the year.


But the benchmark index lost steam this week, posting its first week of losses since the start of the year. Minutes on Wednesday from the last Federal Reserve meeting, which suggested the central bank may slow or stop its stimulus policy sooner than expected, provided the catalyst.


National elections in Italy on Sunday and Monday could also add to investor concern. Most investors expect a government headed by Pier Luigi Bersani to win and continue with reforms to tackle Italy's debt problems. However, a resurgence by former leader Silvio Berlusconi has raised doubts.


"Europe has been in the last six months less of a topic for the stock market, but the problems haven't gone away. This may bring back investor attention to that," said Kim Forrest, senior equity research analyst at Fort Pitt Capital Group in Pittsburgh.


OPTIONS BULLS TARGET GAINS


The spending cuts, if they go ahead, could hit the defense industry particularly hard.


Yet in the options market, bulls were targeting gains in Lockheed Martin Corp , the Pentagon's biggest supplier.


Calls on the stock far outpaced puts, suggesting that many investors anticipate the stock to move higher. Overall options volume on the stock was 2.8 times the daily average with 17,000 calls and 3,360 puts traded, according to options analytics firm Trade Alert.


"The upside call buying in Lockheed solidifies the idea that option investors are not pricing in a lot of downside risk in most defense stocks from the likely impact of sequestration," said Jared Woodard, a founder of research and advisory firm condoroptions.com in Forest, Virginia.


The stock ended up 0.6 percent at $88.12 on Friday.


If lawmakers fail to reach an agreement on reducing the U.S. budget deficit in the next few days, a sequester would include significant cuts in defense spending. Companies such as General Dynamics Corp and Smith & Wesson Holding Corp could be affected.


General Dynamics Corp shares rose 1.2 percent to $67.32 and Smith & Wesson added 4.6 percent to $9.18 on Friday.


EYES ON GDP DATA, APPLE


The latest data on fourth-quarter U.S. gross domestic product is expected on Thursday, and some analysts predict an upward revision following trade data that showed America's deficit shrank in December to its narrowest in nearly three years.


U.S. GDP unexpectedly contracted in the fourth quarter, according to an earlier government estimate, but analysts said there was no reason for panic, given that consumer spending and business investment picked up.


Investors will be looking for any hints of changes in the Fed's policy of monetary easing when Fed Chairman Ben Bernake speaks before congressional committees on Tuesday and Wednesday.


Shares of Apple will be watched closely next week when the company's annual stockholders' meeting is held.


On Friday, a U.S. judge handed outspoken hedge fund manager David Einhorn a victory in his battle with the iPhone maker, blocking the company from moving forward with a shareholder vote on a controversial proposal to limit the company's ability to issue preferred stock.


(Additional reporting by Doris Frankel; Editing by Kenneth Barry)



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Big studios behind swag-fueled Oscar push






LOS ANGELES (AP) — Giant coffee table books, iPod Shuffles, signed letters from directors, even “Lincoln” turkey roasting pans. That’s just some of the largesse doled out by the studios to voters for awards presented earlier this season — each with the potential to influence the outcome of Hollywood’s most important awards, Sunday night’s Oscars.


Such gifts are strictly forbidden by the Academy of Motion Picture Arts and Sciences. But for studios, the stakes are high, and they’ve been creative in working around the rules to give their movies the best spotlight possible. A best picture win can boost a film’s commercial appeal and solidify relations with big-name actors and directors.






This year, top Oscar contenders “Argo” from Warner Bros. and “Lincoln” from Disney pitted two deep-pocketed rivals against each other in what some say was an unprecedented level of Oscar campaigning. There was even some targeted sniping about the films’ bending of historical facts.


Part of what’s behind the seemingly unrestrained lobbying is that this year, an unusually large number of best picture nominees are also doing well at the box office, giving the studios dry powder for their campaigns.


Six of the nine contenders for the top Oscar have reaped $ 100 million or more in ticket sales domestically, and collectively they’ve earned $ 309 million since the nominations Jan. 10, according to Hollywood.com. This record-setting “Oscar bump” dwarfs the $ 111 million the nine best picture nominees made between the nominations and the awards ceremony last year. It also trumps the season that 2009′s megahit “Avatar” was in the running, when 10 nominees brought in $ 204 million in bump.


That means there’s plenty of reason for studios to keep spending — even to the extent of papering the walls of the popular Beverly Hills restaurant Kate Mantilini with campaign posters, which conveniently tower over diners just a block from the motion picture academy itself.


“I have never seen such an assault in terms of stuff being sent to us,” said Pete Hammond, a member of the Broadcast Film Critics Association, which hosts the Critics Choice Awards, and a columnist for the Hollywood blog Deadline.com.


Hammond is one of several voters for the earlier awards where wins translate into momentum for Oscar hopefuls. They say their mailboxes were swamped with swag this year — all of it an attempt to reach the 5,800 academy members who vote on the Oscars, albeit through indirect means.


From the campaign of Steven Spielberg‘s “Lincoln,” members of the broadcast critics group say they received no less than four coffee table books, an intricately framed DVD for review purposes and even a hand-signed letter from Spielberg himself, thanking them for recognizing the film with so many nominations. Some awards voters also received “Lincoln” turkey roasting pans, according to an industry insider who spoke on the condition of anonymity because the person was not authorized to speak publicly about the matter.


The broadcast critics also received an iPod Shuffle, which retails for $ 49, containing the soundtrack to Universal Pictures’ “Les Miserables,” which is up for music and sound mixing awards.


Several voters said this level of giveaway was unusual, but then again, in recent times, well-funded major studios haven’t been that involved.


In the last two years, the movie industry’s top honor went to The Weinstein Co.’s “The Artist” and “The King’s Speech.” Previous to that, 2009′s winner was “The Hurt Locker,” whose backer Summit Entertainment was just starting to get its “Twilight” mojo and was yet to be flush with cash.


Before that it was Fox Searchlight’s “Slumdog Millionaire” and before that “No Country for Old Men” by Paramount Vantage — both smaller arms of major studios that have smaller marketing budgets than their larger siblings.


This year, the majors are back in the game in a big way. In addition to Warner’s “Argo” and Disney’s “Lincoln,” Sony Pictures is behind “Zero Dark Thirty,” 20th Century Fox is backing “Life of Pi” and Universal is the force behind “Les Miserables.”


While The Weinstein Co.’s “Silver Linings Playbook” is earning boffo business above $ 100 million in ticket sales following co-chairman Harvey Weinstein‘s familiar script of making the most of awards season, it appears that this year, the majors have studied up.


“Nobody ever did it besides Harvey, and now everybody’s done it this year,” said David Poland of MovieCityNews.com, which means more intense campaigning because there’s more money to spend.


One look at the release pattern of “Zero Dark Thirty” and it’s clear that Sony didn’t want to repeat what happened to “The Hurt Locker,” another Kathryn Bigelow-directed war film that despite its best picture win, made just $ 19 million in theaters worldwide. Part of the problem with “Hurt” was that it came out in June and was all but gone from theaters by the time the Oscar nominations rolled around.


Instead, “ZDT” showed in just a handful of theaters in December to qualify for the 2012 Oscars, but burst onto 3,000 theaters the day after the nominations in January, capturing the top spot at the box office that weekend.


“We designed our release campaign to take advantage of key dates in the awards season,” said Sony Pictures spokesman Steve Elzer. “With approximately $ 90 million in box office to date, the film has been a huge critical and commercial success and no matter how we do at the Oscar ceremony on Sunday, we couldn’t be more pleased with the film’s performance.”


Starting small and then going wide after the nominations is the “Playbook” that The Weinstein Co. has followed for years, although company co-chairman Harvey Weinstein denies the pattern.


“There is no playbook, there is no campaigning,” Weinstein said. “I have always said the most important thing is to get people to see the films and everything else is mostly fluff.”


Even films at the tail end of their box-office run are pumping up the volume. “Argo,” which came out in October, was heavily advertised by Warner Bros. ahead of the DVD release this Tuesday. The studio began selling digital downloads two weeks ahead of that. Fox followed a similar strategy for “Life of Pi.”


“Because these films are so strong, all the companies are buying (ads),” said Michael Parker, co-president of Sony Pictures Classics, whose film “Amour” is also up for best picture.


Critic Anne Thompson of Indiewire said this year’s extravagance is due to the fact that big studios have high hopes for their films. Amid her swag pile are “Wreck-It Ralph” plastic fists, a toy bow and arrow from “Brave,” and a printed page of the John Williams score from “Lincoln.”


“The factors here are a) the studios involved and b) big hit movies that had extra money,” she said. “And the fact you have a close race between two big studio movies. They have reason to believe they have a chance to win.”


Gadgets News Headlines – Yahoo! News





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You're Invited to PEOPLE.com's Oscars Party!









02/24/2013 at 08:40 AM EST







From left: Bradley Cooper, Oscar, Jessica Chastain


AFP/Getty; Wireimage; Splash News Online


Oscars host Seth MacFarlane isn't the only one gearing up for Hollywood's biggest night – we are too!

Be a part of the glamour and excitement Sunday at 6 p.m. ET when we roll out the red carpet for our PEOPLE.com VIPs.

Here's what you can expect:
• Tune in to our red carpet preshow for exclusive A-list interviews
• Be the first to see the gorgeous gowns – and make your own best-dressed list
• Download your own Oscars ballot – and make your own Academy Awards picks
• Tweet with our editors at #PeopleOscars
• Take our up-to-the-minute Oscars polls

And come back the next day for so much more ...
• See the night's best dresses from all angles with our 360º slideshow
• Come inside the most exclusive Oscars after-parties
• Relive the most memorable quotes of the show
• Get the scoop on the night's biggest shockers and funniest moments everyone is talking about

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FDA approves new targeted breast cancer drug


WASHINGTON (AP) — The Food and Drug Administration has approved a first-of-a-kind breast cancer medication that targets tumor cells while sparing healthy ones.


The drug Kadcyla from Roche combines the established drug Herceptin with a powerful chemotherapy drug and a third chemical linking the medicines together. The chemical keeps the cocktail intact until it binds to a cancer cell, delivering a potent dose of anti-tumor poison.


Cancer researchers say the drug is an important step forward because it delivers more medication while reducing the unpleasant side effects of chemotherapy.


"This antibody goes seeking out the tumor cells, gets internalized and then explodes them from within. So it's very kind and gentle on the patients — there's no hair loss, no nausea, no vomiting," said Dr. Melody Cobleigh of Rush University Medical Center. "It's a revolutionary way of treating cancer."


Cobleigh helped conduct the key studies of the drug at the Chicago facility.


The FDA approved the new treatment for about 20 percent of breast cancer patients with a form of the disease that is typically more aggressive and less responsive to hormone therapy. These patients have tumors that overproduce a protein known as HER-2. Breast cancer is the second most deadly form of cancer in U.S. women, and is expected to kill more than 39,000 Americans this year, according to the National Cancer Institute.


The approval will help Roche's Genentech unit build on the blockbuster success of Herceptin, which has long dominated the breast cancer marketplace. The drug had sales of roughly $6 billion last year.


Genentech said Friday that Kadcyla will cost $9,800 per month, compared to $4,500 per month for regular Herceptin. The company estimates a full course of Kadcyla, about nine months of medicine, will cost $94,000.


FDA scientists said they approved the drug based on company studies showing Kadcyla delayed the progression of breast cancer by several months. Researchers reported last year that patients treated with the drug lived 9.6 months before death or the spread of their disease, compared with a little more than six months for patients treated with two other standard drugs, Tykerb and Xeloda.


Overall, patients taking Kadcyla lived about 2.6 years, compared with 2 years for patients taking the other drugs.


FDA specifically approved the drug for patients with advanced breast cancer who have already been treated with Herceptin and taxane, a widely used chemotherapy drug. Doctors are not required to follow FDA prescribing guidelines, and cancer researchers say the drug could have great potential in patients with earlier forms of breast cancer


Kadcyla will carry a boxed warning, the most severe type, alerting doctors and patients that the drug can cause liver toxicity, heart problems and potentially death. The drug can also cause severe birth defects and should not be used by pregnant women.


Kadcyla was developed by South San Francisco-based Genentech using drug-binding technology licensed from Waltham, Mass.-based ImmunoGen. The company developed the chemical that keeps the drug cocktail together and is scheduled to receive a $10.5 million payment from Genentech on the FDA decision. The company will also receive additional royalties on the drug's sales.


Shares of ImmunoGen Inc. rose 2 cents to $14.32 in afternoon trading. The stock has ttraded in a 52-wek range of $10.85 to $18.10.


Read More..

Investors face another Washington deadline

NEW YORK (Reuters) - Investors face another Washington-imposed deadline on government spending cuts next week, but it's not generating the same level of fear as two months ago when the "fiscal cliff" loomed large.


Investors in sectors most likely to be affected by the cuts, like defense, seem untroubled that the budget talks could send stocks tumbling.


Talks on the U.S. budget crisis began again this week leading up to the March 1 deadline for the so-called sequestration when $85 billion in automatic federal spending cuts are scheduled to take effect.


"It's at this point a political hot button in Washington but a very low level investor concern," said Fred Dickson, chief market strategist at D.A. Davidson & Co. in Lake Oswego, Oregon. The fight pits President Barack Obama and fellow Democrats against congressional Republicans.


Stocks rallied in early January after a compromise temporarily avoided the fiscal cliff, and the Standard & Poor's 500 index <.spx> has risen 6.3 percent since the start of the year.


But the benchmark index lost steam this week, posting its first week of losses since the start of the year. Minutes on Wednesday from the last Federal Reserve meeting, which suggested the central bank may slow or stop its stimulus policy sooner than expected, provided the catalyst.


National elections in Italy on Sunday and Monday could also add to investor concern. Most investors expect a government headed by Pier Luigi Bersani to win and continue with reforms to tackle Italy's debt problems. However, a resurgence by former leader Silvio Berlusconi has raised doubts.


"Europe has been in the last six months less of a topic for the stock market, but the problems haven't gone away. This may bring back investor attention to that," said Kim Forrest, senior equity research analyst at Fort Pitt Capital Group in Pittsburgh.


OPTIONS BULLS TARGET GAINS


The spending cuts, if they go ahead, could hit the defense industry particularly hard.


Yet in the options market, bulls were targeting gains in Lockheed Martin Corp , the Pentagon's biggest supplier.


Calls on the stock far outpaced puts, suggesting that many investors anticipate the stock to move higher. Overall options volume on the stock was 2.8 times the daily average with 17,000 calls and 3,360 puts traded, according to options analytics firm Trade Alert.


"The upside call buying in Lockheed solidifies the idea that option investors are not pricing in a lot of downside risk in most defense stocks from the likely impact of sequestration," said Jared Woodard, a founder of research and advisory firm condoroptions.com in Forest, Virginia.


The stock ended up 0.6 percent at $88.12 on Friday.


If lawmakers fail to reach an agreement on reducing the U.S. budget deficit in the next few days, a sequester would include significant cuts in defense spending. Companies such as General Dynamics Corp and Smith & Wesson Holding Corp could be affected.


General Dynamics Corp shares rose 1.2 percent to $67.32 and Smith & Wesson added 4.6 percent to $9.18 on Friday.


EYES ON GDP DATA, APPLE


The latest data on fourth-quarter U.S. gross domestic product is expected on Thursday, and some analysts predict an upward revision following trade data that showed America's deficit shrank in December to its narrowest in nearly three years.


U.S. GDP unexpectedly contracted in the fourth quarter, according to an earlier government estimate, but analysts said there was no reason for panic, given that consumer spending and business investment picked up.


Investors will be looking for any hints of changes in the Fed's policy of monetary easing when Fed Chairman Ben Bernake speaks before congressional committees on Tuesday and Wednesday.


Shares of Apple will be watched closely next week when the company's annual stockholders' meeting is held.


On Friday, a U.S. judge handed outspoken hedge fund manager David Einhorn a victory in his battle with the iPhone maker, blocking the company from moving forward with a shareholder vote on a controversial proposal to limit the company's ability to issue preferred stock.


(Additional reporting by Doris Frankel; Editing by Kenneth Barry)



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Sexting and bugging revealed at the FBI: CNN






(Reuters) – One FBI employee was fired for sleeping with a drug dealer and lying about it under oath, while another got the boot for bugging the boss’s office.


The FBI suspended for 10 days still another employee for emailing a nude photograph of herself to her ex-boyfriend’s wife – the bureau showed compassion for the woman after she sought help for depression.






Those cases over the past year were among 29 revealed by CNN on Friday after the cable news network obtained an October 2012 quarterly report the U.S. Federal Bureau of Investigation sent to all its employees that was meant to educate FBI staff but not to be disseminated publicly.


The so-called quarterlies summarized cases investigated by the bureau’s Office of Professional Responsibility.


“We have seen a rash of sexting cases and nude photograph cases, you know, people misusing their BlackBerrys for this reason, and we hope getting the message out in the quarterlies is going to teach people you can’t do this stuff,” FBI assistant director Candice Will told CNN.


An employee who used a government-issued BlackBerry to send sexually explicit messages to another employee received a five-day suspension. Another who used a personal cell phone to send nude photographs to several other employees received a 10-day suspension, in part because the conduct created office gossip.


“When you’re given an FBI BlackBerry, it’s for official use. It’s not to text the woman in another office who you found attractive a picture of yourself in a state of undress,” Will said.


Many of the cases involved sex, such as that of the employee who visited a massage parlor and paid for a sexual favor from the masseuse. That resulted in a 14-day suspension instead of a more severe penalty because the employee had an exemplary work record and expressed remorse, the FBI documents said.


Others were more serious, such as the case of the employee who admitted purchasing and viewing video of naked boys. That person was summarily dismissed.


Two employees who were busted for driving under the influence of alcohol were fired because in each case it was a second offense.


Another who was cited for public intoxication while walking the street drunk and armed with a bureau-issued weapon received a seven-day suspension.


Improper handling of evidence resulted in suspensions of three and eight days. Shoplifting got a summary dismissal.


CNN posted the documents on http://i2.cdn.turner.com/cnn/2013/images/02/21/office.of.professional.review.-.cnn01302013_0000.pdf.


(Reporting by Daniel Trotta)


Internet News Headlines – Yahoo! News





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Reeva Steenkamp's Father: If Oscar Pistorius Speaks the Truth, 'I Can Perhaps Someday Forgive Him'















02/23/2013 at 09:30 AM EST







Oscar Pistorius and Reeva Steenkamp


Elite/EMPICS Entertainment/ABACA


Having been freed on bail Friday as he awaits trial for the premeditated murder of his girlfriend Reeva Steenkamp, Oscar Pistorius "will have to live with his conscience," her father said Saturday.

Speaking to the Beeld newspaper (and translated by the BBC), Barry Steenkamp – referring to Pistorius's claim that he fatally fired his gun four times at Reeva because he thought an intruder had broken into his house – said: "If it didn't happen the way he says it did, he must suffer and he will suffer."

Steenkamp also said, "It does not matter how much money he has and how good his legal team is, he will have to live with his conscience. But if he speaks the truth, I can perhaps someday forgive him."

The next hearing for the Paralympian, 26, is scheduled for June 4.

Besides setting bail at $114,000 – the amount is considered high for a murder trial in South Africa, reports The New York Times – Magistrate Nair Desmond also ordered Pistorius to relinquish firearms and passports, and to stay away from his home, because it is an official crime scene.

In addition, he is not permitted to contact witnesses, leave Pretoria without official permission or use drugs or alcohol. He is to report to a police station twice every week.

Arnold Pistorius, an uncle speaking on behalf of the family, told reporters Friday, "We are relieved by the fact that Oscar got bail today, but at the same time, we are in mourning for Reeva Steenkamp and her family."

Oscar Pistorius is reportedly staying at Arnold's home in an upscale part of Pretoria. News photos showed the athlete being picked up from the courtroom and driven away by his sister, Aimee.

Reeva Steenkamp's mother June told Beeld that the Pistorius family had sent a bouquet of flowers.

"But what does it mean?" she said. "Nothing."

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Govs to hear Oregon health care plan


SALEM, Ore. (AP) — Oregon Gov. John Kitzhaber will brief other state leaders this weekend on his plan to lower Medicaid costs, touting an overhaul that President Barack Obama highlighted in his State of the Union address for its potential to lower the deficit even as health care expenses climb.


The Oregon Democrat leaves for Washington, D.C., on Friday to pitch his plan that changes the way doctors and hospitals are paid and improves health care coordination for low income residents so that treatable medical problems don't grow in severity or expense.


Kitzhaber says his goal is to win over a handful of other governors from each party.


"I think the politics have been dialed down a couple of notches, and now people are willing to sit down and talk about how we can solve the problem" of rising health care costs, Kitzhaber told The Associated Press in a recent interview.


Kitzhaber introduced the plan in 2011 in the face of a severe state budget deficit, and he's been talking for two years about expanding the initiative beyond his state. Now, it seems he's found people ready to listen.


Hospital executives from Alabama visited Oregon last month to learn about the effort. And the U.S. Department of Health and Human Services announced Thursday that it's giving Oregon a $45 million grant to help spread the changes beyond the Medicaid population and share information with other states, making it one of only six states to earn a State Innovation Model grant.


Kitzhaber will address his counterparts at a meeting of the National Governors Association. His talk isn't scheduled on the official agenda, but a spokeswoman confirmed that Kitzhaber is expected to present.


"The governors love what they call stealing from one another — taking the good ideas and the successes of their colleagues and trying to figure out how to apply that in their home state," said Matt Salo, director of the National Association of Medicaid Directors.


There's been "huge interest" among other states in Oregon's health overhaul, Salo said, not because the concepts are brand new, but because the state managed to avoid pitfalls that often block health system changes.


Kitzhaber persuaded state lawmakers to redesign the system of delivering and paying for health care under Medicaid, creating incentives for providers to coordinate patient care and prevent avoidable emergency room visits. He has long complained that the current financial incentives encourage volume over quality, driving costs up without making people healthier.


Obama, in his State of the Union address this month, suggested that changes such as Oregon's could be part of a long-term strategy to lower the federal debt by reigning in the growing cost of federally funded health care.


"We'll bring down costs by changing the way our government pays for Medicare, because our medical bills shouldn't be based on the number of tests ordered or days spent in the hospital — they should be based on the quality of care that our seniors receive," Obama said.


The Obama administration has invested in the program, putting up $1.9 billion to keep Oregon's Medicaid program afloat over the next five years while providers make the transition to new business models and incorporate new staff and technology.


In exchange, though, the state has agreed to lower per-capita health care cost inflation by 2 percentage points without affecting quality.


The Medicaid system is unique in each state, and Kitzhaber isn't suggesting that other states should adopt Oregon's specific approach, said Mike Bonetto, Kitzhaber's health care policy adviser. Rather, he wants governors to buy into the broad concept that the delivery system and payment models need to change.


That's not a new theory. But Oregon has shown that under the right circumstances massive changes to deeply entrenched business models can gain wide support.


What Oregon can't yet show is proof the idea is working — that it's lowering costs without squeezing on the quality or availability of care. The state is just finishing compiling baseline data that will be used as a basis of comparison.


One factor driving the Obama administration's interest in Oregon's success is the president's health care overhaul. Under the Affordable Care Act, millions more Americans will join the Medicaid rolls after Jan. 1, and the health care system will have to be able to absorb the influx of patients in a logistically and financially sustainable way.


The federal government will pay 100 percent of the costs for those additional patients in the first three years before scaling back to 90 percent in 2020 and beyond.


"There are a lot of governors who are facing the same challenges we're facing in Oregon," Kitzhaber said. "They recognize that the cost of health care is something they're going to have to get their arms around."


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Wall Street opens higher on data, HP earnings


NEW YORK (Reuters) - Stocks opened higher Friday after two days of losses, lifted by better-than-expected earnings from Hewlett-Packard Co and positive economic data from Europe.


HP, a Dow component, jumped 7.4 percent to $18.34 in early trading.


The Dow Jones industrial average <.dji> was up 45.85 points, or 0.33 percent, at 13,926.47. The Standard & Poor's 500 Index <.spx> was up 6.06 points, or 0.40 percent, at 1,508.48. The Nasdaq Composite Index <.ixic> was up 18.48 points, or 0.59 percent, at 3,149.98.


(Reporting by Ryan Vlastelica; Editing by Bernadette Baum)



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