Advice Pool - Reference and Education

There's been a tremendous amount of news about the student loan and financial aid industry lately. Those who follow the industry know that New York State Attorney General Andrew Cuomo has been pressing settlements or lawsuits to both lenders and colleges, alleging unethical and illega

According to USFDA, a combination product is one composed of any combination of a drug and device; biological product and device; drug and biological product

l practices. The headlines have been filled with sensational claims of all kinds - some factual and some probably exaggerated to some extent. Let's take a balanced look at some of the practices being called into question.

- Revenue sharing. When a college sets up a revenue sha

; or drug, device, and biological product and fixed dose combination would include two or more combinations of drug.

Examples of combination products may in

ring agreement with a student loan company, the loan company may offer the college a payment based on the loans taken out by that college's students, usually a percentage of the loan. While some argue that revenue sharing gives colleges more money to work with for defraying administra

lude drug-coated devices, drugs packaged with delivery devices in medical kits, and drugs and devices packaged separately but intended to be used together.

ive costs or funding additional scholarships, it has been deemed a conflict of interest when colleges have a financial incentive to push students to a preferred lender when it may not offer the best benefits or lowest rates.

- Opportunity pools. Not every student who applies f

here is enormous increase in the number of combination products entering the market in the recent years. Combination products have proven advantages but fixe

or a student loan will receive it, especially with private student loans, which are credit-based. When a college sets up an opportunity pool agreement with a student loan company, the loan company agrees to approve some students who would otherwise not be approved for a loan. This all

d dose combinations are still in the process of convincing regulatory authority on their advantages over the single ingredient formulations.

Combination pro

ows more students the chance to afford college who might not otherwise be able to, but can also provide loans to students whose families may not have the financial resources to repay the loans.

- Call center contracting. Running a financial aid office can be an overwhelming ta

ucts have become life saving products for the pharmaceutical companies who doesn’t have many innovative molecules in their product pipeline and have been inc

k, particularly at large colleges and universities with tens of thousands of students. When a college sets up a call center agreement with a student loan company, the loan company dedicates a portion of its customer service center to act as customer service for the college. The studen

easingly used in the product life cycle management. Even the companies having product patents are trying to extend their product life cycle through the combi

t loan company's employees may identify themselves as employees of the college or employees of the loan company, depending on the contract terms. There are benefits to the college in that call center contracting reduces the burden and cost of a financial aid office for a college. Howe

nation products and maximize the revenues. But the companies involved in this practice are overlooking that they are burdening the patients both economically

ver, call center employees may recommend their employer (the lender) over other lenders, even if other lenders have products with better benefits or lower rates.

- Advisory councils. To stay in touch with what's happening in the financial aid world, student loan companies ofte

and physically. They need to rightly judge the benefits of the combination products and they have to even look at the risks involved when combining the produ

convene advisory councils and invite college financial aid officers to participate. In some cases, the student loan companies pay travel expenses for financial aid officers to attend advisory council meetings. In other cases, financial aid officers may be paid for their time. While a

ts. Some of the combination products were well accepted by physicians while others suffered. Companies involved in development of combination products are fi

dvisory councils can help student loan companies stay in touch with what colleges and their students need, some may perceive the lender has an ulterior motive. By serving on an advisory council and accepting payments or reimbursements for expenses, financial aid officers may have an i

ding difficulty in defining their combination products and facing various challenges from selecting a combination to marketing it.

Following aspects would a

ncentive to recommend a specific lender over others that may have better benefits or lower rates.

- Payments and gifts. In a few of the recently publicized cases, financial aid officers have accepted gifts of significant value from student loan lenders, ranging from consulting

dd to the challenges in developing combination products:

Which markets to tap where the combination products can do fairly well?
Which combination prod

fees to company stock. There are no positives to this practice as offering gifts of significant value implies a quid pro quo, meaning that reciprocity is usually expected, such as placement on a lender list.

- Preferred lender lists. Typically, a college assembles a list of pr

cts are meaningful and rational?
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin

eferred lenders which it recommends to students. In most cases, financial aid officers solicit proposals from lenders for product benefits and rates. A list of lenders is then drawn up and given to students, typically along with their financial aid award package. For the most part, fi

tions increase the patient compliance?
What would be the developing cost?
How to tackle the risks encountered during combination product developmen

nancial aid administrators place lenders who offer the best benefits and rates to students on the list, helping simplify the task of choosing lenders for students and families. However, the process by which lenders are chosen is not always disclosed by colleges. If there is a conflict

t?

As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel

of interest as described above, lenders who don't offer the best benefits or lowest rates may still be placed on the list.

Some of the practices outlined above are clearly a conflict of interest and need to come to an end, such as offering gifts of significant value in exchange for p

ping new procedures for reviewing their safety, efficacy and quality.

Professional from academic institutions, pharmaceutical industries, health care indust

romotion or list placement. Others, such as opportunity pools and revenue sharing, are more of a gray area because there's a definite benefit to some students and families, but potentially at the cost of value to other students and families.

Despite the recent uproar in the press, it

y and representatives from various regulatory agencies are working out to design the regulatory requirements for manufacture and sale of combination products

is important to keep in mind that financial aid officers are for the most part honest and ethical people trying to stretch every dollar they have to help you pay for the ever increasing cost of college. There are a few who have made very bad judgment calls and have behaved unprofessi

.

As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de

nally, but the majority of financial aid professionals do have your best interests in mind and can be trusted.

Incidentally, it's worth pointing out that the Student Loan Network has never and will not engage in these practices. We play by the rules very strictly, and hope that when

elopment. They need to be wiser in analyzing the market trends and the regulatory requirements.

Companies that provide selfless information through particip

you choose a student loan company you'll choose us as the best balance of competitive products and great customer service. If you have any questions about our loan services, or would like help and advice with the financial aid process, please give us a call toll-free at (877) 328-1565

tion in industry events and feedback to regulatory authorities would be able to face the challenges and will be successful in developing combination products

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