Bad, Devalued, Distrusted & Defensive Pharma - Pharma Marketing ...

31 Jan 2013 Vol. 12, No. 1

•

Published by

VirSci Corp. www.pharmamarketingnews.com

www.virsci.com

Bad, Devalued, Distrusted & Defensive Pharma A Tale of Two Books Author: John Mack

Published by:

VirSci Corporation PO Box 760 Newtown, PA 18940 [email protected]

PMN1201-02

Pharma Marketing News

Vol. 12, No. 1: January 31, 2012

“I

t was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us, we were all going direct to Heaven, we were all going direct the other way—in short, the period was so far like the present period, that some of its noisiest authorities insisted on its being received, for good or for evil, in the superlative degree of comparison only.”

That about sums up how I feel after reading two recently published books about the pharmaceutical industry: “Bad Pharma,” a 430-page book by Ben Goldacre, a British physician, whose previous book, Bad Science, was a best seller in the "non-fiction" realm and the much smaller 123-page book “Devalued and Distrusted” by John L. LaMattina, former president of research and develop at Pfizer. The subtitle of the latter asks “Can the Pharmaceutical Industry Restore Its Broken Image?” Both authors speak in “superlatives” and both are evangelists, encouraging their readers to take specific actions to remedy the evil or proselytize the good described in their respective books.

Bad Pharma Allow me to examine a few aspects of BenGoldacre’s offensive against pharma before I summarize the defensive, “anti BadPharma,” effort made by LaMattina. As the name suggests, “Bad Pharma” is a no-holdsbarred critique of practically every aspect of the pharmaceutical industry from drug development to marketing. Chapter titles include reiterations of the "bad" theme such as "Bad Trials" and "Bad Regulators."

p. 2

which summarise all of the evidence ever collected on a given question.” Yet he claims that the drug industry cherry picks its data; e.g., fails to report negative trial data. This is the focus of the first chapter, "Missing Data", and Goldacre says it is "key to the whole story." Marketing Spending vs R&D Spending by Pharma How much money the drug industry spends on marketing vs. research and development is a contentious issue, as Goldacre points out. "Marketing spend is a contested area, as the industry is keen to play it down," says Goldacre in the Notes section of the book. He summarizes the issue this way: "A quarter of the pharmaceutical industry's revenue is spent on marketing, twice as much as it spends on research and development, and this all comes from your money, for your drugs. We pay 25% more than we need to, an enormous mark-up in price, so that tens of billions of pounds con be spent every year producing material that actively confuses doctors and undermines evidence-based medicine." "This is a very odd state of affairs," says Goldacre. It's also "odd" that Goldacre's math does not add up. The value of the global pharmaceutical market was estimated to be US$880 billion in 2011 according to IMS Health (see "Pharmerging Markets to Continue Strong Growth"; http://bit.ly/Wyl3bV). One quarter of that would be over US $200 billion. All of this, of course, is not spent in US marketing, which Goldacre pegged as US $60 billion. However, I cannot imagine that the difference (US$140 billion) is spent in other countries. US marketing spending must be about 75% of the total, which is consistent with the overall size of the US market compared to the rest of the world. Even if it's only 50% that would mean that US $100 billion is spent on pharma marketing in the US, which is quite a bit more than the US $60 billion that Goldacre cited a few pages earlier in his book.

Bad Pharma Marketing The chapter on marketing, which comprises about 25% of the book, is merely titled "Marketing." Goldacre summarizes the raison-d'etre of pharma marketing as existing for "no other reason than to pervert evidencebased decision making in medicine" and proceeds to "take a look at this mysterious world."

OK, that's a math error.

Of course, pharma marketing is not "mysterious" to me or readers of Pharma Marketing News. I am familiar with most of Goldacre's criticisms, having written about the same subjects for many years.

I don't want to nitpick, but which is it: $60, $100, or $30 billion? Obviously, whatever the number, it's big. But is it twice as big as the R&D spend? That's the main thing Goldacre and other critics of the drug industry want people to believe in order to blame marketing for the high cost of drugs. Let me summaris my critique of the $60 billion number that Goldacre cited. Continues…

Goldacre states unequivocally that "tens of billions of pounds are spent each year, $60 billion in the US alone, on medicines marketing." This might be a bit of "cherry picking" data to buttress his arguments despite his claim that "this book is based on systematic reviews, © 2013 VirSci Corporation (www.virsci.com). All rights reserved. Pharma Marketing News

But Goldacre also cites conflicting numbers for pharma marketing spending in the US. While he cites US$60 billion on page 246, on page 317 he says "we know that $30-40 billion is spent by the industry on drug marketing in the Americas" (aka "US").

PMN1201-02


Vol. 12, No. 1: January 31, 2012

p. 3

The study that Goldacre cited for the $60 billion estimate was done by two Canadian authors: "The Cost of Pushing Pills: A New Estimate of Pharmaceutical Promotion Expenditures in the United States," which was published in PLoS Medicine (see http://bit.ly/129Zgeg).

Cost of Samples There is a large difference between the IMS (US$15.9 billion) and CAM (US$6.3 billion) estimates for cost of samples. Essentially, IMS bases its estimate on the retail value of samples, whereas CAM bases it on the Average Wholesale Price.

Their conclusion: The pharmaceutical industry spends almost twice as much on the marketing and promotion of drugs than on research and development.

The PLoS authors use the IMS retail cost estimate because that is how the drug industry itself estimates the value of free samples it gives away! This is just another case where the industry shoots itself in the foot. It's hard to argue with the PLoS authors' statement that "it is inconsistent for donations to be reported in terms of retail value and samples in terms of wholesale value."

"For the last 50 years,” say the authors, “there has been an ongoing debate as to which image [see left] of the drug industry is most accurate. The industry promotes a vision of itself,” say the authors, “as 'research-driven, innovative, and life-saving,' but the industry's critics contend that the drug industry is based on 'market-driven profiteering.'" To prove this, the authors use data from 2 different sources: IMS and CAM as shown in the table below. I am troubled by the methodology of the authors. In essence, the authors place more value on the CAM data then on the IMS data. I'm not sure why, since both companies provide services for a fee to the pharmaceutical industry. The main difference between the two methodologies is that IMS surveys the industry whereas CAM surveys doctors. The biggest differences between the datasets involve cost of samples, cost of detailing, and "unmonitored promotion."

© 2013 VirSci Corporation (www.virsci.com). All rights reserved. Pharma Marketing News

Cost of Detailing The authors point out that "There is a significant discrepancy between the two sets of data in the cost of detailing: US$7.3 billion for IMS and US$20.4 billion for CAM." IMS only considers the "cost to field the rep" and doesn't include in its estimate—as CAM does—indirect costs like costs for the area and regional managers, the cost of the training, and the cost of detail aids such as brochures and advertising material. The authors claim that "relying on physician-generated data to estimate the amount spent on detailing [which is Continues…

PMN1201-02


Vol. 12, No. 1: January 31, 2012

CAM's data collection method] is likely to give a more accurate figure than using figures generated by surveying firms [which is IMS's method]. Companies may not report some types of detailing, for example, the use of sales representatives for illegal off-label promotion, whereas doctors are not likely to distinguish between on- and off-label promotion and would report all encounters with sales representatives." If it were up to me, I would use a number somewhere in between the IMS and CAM estimate—say $10 billion. I am especially troubled by the $14.4 billion estimate for "unmonitored promotion." All that the PLoS authors have to say about this is: "We believe that it is appropriate to correct for unmonitored promotion and that the figure we used is a re-liable estimate. The 30% correction factor is based on a direct comparison that CAM is able to make between the data it collects through its surveys and the amount reported by companies." IMHO, this hardly rises to the level of objective analysis of available data. My analysis would completely discount this number as something that cannot be known and therefore should not be used. Besides, the same could be said for R&D spending. My Estimate Instead of the estimate of $57.5 billion that the PLoS authors use for promotional spending in the US, my estimate is $32.7 billion, which is pretty close to the $29.6 billion the PLoS authors use for the R&D estimate. This would lead me to conclude that—within the margin of error—that the US pharmaceutical industry spends about as much on R&D as it does on promotion. Goldacre’s Response Of course, I don't expect Goldacre to be happy with an estimate that says pharma spends at least as much on R&D as it does on Marketing. In a comment to Pharma Marketing Blog, Goldacre said, “I'm very happy to correct any errors or inconsistencies in the book - it would be bizarre if there were none - and am always glad of help on that front, but I don't think you have identified an example of cherry picking here.” “It's worth noting that there are both higher and lower estimates around for marketing as a proportion of sales. The World Health Organisation said that marketing was a third of all sales revenue, for example (see http://bit.ly/Vw6QOG), said Goldacre. “Your main concern,” said Goldacre, “seems to be the 2011 PLoS Medicine paper whose $60bn figure you disagree with. That paper also discusses other estimates, which are consistent with theirs, and which give estimates of marketing spend from a quarter to a half of total sales revenue (my casual mention of ‘a quarter’ is actually at the lowest end of this range). © 2013 VirSci Corporation (www.virsci.com). All rights reserved. Pharma Marketing News

p. 4

"Our new estimate of total promotion costs and promotion as a percentage of sales is broadly in line with estimates of promotional or marketing spending from other sources,” claimed Goldacre. “The annual reports of Novartis distinguish ‘marketing’ from ‘administration.’ Marcia Angell extrapolates from this annual report to the entire industry and calculates a figure of US$54 billion spent on pharmaceutical promotion in the US in 2001. As a proportion of sales, she estimates 33% is spent on marketing. Using similar methodology, the Office of Technology Assessment derived an estimate for marketing costs in the US by extrapolating from the cost structure of Eli Lilly. The Office of Technology Assessment considers that firms spend around 22.5% of their sales on marketing. Based on United Nations Industrial Development Organization estimates, a report from the Organization for Economic Cooperation and Development estimated that, in 1989, pharmaceutical firms globally spent 24% of their sales on marketing, but few details of the methodology used were provided, making it impossible to verify the accuracy of the estimate. Finally, in 2006 Consumers International surveyed 20 European pharmaceutical firms to obtain more information about their exact expenditures on drug promotion. Among the 20 firms contacted, only five agreed to provide separate figures for marketing, which ranged from 31% to 50% of sales depending on the firm. "The results are also consistent with data on the share of revenue allocated to ‘marketing and administration’ according to annual reports of large pharmaceutical companies, if we consider that the largest part of ‘marketing and administration’ is devoted to promotion. Lauzon and Hasbani found that 33.1% of revenues was allocated to ‘marketing and administration,’ similar to the 31% reported by the Centers for Medicare and Medicaid Services and the 27% from Families USA. “The $60bn marketing spend for 2004 should be interpreted in the context of global revenue in 2004. So, pursuing your ‘back of the envelope’ theme, the marketing spend in the US alone in 2004 ($60bn) was around 15% of sales revenue in 2004 ($441bn). I don't think it's unimaginable that the whole of the rest of the world made up the difference to a quarter. And the very many studies described above, which estimate marketing spend at between a quarter and half of sales revenue, are likely to be more thorough than your back-ofthe-envelope calculation, in which you jumble up 2004 and 2011 figures, and my back-of-the-envelope correction using 2004 figures. “So, overall, the estimate of ‘a quarter’ doesn't seem outlandish, or unreasonable, and it certainly isn't very unusual, nor is it anywhere near the highest estimate of 50%. “That said - as I explain very openly in the book - I didn't want to go too large on marketing spend, over the course of 400 pages, since there are multiple conflicting estimates for Continues… PMN1201-02


Vol. 12, No. 1: January 31, 2012

p. 5

it, and marketing isn't my main area of interest. So I'll happily have a look at those bits of the book and see if there's anything worth revising for the next edition.”

Bad Pharma Research

It’s Not Quantity, It’s Quality Is there any value in defending the drug industry against the common claim that it spends twice as much on marketing as it does on R&D? Gary Monk, Healthcare Innovation Consultant and former Product Manager at Janssen Cilag, believes the actual ratio is of little consequence. “The implicit assumption seems to be Pharma Research = potentially good and Pharma Marketing = surely bad,” said Monk in a comment to Pharma Marketing Blog. “I actually believe Pharma Marketing spend can be valuable to patients, HCPs and wider society if it is done in a balanced way, e.g. promoting a product that has value in a particular subset of patients, or raising awareness of a relatively undiagnosed condition.”

The following section is a review of the research section of Bad Pharma by Adam Jacobs, PhD, Director of Dianthus Medical Limited, and author of the Dianthus Medical blog (http://dianthus.co.uk/blog) .Dr. Jacobs has a PhD in organic chemistry from the University of Cambridge and an MSc in medical statistics from the London School of Hygiene and Tropical Medicine. Dr. Jacobs has written several other blog posts about Bad Pharma.

“It is not HOW MUCH you spend,” said Monk, “rather HOW you spend your marketing budget. Even in a world of perfect numbers, you can't say for example, if company A spends 35% on marketing, it must therefore be using this fat to create dodgy Gary Monk data and inducements to prescribe. Similarly, you can’t say if company B only spends 10% on marketing, it must be very focused on only providing the minimum amount of balanced information and can't be doing anything unethical. Statistics rarely correlate - yet even if they did a deeper exploration of why is required.” Adam Jacobs, PhD, Director of Dianthus Medical Limited, agrees. “We are supposed to believe that the pharma industry [is] not really serious about research if they spend more on marketing than they do on research,” said Jacobs. “In effect, the assumption is that spending on marketing and research is a zero sum game. If you spend a dollar on marketing, then you have one dollar less to spend on research.” “The problem is that that assumption really doesn't stand up to critical thought. It's not a zero sum game. The whole point of marketing (at least if you're doing it right) is to increase revenue. If you spend money wisely on marketing, then you will have greater total revenue, and if you are spending a certain percentage of your revenue on research, then by spending more money on marketing, you will have more money to spend on research (see, for example, http://bit.ly/YiYTcI). © 2013 VirSci Corporation (www.virsci.com). All rights reserved. Pharma Marketing News

By Adam Jacobs

The first sentence of Goldacre’s book is “Medicine is broken”, and the rest of the book is devoted to explaining why Goldacre believes that to be true. We are told that drugs are tested in badly Adam Jacobs designed trials, that the results of those trials are misrepresented, and that doctors make their prescribing decisions based on flawed information. So is Goldacre right to claim this? Well, partly. He certainly makes some good and important points. He identifies some genuine problems with the way medicine is practised. For example, he describes at great length the problem of publication bias. Publication bias is what happens when not all the studies that are done on an intervention get published, and the ones that get published have more favourable results than the ones that don’t. It is indeed an important problem. He also is quite correct to criticise the secrecy surrounding the drug regulatory process. Regulators make decisions about drugs behind closed doors. Goldacre would like to see all the information on which those decisions are based, and the reasoning for the decisions, made public. It is hard to see how any reasonable person could disagree with that, and I absolutely agree with Goldacre that the secrecy surrounding drug regulation is scandalous. However, Bad Pharma is not without its flaws. There are many places where it veers away from a scholarly investigation and comes across more as trying to sell a story. Goldacre frequently exaggerates the extent of the problems he describes, and ignores evidence that contradicts the story he is trying to tell. Goldacre has two Continues… PMN1201-02


Vol. 12, No. 1: January 31, 2012

jobs: he is both a scientist and a journalist. The job of a scientist is to search for the truth in a dispassionate manner, taking account of all relevant evidence, whether or not it is consistent with pre-existing beliefs. The job of a journalist, on the other hand, is to tell a compelling story, and not to worry too much about inconvenient facts that may spoil the story. I am left with the distinct impression that Goldacre wrote this book wearing his journalist hat. This is disappointing. Goldacre tells us near the beginning of Bad Pharma about the importance of considering all the data on a particular subject, and not simply cherry-picking pieces of data that happen to support a particular argument while ignoring disconfirming ones. Goldacre should indeed be very familiar with this concept: he has thoroughly earned a reputation as a razor-sharp debunker of pseudoscientific nonsense. And yet sadly, cherry-picked statistics are not hard to find in this book. We don’t have to look very far: there is one on page 2. Goldacre cites a 2007 study by Bero et al which investigated whether papers sponsored by the pharmaceutical industry were more likely to report results favourable to the sponsor than independent papers. In their primary analysis, they found no statistically significant difference between the two. However, in a secondary analysis, they did find a difference, with an odds ratio of 20. It’s that secondary analysis that Goldacre presents, and he also presents that statistic by saying that “industry-funded trials were twenty times more likely to give results favouring the test drug”, which is to misunderstand what an odds ratio is. An odds ratio of 20 does not mean that something is 20 times more likely. Now, to be fair, Goldacre does describe a systematic review answering the same question on the next page. But would a more honest approach not have been to go straight into the review without reporting some scary but almost certainly misleading statistics first? As an aside, a new systematic review looking at the question of whether industry sponsored studies are more likely to be favourable to the sponsor’s product has been published since Goldacre wrote his book, and it seems that the answer to this question may have been affected by publication bias, as I blogged about recently. So while it may be true that industry sponsored studies are more likely to find favourable results, the evidence to support © 2013 VirSci Corporation (www.virsci.com). All rights reserved. Pharma Marketing News

p. 6

that claim is nowhere near as robust as Goldacre says it is. There are places where Goldacre relies on papers that present very shaky evidence. If they were not confirming his pre-existing beliefs, I’m sure he would be among the first to debunk them, but this doesn’t seem to happen in Bad Pharma. And then there are places where the book is just factually wrong. For example, we are told on page 59 that in the context of reporting adverse events of drugs, pharmaceutical companies “only have to tell the regulator about side effects reported in studies looking at the specific uses for which the drug has a marketing authorisation”. And on page 61, we are told that there is no obligation to tell European regulators about adverse events observed in trials conducted outside the EU. These assertions are just plain wrong. Pharmaceutical companies are required to report adverse events from any use and from any country. To quote from page 7 of the European Medicines Agency’s guideline on Good Pharmacovigilance Practice, “The integrated benefit-risk evaluation should be based on all authorised indications but should incorporate the evaluation of risks in all use of the medicinal product (including use in unauthorised indications).” The EMA also make it clear (in their Q&A document, in answer to question 1) that the periodic safety update reports that pharmaceutical companies are obliged to submit must include data on the “worldwide safety experience”. One thing I have found disappointing in reading responses to Bad Pharma is that some people who should know better have taken everything written in the book as established fact. The book certainly creates the impression of being well evidenced, as it has an impressively long list of references which supposedly support the points being made. However, merely citing a long list of references isn’t enough: closer inspection of those references often shows that they don’t provide the support for Goldacre’s points that he would like us to believe they do. Although one or two blog posts (that last one in Dutch, but Google Translate does a reasonable job on it for those of you whose Dutch is a bit rusty) have been written about Bad Pharma with a suitably skeptical eye, the shaky evidence base for the claims made in the book seems to have escaped the notice of many, including two of my personal heroes when it comes to debunking bullshit claims in medicine, David Colquhoun and Richard Smith. I think that’s Continues… PMN1201-02


Vol. 12, No. 1: January 31, 2012

a shame: a good scientist should treat all claims with skepticism and require that they be proven before they are believed. The response from the pharmaceutical industry has also been disappointing. The ABPI’s response has been widely criticised as being inadequate. They appear to be denying that problems exist, rather than engaging constructively to try to fix the problems. It’s true that some of the problems Goldacre claims exist actually don’t exist, but this does not mean that no problems exist. I wonder if this polarisation in responses to the book is a consequence of the exaggerated claims made in the book, and whether a more balanced and evidence-based approach by Goldacre would have led to some more constructive responses from the industry. But perhaps the biggest problem with this book is that it gives ammunition to pedlars of quack alternative treatments. Claiming that the entire system of conventional pharmaceuticals is broken is exactly what those quacks want to hear. Real harms can result from giving them an excuse to claim that their systems of alternative medicine are better than pharmaceuticals, as Professor David Smith has explained in this thoughtprovoking video response to Bad Pharma. It’s also not hard to find reviews of the book by quacks who seem to be using it for exactly that purpose. I’m sure that Goldacre does not approve of Bad Pharma being used to promote quack remedies, but surely that was a predictable consequence of writing such a one-sided account of the pharmaceutical industry? [This ends the section written by Dr, Jacobs]

Goldacre’s Numbers Game Jacobs believes that I make a good point about the way the numbers are presented in Goldacre’s book. “It's pretty clear to me that there is considerable uncertainty about the numbers, depending on how you measure things,” said Jacobs. “So for Ben to simply present these numbers in the book as established fact, without making all the complexities and uncertainties clear to the reader, does strike me as misleading. “We also need to consider that research spend is incredibly hard to measure as well.” cautioned Jacobs. “These days, big pharma companies do not do all their own research themselves. A lot of research is done in tiny little startup companies, whose research will not figure in any accounts of research spending by big pharma. Big pharma then pays for that research by © 2013 VirSci Corporation (www.virsci.com). All rights reserved. Pharma Marketing News

p. 7

licensing deals or by buying the whole company. Figuring out exactly who's spent what on research under those circumstances is really not a trivial accounting problem.” Jacobs agrees with Goldacre when the latter says "it would be good for patients and industry if people could engage in a sensible conversation about this stuff without resorting to this kind of football team mentality,” We're all on the same side! “So it's a shame that so much of Ben's book seems to have been written with that ‘football team mentality’,” said Jacobs. “There are many places where he could have acknowledged the good work done by the pharmaceutical industry, but chose to take a pop at them instead. For example, the section on ghostwriting completely fails to acknowledge any of the efforts that the industry have made towards addressing this problem (other than by incorrectly claiming that any efforts have been unsuccessful), and didn't cite any of the evidence that ghostwriting is becoming less common.” It should be noted that Jacobs takes an active role in the European Medical Writers Association (EMWA), and was president of the association in 2004-2005. In 2003, he set up EMWA’s ghostwriting task force, as a result of which he was coauthor of EMWA’s guidelines on the role of medical writers in peer-reviewed publications.

Acknowledging the Good Stuff Jacobs asks “Would not a more constructive approach have been to criticise where appropriate, but also to bring in some balance by acknowledging the good stuff?” That’s exactly what LaMattina has done in his book, “Devalued and Distrusted.” After reading LaMattina’s book, one might think that Pharma is Too Big to Succeed; well, succeed alone. LaMattina says that “industry consolidation of the last 15 years has resulted in less competition, less investment in R&D, and a gradual decrease in the approval of new medicines…such a trend should be alarming,” according to LaMattina. LaMattina cites M&A’s disruptive consequences, such as cost-cutting, site closures, shifting of people and projects, etc. However, a few pages on, LaMattina points out that big pharmaceutical companies cannot meet a glaring unmet medical need for new antibiotics because the “commercial return on a new antibiotic would pale in comparison to a new treatment in areas like cancer or Alzheimer’s Disease. This is attributed to the fact that an antibiotic is generally used acutely,” says LaMattina, “not chronically, and so profits are Continues… PMN1201-02


Vol. 12, No. 1: January 31, 2012

diminished by short-term use. . . This narrow use. . . [makes] it unattractive for a big company.” La Mattina suggests that fulfilling such unmet medical needs is “ideally suited to the expertise of biotech companies.” These musings and others in the book seem to undermine LaMattina’s goal, which is to correct the public’s perception of the drug industry—a perception that has been distorted by the media such as The Dr. Oz Show where he made a fateful guest appearance. Much to LaMattina’s chagrin, the show was titled “The Four Secrets that Drug Companies Don’t Want You to Know.” His book is in many ways an attempt to rebuff the premise of that one show by addressing the “four secrets,” which are: 1. Drug companies underestimate dangerous side effects 2. Drug companies control much of the information your doctor gets 3. You’re often prescribed drugs that you don’t need 4. Drugs target symptoms, not the cause I’m not going to get into all of LaMattina’s thoughts on these issues. You’ll have to read the book yourself. Unfortunately, the paperback version costs $29.95, which means most of the American public will never buy it. Even if they did buy it, I doubt they would read it because it is pretty technical and seems to be written more for physicians than for the lay public. Back to the “secrets.” I’d like to focus on LaMattina’s rebuff of “secret” #4 and how it relates to “Pharma is Too Big to Succeed.” LaMattina, fails to convince me that Big Pharma focuses on the causes of diseases rather than the symptoms. When he talks about the benefits of “targeted therapies,” for example, he says we are “not far from the time when a cancer diagnosis” will be one “of a chronic disease, one that might not necessarily be cured but rather treated with a variety of medications that will keep one’s cancer in check. . . what a wonderful situation for patients,” says LaMattina. Obviously, postponing death—a major “symptom” of cancer—is wonderful for many patients. It’s also wonderful for Big Pharma, which currently has about 1000 “novel anticancer agents” in clinical development (according to PhRMA, there are over 3,000 oncology drugs in some stage of development by global pharma companies; http://onphr.ma/TbVgpM). LaMattina suggests he may be “naïve” when he assumes expensive targeted cancer drugs when used in combinations can be delivered at a “reasonable cost.” It’s only this hope that he cites to counter the point he makes earlier that paying for all these new cancer


p. 8

treatments “will become unsustainable.” Treatments are not so “wonderful” when they are not sustainable, IMHO. LaMittina also points out that Big Pharma spends only about 15% of its R&D budget on “R”; i.e., basic research. Research is much better left to NIH, academia and other government funded labs, say LaMattina. He also points out that “a successful academic-industry partnership is crucial in discovering new medicines.” In those cases where NIH is “diverting” hundreds of millions of dollars to do drug discovery, LaMittina suggests this is “clearly better done by industry,” which he says is responsible for 90% of new drugs approved for marketing by the FDA. So, it’s clear that Big Pharma cannot succeed on its own and should not lay claim to all advances in “curing” diseases such as cancer. Pharma Should “Fully Commit” to Rare Diseases Despite the economic realities of Big Pharma companies mentioned above, LaMattina on one hand says that “Big Pharma can gain a lot of good will, something it desperately needs, by fully committing to rare diseases…” On the other hand, LaMattina suggests that Big Pharma needs to be happy with a “niche blockbuster” model whereby instead of having a “few $10 billion-selling drugs,” it has “many billion dollar products.” As I pointed out in Pharma Marketing Blog, it is possible to have billion dollar “orphan drugs” targeted at rare diseases IF the price is right. One such drug is Pfizer's Xalkori (crizotinib), a newly approved for a rare form of lung cancer, for which Pfizer plans to charge $115,200 a year per patient. LaMattina cites Xalkori many times in his book as a wonder drug, but does not mention the price Pfizer wants to charge for it. At that price Pfizer only needs 9,000 patients to reach a billion dollars in sales! (see “New Big Pharma Economies of Scale: Less Patients Needed to Reach Blockbuster Sales”; http://bit.ly/ntyU0B). Drop TV Ads It's been a long, long time since anyone has seriously suggested a "moratorium" or complete halt to direct-toconsumer (DTC) drug TV advertising in the U.S. But that's just what LaMattina suggested in his book and in a Forbes online opinion piece titled "Pharma's Reputation Continues to Suffer -- What Can Be Done To Fix It" (find it here: http://onforb.es/WBMfmN). Continues…

PMN1201-02


Vol. 12, No. 1: January 31, 2012

Actually, LaMattina offered 4 "fixes" — "Drop TV Ads" was #4 on his list. The other 3 fixes that LaMattina put on a par with dropping TV ads are 1. Transparency of payments to healthcare professionals, 2. Transparency of clinical trial data, and 3. Stop the illegal detailing of drugs The first three fixes are not nearly as controversial as fix #4. #1 is already being dealt with thanks to the Physician Sunshine law—although complete implementation has not yet occurred (read this: http://bit.ly/11g5uJj). #2 is also in the works, although there seems to be some push back from the industry (see "A Voluntary Industry Code For Releasing Trial Data?; http://bit.ly/118lSwu). #3 is self-evident. Duh! Drug TV ads, says LaMattina, "may be doing more harm than good. The litany of side effects that must be discussed is numbing and probably doesn’t provide a sense of the true risk-benefit for that medication. Plus, the public views these ads to be a waste of funds that could otherwise be invested in R&D or in lessening drug costs."

p. 9

Pharma Needs to Step Up & Help Develop a Universal Flu Vaccine See http://bit.ly/WdS4dH for the full article. A Bloomberg View piece points out that the greatest breakthrough in the fight against the Flu, which each year kills as many as a half-million people, including 3,000 to 49,000 Americans, would be "a universal flu vaccine that would protect against all viral strains, eliminating the need for annual and pandemic inoculations. Researchers are experimenting with parts of the virus that don’t mutate in the hope of creating vaccines offering lifelong, or at least years-long, protection." "[T]he government has limited means and little product-development experience. Making a new vaccine typically takes a decade and can cost $1 billion. A project of that size is better suited to large pharmaceutical companies. Most, however, have been loath to seriously invest in new vaccines, which offer low returns. "Given this market reality, the U.S. government should design incentives to get the industry more deeply involved, and it should encourage other countries with manufacturing capability to follow suit. The National Vaccine Advisory Committee should begin by asking industry leaders what it would take. Among the possibilities they should consider: tax credits for research and development costs, fast-track procedures for product approval, extensions for patents and periods of market exclusivity, and financial prizes for scientific breakthroughs.

LaMattina may have been channeling the comments I made in August 2009 when I wrote a piece that appeared in the NY Times (see "The New York Times, DTC, and Me"; http://bit.ly/3u7JrX). In it I said "the industry pushes the envelope by overstating benefits and playing down the risks. That has got to stop." Continues…


"By engaging Big Pharma in creating future flu vaccines, governments can ensure that a market failure doesn’t lead to a public health catastrophe." Imagine the public relations benefit if the drug industry announced a unified effort to develop a universal flu vaccine?

PMN1201-02


Vol. 12, No. 1: January 31, 2012

In his book, LaMattina closes the section on dropping TV ads with this paragraph: "If the pharmaceutical industry is really concerned about being better valued by the public, it might do well to drop TV ads completely. However well-intended they are, the negatives have always [my emphasis] outweighed the benefits. If the members of the Pharmaceutical Research and Manufacturers Association agreed to halt TV ads, my guess is that the public's response would be overwhelmingly positive. My sense is that they wouldn't miss the commercials either." I know a few influential people who WOULD miss the ads: pharmaceutical brand managers and their DTC advertising agencies. After all, these ads generate a 2:1 return on investment (ROI) according to DTC experts and the agencies surely enjoy and, in these trying economic times, need their portion of the $2.4 billion that LaMattina says is spent on TV ads each year by the industry. So will pharma ever "drop" TV ads? It's like the old Woody Allen joke: a guy walks into a psychiatrist's office and says, hey doc, my brother's crazy! He thinks he's a chicken. Then the doc says, why don't you turn him in? Then the guy says, I would but I need the eggs!

p. 10

Not Everyone Likes Us – Get Over It! After reading over 600 pages in these two books, one thing is clear: both authors are “preaching to the choir.” That is, it’s not likely that a large segment of the general public will ever read either of these books because they generally are pretty technical and use complicated words not easily understood by the average “Joe” or “Jane.” So, I am not sure if either book will have an impact on pharma’s reputation among the Joes and Janes out there. Perhaps someone should write a book using only the most common 1000 words in English as Derek Lowe, author of “In the Pipeline” blog, did in a post titled “Drug Discovery with the Most Common Words.” The last paragraph of Lowe’s post summarizes pharma’s defense: “Not everyone likes us. Our stuff can be a lot of money for people. It may not work as well as someone wants it to, or they may not like how we talk with their doctor (and they may have a point there). Even so, many people have no idea of what we do, how hard it is, or how long it can take. But no one has got any other way to do it, at least not yet!” Pharma Marketing News

In his book, LaMattina admits he was part of the problem when he was employed by Big Pharma. "I was sympathetic to these ads," he says. Perhaps LaMattina could have spoken out against TV Ads when he was president at Pfizer, but as an R&D person it wasn't his place to do so. However, at least ONE currently employed Big Pharma executive has suggested that pharma marketing spending has gone too far, at least relative to R&D. In a video interview with Wall Street Journal, Joseph Jimenez, the CEO of Novartis, said "The industry needs to spend more money on R&D and less on sales and marketing" (read more about this here: http://bit.ly/XI2Zs5).


PMN1201-02