Bean Counters Stifle Pharma Market Research

The drug industry is laying off people left [brain] (research) and right [brain] (marketing and sales). Market research (MR) -- definitely a left brain activity -- is currently experiencing a downsizing that will have "implications for those in the trenches," according to Marc Iskowitz, writing in Medical Marketing & Media (see "State of Market Research: Analyze This"). Iskowitz summarized results of the Pharmaceutical Marketing Research Group (PMRG) Second Annual State of the Industry (SOI) Survey, conducted in collaboration with TGaS Advisors. Full survey results will be available at PMRG's Annual National Conference.

Here's some trend data from the survey that documents the downsizing:

"The reasons behind the downsizing are well known to anyone who follows the pharma industry," notes MM&M. "Brands are maturing and thus requiring less overall analytical support."

The workload of the MR staff, however, has increased according to Todd Francis, VP and head of commercial support and enterprise marketing for Sanofi US. Francis was quoted as saying "With reduced [research] headcount, [and] the same number of marketers asking the same amount of questions, you become less able to think about what you need to be doing next and more focused on the questions that are being asked."

But, who exactly is doing this work? Outside vendors are relied upon more and more to do market research. According to Karen Tibbals, former Director Market Research at Schering (Merck), this is stifling innovation in marketing research primarily because of the industry's preferred vendor system (see "Pharma needs truth tellers, not preferred vendors"). Tibbals now is a Self-employed Consultant, Trainer, Speaker and a Masters of Divinity Student at Earlham School of Religion (see her LinkedIn profile).

Tibbals also writes a soul-searching blog focused on the state of pharma marketing research "because I am concerned about the direction of the field. There have been changes taking place due partly to global economic trends. While I understand the forces behind the trends, I want market researchers to start to think about how they respond to the trends and not just react. I see danger in pure reaction, danger for the future of the market research field."

"With Finance and its henchmen in Purchasing and HR running pharma's operations, intangibles such as insight, veracity and innovation are low priorities when it comes to selecting suppliers," wrote Daniel Hoffman, the author of the Philly.com story cited above. "Finance and its minions claim that such qualities, in fact, don't really exist because they are not easily quantifiable or amenable to spreadsheet analysis. Absent such characteristics, marketing research becomes a commodity service that the pharmas can retain on a lowest cost basis. Some companies even go so far as to make supplier candidates compete for retainers by means of negative auctions -- lowest bidder wins. Since it works for hog bellies and soybeans, why not use it for marketing research?"

"Automation and outsourcing are giving us faster and/or cheaper, but not better," says Tibbals (see here). "Better has to come from people who are interacting, and thinking. In the effort to cut costs, care has to be taken that what is cut doesn’t affect the ability to improve, to provide more value and to serve as a competitive advantage for the corporations that pay the salaries."

[Note: PMRG is a Pharma Marketing Network (PMN) advertiser. PMN helps promote PMRG's Annual Conference. I am not paid to write blog posts such as this one by PMRG or any other advertising partner.]

China Enjoys a Burst of Pharma Marketing Spending While U.S. & Japan See a Decrease

Cegedim Strategic Data (CSD) reports a decline of 3.4% in worldwide audited pharmaceutical marketing investments for 2011 (see "Pharma Marketing Global Spend Dipped 3.4% in 2011"). In China, however, pharma spending on sales rep detailing physicians increased by 23% in 2011 compared to 2010. That activity represents about 81% of the total pharma marketing spend in China compared to 60% globally.

"This is typical of emerging markets," noted Christopher Wooden Vice President for CSD Global Promotion Audits.

Another type of marketing spend that is "typical" for emerging markets is meetings where physicians are invited to listen to key opinion leaders or specific promotions. In China, meeting spending was up 43% in 2011 vs. 2010. That represents 17% of the total marketing spend in China. Sampling, on the other hand, represents only 1% of the marketing spend, whereas in in the U.S. 21% of pharma's marketing spend is on samples. Note that CSD costs samples according to Average Wholesaler Cost rather than retail value.

Japan, on the other hand, saw a "surge" in pharma marketing spend in 2010 over 2009, but there was a "pull back" in 2011 with a 12.5% drop overall. Detailing was down 12% and spending on meetings, which accounts for almost 30% of the marketing mix, was down 11% to $7.4 Bn.

Using my math, that means that total pharma marketing spend in Japan in 2011 was about $24.7 Bn (7.4/.3) compared to $29.2 Bn in the US.

In the U.S., pharma marketing spend was down by about 4% overall, with detailing dipping 6% in 2011 compared to 2010 (see "2011 U.S. Pharma Company Promotion Spending" and chart below).

Pfizer "Clinical Trial in a Box" Failure: The Dead Rat Comes Home to Roost

After Years of Telling Consumers Not to Trust the Internet, Pfizer Discovers that It Cannot Convince Patients to Participate in Internet-based Clinical Trials. Duh!

As reported on Pharmalot (here): "Last year, Pfizer announced plans to run the first clinical trial to allow patients to participate from home by using computers and smartphones instead of going to a clinic or doctor’s office. The idea was to create a model for saving money that will rely on personal technology to more easily recruit patients and monitor their progress. Known as a ‘clinical trial in a box,’ the study is testing the Detrol overactive bladder drug in 10 states and gained an FDA blessing. However, Pfizer ran into some snags winning over patients."

Craig Lipset, Head of Clinical Innovation at Pfizer, explained it this way: "I think some of the staunch advocates for using online and social media for recruitment are still reticent to claim silver bullet status and not use conventional channels in parallel. In terms of health literacy, the patient population is largely unaware of clinical trials and participation. You’re going in at a level where there’s still a lot of basic learning needed for individuals to make informed decisions about whether to participate. And doing that without an interaction with a healthcare provider is a challenge."

I wouldn't say there's a lack of "health literacy" regarding decisions to participate, but more lack of credible information and TRUST, which is what Lipset is talking about in the last two sentences quoted above.

As Lipset admits later on in the interview with Pharmalot:

"In a world where we’ve been telling people not to trust (web) sites online and then to ask them to do everything online is still a challenge. A very important takeaway is that online is great, but make sure these folks know they’re not alone and have a sense of contact that they need… The twist here was to go from awareness to randomized participant entirely online, and this is where ensuring some human contact as well as an optimized online process have proven extremely important."

Is this a case of the "dead rat" coming home to roost? See "Was a Rat Harmed in the Filming of This Pfizer Commercial?"

A Loophole (?) in New FDA Guidance on Pre-Dissemination Review of TV Direct-to-Consumer Ads

On September 27, 2007, President Bush signed into law the Food and Drug Administration Amendments Act of 2007 (FDAAA), which gives FDA the authority to ". . . require the submission of any television advertisement for a drug . . . not later than 45 days before dissemination of the television advertisement." The notice of issuance of "Draft Guidance for Industry Direct-to-Consumer Television Advertisements — FDAAA DTC Television Ad Pre-Dissemination Review Program" was published today in the Federal register (see "Draft FDA Guidance on PreDissemination Review of TV Direct-to-Consumer Ads").

Before I get to the "loophole," here's a summary of the guidance.

Up until now, the FDA allowed the VOLUNTARY submission of TV ads for review prior to airing, but did not require it. The draft guidance details which type of TV ads REQUIRE approval prior to "dissemination," how long it will take FDA to review these ads and get back to the sponsor (45 days), and what the sponsor can do if the FDA does NOT meet the 45-day deadline. Of course, it also mentions CRIMINAL and CIVIL MONETARY penalties that may be sought by the FDA for violations.

Which Ads Will Require "Pre-dissemination" Review?
The Agency intends to require sponsors to submit TV ads for pre-dissemination review in the following categories:

• Category 1: The initial TV ad for any prescription drug or the initial TV ad for a new or expanded approved indication for any prescription drug 
• Category 2: All TV ads for prescription drugs subject to a Risk Evaluation and Mitigation Strategy (REMS) with elements to assure safe use (see section 505-1(f) of the FD&C Act) 
• Category 3: All TV ads for Schedule II controlled substances 
• Category 4: The first TV ad for a prescription drug following a safety labeling update that affects the Boxed Warning, Contraindications, or Warnings & Precautions section of its labeling 
• Category 5: The first TV ad for a prescription drug following the receipt by the sponsor of an enforcement letter (i.e. a Warning or untitled letter) for that product that either cites a TV ad or causes a TV ad to be discontinued because the TV ad contained violations similar to the ones cited in the enforcement letter  
• Category 6: Any TV ad that is otherwise identified by FDA as subject to the pre-dissemination review provision

"Specifically, these categories allow the Agency to review and provide comments on TV ads for prescription drugs with particularly serious risks," says the FDA

Regarding the 45-Day Review Period, FDA says:

"Once the 45-day review time has elapsed, there is no specific legal consequence resulting from disseminating the proposed TV ad without waiting for FDA’s comments. However, once an ad is disseminated, the sponsor is at risk of enforcement action if the ad violates the FD&C Act and implementing FDA regulations."

That is, if the FDA misses its deadline, the situation reverts back to what is the current practice -- air the commercial and perhaps suffer the consequences, which could be nothing more than a warning letter, but may also require the sponsor to air a correction.

What Exactly Will the FDA Review?
In the past, FDA has primarily reviewed TV Ad storyboards, which are graphical representations of key scenes in the ad with dialog included. Storyboards are blueprints for production and are created BEFORE any video production has begun. Now, however, FDA requires a video of the TV ad to be submitted to fulfill the submission requirements. Only after the video is submitted will the 45-day review clock start running.

"FDA cannot provide final comments on the acceptability of a TV ad without viewing a final recorded version in its entirety. FDA understands that some sponsors may wish to receive comments from the Agency before producing a final recorded version of the ad. In such situations, sponsors can submit a pre-dissemination review package without a final recorded version of the ad, but once the final recorded version is produced, it will need to be submitted to the Agency for pre-dissemination review."

After writing this, I had short Twitter conversation with Alexander Gaffney (@AlecGaffney), health wonk and writer of news for @RAPSorg & Regulatory Focus. Regarding FDA's requirement to review videos and not just storyboards, Alec said the guidance would likely cuts down on "poor marketing" spending, which I interpreted to mean "pushing the envelope" spending. In the past, pharma marketers could submit a storyboard (cheap) and run the ad without waiting for comments from the FDA. The ad could push the regulatory envelope and run its course on TV before the FDA could issue a warning letter. I commented on this previously. Read "FDA and YAZ: Is FDA Helping Marketers Work Around Regulations?"

The "Loophole"
FDA does not define what exactly it means by "dissemination." Perhaps it has defined this term elsewhere in it regulatory archives, but I assume in this case it means airing the ad on mass market TV. Does that include uploading the video to YouTube? A drug company could upload a video of a pre-approved ad to YouTube at the same time that it submits the video to FDA for "pre-dissemination" review. The video can then be embedded in the drug.com website or promoted via Twitter.

The bright line between TV and online video is getting more blurry every day. I currently am able to watch Youtube videos on my TV via Apple TV. Of course, it is not the same as regular TV ads that I can skip over thanks to my new cable box that allows me to record programs and play them back later. And I may be the only person that would actively search out drug TV ads published on YouTube!

Would a pharma company want to do this? Maybe, if it does not violate the "letter" of the law; ie, is not classified as "dissemination." That would let the company off the hook for violating the law, but FDA could still cite the YouTube version as violative (ie, as it does right now). A violative YouTube version of the video could result in an FDA warning letter, which probably would be issued months after the ad was first uploaded.

Just my thoughts and a comment that I think the FDA should consider when developing its FINAL guidance.

Up Yours, Rush Limbaugh, Say Women Lawmakers!

In Virginia, state Senator Janet Howell reacted to a bill that requires women to get an ultrasound before an abortion with an amendment requiring doctors to perform a rectal exam and stress test before prescribing impotence pills.

I'm pretty sure Rush Limbaugh would not like to have a rectal exam every time he went in to refill his Viagra prescription!

Peter O’Toole, a Pfizer spokesman, said by phone that the company doesn’t comment on specific legislation.



HT: Pharmalot ("Want Viagra? See A Sex Therapist And Notary First!")

Also see "Women Lawmakers Turn the Tables on Men Who Take Viagra".

Do Drug Coupons Hurt Employee Health Plans and Ultimately Employees?

"Coupons for drug co-payments are illegal and drive up long-term health-care costs for all, a consumer group and four trade-union health-insurance plans said Wednesday in announcing lawsuits against eight pharmaceutical companies," reported the Philadelphia Inquirer (see "Trade union health plans sue 8 pharma companies over drug coupons").

The eight drug companies being sued are:

1. Abbott Laboratories
2. Amgen
3. AstraZeneca
4. Bristol-Myers Squibb 
5. GlaxoSmithKline
6. Merck & Co.
7. Novartis
8. Pfizer

The lawsuits claim that although coupons reduce the consumer’s out-of-pocket cost, the health insurer still pays the previously negotiated price to the drug company. "With no savings from generics, health plans will need to charge patients more to keep up with rising costs, the lawsuits say."

That was precisely my criticism of Pfizer's attempt to compete with generic versions of Lipitor by offering consumers coupons that lowered the co-pay to $4:

"Most patients taking Lipitor won't even know what's going on except that their out-of-pocket co-pay will be decreased," I said. "But as more patients pay a portion of their employer-sponsored healthcare coverage, they should be concerned that employers may pass along the added expense (to them) to their employees. And even though the Pfizer-PBM deal will end in six months and Lipitor co-pays will rise back up, it would still hurt employers who will remember the shakedown when they adjust their employee benefit plans!" (see "Occupy Pfizer! Protest It's Deal to Block Sales of Generic Lipitor! #OccupyPFE").

In a comment submitted to the Inquirer, Wells Wilkinson, JD., Director, Prescription Access Litigation Project, said:

"If a drug is a patient’s only option, and it has no real alternative, then we applaud when companies like Pfizer help patient in need afford their medications.

"But copay coupons are not aimed at patients in need, they are marketing tools that target people with insurance. Distributed for drug companies by doctors and pharmacists alike, they can be coupled with tv ads that promote an expensive drug. For instance, Lipitor is competing with other statins that cost one-fifth to one tenth as much. In fact some statins (like lovastatin, pravastatin) are so inexpensive you can get them for $4 without any insurance at all. Does it help the consumer in the long run to trick them into using a coupon, and passing on $120 in costs to their health plan, when they could buy a low-cost statin that is just as effective for $4 with no cost to their employer or health plan?

"Consumers need to see that there are real costs to using coupons – costs that drive up their premiums and their employers costs for health care. Forgoing copay coupons and using lower cost drug also helps save funds that they may need later, or that their coworkers need for the really expensive drugs with no alternatives.

As more and more drugs lose their patent protection and become available at competitive prices, consumers should use these first, and take advantage of market competition to keep our health care costs down."

It should be noted that federal Medicare and Medicaid programs prohibit the use of coupons because they can hurt the programs, which have to pay for higher-cost drugs that the coupons promote.

Pfizer had nothing to say except "While many health plans have raised their co-pays and/or are encouraging switching to generic medications to achieve cost-savings, these treatments may not be appropriate for all patients."

The drug industry continues to claim that generics are "different" than brand name drugs and therefore "may not be appropriate for all patients." It's also an argument the industry makes against "biosimilars" or follow-on biologics. What do you think?

Are generic versions of non-biologic drugs such as Lipitor appropriate for patients who were previously prescribed the brand name drug?
	Yes, always
	Yes, in most cases
	No, never
	I have no idea