Friday, January 14, 2005

How the FDA Can Fix DTC

According to today's Financial Times (FT), executives from UK pharma companies GlaxoSmithKline and AstraZeneca told a UK parliamentary committee they did not believe it was appropriate (my emphasis) for Britain to allow drug companies to advertise directly to UK consumers.

This is quote surprising, coming as it does from two companies that top the list of DTC advertisers in the US. DTC spending for Nexium and Crestor --
AstraZeneca drugs -- totaled $228 million in the first 2 quarters of 2004. They were #1 and #3 on the list. Flonase and Wellbutrin -- GlaxoSimithKline drugs -- were #7 and #9!
To put this into context: It is estimated that a total of $5 billion dollars will be spent in 2004 on DTC advertising in the US. (Some DTC proponents, such as the editors at DTC Perspectives magazine, are very defensive about this number as more and more people criticize DTC. They claim it is based on an advertising "list price" which pharma companies rarely pay and that the real figure is more like $2.5 billion. As one US Senator once said, "A $billion here and a $billion there, pretty soon we are talking about real money.")
The remarks by Glaxo and AstraZeneca are also surprising because DTC is vigorously defended by drug companies here in the US. Just a few days ago I reported that a Glaxo spokesperson in London claimed that it was tough to sell ED drugs without the help of consumer advertising (see "ED Drug Sales Limp").

DTC is a double-edged sword. It is effective in getting market share for new drugs quickly after launch, but its mere presence shines a light on drug issues like high prices and misleading ads hurt pharma's image.
Just a few days ago the FDA issued the first warning letter of 2005 to Pfizer for misleading DTC ads for Bextra and Celebrex (see the letter at: http://www.fda.gov/cder/warn/2005/12560-letter.pdf).

It may be that drug companies are looking for a way to end DTC thereby saving them a few billion dollars and a lot of grief.

So why don't they stop doing DTC? Simple, no one company can afford to be the first and only company to stop DTC advertising. They would be at a competitive disadvantage. Also, there is a HUGE ad and marketing industry financed by DTC. Media -- especially print and TV media -- would suffer. DTC advertising feeds a lot of mouths.

Interestingly, however, there is a savior out there -- the FDA! Yes, that much maligned agency can help the industry. It thinks it helps the industry by not being too tough on DTC (see "FDA Draft Guidance for Print DTCA: Less than Feared"), but a little "tough love" is really needed by imposing stricter guidelines on DTC advertising in the US.

I predict that this is precisely what the FDA will do within the next few months.

Here's My Suggestion for the FDA
I am not sure how strict the guidelines will be, but I have a suggestion. Restricting DTC should be tied into (1) a requirement that drug companies perform more post launch surveillance studies to prove the safety of their drugs in the marketplace -- the restriction on DTC can be provisional upon completion of those studies; (2) increase the patent life of drugs so that drug manufacturers can make up for lost income due to lack of DTC after launch; and (3) make it much harder for "Me Too" drugs to be launched, especially during and immediately after the provisional period of the first-to-market drug where DTC is restricted -- this would prevent the copy cat from taking advantage of the groundwork established by the first-to-market drug, especially with regard to the safety studies.

1 comment:

  1. Anonymous2:14 PM

    I suspect FDA will ake actions to discourage DTC, and I hope they will extend patent life, the relative effective brevity if which is responsible for the manic, blitzkrieg launch mentality that creates rapid adoption that outpaces adverse event monitoring. The industry may be amde more supportive by the bankrupting foprce of the trial bar. When you add litigation cost into the ROI equation, DTC reddens rapidly.

    ReplyDelete