Thursday, August 31, 2006

Kindler, Cheney: Kindred Spirits?

Peter Rost -- a true thorn in Pfizer's side -- and friends at Cafe Pharma have a little blog discussion going on regarding a Pfizer SEC filing, which states:
"Mr. Kindler and his spouse and dependent children will be required to use aircraft provided by the Company for air travel for security reasons."
I've already noted that Kindler likes to hole up in a Pfizer "bunker" -- see "Kindler Fox in Pfizer Henhouse (aka Bunker)", which includes a photo of Kindler in the bunker. He's obviously proud of the bunker because he allowed the photo to appear in a recent issue of
Pharmaceutical Executive Magazine.

Bunker, security fanatic... sound like some other big wig you know?

Some have claimed the statement in the SEC filing is not true based on Kindler contract. If that's the case, then Pfizer/Kindler is guilty of filing a false statement with the SEC.

Whatever the case, many commenters expect this story to be picked up by the mainstream press -- I'm guessing after Labor Day.

My little poll asking whether Kindler was right for Pfizer is almost evenly split between those voting yea and nay. Read Dr. Rost's posts on this subject and vote below.
Is Kindler Right for Pfizer?
Don't Know
Don't Care

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Wednesday, August 30, 2006

Caduet, Smaduet! Add some wood to the fire!

In an effort to stave off "Looming Brand Extinction," many drug companies are developing dual action drugs that combine a best-selling drug near patent extinction with another drug. Merck's Vytorin, which combines the lipid-lowering drugs Zocor with Zetia, is an example (see "Two Sources of Zocor").

Pfizer is now advertising a new dual action drug called Caduet, which combines into one pill Norvasc (for hypertension) and Lipitor (cholesterol), which is soon to go off patent. The name "Caduet" may be a combination of "Cadiovascular" and "Duet."

The print and TV ads for Caduet feature a hiking man split into two -- one who needs a pill for high blood pressure and another who needs a pill for high cholesterol. In the print ads these two guys are shown side-by-side against a forest backdrop. It resembles one of those old fashioned stereoscopic photos that results in a 3-D image when viewed in a special optical device (see photo above). Unfortunately, the 3-D technique is not used in the Caduet print ad. Too bad! A lot of buzz could have been created if it were.

Caduet is the first combination drug that I know of that treats two
different medical conditions. Vytorin's components treat only one condition -- high cholesterol -- but through two different pathways.

To sell Caduet, Pfizer has to focus on people who have both high blood pressure (HBP) AND high cholesterol. That's got to be a smaller population than the total population of all sufferers in the two separate categories (that is, if A=population with HBP, B=population with high cholesterol, and C=population with BOTH, then C has to be less than A+B). Still, C is a significant population, especially if the diagnostic guidelines for HBP and high cholesterol keep setting lower limit cutoffs.

What Next?

The next step for Pfizer is obvious: Add Viagra to the mix! Now, that's what I'm talking about!

Here's my concept of the print ad graphic for "TriVig," the name I have given to the new combination of Norvasc (for hypertension), Lipitor (for high cholesterol), and Viagra (for erectile dysfunction, aka ED):

Undoubtedly, the two guys on the left and right want to be the guy in the middle. Enough with hiking in the woods! Get some wood at home!

It makes sense to add Viagra to Caduet. After all, the new ED marketing mantra is that hypertension and high cholesterol can lead to ED in men. The new combination would
treat the whole man and make the man whole! That could even be the TriVig marketing slogan!

What about diabetes? Isn't that also a risk factor for ED? What about adding Exubera to produce a four-in-one pill called "QuadraVig?" But it can't be a pill because Exubera is delivered by inhaler. QuadraVig would have to be a combo drug delivered by inhaler like Exubera. That would be very fast acting! Even faster wood!

Eventually, there will be Swiss Army pills on the market that combine multiple ingredients. It's not exactly the kind of innovation the industry is touting in its PR, but I can see some advantages.

By combining more than two drugs in a single pill, you can increase the number of unique combinations or brands. Three ingredients (A, B. C), for example, can be combined in 4 unique ways (ABC, AB, AC, BC) to make four new brands. Four ingredients can lead to X different brands! I've leave the solution of that math problem to commenters.

One Problem: More Risk to Communicate
I notice that the Caduet print ad devotes significant space to the "fair balance" statement -- about 15% of the ad (see black outline in figure on left). The average for other Rx print ads is about 12%.

More importantly, the "brief summary" -- the safety information that usually appears in small print on the back side of print ads -- takes 2 full pages! And the type size is miniscule!

The Caduet brief summary is so long because side effects and safety information for EACH component of Caduet -- Norvasc and Lipitor -- must be included. Imagine if there were a third or fourth component!

The Vytorin print ad, on the other hand, devotes only 6% of the ad space to the fair balance statement and only one page to the brief summary, which is in patient-friendly, large type format -- a format that Pfizer pioneered!

Consequently, Caduet represent a step forward in terms of combination therapy, but a step backward it terms of communicating risk in its consumer ads.

Monday, August 28, 2006

Marketing plan A for Plan B

Now that Plan B is approved for sale OTC and by prescription, Barr Pharmaceuticals is faced with the task of marketing it. What's their marketing "plan A" for Plan B?

A few insights to Barr's thinking can be found in a recent Wall Street Journal article ("
A Subtle Method for Selling Plan B").

Contrary to the title of the WSJ article, the evidence so far hints at a not-so-subtle approach. For example, the ad shown on the left has run recently in Lucky and Cosmopolitan magazines. It plays upon the fear of "contraceptive failure" -- "I Chose a Condom, But it Broke." Have no fear, Plan B is here!

Of course, we all know that accidents can happen, although I have never experienced a condom breaking.

Planned Parenthood provides these condom statistics: "Of 100 women whose partners use condoms, about 15 will become pregnant during the first year of typical use. Only two women will become pregnant with perfect use."

We could argue if that is an acceptable risk or not. But just like drugs with side effects, I wouldn't want to be among the two percent that suffers the problem.

But if the same fear campaign tactics were used with other drugs -- like statins -- we might protest. "I exercised and ate right, but I still got a heart attack. Next time, take Pravachol!" is different than "Along with exercise and diet, Pravachol can help you prevent a heart attack."

That's one reason why you won't see broad-based Plan B TV ads that talk about "contraceptive failure." "...playing up the sexual factor rather than medical information makes some regulators uncomfortable," according to the WSJ article. TV is just too visible, politically speaking.

"You won't see that from us," says Amy Niemann, Barr's vice president of proprietary marketing. "We have been and will continue to be committed to responsible marketing with this product."

So, what will we see?

Plan A: Internet-based Behavorial Marketing

"The Internet and other, more subtle marketing methods could prove very effective in promoting Plan B, says Anne Devereux, chief executive of TBWA World Health, an Omnicom Group network of health-care marketing agencies. [WSJ]

The most subtle Internet Marketing technique I know of is behavioral targeting (see "
Behavioral Targeting: RJ vs JP").

Behavioral marketing, which categorizes users based on their previous Internet searches and then serves them relevant ads no matter where they are on the Internet, may be just the ticket for Plan B Internet marketing. I have dissed the technique elsewhere (op cit), but think it is a perfect idea for Plan B! No, really! The main advantage to Barr is the stealthiness of behavorial targeting -- behavorial-targeted Plan B Internet ads will simply be invisible to Senators and Congressmen!

Here's how it could work.

Let's assume the demographic is a female teen between the ages of 14 and 19.

BTW, Barr shouldn't worry about the 18-year minimum for OTC purchase -- I assume, just as with underage boys and beer, underage girls can get the help they need for an OTC purchase of Plan B. Besides, I've heard that an old marketing maxim says to direct your ads at a younger target audience than your typical user. This maxim has been applied with a vengence in the erectile drug market (see, for example, "Pushing the Envelope is Bad for DTC"). Of course, Barr will have to keep its marketing strategy very confidential -- they may need a bunker like the one in which Pfizer's Kindler relaxes.
Instead of the old-fashioned approach, where you place ads on Web sites and pages where these girls hang out, why not let Yahoo! develop a targeted category of teenage females based on their recent searches and deliver ads to them whenever they are on the Internet?

You could, for example, categorize users by searches on topics related to music, brands, cosmetic procedures, etc. that are popular with young women -- anything that would put them into a "female sexual promiscuity" category. (I know...fiendish, isn't it?)

"You are no longer targeting people you think will be interested in your product," said Les Kruger, a senior marketing manager at Cingular. "We know based on your behavior that you are in the market, and we can target you as you bounce around the Internet." (See "
Marketers Trace Paths Users Leave on Internet".)

Ads run within context on relevant pages may be ignored whereas behaviorally-targeted ads are "less expected and [are] playing to your subconscious," says Lydia Snape, the director of online marketing at Renegade Marketing, Panasonic'’s Internet advertising agency.

So, when there's a contraceptive emergency, you know right away about Plan B, because you've been seeing the ads for some time in a lot of the places you go on the Internet -- and not just places that talk about emergency contraception.

Behavorial Targeting: Right for Plan B Marketing?
Absolutely Not!
Probably not a good idea
Yes, if done properly
Absolutely Yes!
No opinion
Free polls from

While you're at, pick up a package of Plan B, just in case.

BTW, can guys buy Plan B? Just a thought. What could be cooler than a 19-year old guy showing up to a date with his 17-year old girlfriend with a pack of condoms and Plan B? Unfortunately, the Plan B package probably won't fit into his wallet!

Friday, August 25, 2006

Market Research: Privacy Matters

This week I shared my experience as a subject in a Levitra/Men's Facts research project (see "My Sojourn as Market Research Subject for Levitra" and "Levitra Market Research: The Interview"). This has led to a discussion of market research privacy issues among my colleagues in the Online Pharma Marketing Discussion Forum, many of whom are in the market research business.

In the previous posts, I also asked visitors to vote on whether they thought my privacy was violated. You can cast your vote at the end of this post, if you haven't already done so. So far, a good majority (57%) of respondents felt that my privacy was violated (36% said absolutely, 21% said probably). Forty-three percent (43%), on the other hand, felt that my privacy was not violated (18% said absolutely not, 25% said probably not).

Aside from the poll results, I learned a bit more about pharmaceutical market research from all the comments I received. I would like to share these comments with you and offer my feedback as well.


Christi Maginn asked:

"Did you sign a waiver at any time for the release of your medical information and for filming? Usually this would have been handled when you were given honorarium for your time."
Of course, I don't know if I was filmed, videotaped, or recorded -- I wasn't told one way or the other. I did sign a sheet when I received the honorarium. I must say that I did not read what was at the top -- it was only one sentence and there were several other names and signatures on the sheet (which is another privacy faux pas).

So it wasn't a specific waiver and they certainly didn't make sure I knew it was a waiver. I just assumed it was a receipt for payment. Consumers make assumptions all the time. Good privacy practices make sure that consumers have the knowledge they need to make informed assumptions!

I put a call into the agency yesterday and asked if I did or should have signed a waiver. See below under "Online vs. Offline Research" for the response.

A few people, including Katherine O'Neil, wanted to know the market research company name:

"I have done a ton of market research in Philly and I'm dying to know what facility you went to. Would you consider sharing?? You have no obligation to keep the info confidential....."
Before I reveal the name, I want to give them a chance to respond.

Evil or Incompetent?

BTW, I am not accusing the MR agency of "evil doing." As many experts on the
Pharma Marketing Online Forum pointed out, they may be incompetent but not evil.

The worst privacy violations, however, have been perpetrated by people with the best of intentions. Eli Lilly, you may recall, was sanctioned and fined by the FTC because an eager-to-please, but untrained, person sent out an e-mail message to all subscribers informing them that the Prozac reminder service was being terminated.

It was a well-intended gesture, but unfortunately the sender put everyone's e-mail address in the "To" field where all recipients could see it. Neither the individual nor Lilly is "evil." Lilly just did not do what it promised to do in its privacy policy: adequately train its personnel working with personally identifiable information (PII) on its security procedures. For more on this case, see "
The FTC-Lilly Consent Decree: What it Means for PHARMA Vendors and Partners."

Another Code Ignored?

John Mitchell suggested I contact the Council of American Survey Research Organizations (CASRO): "they are the industry watchdogs and I am sure someone there will be both interested in this case and willing to help you answer these questions."

I might take John up on that, but, frankly, I can only take one or two organizations stonewalling me at a time. Right now, I am still awaiting feedback from GSK and the MR company on this issue. (I've given up on Sepracor ever responding to my complaint about their violation of the PhRMA DTC Code; see "
More Reminder Ad Sightings").

I did, however, look up the CASRO Code and found the following:

"Respondents should be:

  • willing participants in survey research;
  • appropriately informed [my emphasis] about the survey'’s intentions and how their personal information and survey responses will be used and protected;
  • sufficiently satisfied with their survey experience;
  • willing to participate again in survey research."
I was indeed a "willing participant" of the research. The question is, did the MR firm that interviewed me "appropriately" inform me how my personal information and survey responses will be used and protected?

The answer is "No," I was not appropriately informed. You can see why I feel this way by reading the previous posts on this subject.

The code also states:

"Electronic equipment (taping, recording, photographing) and one-way viewing rooms may be used only with the full knowledge of Respondents."
"Sounds like there were some communications and procedural glitches in the process of bringing you in for your interview," said John Mitchell. "You should have been told whether you were being recorded or videotaped, it's an obligation to do so when conducting market research." As I pointed out, I was told that there was someone behind the mirror observing, but I was not told one way or the other if the session was being recorded or videotaped (although I have reason to believe it was -- see the discussion below under "Online vs. Offline Research"). I did see recording equipment and a video camera in the room.

The CASRO code has some interesting provisions about how MR research firms should report de-identified data to their clients and how they should destroy personally identifiable information (PII) when no longer needed. Unfortunately, only European Union subjects have the right to be
notified of these practicess.

Here's what John Mitchell had to say about this:

"In terms of sharing your information for market research purposes, so that the research company knew some of your profile ahead of time, and contacted you for research purposes, you're in a bit of a gray area. There's a lot of leeway that research companies have that is not granted to marketing organizations. However, the leeway is based on their adhesion to strict professional standards."
I question if there is any "leeway" in this situation.

This was research carried out on behalf of GSK for marketing purposes. The MR company, therefore, is an agent of GSK and should practice the same level of privacy protection and notice as does GSK as described in the privacy statement.

I've worked with several market research agencies that were required to pass a rigorous Privacy Critical Self-Assessment audit before they could work on behalf of Eli Lilly to process consumer information on Lilly's behalf. This was a requirement of Lilly's consent decree with the FTC. Lilly, therefore, now has a model privacy program that other pharmaceutical companies should follow.

John agrees that the MR firm should follow the same set of privacy rules that GSK abides by.

"Not sure where the glitch was," John said. "I don't work for either party, and my guess is that from the contract signed between the brand and the company hired to do the market research, and the people on the ground executing, there was a loss of clarity in purpose and communication. Happens when you have too many low paid bodies involved! Typically recruiters for market research studies are under pressure to get bodies in the door and if rigorous quality controls aren't in place, there are glitches. That's why I work online now."
Tahnee Jackson Whitlock disagrees (somewhat):
"In my experience setting up DTC call center campaigns (both the inbound 1-800 response vehicle and outbound market research function) the Pharma DTC privacy policies do not apply to market research -- although they should. Some pharma companies keep the market research privacy practices consistent with their privacy policies. This is the best way to go."
Katherine O'Neil also disagreed:
"I disagree with the previous post about the market research company having to follow the same confidentiality issues as the Pharma. The standard and ethical practice is that names and any identifyingcharacteristicss of market research respondents are NEVER given to the client.

"I have been interviewing docs and patients for many years, and always start an interview by telling them that their identity is not revealed and that what they tell me in the interview is reported in the aggregate.

"I am alsosurprisedd that a professional MR company would conduct in person interviews on the subject of ED. If I were designing the study, I would have suggested doing patient diaries or online research where the respondent can maintain some anonyminity and is therefore more likely to provide authentic feedback."
For me it's not a question of whether or not the MR company reveals my name and other PII to the pharmaceutical company that hired it. The question is, does the MR company protect my PII to the same rigorous level and does it notify subjects about it's security and data handling practices? That, at least for Lilly, is also important even though Lilly never gets identified data from its MR vendors. However, if there ever was a leak of PII from the MR vendor, guess who would be sued along with the vendor?

Online vs. Offline Research
It's interested that both John and Katherine make reference to alternative means of doing market research involving sensitive issues such as ED: online. It turns out that the MR company that interviewed me also seems to have a large online panel that it uses for market research.

So why didn't they do this research online?

One reason I can think of is body language. At several points in my interview I squirmed and probably displayed very telling messages with my facial expressions and body language. This is something you can't get from online research. Therefore, I am sure I was videotaped!

A representative from the MR company confirms that I was indeed recorded or videotaped: "The interviews were recorded strictly for the use of research to assist the interviewer in preparing her report. The recordings will not be used for any other purpose and therefore, no one was asked to sign a waiver."

Laurie Bredenfoerder had this to say:

"I'm a female qualitative marketing consultant specializing in medical market research, and I easily can imagine being asked to conduct an interview much like the one you described. However, I can't imagine doing it for an ED product!

"In a former professional life on the payor side, I had an opportunity to observe my male colleagues' squeamish reactions in multiple discussions of the potential corporate bottom-line impact of the (then) new oral erectile dysfunction meds. The guys seemed reluctant to even refer to this condition by its initials. I am not interested in going there again.

"However, if I somehow got backed into the project, one of my top priorities in the interview would be to make sure you, the respondent, feel as much in control as possible of this very artificial situation. I do this for all my work, and for a practical reason: a tense or distracted respondent is not a very good interview.

"Further, I'd lobby my client to allow me to at the beginning of the interview, to inform you that you can refuse to provide any of the sensitive personal information I request. (However, I'd also explain to you that the greater good of mankind would be served should you choose to provide it.) To do otherwise turns the interview into an inquisition and further chips away at your sense of control. Telling you that I've 'heard it all before' only means that I've been listening very closely.

"It goes without saying that I would inform you early on that you are being audio- and video-taped (standard in the industry) and that there are people behind the mirror observing the interview. However, I can't imagine personifying the observers by telling you their names or genders. Make those people too 'real,' and I've lost you again - as you silently calculate how to avoid coming off looking too stupid on the other side of the glass.

"Frankly, I am amazed you were such a willing and complicit subject. 'Sheila' probably was too! I bet if you called her, she'd tell you she had either a very low show rate -- or a very low completion rate (because the guys who were brave enough to show up refused to divulge so much personal information) or both!"

"In your poll about a potential violation of your privacy rights, I voted 'probably not.' Whether 'Sheila' told you or not, you ALWAYS have the option to tell a market research interviewer that you don't feel comfortable answering a question -- and if he or she is ethical, that will be the last time it comes up [sorry, I couldn't resist].

"In my opinion, and in the broad scheme of things, you essentially CHOSE to allow the interview to proceed and you CHOSE to give that information to 'Sheila' and her colleagues, social pressure notwithstanding. The real violation here was in the good judgment, personal sensitivity and taste of those who designed this research project."
Perhaps I am being too rigid, but I made those choices without being adequately informed of the potential consequences. After all, I did not know if they were or were not going to reveal my name to third parties. What about keeping all the papers, videotapes, etc. with my personal information safe? Again, I made the choice without actually having enough knowledge -- it was consent, but not informed consent.

It would have been comforting to know that only de-identified data would berevealedd in any reports to 3rd parties and that documents are kept secure 24/7 under lock and key or that they were destroyed after a certain time or upon request by me.

What Do You Think? Was My Privacy Violated?

Has my privacy been violated? Was it violated when the market research company looked up my phone number and contacted me by phone without my permission to do so? Was it violated during the interview because I was not given notice of the privacy practices in effect and who the responsible party was? Was it violated because I was not given an explicit opportunity to opt-in before revealing personally-identifiable information? Was it violated because I was not informed how the market research company and the drug company that hired it was going to use the information I provided?

Were my privacy rights violated?
Absolutely Yes
Probably Yes
Absolutely Not
Probably Not
Don't Know/No Opinion

Thursday, August 24, 2006

Levitra Market Research: The Interview

On Monday, I posted the first part of my sojourn as a market research subject for Levitra (see "
My Sojourn as Market Research Subject for Levitra"). This is the conclusion of the story in which I arrive at the market research company's facilities in Philadelphia, PA.

At first, I thought I was going to be put into a focus group with several other men. I envisioned a runaway jury scenario. As a notorious trouble maker, this appealed to me! However, they opted for a one-on-one interview.

First, however, I had to complete a short questionnaire, which asked for personal information such as my date of birth, marital status, and a list of drugs I was taking. It also went over some of the same territory that Wendy went over on the phone in the pre-interview phase, namely, how often I experienced erectile problems. I responded as truthfully as I could.

The form also asked if I was employed by a pharmaceutical company. Since I am not an employee of any company, I answered "No" to those types of questions.

There was no mention of a privacy policy nor did I see any notification of how the market research firm was going to use, share, or protect my personal information. As I pointed out in the previous post, it is not clear if the Web site privacy policy is applicable to the research firm that was collecting a lot of additional information. I'll get back to the privacy issues later in this post.

Anyway, I was soon whisked into the interview room by Sheila (not her real name). I note that all of my interactions with the market research company were with women -- Wendy on the phone, the receptionist who handled the questionnaire, and Sheila who did all the interviewing.

One whole side of the interview room was a mirror. Sheila told me that Troy (not his real name) was behind the mirror watching. I also noticed a video camera, but was not advised whether or not I was being videotaped or recorded.

The goal of the interview was to find out why men were not asking their doctors for Levitra after receiving the coupon for a free sample in the Men's Facts Kit. Obviously, Sheila knew I did not use the coupon because the fulfillment company that sends them out can track coupons when they are cashed in for pills at the pharmacy. A script from the physician is also necessary.

Sheila asked me to describe my sexual experiences and suggested that I talk frankly because she "heard it all." Maybe it's just me, but I found it difficult to talk about penis size and the quality of my erections with anyone let alone Sheila, who I just met. I also noted that maybe this was the reason I didn't bring the subject of Levitra up with my GP -- who also happens to be a woman.

During the course of the interview I also told Sheila that I visited a cardiologist about once a year (he's male). She asked me why I went to a cardiologist in the first place -- another bit of my medical history revealed.

The two objectives of the session were (1) determine what held me back from bringing up the subjection of erections and Levitra with my physicians, and (2) what specific statements resonated with me as strong openings to use with my physicians.

Managing the physician-patient interaction is important for pharmaceutical marketers. As the ED drug case shows, direct-to-consumer (DTC) advertising may be effective in raising awareness of an untreated medical condition among a target population, but it means nothing if no action is taken by the consumer to visit the doctor and ask the right questions.

Technology to the Rescue!

A Fellow at a prestigious medical school called me after I posted the first part of my Levitra market research sojourn. He was interested how the privacy issues were handled because he was working on a technology product that promises to help patients and physicians better communicate with one another. Technology, he said, can break down barriers as when patients and physicians communicate via e-mail, for example. However, there are big privacy issues that need to be addressed in any technology-based system that handles sensitive medical information. The Fellow promised to keep me in the loop as his system is unveiled. Hopefully, I will have more to write on this topic at a later date.

Back to my interview with Sheila, the market researcher.

Role Play

Working on understanding my interaction with my physicians, Sheila asked me to do some role playing. She handed me two sheets of paper. Each had four empty rectangles arranged in a 2x2 matrix. I was supposed to write in one lower rectangle what I might say to my physician to bring up the subject of treatment for ED. In the rectangle immediately above that I was to write what I was really thinking when I was saying this to the physician. In the other lower rectangle I was to write what I thought the physician would say in response and above that what I thought he or she might be thinking. I had to do this for my GP and for my cardiologist.

We talked about that for a while.

Afterward, Sheila began working on her second objective: she showed me nine different statements about sexual function/ED and treatment. These were "ice breakers" that a patient might use to bring the subject up with his or her physician. There were subtle differences between them; eg, use of "sex life" vs. "love life."

I was asked to arrange the statements into three piles: in one pile I was to put the statements that I definitely felt would be helpful to me in talking to my doctor, in another pile those statements that I definitely would not use, and in the third those statements that were just so-so. You know, like Little Red Riding Hood with the porridge-- except that "hot" was the best choice.

After all this analysis, Sheila asked if I now would be likely to ask my physician about treating ED. I said it wasn't yet high on my list of priorities. Perhaps one day the problem would just become too unbearable and I would "tip" and finally ask about it. In the meantime, I would work on the ED "risk factors" through diet and exercise to reduce my cholesterol and blood pressure levels and prevent diabetes. Sheila was not too interested in talking about that course of action.

A Matter of Privacy

OK, so here'’s what this market research company (and GSK) knows about me:

My name, address, email address, phone number, birth date (age), diagnoses vis-a-vis high blood pressure, high cholesterol, and diabetes, medications I am currently taking, and what I look like (my facial image). They know what I told them about my erectile problems. They know I see a female GP and a male cardiologist.
In other words, this market research firm, which I assume was employed by GSK, has a pretty good slice of my medical record. I revealed all this information without being advised of my privacy rights or options regarding further disclosure.

Whose privacy policy is in effect with regard to the market research? The Web site's privacy policy only pertains to the information I supply through the Web site, not any further information I provide in interviews with the companies hired by the drug companies.

Was My Privacy Violated?
Has my privacy been violated? Was it violated when the market research company looked up my phone number and contacted me by phone without my permission to do so? Was it violated during the interview because I was not given notice of the privacy practices in effect and who the responsible party was? Was it violated because I was not given an explicit opportunity to opt-in before revealing personally-identifiable information? Was it violated because I was not informed how the market research company and the drug company that hired it was going to use the information I provided?

Were my privacy rights violated?
Absolutely Yes
Probably Yes
Absolutely Not
Probably Not
Don't Know/No Opinion

My GSK Call Center Experience

To get answers to some of these questions, I called the 1-800 number listed on the privacy policy. A GSK operator answered. I explained to her that I was contacted by phone by a research company even though I did not leave a phone number on the Web site and I did not give GSK or their agents permission to call me by phone and that I thought this violated the privacy policy. I was put on hold for a few minutes while the operator did some research. During that time I had to listen to the GSK story about the value of drugs, which is part of their ongoing PR campaign (see "
The Empire Strikes Back").

When the operator returned, she apologized for the error and asked if she could call me back at the number I gave her after she did some more research. That was Monday, August 21, 2006. To date, I have not heard back from her. I'’ll have to call back or try a more direct approach by calling the privacy office.

IMHO, it is very important that pharmaceutical companies and their agents adhere to strict privacy guidelines when conducting market research with consumers, especially when it concerns sensitive medical conditions like ED. The researchers should clearly notify subjects about their privacy rights and give them an opportunity to explicitly opt in and understand how their personal information will be used, shared, and protected from unauthorized access. Clearly, the market research company GSK hired to do this research was not up to par in this regard. Ultimately, GSK is responsible.

Monday, August 21, 2006

My Sojourn as Market Research Subject for Levitra

Part 1: Why Was I Chosen?

A few months ago, in response to a TV ad, I registered on to receive a Men's Facts Kit and free sample offer for Levitra, a treatment for erectile dysfunction (ED) manufactured by Bayer and marketed by GSK and Schering-Plough.

Not that I have ED! I was just doing some research on the subject!

That's the problem. A lot of men may be researching the subject, but fewer than expected (or desired) are actually stepping up to their physicians and asking for a specific ED treatment. Sales for ED drugs -- Viagra, Cialis, and Levitra -- are limp, at least from the perspective of where sales should be according to ED drug marketers' plans (see
ED Drug Sales Limp and Blockbuster or Ballbuster?).

According to Richard Meyer, who was a member of the Cialis marketing team for 4 years (now a fellow blogger over at
World of DTC Marketing), "When I was on the Cialis team doing some research with ED patients, I remember at one point a member of our team saying 'I don't know if we can reach these guys with TV. They have a lot going on.' She was referring to the emotional barriers that men have to overcome to seek treatment for ED."

Given this reality, it's no surprise that the Levitra folks are interviewing men who registered for the Men's Facts Kit but who have not yet taken advantage of the free offer. They are trying to find out why these men have not gone to their doctors to get scripts for Levitra.

I was one of the guys they called. As always, when called, I am here to serve the industry! Especially if they are willing to pay me a nice cash honorarium for a one-hour, one-on-one interview! (drat! Now I have to declare the income!)

Before being invited to the interview, I was screened by phone by Wendy (not her real name) who called from Florida (a real state). Of course, I had to admit that I had problems maintaining an erection about 20% or more of the time. I guess I fit the profile in other respects as well: male (of course), over 50 years of age, and being treated for high blood pressure and high cholesterol.

A Question of Privacy
Wendy asked me to list the medications I was taking for my blood pressure and cholesterol problems, which leads me to ask some questions about protecting my privacy.

How'd They Get My Phone Number? And Who Said They Could Use It?

How are the market researchers planning to use, disclose and protect my personal information they collect from me on the phone and through the interview?

The Men'’s Facts Web site includes this statement in its privacy policy:

"“Bayer, GSK, and Schering-Plough and/or the companies we hire will use this information to comply with your request for information, to contact you in connection with the promotion of LEVITRA, to better understand your needs and how we can improve our products and services, or as otherwise disclosed to you on the Web page when you submit your information to us."
Since I did not give them my phone number, but only my home address, they must have looked up my number in the phone book. Nevertheless, I did not give "Bayer, GSK, and Schering-Plough and/or the companies [they] hire"” permission to contact me by phone. Technically, therefore, they are in violation of their own privacy policy.

The research was carried on by an independent market research company, which I assume was under contract to GSK or Schering-Plough or Bayer or all three. That is, it was one of those companies that the privacy policy said the drug companies could hire to contact me.

Who's privacy policy is in effect with regard to the market research? The company doing the research never mentioned or showed me any privacy policy at all. The Web site policy only pertains to the information I supply through the Web site, not any further information I provide in interviews with the companies they hire.

I'’ll have to contact the Customer Response Center at 1-888-825-5249 and see what they have to say about all this. When I learn more, so will you.

Not Your Father's Marketing Campaign!
ED drug marketers are targeting men fitting the above profile in order to expand the market for their products. Here's the message in Men's Facts graphical format:

Added up, that's 87 million men or 86% of all men in the U.S. over 18 years of age (according to the 2000 census numbers). Previously, ED drug marketers focused only on men over 40 years old, 40%-50% of whom suffer from ED to one degree or another according to the numbers cited on ED drug Web sites. By that reckoning, about 30 million men in the US suffer from ED (see ED Drug Sales Limp).

By switching tactics and focusing on men with diabetes, high blood pressure, and high cholesterol, the marketers have effectively expanded the market for ED drugs three-fold!

Of course, like me, many men have two or more of these "ED risk factors," so the total population would be lower than 87 million. And, although the graphic above implies that all of these men's love lives are not what they used to be (ie, less than optimal), you'll have to read other text in the kit to learn that only 58% of men with diabetes and 68% of men with high blood pressure experience "changes in erectile function."

Nevertheless, ED drug marketers have set the stage to communicate with many more men than ever before. This is definitely NOT your father's marketing campaign!

But reaching a larger target audience is only the first step. ED drug marketers are having problems with the second step -- getting these men to take action. That's what my interview in Philadelphia was all about.

So, on a hot Friday afternoon I found myself tooling down route 95 to Philadelphia in my BMW, which, in case you are wondering, I did NOT buy to compensate, to a one-on-one focus "group" interview.

I will talk more about that interview in tomorrow's post to this blog. Please come back then.

Friday, August 18, 2006

Highlights & Updates

The following list of topics is a sampling of posts made to Pharma Marketing Blog in the past month or so. Some additional information has been added to bring some of these topics up-to-date.

Free lunch for patients! Why not?
Posted August 1, 2006
I have no problem with free lunches for physicians. But what about patients?

I think patients -- who are seeing more free physician lunches being wheeled right by them in their doctors' waiting rooms -- are feeling more and more left out. This is bad from a PR perspective and short-sighted from a marketing perspective.

My solution is to provide patient free lunches simultaneously with physician free lunches.

Here's what some readers have said:

"Horrified though I am, that's actually a great idea." -- Anonymous

"I think that is a great idea and as for me I see only advantages of this and it all seems to be very well thought-out!" -- PharmaMedics

Vioxx Scorecard: Was 5-3-14192, Now 4-5-14191
Posted August 7, 2006
On August 7, 2006 Merck was celebrating a Vioxx victory that tipped its scorecard to 5 wins, 3 losses and 14,192 remaining cases. However, that victory was reversed on August 17, 2006 (Merck plans to appeal the reversal) and Merck lost another case setting the Vioxx scorecard to 4-5-14191!

Back on August 7, many analysts were using the Vioxx win-loss scorecard as proof that Merck's strategy is "prudent" and paying off. But do the numbers -- even the August 7 numbers -- justify the rosy forecasts?

Have fun working with the numbers and making some predictions regarding how many more years of Vioxx litigation Merck has in store and how many man years of effort will be involved.

Brand Extinction Looms
Posted August 11, 2006
According to a Forbes article, "By 2011, a quarter of current drug sales in the U.S. will be eaten away by less expensive generic pills as medicines lose patent protection. Between 2007 and 2011, more than 80 medicines are expected to face this fate."

Faced with this looming drought, what are the options for the drug industry?

And, are biotech companies immune?

Further Adventures of PhRMA Intern!
July 27 and July 31, 2006 episodes

Yes, it's PhRMA Intern! Strange visitor from an Ivy League school who came to PhRMA with powers and ability far beyond those of Ken Johnson.
PhRMA Intern vs. the Pharma PR Agency!
Emily ... that is, PhRMA Intern! ... takes on a large pharma PR agency in NYC where she is confronted by a familiar foe...

PhRMA Intern Tackles Terrorists!
Ripped right out of today's headlines! Our story begins with an amendment latched on to the $31.7 billion Senate Homeland Security Appropriations bill that would create a Canadian loophole in the Food and Drug Administration ban on importing prescription medicine into the United States.

Does the importation of drugs from Canada by seniors pose a terrorist threat? What's the connection between this issue and the infamous Medicare Part D "donut hole?" Is there really a "donut hole?"

What is PhRMA Intern!'s viewpoint and what, if anything, does she do about it?
[Our poll shows that a slim majority of respondents wish to see more of PhRMA Intern! (52% vs. 48%). This may be the last sighting of our super heroine before she returns to school.]

Do you want more or less of PhRMA Intern!
Yes, please continue!
No, I've had my fill of PhRMA Intern!
Yes, but bring more villians into it!
Whatever! You may be going too far!

Lunesta, a Sleeping Dog; Rozerem Too!
Posted July 25, 2006
Well, well, well. Sepracor, the pharmaceutical company that we love to hate for reneging on its pledge to comply with PhRMA's Guiding Principles for DTC advertising (see Sepracor Sneaks In Lunesta Reminder Ad), said sales of its sleeping pill Lunesta will be lower than expected.

Lunesta is a "dog," said David Southwell, Sepracor's chief financial officer, in an interview.

"Since the April 2005 rollout of the drug, its manufacturer, Sepracor, has spent $227 million, making Lunesta the drug most frequently advertised to the public last year." -- Consumer Union (Sleeping pills Are they worth the risks?)

Lunesta may not be the only sleep aid dog of a product. Rozerem may have also drug failed to live up to its expectations and advertising budget. Pharma Marketing Blog has learned from a reliable industry source that Rozerem's market share increased from 1.4% to 1.7%, which is a minuscule blip considering that Takeda spent $100 million on Rozerem ads -- ads like the one shown in "Rozerem Ads Dis Lincoln, Show Beaver" -- over the past 12 months. Estimating the total market for sleep aid drugs to be $3 billion per year, the Rozerem ads are well into "negative" ROI territory. (The increase in market share, 0.3%, equates to about $9-10 million, which was achieved with an investment of $100 million in DTC advertising. In other words, for every dollar of DTC advertising, Takeda received 10 cents in return!)

Look for a change in the focus of Rozerem and Lunesta DTC ads in the near future.

Sicko si, Pharmaco no!?
Posted August 9, 2006
Last February I wrote about Michael Moore's new film "Sicko" and suggested that it will be about "Moore" than the pharmaceutical industry. In July, Moore sent out an email notice that more or less confirmed this.

Also, there have been reports about problems with production of the film as well.

What techniques have pharmaceutical companies employed that may have short-circuited Moore?

McKinnell's New Gig: Male Model
Posted August 10, 2006
Pfizer's CEO Hank McKinnell -- soon to retire -- has lost no time finding another gig: that of male model for pharmaceutical vendor ads. Some golden parachute!

Evidence of his new career can be seen in a spread in a trade publication, which is known for its quirky ad/editorial juxtapositions!

Thursday, August 17, 2006

Precision Buzz Marketing

Pharma companies have long ago mastered the art and science of "Precision Marketing" to physicians. No where has this prowess been demonstrated more conclusively than in a recent analysis of internal industry documents reported in the August 15, 2006 issue of the Annals of Internal Medicine (see "Narrative Review: The Promotion of Gabapentin: An Analysis of Internal Industry Documents"). You can also read summaries of this analysis published by NBC News.

What is Precision Marketing?

It's not a term that I invented. Here's a definition I found in a
white paper: "optimizing customer profitability by delivering the right messages, to the right individual customers or market subsegments, through the right channels, and at the right points in time."

Precision marketing is usually a term heard in direct-mail marketing and customer relationship management (CRM) circles. However, I would like to use it in relation to Buzz Marketing and examine how it is applied by pharmaceutical marketers to "optimize" the profitability of its physician and patient customers.

I will refer to the AIM paper as well as industry documents stored in the
Drug Industry Document Archive at the University of California, San Francisco.
[The Drug Industry Document Archive (DIDA) houses about 1000 documents drawn primarily from United States ex. rel. David Franklin vs. Parke-Davis, Division of Warner-Lambert Company (now owned by Pfizer, Inc). The litigation concerned the marketing of Neurontin (gabapentin). DIDA also contains documents on the marketing of Vioxx (rofecoxib) from the public records of the Minority Office of the Congressional Committee on Government Reform. The documents in this Archive focus primarily on the marketing of Neurontin (gabapentin) and Vioxx (rofecoxib), and include internal documents from Parke-Davis, Merck & Co. and correspondence with outside physicians and organizations, such as medical education and communications companies and advertising firms. Also included are regulatory and legal documents, court filings and depositions.]
One of these documents (Exhibit 144: Northeast CBU 1997 Situation Analysis, 05/31/96), from Parke-Davis (now Pfizer), talks about "precision marketing opportunities" in the northeast physician market, which described as "very conservative." According to this document PD also employed "Precision Marketing Managers."

The document also talks about the use of the off-label uses of Neurontin for pain and psychiatric disorders:

Neurontin usage in chronic pain has been graining (sic) tremendous ground over the past six months. The continued "noise" [my emphasis] regarding pain will undoubtedly have significant impact through the coming year. The Northeast has a high percentage of psychiatrists and provides tremendous potential for use in bipolar disorders.
Let's focus on the impact that "noise" had on off-label use of Neurontin for pain in 1996, the year when this document was written. The chart below is instructive. I copied it from the AIM article and added the two "A" and "B" markers. These markers indicate where I believe the "tipping points" for the off-label use of Neurontin for pain and psychiatric disorders, respectively, occur.

In the book "The Tipping Point" by Malcolm Gladwell -- who is an author well-read by the pharmaceutical industry -- the author talks of the tipping point as the "moment of critical mass, the threshold, the boiling point" when an idea, fashion, or product takes off. In this case, we are talking about the tipping points for off-label uses of Neurontin.

My point is that pharmaceutical companies have mastered the techniques that produce these tipping points in prescribing by physicians. It's all about "buzz" or "noise", or as Gladwell would say, contagiousness. It's also about little causes that have big effects -- another characteristic of "tipping point marketing." It's not the individual gifts of free pens and mugs that cause doctors to prescribe according to the drug company plan, but the combination of that with all the other little precision marketing techniques employed by the industry.

Look at 1996 in the chart ( see "A"). That's when physicians started writing a lot more scripts for Neurontin off-label to treat pain. This tipping point was engineered by the combination of the following techniques -- most, but not all, legal and acceptable at the time -- that are outlined in Exhibit 144:

  1. Target high-potential physicians
  2. Shadowing/Preceptorships - each representative will participate in a formalized preceptorship with a high-decile no-see neurologist. They are also setting up Preceptorships on their own with influential called-on physicians. This will help to build relationships and spur more meaningful discussions regarding Neurontin
  3. Expand the speaker base - identify and train strong Neurontin advocates and users to speak locally for Neurontin. Peer-to-peer selling is one of the most effective ways to communicate our message.
  4. Medical Liaisons - 90% percent of their time is dedicated to responding to inquiries face to face with our area neurologists. It is critical to take advantage of the momentum regarding Neurontin in other uses.
  5. Consultants Programs - Continued interaction with our local thought-leaders. Programs will be held throughout the CBU on a local level. Hosted by a local thought-leader and presentations given by national speakers.
  6. Psychiatry CUE Program - support for education regarding anticonvulsants in bipolar disorders taking advantage of our high potential.
  7. Funding for Local Studies and Published Findings
  8. Strengthen Relationships with Thought-Leaders - they are not convinced of Neurontin superiority, their support is critical.
These techniques have all the hallmarks of buzz marketing: use of "peer-to-peer" selling, absence of a clear demarcation between promotion and non-promotion, and manipulation of personal communications between physicians to insert product messages (read the AIM article for details).

It's expensive to carry out Precision Buzz Marketing. According to reliable estimates cited in the NBC article, the drug industry spends $18.5 billion each year on promotion to doctors -- "that's about $30,000 a year for every physician in the U.S."

What About Consumers?

It's often said that pharmaceutical companies don't do a good job with precision marketing to consumers. Frankly, they may not be able to afford it! The industry spends about $4 billion each year promoting drugs directly to consumers -- that's about $18 per adult in the U.S. No way that you can ever sustain a Precision Buzz Marketing initiative for consumers on that budget. Not even the pharmaceutical industry can afford to spend $30,000 per U.S. adult!

There is another way: focus on the true customers among consumers -- the
patients who are taking the drugs. This is a much smaller group. As with physician-focused marketing, pharma companies can also measure how effective patient-focused campaigns are -- through patient-level prescribing data, which is an emerging field of market research (see "Patient-Level Data: A New Level of Analysis").

Consultants to the drug industry already are pushing their clients into the realm of buzz marketing to patients (see "
Buzz 'n Blogs -- Stealth Marketing" and "Rules of Engagement").

The strategy for patient-focused precision marketing is two-fold: keep patients who are currently taking your product to continue taking it and (2) switch patients who take competing products to your product. The same strategy, in other words, as physician-focsued precision marketing.

Some of the same techniques used in "word-of-both" precision buzz marketing to physicians can be used with patients. However, to make it scalable and cost-effective, this has to been done almost exclusively electronically via the Internet, iPods, and cell phones.

First, you have to identify the equivalent to "high prescribers" among patients. These people would fit Gladwell's profile of Mavens: their motivation is to educate and help. They can be found in the "consumer-generated content" watering holes online, such as patient forums and blogs.

Then you have to "shadow" them -- sit in on their conversations online much like sales reps sit in on patient-physician consultations in preceptorships.

You will also have to recruit patients for "peer-to-peer" selling. Pay them like physicians are paid (but much, much less).

You will need a patient equivalent to medical science liaisons who are used on the physician side to maintain relationships. These people will fit Gladwell's profile of "Connectors" -- those people who "know lots of people."

I can go down the list of techniques used for physicians and show how they can also be applied to patients and how the drug industry can tip patient behavior as well as physician behavior, but I will leave that up to your imagination and comments to this post.

Tuesday, August 15, 2006

WLF: A No-Risk Ad is a Good Ad

According to a recent story in BrandWeek, "The Washington Legal Foundation, a conservative think tank, filed a petition with the Food and Drug Administration Monday [August 7, 2006], challenging the FDA's right to send warning letters to drug companies whose advertising it finds misleading." (See "Conservative Think Tank Takes On FDA Over Drug Ads".)

However, the challenge is really being made against FDA's rules requiring that direct-to-consumer (DTC) ads include "fair balance" -- ie, statements about major risks along with the benefit statements -- in the creative part of the ads.

The WLF, however, focuses on the legality of FDA to issue "warning" and "untitled" letters, which warn drug manufacturers of problems with ads and suggest corrective actions. If they can win the legal point, they can achieve their real goal: allowing DTC ads without risk information.

The WLF attacks FDA use of warning letters although the number of such letters has declined in recent years (ie, since Bush took office) despite the Vioxx adverse event scandal (see Figure on right).

Besides, warning letters are hardly a concern for pharmaceutical marketers. Paraphrasing a comment I heard once at an industry conference, "a product manager with an FDA warning letter framed and hanging on the office wall has bragging rights."

All this just confirms that the warning letter issue is a "straw man" that WLF has set up to divert focus from its real mission of freeing drug advertisers from the need to include any risk information at all within the "creative" body of drug ads.

WLF petition ("Citizen Petition Regarding Review of Policies and Practices of DDMAC and OCBQ to Ensure Compliance with First Amendment and Statutory Mandate") also tackles the risk information requirement directly stating that it represents a "double disclosure" policy for risk information.

WLF says: "DDMAC and OCBQ also have established a policy of requiring drug manufacturers to include duplicative risk information in printed promotional materials, such as scientific journal advertisements aimed at health care practitioners. Under this policy, manufacturers are required to communicate publicly about their products in ways that overemphasize the risks of drug use and underemphasize their benefits."

We've seen this argument before in another "citizen's" petition issued by the Coalition for Healthcare Communication (CHC) back in March (see "
DTC without the Risk"). In many ways, CHC and WLF are fellow travelers and often share the dais at industry meetings chipping away at this issue.

Here's an example of what the WLF is complaining about:

This ad for Rozerem, a sleep aid drug, shows how much space some print drug ads allocate to imagery (usually conveying a positive benefit message), shown here outlined in red ("A"), and text statements about benefits (shown outlined in green, labeled "B") and risks (all the other text). In this ad, about 85% of the creative space is used up by the wacky image, 5% is devoted to the benefit statement, 8% to the fair balance statement, and 1% to the brand logo. If you consider the imagery as part of the benefit statement, then the ratio of fair balance information to benefit information in this ad is 10%. That is, only 10% of the creative space in this ad is devoted to risk information!

Admittedly, the Rozerem ad is unusual. An analysis I have done of over 60 print ads, however, shows that, on average, only 19% of the creative space in print drug ads is used to present so-called "duplicative" risk information. The average for the benefit statement is 20% (not counting the image area, which accounts for an average of 47% of the creative ad space). Together, the image area and benefit text area occupy 67% of the creative ad space. This is over 3 times the space allocated to risk information. Hardly evidence for overcommunicating risk and undercommunicating benefits in print drug ads!

WLF Says Duplicative, I Say Whaaaa?
What's up with WLF's claim that even this small amount of risk information is "duplicative?"

What WLF means is that every Rx drug ad must also include the approved labeling (aka, package insert or PI) or summary of the drug label. This is usually included on the page following the creative part of the ad (on the reverse side of the page to be exact). WLF thinks that is enough to convey risk information. Note: The PI also contains benefit information, but you don't hear the WLF complaining about "duplicative" benefit information!

The WLF focuses mainly on print drug ads aimed at physicians and suggests that physicians can read the PI and get all the risk information they need. Therefore, the requirement to summarize the main risks in the creative part of the ad is "duplicative." [Using this logic, why not just present the PI as the complete ad?]

Sounds reasonable. However, the FDA rules make no distinction between ads aimed at physicians and those aimed at consumers. A legal maneuver to eliminate risk in one, therefore, would also remove risk in the other. We all know that consumers do not read the PI behind the creative ad page. If they did, not many would know where to find the risk information in the PI let alone understand it once they did find it (see "Future of Drug Print Ads").

WLF also makes a first amendment case against FDA
FDA requires -- in some cases -- offending companies to publish "corrective" advertising and "cites advertisers for using studies it has not reviewed without taking into account that those studies may be accurate or appropriate." WLF insists that the FDA "undertake a comprehensive, systematic review of their ... policies and practices relating to prescription drug advertising and promotional labeling for consistency with their statutory authorities and with the First Amendment. WLF requests, further, that appropriate proceedings (e.g., rulemaking, guidance development, withdrawal of draft guidances) be initiated to implement the results of that review."

The FDA is reacting to the WLF and similar petitions -- indeed, it is legally required to do so. As indicated by the WLF: "Four years ago, FDA issued a Request for Comment on First Amendment Issues, in an effort to ensure that its regulations, guidances, policies, and practices continue to comply with the governing First Amendment caselaw." That may have been in response to previous petitions of the WLF, which has a bee in its bonnet about this issue and frequently tilts at the FDA wind mill.

Sometimes -- as in the Plan B case -- the FDA initiates a comment period as a delaying tactic. This has not gone unnoticed by the WLF, which claims that "Despite receiving 173 comments from interested persons, FDA has not yet systematically reviewed its policies and practices."

Industry Studies Ads Without Risk Info
Meanwhile, drug companies like Merck are performing "DTC risk-recall" research with technical assistance from FDA's DDMAC according to an article in the August 2006 issue of MM&M ("Merck taps DDB, Ogilvy for DTC risk-recall research"). This is a bit like the fox guarding the henhouse, especially when ad agencies are involved!

But what's really scary about this research, which will show TV ads with differing levels of risk information to consumer panels, is that it specifically includes an ad "stripped of all risk information, scanned like an ad for an OTC product."

This is merely a "control," says Merck. But the data will be there for groups like the WLF to further make its case against risk information in DTC ads and for the FDA to make its decision without caving in to WLF on the warning letter issue. It's all good as far as the WLF is concerned!

Friday, August 11, 2006

Brand Extinction Looms

According to a Forbes article, "By 2011, a quarter of current drug sales in the U.S. will be eaten away by less expensive generic pills as medicines lose patent protection. Between 2007 and 2011, more than 80 medicines are expected to face this fate." (See "Nagging Doubts For Big Pharma".)

The data are plotted on the left.

This year was bad, but 2011 looks even worse! You might even say it's a "Tipping Point."

Faced with this looming drought, what are the options for this "innovative" industry?

Don't expect much relief from in-house innovation. The current pipeline of new drugs from Big Pharma has slowed to a trickle. "It's not clear that new drugs can make up for the ones that will be lost," says Forbes.

Other options being pursued, include the following.

OPTION 1: Reap a temporary windfall from the new Medicare drug benefit.

This option is a double-edged sword: "Down the road, this Medicare boost could be a double-edged sword. Once they have enrolled all those new patients, the HMOs and benefit managers will start exerting more price pressure on the drug companies, forcing them to sell more medicines on the cheap."

OPTION 2: Protect the franchise.

The naming of Jeffrey Kindler -- former corporate counsel -- as CEO of the biggest pharmaceutical company in the world telegraphs that the industry will pursue legal remedies to shore up and extend the life cycles of its current drugs (see "Kindler Fox in Pfizer Henhouse/Bunker").

Buy new experimental drugs from smaller companies.

This is what the Forbes had to say about that: "Worse, buying new experimental medicines from tiny startups is getting increasingly expensive. For instance, Genentech yesterday offered to pay up to $605 million for rights to co-discover and develop new cancer drugs with a privately held biotech, Inotek Pharmaceuticals."

Traditional biotech companies like Genentech, which are now buying innovation from smaller companies, are beginning to look and act more and more like "Big Pharma" companies. We soon will be entering an era of biotech "me-too" drugs. "Even biotech drugs, which are synthetic versions of natural proteins, may face copycats," says Forbes.

Facing competition from copycats, it's no wonder that biotech companies are starting to market their drugs directly to consumers like Big Pharma. For more on that, see "Biotech DTC: Business Not As Usual."
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