Is Pfizer Arrogant and Superior?

The members of the online Pharma Marketing Discussion Board, which I moderate, had a lively exchange on the subject of Pfizer, torcetrapib, and drug costs over the past several days. I'd like to summarize that discussion here. Keep in mind that all these people are professionals working within the pharmaceutical industry either employed at major pharmaceutical companies or with outside agencies or vendors providing services to the industry. I include only their first name and initials here to protect their identity, although they had no qualms about that amongst their colleagues on the discussion board.

Pfizer: "Arrogant and Superior"?
One repercussion of the torcetrapib failure is the negative publicity Pfizer is receiving and criticisms from Wall Street analysts (see for example "torcetrapib: $800 Million Failure but Kindler Safe"). Some of the latter may be driven by short-sellers, but some people in the industry seem to have pent-up feelings, such as the following:

While I agree that jumping all over Pfizer is not in the best interest of learning from this situation, I can tell you that as a former vendor, they do hold a reputation as arrogant and superior to everyone else, and this may be a way for many to retaliate.

Concerning the mea culpa within 5 hours - that will be a question many will ask: "What did they know and when did they know it?"

Could things have been done better? Perhaps. A more extensive safety trial prior to phase-3? Less of a focus on developing drugs to protect a market niche held by a product with only a few years left on its patent?

The pharmaceutical industry is fully aware and accepts the fact that many of the drug compounds in development will not reach it to market. It becomes major news when so much money is invested and people die. Just the realities of life.

Mike A.

John M. (another John M., not me!) disagreed with Mike's suggestion that Pfizer has an "arrogant and superior" reputation and offered offered his personal experience as an example:

Probably different groups, but my Pfizer clients have always been among the best.

to which Mike responded:

Not my personal experience either, but this is what I have heard from many companies who have dealt with them. The most common comment, paraphrased, is "We just want you to execute our strategies and tactics - don't think. We wouldn't be as big as we are if we didn't know what we were doing."

You can't argue with success (to date)! Luis Q. put it this way:

a lots of times, if a person show skills for think in a laboral interview, he/she is "overqualify".

We've all been there!

My own viewpoint is this: Most of the people I have dealt with at pharmaceutical companies -- including people at Pfizer -- have been very competent, knowledgeable and great to work for. For the record, I am currently doing some consulting work for Pfizer, so I may be biased.

So many times I have heard from pharmaceutical people at conferences how much they enjoy my blog or participating in the online discussion board -- at least listening in. The most common remark is something like this: "What you said about X was right on. I wish I could say that!" There are some things that pharmaceutical companies do based on strategies developed at the highest levels that do not sit well with the rank and file. Same as with other industries. But if we all just say "Yes sir, great strategy" are we doing the industry a favor?

Anyway, I digress. Adam B. adamantly defended Pfizer's handling of the torcetrapib debacle:

Woo-hoo! A lot of people are really stepping out on the ledge this week and criticizing Pfizer. Do you also like cute puppies and dislike Osama bin Laden?

* How about some solutions for how Pfizer can best respond now?
* How can other companies avoid this sort of crisis?
* Is M&A to create mega-pharmas a failed strategy?
* Why hasn't Pfizer gotten any positive coverage for so quickly yanking the clinical trial? (The last time you made a major mistake, did you publish a mea culpa within five hours?)

I wish Adam hadn't mentioned the "O" word and brought politics into the picture! I don't want the Negroponte and other folks at NSA snooping through my email and the email of the other members of the discussion board who received Adam's message.

Mike A.'s comment, which I quoted at the beginning of this post, was actually a response to Adam. For the record, I gave Pfizer a "B" for pulling the plug on torcetrapib (see "Pfizer's torcetrapib: Who Knew What, When?"). That's pretty good coming from me, but remember, I may be biased!

As always, the discussion veered at this point to other matters, which I may cover in a future post.

I'd like to end this with a poll of readers asking you whether or not you agree that Pfizer is "arrogant and superior." You can vote below and add comments to this post by clicking on "Comments" at the end. It's all anonymous, so don't worry about losing your job.

Is Pfizer Arrogant and Superior?
	No (emphatic)
	Yes (sigh)
	Yes and rightly so!
	No, it's a cute puppy! (sarcastic)
	Superior yes, Arrogant no!
	How the hell should I know?

Betting the Pharm

Pfizer's failure to launch torcetrapib will have repercussions throughout the industry on many different levels. As a seminal event, it will rival the withdrawal of Vioxx from the market.

First, it is "devastating to Pfizer" whose executives bet big on torcetrapib as a replacement for Lipitor, which will go off patent in 2010.

Pfizer Chief Executive Jeffrey Kindler believed that torcetrapib was "one of the most important developments in our generation" and Pfizer research president John LaMattina said, "We believe this is the most important new development in cardiovascular medicine in years." (See, for example, "Demise of a Blockbuster Drug Complicates Pfizer's Revamp".)

Pfizer Psyche Shaken
These executives as well as every Pfizer employee must be in shock and awe. Shocked that their company could fail so publicly and awed by the power of the butterfly effect that a rise in a few millimeters of mercury of blood pressure can have.

The failure of torcetrapib not only affects the psyche of Pfizer, but also its people, more of whom are now likely to be out of work on top of the previously announced 20% cut.

While Mr. Kindler says he is "relentlessly focused on shareholder value," some $20 billion of it evaporated on Monday, according to the Wall Street Journal. That makes the $800 million Pfizer claims to have spent on development costs look like a rounding error, as one member of the online Pharma Marketing Discussion Board quipped.

Another repercussion concerns mergers and acquisitions. Some analysts are predicting that Pfizer will have to buy new drugs for its pipeline through mergers and acquisitions and this will speed up M&A activity throughout the industry.

Door Opens for Real Snakes
The visible failure of Pfizer’s prize replacement for Lipitor may also be sending a chill through the public, which could be losing confidence in Lipitor and other lipid-fighting drugs despite the lack of any supporting scientific evidence.

For proof of this, I cite the new anti-cholesterol spam emails I have been receiving lately touting cholesterol "breakthroughs", such as the following:


Receiving this email at this time may have been a coincidence, but as a believer in the opportunistic nature of marketers, I think not.

"Drugs like Lipitor®, Zocor®, Crestor® and the other statins can cause a whole new set of problems," claims this ad. "So, ask your doctor if you can try the safe, natural alternative. It really works" (read between the lines: "It really works, unlike torcetrapib, the replacement drug for Lipitor, which has its own set of problems.")

At least this ad urges readers to "follow your doctor's advice, and don't stop taking any prescription until you get your physician's okay." Others may not be so finicky.

Drug Development Without Medical Science Foundation
Torcetrapib problems may have resulted from raising the level of “bad” HDL. If so, that would signal trouble for the entire class of CETP inhibitors. "The whole class goes down at that point," said Steven Nissen, chief of cardiovascular medicine at the Cleveland Clinic.

Finally, the torcetrapib failure puts a monkey wrench into the ascendancy of commercialization over science. Some experts claim that, like it or not, “we are in an era where development of "successful" drugs is going to be shaped by potential marketplace success” rather than clinical efficacy (according to an expert quoted in the upcoming December issue of Pharma Marketing News).

Torcetrapib may have been one of these drugs shaped more by commercial potential--ie, blockbuster potential--than by any viable science to back it up.

A recent article by an assistant managing editor at The Wall Street Journal ("Drug's Demise Demonstrates Why CEO Is Pushing to 'Transform' Pfizer") questions this strategy and suggests that Pfizer and the rest of the pharmaceutical industry needs to change its "creaky traditions," including how it develops drugs, sells drugs, and manages public opinion. Here's his words on that:

"That leads to the first transformation Mr. Kindler needs to make: a transformation in the way Pfizer develops drugs. Instead of one big blockbuster, it's probably going to have to figure out a way to nurture a large number of smaller hits to keep growing.

"And then there's the transformation needed in the way Pfizer sells drugs. The sales effort relies heavily on a huge and costly sales force that has often consisted of attractive females whose first job is to get in the doctor's door so they can make their pitch. Mr. Kindler has already announced plans to shed 2,200 members of that sales force, and more cuts are likely.

"Finally there's the transformation in the way Pfizer deals with politicians and a public upset about the high cost of drugs. In the past, the company's approach has been to buy the former and ignore the latter. But that strategy is clearly fraying, and the threat of price controls, in one form or another, hovers on the horizon."

Amen to that!

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torcetrapib: "$800 Million" Failure but Kindler Safe

Expect to see Pfizer’s failed attempt to bring torcetrapib to market as an oft-cited object lesson of why the costs of drugs needs to remain high. The following comment from Rich Meyer, author of the World of DTC Marketing Blog, is perhaps the first example of this:

"After spending more than $800 million [my emphasis] to develop a successor for its block buster Lipitor Pfizer, the world's largest drug maker, halted development on Saturday of its top experimental medicine the cholesterol drug torcetrapib, due to safety concerns. This is a key example of the risks that America's pharmaceutical companies face when developing new products and why spending on R&D needs to remain at high levels…when asked to explain their marketing practices to a skeptical public or to Congress Pfizer should use torcetrapib as an example of why costs continue to remain high." -- quoted from "$800 million does not guarantee success."

Where did Meyer get that $800 million figure? I'm guessing it came from the many stories written in the press about the clinical trial, including a couple in the Wall Street Journal by Scott Hensley. I know that's where I got the number when I first wrote about this on Sunday (see "Pfizer's torcetrapib: Who Knew What, When?").

On November 13, 2006, for example, in the article "Pfizer Presentation Is Limited Due to a Disclosure Violation," Hensley says "Pfizer is spending more than $800 million on clinical tests of the drug."

If Pfizer really spent $800 million on the 15,000-patient torcetrapib trial, that would mean that it spent $53,000 per patient! Even at $10K per patient for a trial--two to three times a typical CRO estimate and 50 percent higher than the NCI's reported average costs--a 15,000 patient trial would cost about $150 million, not $800 million. Granted, there were probably other trials, but this was the biggest by far. Even doubling the estimate to $300 million doesn't get us close to $800 million.

Where did Hensely/WSJ get that number?
He got it from Pfizer. In a December 4, 2006 article entitled "Demise of a Blockbuster Drug Complicates Pfizer's Revamp,” Hensely reports: “Pfizer said at the time it would invest $800 million to prove the drug's effectiveness and win approval from the Food and Drug Administration..." This time "win approval" is included in the estimate, which we didn't have before.

The $800 million figure was cited again in today's WSJ thusly: "Pfizer had committed $800 million to getting its HDL-raising torcetrapib to market" (see "After Pfizer Blockbuster's Failure, What's Next for the Heart?").

So, in this one newspaper alone, we've gone from "is spending" to "would invest" to "committed" (which I interpret meaning a budget line item, but not yet all spent).

Aside from this confusion about whether or not $800 million was actually spent or was committed to be spent, the number itself is suspicious.

Where did Pfizer get the $800 million figure?
I suspect Pfizer pulled the number out of an often-quoted--and much disputed--PhRMA sponsored Tufts University survey of 10 major pharmaceutical companies. The drug development cost estimate based on this study is disputed. Apparently, about half of the estimate is financing costs; aka "opportunity cost of capital." It's like me saying that the cost of my BMW equals the actual $50,000 I spent on it plus the money I didn't earn by failing to invest that $50,000 elsewhere.

But, as the industry always points out, "Today’s drugs finance tomorrow’s innovation." Therefore, the $150 million or $300 million or whatever Pfizer spent on torcetrapib, was really the best investment it could have made, although not a guaranteed winner, obviously.

However many millions of dollars Pfizer lost on torcetrapib, it lost much more in credibility as an innovator. The talk on Wall Street now revolves around the innovation that Pfizer must buy through mergers, not innovation! In other words, Wall Street investors have little patience for the "Today’s drugs finance tomorrow’s innovation" argument. They need more instant gratification.

Kindler Is Safe
Don't expect Kindler to lose his job over this. He inherited the problem. However, I suspect other heads will roll -- probably a lot of marketers and sales reps who now won't have much to do in the next few years.

Pfizer's torcetrapib: Who Knew What, When?

Reported today in the Wall Street Journal:

"Pfizer Inc. halted development of a drug to boost good cholesterol that was the most important medicine in its pipeline, after more patients than expected died during a large clinical test. Half the people in the study, which was supposed to last three more years, took a combination of torcetrapib and Lipitor. The other half took only Lipitor. The company said that 82 patients taking a combination of torcetrapib and Lipitor died, compared with only 51 deaths among those taking Lipitor alone. Pfizer said the study cast no doubt on the safety and effectiveness of Lipitor." (see "Deaths Halt Development Of Pfizer Cholesterol Drug").

The unanticipated deaths became known Saturday after a board of independent experts reviewed the latest data from the 800 million dollar study, according to the report.

Who Should Know What, When?
I think this story is ripe for conspiracy analysis concerning who knew what, when. But it is also a story about what the public should know about drug risks and when. Here's my take on this.

Back in mid-October, Pfizer Chief Executive Jeffrey Kindler, at a Wall Street analyst meeting, softened Pfizer's message on torcetrapib's chances for early and resounding success. At that time, everyone was focused on the worry was over the discovery that torcetrapib raised systolic blood pressure an average of three to four millimeters of mercury (see "Pfizer's Top Experimental Drug Is Clouded by Blood-Pressure Rise").

Would a few millimeters prevent the risk-adverse FDA from approving the drug no matter what the benefits or did Mr. Kindler know something his medical consultants and chief medical officer did not know?

At the time, experts were divided as to how much they should worry over a few millimeters of mercury. The argument went straight to the issue of balancing risks vs. benefits. Defenders of the industry pooh-poohed the flap over the rise in blood pressure and suggested that the risk will be "far outweighed" by the benefit. This was the view of Alan Tall, a Columbia University professor and pioneer in research on good cholesterol who consults with Pfizer.

"We're still very positive about the drug," said Joseph Feczko, Pfizer's chief medical officer, in an interview. He acknowledged the blood-pressure increase but said scientists at the company still think the drug will have a positive "net impact" for patients by raising their good cholesterol and improving their clogged arteries. He said the company won't know for sure until completion of additional studies that will show, using ultrasound, the effect of the drug on arteries. (WSJ)

Death certain disrupted that plan to collect more evidence!

Pfizer should be commended for taking action, even it was a suspiciously-timed Saturday night massacre designed to attract as little media attention as possible on a weekend.

Role of AHA
One other side note involves the American Heart Association (AHA). The AHA prevented Pfizer from reporting on the latest clinical trial data at a meeting of heart specialists:

"Pfizer scientists were supposed to present the latest data on tests of an experimental drug to boost so-called 'good' cholesterol at a meeting of heart specialists in Chicago on Wednesday.

"Late last week the American Heart Association pulled the plug on that plan, ruling that Pfizer had violated the group's embargo by issuing a press release at the end of October that went into too much detail on the closely watched medicine, called torcetrapib.

"The upshot: Doctors and researchers did not get the chance to review data on the drug in detail and to question the Pfizer scientists responsible for them. Instead, Pfizer plans to make a presentation during the company's review of its research pipeline Nov. 30 in Groton, Conn., where the audience will be investors, not outside scientists and heart specialists. " (See "A Look Behind the Recent Flap Over a Pfizer Press Release")

AHA is obviously more concerned with upholding its "nondisclosure" policies than ensuring that important drug safety information reach key physicians. Fortunately for the US public -- but not so fortunately for some people in the study -- death occurred and further development of torcetrapib is a dead issue also. Otherwise, torcetrapib could have been another Vioxx!

The drug industry and physicians are always reminding patients that all drugs have risks and those risks have to be balanced against the benefits. Sounds good in theory, but if in practice the risks are not communicated early and widely, we do not have the information we need to make an informed decision.

For more discussion of acceptable risk, listen to the latest Pharma Marketing Talk podcast, which also covers legislation that may be in store for the pharmaceutical industry and new powers that may be granted to the FDA to increase the amount of risk information available to the public.

With regard to protecting the public from potential harm, I'd give Pfizer a B and AHA a D!

Compliance, Math, and Marketers

I spent the day yesterday at eyeforpharma's 3rd Annual Patient Compliance and Adherence Congress in Philadelphia. I went mainly because I was "commissioned" by the conference organizers to be a roundtable moderator on the subject of Direct-to-Patient compliance campaigns. The round table participants discussed new ways to implement a successful direct-to-patient campaign to increase compliance. More on that in a bit.

While there, I also sat in on a few presentations and learned a thing or two. I'll just give a 50,000 foot overview here and will have a more in-depth review published in an upcoming issue of Pharma Marketing News (see the Pharma Marketing News Editorial Calendar).

Definitions
Compliance concerns following the dosing regime of a drug. You can measure it as the percent of doses of a drug taken as prescribed while the patient is actively taking drug.

Adherence, on the other hand, concerns refilling the prescription. As time goes on, patients refill less and less often and many drop the medication altogether. It has been estimated that in developed countries only 50% of patients who suffer from chronic diseases adhere to treatment recommendations. This is measured with "persistence" curves.

One thing I learned was that to understand compliance and adherence problems, you need a lot of data and analysis -- math, in other words.

Many of the presenters were vendors or solution providers and some presented data tables and plots, which I saw sailing right over the heads of many pharma marketers in the room.

Aversion to math is just one problem about assigning the compliance problem to marketers. The other is that compliance is a long-term problem and marketers -- especially pharmaceutical marketers -- are short-term thinkers. How can they be otherwise? After 2 years, product managers move on to another product or department. Compliance is the next guy's problem.

So what ideas, solutions or insights did participants in my direct-to-patient roundtable discussion come up with?

IMHO, the best idea we came up with is the one I championed: social networking. I have already blogged on the topic of social networking for compliance; see "Chantix: Opportunity for Social Marketing Lost?"

The idea started when someone suggested using celebrities to help get the message out that patients on drug X should remember to get their prescription refilled, etc.

We've seen celebrities used in traditional DTC ads urging people to ask their doctor about drug X. These ads, however, are designed to recruit NEW patients, not keep the ones already prescribed the product.

Instead of celebrities, what about people more like the typical patient?

At that point, I threw in the idea of "Consumer Opinion Leader", which is a term coined by Jack Barrette at Yahoo! (see "The Girl from Google"). "Patient Opinion Leader" (POL) would be more appropriate here to confine our attention to consumers already on medication.

POLs already exist on the Internet in patient chat rooms and bulletin boards and social networks where they upload content for other patients, give advice, and are rated on how helpful they are.

Take Marketers Out of the Equation
Getting marketers involved in social networking, however, is a touchy subject, especially in the pharmaceutical industry. In fact, every solution we came up with would be a problem for pharmaceutical marketers who don't understand patients' needs very well.

Whatever the compliance solution is, I propose that marketers be taken out of the equation. They are neither equipped nor motivated to solve the problem. What's needed are people who are patient advocates within the pharmaceutical company akin to Medical Science Liaisons (MSLs) who manage relations with physician Key opinion Leaders (KOLs).

Just as MSLs and physician education programs are now separate from marketing with their own budgets, patient advocates and patient education programs (ie, compliance-focused campaigns) must be separate from marketing and have their own budgets as well. Only then will pharma companies be equipped to deal with the long-term issues of compliance and adherence and perhaps solve them, IMHO.