Drug companies use unscrupulous and unethical marketing tactics not only to influence doctors to prescribe their products but also subtly to persuade consumers that they need them, a report claims today.The full report includes an appendix, stratified by company, listing instances of questionable marketing practices contrasted with each company's relevant ethical codes, and comments on any discrepancies. The incidents listed are international in scope, mostly, but not exclusively European, including a few which have appeared on Health Care Renewal, but many which are new to me.
Consumers should be concerned because time and again the companies violate their own industry's ethical marketing codes.
The report examines the marketing practices of 20 of the world's biggest drug companies. It alleges that:
· Drug companies are promoting their products through patients groups, students and internet chatrooms to bypass the ban on advertising except to doctors.
· They offer information to the public on "modern" lifestyle diseases, such as stress and poor eating habits, to encourage people to ask their doctors for medicines.
· They make inaccurate claims about the safety and efficacy of their drugs.
· Doctors are offered incentives to prescribe and promote drugs including kickbacks, gifts, free samples and consulting agreements.
· Many companies have been implicated in anti-competitive strategies, including cartels and price hikes.
Drug companies are not permitted to advertise products to the public. But companies are increasingly looking to influence consumers directly through funding patient groups and launching 'disease awareness campaigns', which do not name a product but are likely to encourage patients to seek treatment.
'This type of 'nice-and-friendly' marketing is often disguised as corporate social responsibility and has been shown to create a subtle need among consumers to demand drugs for the conditions, while giving consumers a sense of trust in the pharmaceutical companies,' says Consumers International.
Best placed to persuade doctors of the merits of a new drug are other doctors. Drug companies often pay specialised medical communication agencies to recruit and train leading doctors, specialists and academics as 'key opinion leaders', or KOLs, as they are known in the business. These people will be paid to promote drugs to other doctors through presentations, research papers, discussions and debates.
'The relationship between companies and KOLs is not explicitly transparent,' says the report. 'As a consequence, consumers and patients, and in some cases health professionals, may not always be aware how motivation for individual profit could play into the drug information they receive via the KOLs.'
Violations of industry-wide drug promotion codes occur with regular frequency, says the report. The 20 companies were involved in 972 breaches of the ABPI's rules on ethical drug practices between 2002 and 2005. More than 35% of those breaches, the largest category, had to do with misleading drug information.
More than half of the 20 companies whose marketing practices are examined in the report have been implicated in controversies regarding free samples, kickbacks and gifts to medical professionals, it says. Half have breached the ABPI code of practice on the conduct of the medical representatives who visit doctors.
Most of them - 17 out of 20 - have been involved in publicising irresponsible or controversial promotional materials. Only two companies, GSK and Novartis, are transparent in reporting the number of confirmed breaches of marketing codes and any sanctions imposed.
This record raises questions about the efficacy of self-regulation.
As an aside, we have posted about how some leaders of US health care for-profit corporations are now under fire from their own stock-holders for compensation that seems exaggerated compared to their companies' financial performance. One of these leaders was the CEO of Pfizer, Henry McKinnell (see post here). Recently, as reported by Reuters, McKinnell defended his compensation because it was based on his total performance, not just the stock price: "So what is performance? Is it current share price? I don't think so. It's long term value." Furthermore, McKinnell asserted that only the Pfizer board of directors is competent to judge that value because it "knows about the business, sets tough standards for the CEO and rigorously evaluates that performance."
I wonder if the board was aware of the list of questionable marketing practices attributed to Pfizer in the CI report when it assessed McKinnell's performance. They included:
- In 2004 Pfizer pleaded guilty on charges of falsely marketing its epilepsy drug Neurontin for off-label uses.[1]If not, they should have been. See the CI web-site for more details.
- The Dutch Code Commission granted a complaint by a doctor against Pfizer in 2004. The doctor had filled a complaint about an invitation that he had received from Pfizer for a informational meeting about Celebrex. Pfizer promised to cover expenses by giving 200 euro for doctors signing up to the meeting.[3]
- In two advertisement for Norvasc (amlodipin) in Germany in 2004, Pfizer left out important findings from the ALLHAT-study that was referred to. It claimed 'equal value' of Norvasc when compared to diuretics, whereas this could not be concluded on the basis of the research findings.[4] The American College of Cardiology (ACC) cooperated with Pfizer and issued a statement urging doctors to stop the use of the competing drug Cardura.[5]
- Published data on Pfizer's anti-depressant Zoloft has claimed that it reduces the likelihood that people will harm themselves. However, data from clinical trials indicated the opposite, namely that people continue to harm themselves.[6]
- The MHRA ruled that in a promotional letter, sent to healthcare professionals in the UK in November 2004, information about Celebrex was not balanced or accurate. The MHRA required that Pfizer would send a corrective statement, but after a publication by the MHRA on the use of selective COX-2 inhibitors in general, this requirement was dropped.'[7]
- Pfizer has sponsored an Impotence Association campaign in which the logo of Pfizer figured prominently on the advertisements. The UK Prescription Medicines Code of Practice Authority (PMCPA) ruled that this was inappropriate and could encourage patients to ask doctors specifically for Viagra.[8]
- In 2004, Pfizer was criticized by the Federation of German Consumer Organizations for illegal direct-to-consumer advertisements in newspapers. According to the NGO, Pfizer claimed in advertisements targeting market German drug regulations that Sortis is the best cholesterol-lowering medicine available.[9]
- In 2005, the Dutch Code Commission (CGR) ordered Pfizer to shut down a website about erectile dysfunction that it sponsored, because the company was promoting of its prescription drug Viagra to the general public.[10]
- In Spain, Autocontrol judged in 2005 that Pfizer had violated articles 3.8 and 7 of the Farmindustria Code. It had made an unfair comparison between its drug Viagra and Eli Lilly's Cialis and illegally promoted the drug to the general public. The company was fined €90.000.[11]
- In September 2005, the Prescription Access Litigation project (PAL) filed a class-action lawsuit in the US, accusing Pfizer of a deceptive advertising campaign for Lipitor.[12]
As a businessman I cannot think of a more predatory industry than pharmaceuticals, yet these are the very people we turn to, not only for the drugs, but for the information to maintain our health. I wish doctors would show a great deal more skepticism when dealing with the latest and greatest drug or study and remember: A new drug only needs to show it does no harm, it is not required to be better or more cost effective.
ReplyDeleteSteve Lucas
In the Market to Save Lives
ReplyDeleteMichael White, President, PharmaKinnex
Consumers International, a consumer group based in London, recently issued a report that called on governments to rein in the pharmaceutical industry and demand an end to what they claim are unscrupulous marketing practices. They also claim that the pharmaceutical industry spends nearly twice as much on marketing drugs as it does on research and development. Simply stated, when it comes to the U.S. market, the group is way off base.
First of all, according to Pharmaceutical Research and Manufacturers of America, an industry association, in 2003, its members alone spent $33 billion on R&D, 23 percent more than the whole industry spent on promotional activities that year. Moreover, the Food and Drug Administration (FDA) strictly regulates the industry’s marketing activities, overseeing all promotions and communications with doctors and patients. Any company not in compliance is subject to penalty.
Consumers International seems to miss the point about pharmaceutical marketing. In reality, the best pharmaceutical marketing activities educate patients and consumers on state-of-the-art approaches to managing disease. Other methods, such as relationship marketing, emphasize building long-term relationships with customers rather than on individual transactions. It involves understanding the customers' needs as they go through life, providing a range of products or services as they need them. This is hardly a bad thing.
Marketing efforts do indeed come with a hefty price tag, but the result is often the profit that feeds further research. Keep in mind, pharmaceutical innovation is a high-risk, high-return proposition. To get one new drug on the market requires the screening of 10,000 potential agents. The time window from discovery to approval is 12 years on average. And, with a 17-year patent in place, that means the company will have as little as five years to make its 12-year investment pay off. That investment will involve thousands of patients treated and assessed to ensure that the product’s safety and efficacy are acceptable. The studies needed to do this cost hundreds of millions of dollars and will carry a high risk of failure along the way.
In contrast to what the authors of the report claim, there is sufficient transparency, not to mention a very strong disincentive to “play games,” when it comes to marketing pharmaceuticals. Today, the industry is compelled to work closely with the FDA to ensure compliance with increasingly rigorous marketing regulations. Penalties range from making changes to certain communications to more severe actions that can disrupt a company’s operations. The Office of the Investigator General (OIG) has added to the scrutiny over the last several years. Both FDA and OIG oversight has resulted in courts imposing high fines, and even jail sentences, on companies and individuals found in violation.
There is a bigger issue here that should be discussed. The dynamics taking place in the pharmaceutical industry are, pardon the pun, unhealthy, but it has nothing to do with their marketing activities. The pharmaceutical industry has been identified on multiple fronts as an easy target. Companies are routinely criticized as biased in their promotional communications, excessive in their pricing, and under-committed in their investment in R&D. Unfortunately, those individuals and groups that complain fail to acknowledge the efforts many pharmaceutical companies are making to improve ethical standards, not to mention improve health and save lives.
While R&D and the drug development pipeline are of paramount importance to pharmaceutical companies, they are compelled to spread the word when they possess an effective, and often life-saving, product. And, yes, this takes an enormous financial commitment. These are not reasons to be maligned.
Ultimately, pharmaceutical marketing is nearly as important as the drug development process in that it brings about awareness of new disease therapies and treatments. The vast majority of pharmaceutical companies operate on an ethical level with a desire to make their therapies more available. They are committed to doing what's best, not only for their business's profitability, but for the well-being of their patients.
Michael White is the founder and president of PharmaKinnex, a New Jersey-based marketing services company that provides cost-effective, brand specific multi-channel marketing and sales support to pharmaceutical and biopharmaceutical organizations.
In the Market to Save Lives
ReplyDeleteMichael White, President, PharmaKinnex
Consumers International, a consumer group based in London, recently issued a report that called on governments to rein in the pharmaceutical industry and demand an end to what they claim are unscrupulous marketing practices. They also claim that the pharmaceutical industry spends nearly twice as much on marketing drugs as it does on research and development. Simply stated, when it comes to the U.S. market, the group is way off base.
First of all, according to Pharmaceutical Research and Manufacturers of America, an industry association, in 2003, its members alone spent $33 billion on R&D, 23 percent more than the whole industry spent on promotional activities that year. Moreover, the Food and Drug Administration (FDA) strictly regulates the industry’s marketing activities, overseeing all promotions and communications with doctors and patients. Any company not in compliance is subject to penalty.
Consumers International seems to miss the point about pharmaceutical marketing. In reality, the best pharmaceutical marketing activities educate patients and consumers on state-of-the-art approaches to managing disease. Other methods, such as relationship marketing, emphasize building long-term relationships with customers rather than on individual transactions. It involves understanding the customers' needs as they go through life, providing a range of products or services as they need them. This is hardly a bad thing.
Marketing efforts do indeed come with a hefty price tag, but the result is often the profit that feeds further research. Keep in mind, pharmaceutical innovation is a high-risk, high-return proposition. To get one new drug on the market requires the screening of 10,000 potential agents. The time window from discovery to approval is 12 years on average. And, with a 17-year patent in place, that means the company will have as little as five years to make its 12-year investment pay off. That investment will involve thousands of patients treated and assessed to ensure that the product’s safety and efficacy are acceptable. The studies needed to do this cost hundreds of millions of dollars and will carry a high risk of failure along the way.
In contrast to what the authors of the report claim, there is sufficient transparency, not to mention a very strong disincentive to “play games,” when it comes to marketing pharmaceuticals. Today, the industry is compelled to work closely with the FDA to ensure compliance with increasingly rigorous marketing regulations. Penalties range from making changes to certain communications to more severe actions that can disrupt a company’s operations. The Office of the Investigator General (OIG) has added to the scrutiny over the last several years. Both FDA and OIG oversight has resulted in courts imposing high fines, and even jail sentences, on companies and individuals found in violation.
There is a bigger issue here that should be discussed. The dynamics taking place in the pharmaceutical industry are, pardon the pun, unhealthy, but it has nothing to do with their marketing activities. The pharmaceutical industry has been identified on multiple fronts as an easy target. Companies are routinely criticized as biased in their promotional communications, excessive in their pricing, and under-committed in their investment in R&D. Unfortunately, those individuals and groups that complain fail to acknowledge the efforts many pharmaceutical companies are making to improve ethical standards, not to mention improve health and save lives.
While R&D and the drug development pipeline are of paramount importance to pharmaceutical companies, they are compelled to spread the word when they possess an effective, and often life-saving, product. And, yes, this takes an enormous financial commitment. These are not reasons to be maligned.
Ultimately, pharmaceutical marketing is nearly as important as the drug development process in that it brings about awareness of new disease therapies and treatments. The vast majority of pharmaceutical companies operate on an ethical level with a desire to make their therapies more available. They are committed to doing what's best, not only for their business's profitability, but for the well-being of their patients.
Michael White is the founder and president of PharmaKinnex, a New Jersey-based marketing services company that provides cost-effective, brand specific multi-channel marketing and sales support to pharmaceutical and biopharmaceutical organizations.
John,
ReplyDeleteI can just say that regulation of pharmacutical advertising throughout the world is a very poor state of affairs. the US and New Zealand are possibly the worst offenders. With no restrictions on direct to consumer advertising. I cannot believe that people advocate this, consumers need information, so drug companies are providing a public service. I'm sorry I have studdied medicine for 5 years and public health governance for 3 years. There is no objectivity in comments if your bottom line is reliant on sales.
But it is a tight rope. and no country likes to walk it. do we regulate to our hearts content and let industry suffer or do we let the dogs loose and let the public (which has no medical knowledge and even less idea of what good health is) decide? ther is no easy answer