Pharma Reform

The increasingly influential role of clinical pharmacists in the evolving new healthcare market represents an opportunity for pharmaceutical marketers.   At the same time, to take advantage of this opportunity, pharmaceutical marketers will need to redesign their commercialization strategies and tactics.  Clinical pharmacists are not going to be receptive to traditional marketing and sales tactics.

Pharmaceutical marketers who lack sophistication and try to merely enroll clinical pharmacists as their sales advocates will be woefully disappointed.  Clinical pharmacists are well educated, well informed, and very analytical when it comes to evaluating therapeutic treatment options.  They have an insatiable need for clinical data to support not only efficacy and safety but also the value proposition for a product.

Pharmaceutical marketers should spend some time understanding the different roles clinical pharmacists might play in the evolving healthcare system and better determine the information needs and evaluation criteria used for assessing products in therapeutic categories that pertain to their marketed products.  More importantly, pharmaceutical marketers should understand the best ways for packaging and presenting their product information so as to assist clinical pharmacists with their product evaluations, presentations, and fulfilling their clinical responsibilities.

Assuming you have a high demand product that fills a significant unmet medical need, clinical pharmacists can play a critical role in making sure your product is available in their healthcare system, is a part of treatment guidelines and highlighted in any e-prescribing support systems they use to encourage appropriate use.  They can facilitate educational programs for physicians and patients to ensure that the right patients are considered for your product, are aware of any potential safety issues, and reinforce the value of your product relative to other therapeutic options.  Clinical pharmacists are also well qualified to be clinical care coordinators in Accountable Care Organizations, and are organizationally well positioned to ensure patient compliance and adherence while monitoring and tracking the financial benefits derived from appropriate use of the product.

So tactically, what does this mean for pharmaceutical marketers?  Here are some things to consider.  Who will be making your product presentations to ensure product inclusion on formularies and securing reimbursement?  Do they have the credibility and training necessary to discuss the clinical data and value proposition (e.g., outcomes and quality metric implications) without having to refer questions to the company Medical Affairs department?  Do you have a user-friendly, comprehensive product dossiers with any efficacy, safety, or value claims (including outcomes and quality metric implications) supported by published clinical data?  Can you provide clinical trial designs and templates for doing comparative efficacy trials for your product?   Can you customized your healthcare provider and patient education materials  for specific healthcare systems?  Are you ready with electronic medical records integration technology and patient care support apps for mobile devices (think e-prescribing and adherence support)?  Can you help with customized electronic models for tracking and analyzing improvement in outcomes and quality metrics consistent with the healthcare provider system goals and objectives?

Reception of these tactics will depend on the healthcare provider system and the clinical pharmacists but also the quality and value of the products and tactics being made available.  The key is for pharmaceutical marketing to align with and embrace the needs of clinical pharmacists and find ways to help healthcare provider systems accomplish their goals and objectives in this evolving new healthcare market.  Pharmaceutical marketers who figure this out can create a significant competitive advantage and enhance revenue growth, assuming they have the innovative products, the data to support their claims, and tactics that are supportive and embraced by healthcare provider systems.

mike@pharmareform.com

The clinical pharmacist has gradually evolved in influence from the early 1980’s to a new point of power with healthcare reform, especially in anticipation of Accountable Care Organizations.  While some may have an extended clinical role out of their community pharmacy (e.g., nursing home services), I’m not talking about the dispensing pharmacist behind the counter at your local pharmacy.  I’m talking about the highly trained drug treatment specialists with extensive clinical experience who now play an even more influential role in the increasingly managed healthcare delivery system.

I’m talking about the clinical pharmacists who evaluate and make formulary recommendations for treatment options within large healthcare systems, managed care, Pharmacy Benefits Managers, government agencies (think CMS), and at healthcare insurance companies.  I’m talking about clinical pharmacists who are rounding in the hospital with attending physicians; monitoring, evaluating, and consulting on drug treatment. And, I’m talking about clinical pharmacists who are delivering and managing chemotherapy and other intravenous drug treatments in the outpatient or home health settings.

Clinical Pharmacy’s power comes from the ability to influence formularies and reimbursement decisions, draft treatment guidelines, and recommend treatment choices.  They are frequently involved in clinical trials and may find themselves increasingly involved in designing, executing, and evaluating “comparative effectiveness” studies.

More importantly, clinical pharmacists could be in the best position of healthcare providers to monitor and manage patient compliance and adherence to treatment, ensuring that treatment outcomes and quality metrics improve, and patients realize the full benefit of drug treatment after the prescription has been written.

The intensifying cost consciousness of the managed healthcare market being driven by healthcare reform and the opportunity for financial incentives from Accountable Care Organizations will further elevate the relevance, importance, and value of the drug treatment expertise of the clinical pharmacist.

It is important for pharmaceutical marketers to understand and appreciate the increasingly influential role of the clinical pharmacist in the evolving new healthcare market.  See why in the next post.  mike@pharmareform.com

This may sound simplistic and obvious.  But, have you noticed lately that pharmaceutical companies appear to be struggling with a confusing array of seemingly contradictory strategic choices?  Some of these choices leave even the most knowledgeable industry followers wondering and speculating about the rationale behind the decisions.

Should they get bigger, should they downsize?  Should they acquire, grow organically, or divest? Should they be “pure” pharmaceutical plays or diversified healthcare companies?  Should they continue to exploit the US market or expand into emerging markets?  Should they rebuild and restructure R & D or move to a more flexible outsourcing model?  Should they focus on diseases, products, or technologies?  Are regulatory compliance, manufacturing quality, and integrity important for building trust and credibility or are they “envelops to be pushed” for competitive advantage and financial gain?  Strategic and tactical choices that can affect business today and well into the future.

So what’s the big deal?  Don’t all companies go through this?  Why is this important?

It’s important because, when a company determines who they are, finds its purpose, and develops a passion for what they do; strategic and daily operational decision making become easier and are more likely to deliver the organizational goals and objectives that support the company purpose.  This corporate understanding of “self” includes a deep seated set of behavioral expectations, values, and principles by which the company operates and does business.

Definition, consistency of behavior, and organizational alignment allow employees to embrace and support the corporate purpose in their daily activities.  Decisions become easier as choices and options either fit or don’t fit the behavioral values or purpose.  More importantly, employees, prospective employees, customers, collaborators, and investors all know what to expect from the company.

Despite all the mission and vision statements in their lobbies, I believe many of the Big Pharma companies today have lost their purpose and are confused about their ”self.”  With a fixation on near-term financial performance (their apparent purpose), they seem to be struggling to find the “quick fixes” to business success in the evolving new healthcare market.

Most pharmaceutical companies would never admit they have lost their purpose.  At the same time, if they were to explore this fundamental business principle, many might learn that even their management teams are uncertain, if not finding total organizational disagreement about who they are and what they do.

mike@pharmareform.com

Over 70% of prescriptions today are filled with generic drugs.  Once a branded product loses patent protection, they experience generic erosion and a rapid decline in market share of prescriptions.  With the healthcare market becoming increasingly more managed (think government, insurers, and Pharmacy Benefits Managers) and the dramatic difference in price (generic drugs being significantly less expensive) it doesn’t take long for generic drugs to replace branded products in the market.

But …  what would happen if the branded product manufacturers (Big Pharma) started to “match generic drug prices” once their product patents expired?   As generic drugs of the branded product come to market, the branded product matches their price or even prices slightly lower than the generic drug to preserve their market share.    Surely, nobody could be a lower cost manufacturer than the innovator, brand manufacturer.

Let’s think about this. The branded company development costs are well behind them.  Manufacturing facilities, equipment, and staff are already in place.  Training, quality systems, and regulatory compliance requirements are also in place.  Operational efficiencies have been honed over years of production.  Branded manufacturers can certainly negotiate at least as good a terms on API (active pharmaceutical ingredients), packaging, and supplies as the generic drug companies.  And while branded manufacturers may have higher “overhead expenses” that’s an accounting allocation issue.  Building a patient base, marketing, sales, and supply chain logistics are already in place for the branded product.

The generic drug company on the other hand has to develop the generic product (formulation and establishing bioequivalence can be challenging), purchase and set up manufacturing capabilities (or retool what they have), source API, packaging, and supplies, put in place new manufacturing SOPs (standard operating procedures) and regulatory required quality processes.  They have to hire and train new personnel (or at least retrain current staff), develop their regulatory filing, and secure FDA approval.  They may even have to challenge the patent validity of the innovator product.  And once approved, they have to market to and negotiate with the supply chain and the managed market.  In the end, these are all new costs for generic drug companies that have to be covered in the price of their new product entry.

In the past, branded products matching generic drug prices would have meant leaving money on the table and forfeiting profits as generic drugs gradually made their way into the market over a period of years.  Today, however, it only takes a matter of months before a majority of branded prescriptions drugs can be converted to generics.

I’m sure somebody has already done the math on this from a Big Pharma profitability perspective but I still believe that “matching generic drug prices” could have value for patients and Big Pharma.   Matching generic drug prices would preserve a large patient base of lifetime revenue (albeit at lower margins) for the branded product.  It also rewards loyal patients with lower prices for the same drugs they may have been taking for years. It would certainly make it easier and more efficient for healthcare providers, patients, and the managed market in that there would be no reason to worry about changing patient prescriptions.   And, while Big Pharma might view this as “throwing in the towel” ,  this approach would be a challenging “game changer” for the generic drug industry.  mike@pharmareform.com

The commentary and highlights of pharmaceutical industry challenges noted in Duff Wilson’s article “Patent Woes Threaten Drug Firms” in The New York Times (3/6/2011) and the Morgan Stanley report “An Avalanche of Risk? Downgrading to Cautious” come as no surprise if you have read the book Pharmaplasia™.  This disconcerting pharmaceutical industry situation has been decades in the making and unfortunately, will take decades to turn around.

Those looking for or postulating near-term quick fixes from strategic restructurings, mega-mergers, technology acquisitions, or breakthrough serendipitous discoveries to resolve the industry dysfunction will be sadly disappointed.  As described in Pharmaplasia™, the problems in the pharmaceutical industry are deep rooted and involve more than just a lack of  R & D productivity.

Sure there are going to be the occasional successful new product introductions that give us hope that the industry is recovering but even those introductions will have been the result of decades of development work and there will be too few to really make a significant impact on restoring healthy consistent revenue growth for the industry.  For the pharmaceutical industry there are no quick fixes and it could take decades for the impact of the multitude of strategic efforts today to really begin delivering the types of financial results expected from the magnitude of investment being made by the industry.

In addition to fixing R & D, the pharmaceutical industry business model must become more efficient (increase operational productivity and reduce waste), must be more responsive to healthcare market needs, and must replace traditional sales and marketing tactics with healthcare market embraced programs.  Success will depend on competent leadership that is more interested in satisfying evolving new healthcare provider needs and patient well-being than “driving revenues”, satisfying Wall Street, and building personal financial wealth.

In the end, a more prosperous future for the pharmaceutical industry will come from discovering and developing truly innovative new treatments that provide clinically meaningful benefits over currently available therapeutic alternatives.  This will take a major change in R&D philosophy with a much more comprehensive basic sciences approach to finding preventions, treatments, and cures for diseases rather than relying on historical “tweaking of chemistry” and “trial and error” approaches of matching compounds with postulated disease targets.   mike@pharmareform.com

As mentioned in the previous post generic drugs now account for more than 70% of prescriptions filled in the US and that percentage is likely to increase with patent protection expiring on several blockbuster products over the next 3-5 years.  With additional support from the Obama administration to exploit the potential cost savings from the use of more generic drugs and continued efforts to ease the way to market for generic drugs, including biologics, you would think the future for generic drugs has never looked more promising.  Yet, there are five vulnerabilities and risks that could undermine the cost savings potential and success of generic drug manufacturers in the future.

• Manufacturing Quality

Drug manufacturing is difficult, especially delivering lot-to-lot consistency for tablets and capsules and ensuring the sterility of injectable products.  One of the biggest concerns raised most often about the use of generic drugs is whether they are, in fact, the same as the branded products.  The FDA goes to great lengths to dispel purported generic drug misinformation and to provide definitive answers to common questions regarding comparability.  According to the FDA website:

“Health care professionals and consumers can be assured that FDA approved generic drug products have met the same rigid standards as the innovator drug. All generic drugs approved by FDA have the same high quality, strength, purity and stability as brand-name drugs. And, the generic manufacturing, packaging, and testing sites must pass the same quality standards as those of brand name drugs.”

I’m not sure how the FDA can possibly making sure “all generic drugs have the same high quality, strength, purity and stability as brand-name drugs.”  When you consider the increasing number of generic drug products being made available by more manufacturers (many, if not most, not even in this country), their assurance seems a bit definitive and even suspect (lacking credibility) given FDA’s already stretched resources and limited inspection capacity and capabilities.

Generic drug vulnerability in manufacturing quality comes with the potential for some well publicized cases of documented manufacturing problems, safety issues, or FDA warnings about any quality concerns that would compromise healthcare provider and public confidence in the efficacy or safety of generic drugs.  In fact, any concerns voiced by the FDA with regards to the use of generic drugs could destroy the confidence of an already skeptical patient population.

• Unsustainable low prices

Even though generic drug manufacturers have built their business models around being low cost providers they still must make a reasonable profit to stay in business.  It is important to note that drug manufacturing, especially sterile injectable drugs, is not cheap.  Regulatory compliance and cost of goods can still make pharmaceutical manufacturing expensive, even for generic drugs.

When the healthcare market (e.g., pharmacies, wholesalers, Pharmacy Benefits Managers) drives competitive prices down to a point where even generic drug manufacturers can no longer make a reasonable profit, fewer manufacturers participate in that market and ultimately the healthcare market becomes more susceptible to shortages for those products.  I believe this is a major reason for the current shortage of over 150 medically necessary drugs, many which are generic drugs.

So, generic drug manufacturers are vulnerable to the negative financial impact of unsustainable low prices.  When they decide to manage this by limiting or eliminating the manufacturing of low or no margin products they leave themselves open to criticism and diminished public confidence as more of the critical drug shortages start to be blamed on the generic drug industry rather than on Big Pharma (the perception today).

• Supply of Active Pharmaceutical Ingredients (APIs)

As generic drug manufacturers squeeze their suppliers for lower prices, those suppliers also lose interest in delivering at those low prices and a cascade of events begins to drive a shortage of APIs when you need them.  Without the financial incentives (reasonable profits) to ensure supply availability, even API suppliers start to limit and maybe even discontinue making the lowest margin products on a regular basis in favor of higher margin opportunities.

Unlike in other markets, the regulatory and manufacturing challenges of pharmaceuticals makes it difficult and time consuming for new manufacturers (API or generic drugs) to step in and take advantage of these drug shortages.  Even if a new manufacturer were able to begin production, the finished generic drug’s price would almost certainly be much higher than the previous generic drug price.  Again, potentially irritating and alienating the healthcare market and patients.

• Burdensome Government fees

Additional fees levied on generic drug manufacturers (i.e., FDA reviews) as proposed by the Obama administration could erode the cost savings potential to the healthcare providers system.  Expecting generic drug companies to absorb these incremental fees could be counter productive (resulting in higher generic drug prices). More importantly, high fees across a portfolio of products could put sustainable profitability for smaller  generic drug companies at risk, even forcing some out of the market.

• Product Liability

As more products become available and more patients take generic drugs, product liability cases will inevitably increase for generic drug companies.  As a result, they may become more inclined to avoid or quit manufacturing products with the potential for an inordinate amount of litigation.  Again, with their low cost of operations and thin profit margin business models, repeated and protracted litigation for low margin products may not be financially feasible, will add to their overall cost base, and could negatively impact healthcare provider and patient perceptions of quality.

The potential liabilities for generic drug companies is especially noteworthy in light of the pending Supreme court review of whether or not generic drug companies can be held liable for “failure-to-warn” when they rely on the prescribing information developed by the branded drug company and approved by the FDA.   Should generic drug companies not prevail, it will open generic drug manufacturers to new potential liabilities and future litigation which could further compromise their low cost business models.

So, while the future looks very promising for generic drug manufacturers, it is not without challenge or risk.  For the market to continue to reap the financial benefits of a consistent and safe generic drug supply, generic drug manufacturers must guard against these vulnerabilities.  And as much as insurers and patients might enjoy the low prices we pay for generic drugs, the low prices only matter when the products are as effective as the brand, are safe to take, and are available when we need them.

mike@pharmareform.com

Recently, in one month, the price of my branded prescription drug for high cholesterol went from $130 per month to $145 per month at the same pharmacy.  Yesterday I changed to a generic drug alternative (not the same as the brand I was taking) which will cost me $4 per month after joining a $20 per year prescription savings club.  I now get more than two years of medication for the price I was paying for one month of the branded product.  Assuming I will be able to control my cholesterol with this new medication (no reason to believe it won’t as I have taken most of them over the past several years),  at $1 per week it is hard to complain about the high price of prescription drugs.

So why was I even paying $130 in the first place, when generic alternatives were available?  Well, when I had prescription drug coverage through my employer provided insurance,  my co-pay for the branded products was about $20.   I not only didn’t think about the actual price of the drug but I didn’t even care to know what it would have cost without insurance.   Generic drug alternatives didn’t enter the thought process.  Besides, how much lower priced could the generic drug be? More recently, until the price increase,  I just kept getting the prescription filled even though it seemed expensive at $130 per month.

Fortunately my physician agreed to try me on the generic alternative.  For once I also felt fortunate that I was not covered by a government program (e.g., Medicare, Medicaid, and TRICARE) which would have made me ineligible for this savings club and these generic drug prices.  There is a wide range of therapeutic categories with over 400 generic medications available from this pharmacy prescription savings club priced at $12 for a 90-day supply (or $9.99 for 30 days).  Again, hard to suggest these prices are unreasonable and they certainly are not expensive in the context of most prescription drug price discussions.  Even without the savings club membership the price would have been less than $30 per month.

Despite the fact that over 70% of prescriptions in the US are now filled with generics drugs, I can’t help but to think from my own experience that there are still a lot of people who could financially benefit from a switch to generics.   I also believe healthcare reform will bring significant cost pressures to get more patients converted to generic drugs.  The Congressional Budget Office reported that in 2007, if all of the 45 million Medicare Part D prescriptions filled with multiple-source brand-name drugs (brand name drugs with generic alternatives) had instead been filled with their generic counterparts, an additional $900 million would have been saved.  And that is without considering therapeutic substitutions (as my case would be considered) or the potential savings from the blockbusters now coming off patent over the next few years.

The biggest downside for patients resulting from this healthcare market evolution to encouraging the use of more generic drugs is that if you need one of the innovative branded products for which there is no good generic alternative, you are going to pay much higher prices than you might have in the past.  If my generic cholesterol lowering agent isn’t as effective (or has more side effects) as the branded product I was taking, I’ll be back to paying the $140 per month.

I believe two factors will drive branded product prices higher with healthcare reform.   First, truly innovative treatments that deliver real clinical value and unique therapeutic benefits will command a premium price because they will be deemed worth paying for and taking.   Second, more generic drugs and more patients taking generic drugs will shrink the market for branded products to people who absolutely need the branded products.   Drug companies will have to exact their profits from fewer products that can deliver these unique therapeutic benefits to much smaller patient populations.   Companion diagnostics will further reduce these already small populations of patients, by identifying responders and eliminating those who might experience side effects.

So the good news for patients is there will be more generic drugs available at low prices resulting in lower costs to government programs (tax payer benefit), private insurance (keeps co-pays lower), and patients.   Pharma companies on the other hand will be able to, and will have to, charge even higher prices when patients need their innovative branded products.

Disclosure:  I am not compensated  by the prescription savings club.  The link is included here only as a reference.

mike@pharmareform.com

There is plenty of discussion, debate, legal maneuvering by state governments, and media coverage dedicated to the potential repeal of healthcare reform legislation in the US.  While many feel comprehensive rejection of the bill is unlikely, others suggest there are several components of the reform legislation that should be redrafted or eliminated outright.

Without getting into all the nuances (e.g., implications of electronic health records or accountable care organizations) of the legislation, the major healthcare reform implications for the pharmaceutical industry include:

• Commitment for fees, rebates, and discounts totaling over $100 billion over 10 years
• Additional 30 million potential patients with insurance and drug coverage

Agreements and other negotiated benefits for the pharmaceutical industry:

• 12 years of data exclusivity for biologics
• No direct government negotiations on pricing
• No reimportation of less expensive drugs from foreign countries

So, for pharmaceutical companies, does it really matter if the healthcare reform bill is repealed?

To answer this you have to look beyond the next couple of years and any politically driven tweaks to the legislation that might take effect as a result of trying to pacify special interest groups, including insurance companies, advocacy groups, and state governments.  Any near-term implications don’t and won’t change the fundamental realities of where the US and global healthcare markets are trending.  These realities include:

• plenty of inexpensive generic drugs to treat many mass market diseases
• an increasingly cost conscious managed market with direct or indirect (mandatory discounts and rebates) price control tactics
• increasing market expectations for premium priced new products to deliver clinically meaningful benefits over other available therapeutic options (with sophisticated expert reviews of new treatment options)
• increasing demands for definitive pharmacoeconomic data to support the relative value of premium priced new products

Any near-term changes, repeals, or tweaks to the US healthcare reform legislation will not impact these fundamental market expectations.  Interestingly, the more the US market moves to a single payer model with increasing government involvement, the more these expectations will drive the prescription drug market.

Regardless, I believe the implications of any repeal of healthcare reform will be inconsequential in the context of the long-term business model implications for the pharmaceutical industry.  Yet, it’s scary to think about the amount of lobbying money being spent right now by big drug companies and the industry to influence this legislation.

I’m sure there are also teams of people at pharmaceutical companies right now working diligently trying to forecast and model all the permutations of legislative repeal.  While a necessary exercise (don’t want to miss an opportunity or provide Wall Street with flawed financial guidance), a laborious review could be a huge distraction and probably a waste of time in the context of what needs to be done for the long-term.

The real focus for pharmaceutical companies should be on enhancing and bolstering their discovery research.  In the end, the pharmaceutical industry and drug company success will be determined by finding better more efficient ways to deliver products that satisfy a much more demanding market that has higher expectations for therapeutic benefits and value.  mike@pharmareform.com

It has taken me a long time and a lot of reflection to acknowledge and appreciate the sage advice my first district manager gave me over 30 years ago.

Here are some of the nuggets of wisdom I found helpful that might be of interest regardless of where you are in your career.  You’ll notice these apply more universally to business than just to the sales position I was in at the time.  They may seem simple and obvious but like many things in life, holding true to their full intent and purpose is much harder than the words might suggest, especially over the course of a career.

Show up: Put in a full day, everyday.  Not just when you feel like it or want to,  but especially when you don’t feel like it or don’t want to.  Most people don’t.

Follow up: check regularly and return phone calls immediately. You don’t know the customer’s sense of urgency, it could be an emergency.  When you promise to do something, send something, or check back … do it… no excuses.

Make one more call: At the end of the day when you are ready to go home, make one more sales call.  This extra effort accumulates into an additional month of sales calls every year.  You never know when that one extra call is going to make a difference for your customer, a patient, or for your incentive compensation.

You get one shot at trust: If your customers quit trusting you, they quit buying from you.  They catch you once in a lie, misrepresentation, or faking an answer, they have no reason to believe you after that.

Be ready for your next job before you get it: This meant that I would have to find the time, energy, and commitment to stretching my development to include subjects and skills beyond my current position. In other words, take responsibility for my own education and career development.  

As busy as we were the days he rode with me, I always found it interesting that he found quiet time to have a cup of coffee to have these discussions.  He made it a point to make sure I was able to listen, commit my complete attention, and engage in the discussion.  This was never during drive time in the car when it might have been convenient and perceived as a good use of time but he knew I would have too many distractions to absorb the salient points he was making.

I feel fortunate to have the opportunity to pass these along to you.  Hopefully they will be useful in the pursuit of your career aspirations.  Perhaps some of you will share some of the more useful pieces of insight, advice, or coaching that you received in your career.

mike@pharmareform.com

Pharmaceutical industry marketing and sales are often blamed for promoting  “off label” prescribing and have been highlighted in prescription drug fraud and product liability cases.

If the healthcare market, industry critics, regulatory agencies, and patients are looking for a way to control and reduce the influence of pharmaceutical company advertising and promotion on prescription drug choice, they should step up and take responsibility for the decisions they are making.  Don’t blame the drug companies for prescribing and reimbursement choices being made by the healthcare market.

Nobody is forcing physicians to prescribe these drugs.  Nobody is forcing insurance companies or the government to reimburse prescriptions written for “off-label” uses.  Nobody is forcing patients to take drugs for unapproved uses or to take drugs that might result in side effects or adverse reactions.  These are all conscious choices.

Information about the appropriate use of prescription drugs and the known potential risks associated with taking these drugs is readily available in the prescribing information (FDA approved label claims or package insert) for each drug.

One would think that prescribing decisions would be based on careful evaluation and assessment by the healthcare market, physicians, and patients and not driven by the influences of pharmaceutical company marketing and sales activities.  How irresponsible is it for physicians, government agencies, or insurance companies to accuse drug company advertising and promotion for determining their prescribing practices or reimbursement policy rationale?  It is also not credible to suggest the government (including state agencies) and insurance companies are being duped by drug companies and are blindly reimbursing for drugs prescribed for “off-label” uses.

So how should this be working?  (I am not trying to be a lawyer here, just proposing how it should be working)

• When a physician and a patient decide to use a product, it should be implicitly acknowledged that they are aware of and understand the information in the product prescribing information (FDA approved label claims and safety information).  If the patient does not understand the information in the product label or the implications of the wording in the product label, it is the physician’s responsibility to help them understand the potential risks and benefits.
• The patient has a choice to take the drug or not based on the information they receive from the physician (and they can read the product prescribing information themselves, if they want to).  By deciding to take the drug, patients acknowledge they are aware of the potential for side effects and adverse reactions and accept these risks (shouldn’t be able to come back and sue the pharmaceutical company for something that is in the package insert).  They have made an informed choice to accept the risks.
• Pharmacists, before dispensing a prescription, should make sure patients understand how to take their medications and the potential side effects, adverse reactions, and food or drug interactions.  Dispensing pharmacists should be accountable for making sure patients understand the risks.
• Physicians should prescribe products only for the FDA approved label claim indications.  Physicians who prescribe and patients who decide to take a drug for an “off-label” indication or use should assume the product liability for how the patient responds to the drug (lack of efficacy or any resulting side effects and adverse reactions). They have made a conscious informed decision and choice to prescribe the product for a use for which the manufacturer has not obtained sufficient evidence of safety or efficacy (FDA approval).
• Government programs (e.g., CMS), private insurance companies, healthcare provider plans (including state government programs), and pharmacy benefits managers should reimburse only for FDA approved label claim indications.  By providing reimbursement for “off-label” uses, I believe they are complicit in the promotion of “off-label” use of prescription drugs.  The lack of reimbursement makes the promotion of products for “off-label” uses much less attractive for drug companies.
• Insurers (private or public) who provide reimbursement for off-label uses of a product should assume all product liability for its “off-label” use, including lack of efficacy or any resulting side effects or adverse reactions. (can’t come back and sue the pharmaceutical company)
• Insurers (private or public) who agree to reimburse for “off-label” use of a product should not be able to sue for false claims or fraud related to that “off-label” use.  The insurer knows the physician has made a conscious decision to prescribe the product for an “off-label” use, the patient has been informed of this decision and how it was reached (discussion with the physician), and the reimbursing insurer has the prescribing information against which to evaluate their decision.  By providing reimbursement, the insurer acknowledges agreement with these decisions and should accept the potential liabilities.

If the healthcare market, insurers, physicians, and patients don’t want to be influenced by drug company advertising and promotion, they can simply take responsibility for the drug treatment choices and reimbursement decisions they make.  The ready availability of FDA approved prescribing information leaves little excuse to be unduly or inappropriately influenced by drug company marketing and sales activities.  In fact, isn’t it embarrassing to admit that prescribing and reimbursement decisions are based more on pharmaceutical company marketing and sales than medical information and clinical judgment.

So quit blaming drug companies for prescribing choices and reimbursement decisions.  mike@pharmareform.com