Largest criminal fine imposed by US in any matter   

Last week, the Department of Justice (DOJ) announced that its investigaton and several whistle-blower, or qui tam lawsuits had lead to a $2.3 billion dollar settlement resolving the alleged criminal and fraudulent marketing and promotion of the drug Bextra by Pfizer (NYSE: PFE), as well as their illegal promotions of 12 other drugs.  The settlement included $1.2 billion criminal fine for the felony promotion of Bextra, the largest ever imposed by the US for any matter.

 
The lawsuits were brought in response to the  regarding various civil and criminal charges connected to the fraudulent marketing and the payment of kickbacks. The settlement includes a guilty plea and a civil settlement of $1 billion, with $668 Million for federal programs, and the remainder going to reimburse States Medicaid costs.

What did Pfizer do?  

While the exact terms of the guilty plea are not available yet, it is alleged that Pfizer committed a felony by ‘misbranding’ the drug Bextra, or promoting its sale and use for treatments and at dosages above the maximum levels approved by FDA. (Bextra was approved by the FDA to treat symptoms associated with osteoarthritis, rheumatoid arthritis and primary dysmenorrheal. While a doctor can prescribe a drug for any use, a drug manufacturer may not promote any use other than that which has been approved by FDA.)  The settlement agreement describes the DOJ allegations that Pfizer acted illegally by:

• Making false and misleading claims of safety and efficacy of Bextra in sales materials and sales messages;
• Promoting Bextra directly to physicians, using  payments disguised as so-called advisory boards, consultant meetings, or  travel to lavish resorts;
• Creating sham requests in order to send unsolicited information to physicians about unapproved uses and dosages;
• Sponsoring  purportedly independent continuing medical education programs (“CME”) to disseminate specific messages about unapproved uses of Bextra;
• Promoting Bextra for unapproved uses and dosages by initiating, funding and sometimes ghostwriting scientific articles about Bextra for unapproved uses, without appropriate disclosure of Pfizer’s role in preparing the article, and;
• Providing  promotional samples and otherwise promoting Bextra for unapproved uses and dosages to surgeons and other medical prescribers who had no FDA-approved use for the Bextra samples, or at that dosage;

But wait, there’s more: Pfizer’s off-label promotion and deceptive marketing of twelve other drugs

The settlement also releases other claims related to the DOJ’s allegations that Pfizer “made and /or disseminated unsubstantiated and/or false representations or statements about the safety and efficacy of” of the drugs Geodon, Zyvox, and Lyrica, and that Pfizer “offered and paid illegal remuneration to health care professionals to induce them to promote and prescribe” these drugs for various time periods between 2001 and 2008. Further, the agreement notes that the DOJ claims that such promotions were for ‘off-label’ uses, i.e. for uses not approved by FDA.

The settlement also resolves the federal government’s claims regarding “kickback” or other “illegal remuneration” paid by Pfizer “to health care professionals to induce them to promote and prescribe the drugs Aricept, Celebrex, Lipitor, Norvasc, Relpax, Viagra, Zithromax ,Zoloft, and Zyrtec,” from  “January 2001, through December 2004….” This “illegal remuneration” took the form of “speaker programs, mentorships, preceptorships,journal clubs, and gifts (including entertainment, cash, travel and meals)….”

What’s next:  increased government oversight of Pfizer

In addition, as part of the settlement, Pfizer has entered into a comprehensive five-year Corporate Integrity Agreement with the Office of Inspector General in the Department of Health and Human Services.  This allows monitoring for the next five years. Pfizer will also:

• Publicly disclose on its website information about payments to doctors, honoraria, travel or lodging;
• Notify doctors about this settlement and establish a mechanism by which doctors can report questionable conduct by any Pfizer representative;
• Undergo an annual audit of their Board of Directors;
• Have their senior executives certify annually that Pfizer is in compliance with the Corporate Integrity Agreement, and
• Proactively identify potential risks associated with promoting individual products and then it implement a plan to mitigate the identified risks.

If Pfizer fails to meet the requirements in its Corporate Integrity Agreement, it could face higher penalties AND be barred from inclusion in Federal health programs, like Medicare and Medicaid.

Pfizer: don’t settle for second:

Interestingly, Pfizer had paid $430 million to settle a criminal and civil case brought by federal and state prosecutors regarding the off-label promotion of the anti-epilepsy drug Neurontin. Entered into in just 2004, this agreement included what the DOJ described as a “$240 million criminal fine, the second largest criminal fine ever imposed in a health care fraud prosecution” at the time. However this new $2.3 Billion dollar settlement puts Pfizer in the lead, and easily outpaces the last government settlement for $1.42 Billion with Eli Lilly over the marketing of Zyprexa.  

The size of the new $1.2 billion criminal fine may be in response to that fact that Pfizer’s 2004 settlement also included a ‘compliance program.’  We hope this record fine, and the continued watchful eye of HHS will help to keep Pfizer in line. But with billions of dollars in profits from off-label promotion of their many drugs, only time will tell.

Benefits for consumers: not yet, but stay tuned

We here at PAL are glad to see this settlement, and to see signs that the DOJ is actively investigating abuses by the pharmaceutical industry.    Mr. Tony West, Assistant Attorney General for the Civil Division of the Department of Justice, describes what’s at stake:

“Illegal conduct and fraud by pharmaceutical companies puts the public health at risk, corrupts medical decisions by health care providers and costs the government billions of dollars. This civil settlement and plea agreement by Pfizer represent yet another example of what penalties will be faced when a pharmaceutical company puts profits ahead of patient welfare”

But this settlement does not include any compensation for consumers, union benefit funds, or insurers who paid for Bextra. A seperate agreement has been reached with Pfizer concerning their promotion of Bextra and Celebrex, with consumers and private, non-governmental insurers to share $89 million to settle suits brought by consumers and “third party payors” who alleged that they defrauded by Pfizer’s marketing and failure to disclose the risks of the drugs.  Please keep your eye on our blog, or check our website for updates on consumer settlements.

The brand-name pharmaceutical industry constantly pushes the myth that its expensive blockbusters are breakthrough treatments that greatly increase people’s health and well-being, and thus are worth the high price-tag. That myth has more holes than a slice of swiss cheese, yet they keep pushing it on the American public like it’s one of their drugs.

As Dr. Marcia Angell, former editor of the New England Journal of Medicine and author of “The Truth About the Drug Companies” (see an interview with Dr. Angell in PAL’s newsletter here) famously said, “Important new drugs do not need much promotion. Me-too drugs do.” So drugs which offer little breakthrough in treatment need to be (over)hyped.

For years, the drug industry has touted antidepressants (particularly SSRIs - Selective Serontin Reuptake Inhibitors — Prozac, Paxil, Wellbutrin, Zoloft, Celexa, Lexapro, etc. as one of its major successes. Yet, this week, a major meta-analysis (a study that reviews the full range of studies and articles on a particular drug) was published in the open-access medical journal PLoS (Public Library of Science) Medicine. That article concluded that, for the majority of patients, SSRI antidepressants are barely better than a placebo.

It’s likely that patients in the U.S. (and their health plans, and government health care programs like Medicare, Medicaid, the Veterans Administration, the military health care plan Tri-Care, etc) have spent tens of billions of dollars on antidepressants in the past decade, despite the fact that for many of them, it was likely a waste of money, exposed them to the risk of side effects, and may have resulted in their not availing themselves of other non-pharmaceutical options for treating their depression.

The billions that the industry spent on marketing these drugs, both to consumers and to doctors, led millions to believe that relief was just a pill away (We gave the makers of Paxil, one of these antidepressants, one of our Bitter Pill Awards in 2005, the Cure for the Human Condition Award: For Hawking Pills to Treat the Trials of Everyday Life).

Drugs for depression are just one of numerous groups of drugs for which the benefits are overhyped and people for whom an expensive drug is unnecessary or overkill are convinced to take it in lieu of something cheaper, that’s been around longer and whose risks and benefits are more well known.

“Statin” drugs for reducing high cholesterol are another group of drugs that have been massively overhyped, and that also have been in the news a great deal lately. Last month, the results of a study of Schering-Plough and Merck’s combination-cholesterol drug Vytorin, the ENHANCE study, were released, showing that it offered no benefit over simvastatin (Zocor), a statin that last year went generic. Vytorin is a combination of Zocor and Zetia, which is also sold by itself. Vytorin and Zetia together have more than $5 billion in sales.

Statin drugs have also been in the news because of the revelation that Dr. Robert Jarvik, Pfizer’s boat-rowing pitchman for Lipitor, is not a licensed physician, cannot write a prescription for Lipitor or any drug for that matter, and is not even a rower (a stunt double was used in the Lipitor ads). We’ve blogged about Jarvik-gate here on several occasions, including proposing some other famous “doctors” who aren’t licensed physicians that Pharma ought consider using as paid flaks — including Dr. Teeth from the Muppets, Basketball legend Dr. J, Dr. Nick Riviera from the Simpsons, and New Orleans musical legend Dr. John).

Of course, the real Lipitor story is not Dr. Robert Jarvik and his rowing and prescribing credentials. At best, he’s a bit player in this drama. The real story is how incredibly overhyped Lipitor is. Pfizer boasts it’s the “most powerful” statin as though that means that everyone with high cholesterol should be on it. But for many (perhaps most) people with high cholesterol, using Lipitor is like using a chainsaw to cut paper instead of scissors: that is, unnecessary overkill. Members of the PAL coalition filed a lawsuit against Pfizer in 2005, alleging that Lipitor had been overhyped and promoted to patients for whom it offered no benefit, and we gave them and AstraZeneca, the makers of Crestor, a Bitter Pill Award in 2006: The “Got Cholesterol?” Award: For Overpromoting Expensive Brand-Name Statins.

But even that’s not the real story — there are larger questions about statins. For instance, does lowering your cholesterol translate into a lower risk of heart attack or heart deaths on January 17 was Do Cholesterol Drugs Do Any Good? Research suggests that, except among high-risk heart patients, the benefits of statins such as Lipitor are overstated.

Here are a few choice excerpts:

[Statins] are the best-selling medicines in history, used by more than 13 million Americans and an additional 12 million patients around the world, producing $27.8 billion in sales in 2006. Half of that went to Pfizer for its leading statin…
The second crucial point is hiding in plain sight in Pfizer’s own Lipitor newspaper ad. The dramatic 36% figure has an asterisk. Read the smaller type. It says: “That means in a large clinical study, 3% of patients taking a sugar pill or placebo had a heart attack compared to 2% of patients taking Lipitor.”

Now do some simple math. The numbers in that sentence mean that for every 100 people in the trial, which lasted 3 1/3 years, three people on placebos and two people on Lipitor had heart attacks. The difference credited to the drug? One fewer heart attack per 100 people. So to spare one person a heart attack, 100 people had to take Lipitor for more than three years. The other 99 got no measurable benefit. Or to put it in terms of a little-known but useful statistic, the number needed to treat (or NNT) for one person to benefit is 100.

Compare that with, say, today’s standard antibiotic therapy to eradicate ulcer-causing H. pylori stomach bacteria. The NNT is 1.1. Give the drugs to 11 people, and 10 will be cured.

A low NNT is the sort of effective response many patients expect from the drugs they take. When Wright and others explain to patients without prior heart disease that only 1 in 100 is likely to benefit from taking statins for years, most are astonished. Many, like Winn, choose to opt out…

NNTs are the “dirty little secret” of the world of prescription drugs. And a perfect illustration of how hyping drugs through advertising to consumers and marketing to doctors (through the 100,000 salespeople employed by drug companies, self-serving biased clinical trials and corporate-influenced “continuing medical education”) doesn’t benefit patients. As the article says,

The truth about drugs’ effectiveness wouldn’t be as worrisome if consumers and doctors had an accurate picture of the state of knowledge and could make rational decisions about treatments. Studies by Darlington Hospital’s Trewby, UBC’s Wright, and others, however, show that patients expect far more than what the drugs actually deliver…

The whole statin story is a classic case of good drugs pushed too far, argues Dr. Howard Brody, professor of family medicine at the University of Texas Medical Branch at Galveston. The drug business is, after all, a business. Companies are supposed to boost sales and returns to shareholders. The problem they face, though, is that many drugs are most effective in relatively small subgroups of sufferers. With statins, these are the patients who already have heart disease. But that’s not a blockbuster market. So companies have every incentive to market their drugs as being essential for wider groups of people, for whom the benefits are, by definition, smaller.

Finally, an excellent piece posted today on Alternet examines the statin and cholesterol controversy in detail: The Cholesterol Con — Where Were the Doctors?

Last month, the House Energy and Commerce Committee announced that it would be looking into the use of celebrities in drug advertisements, and in particular into the appearance of Doctor Jarvik in Pfizer’s ads for Lipitor. We posted “Should you trust Dr. Jarvik on Lipitor?” discussing this investigation. It was revealed back then that Dr. Jarvik has never had a license to practice medicine, is not a cardiologist and thus has never written a prescription.

The New York Times ran an article today, ““Drug Ads Raise Questions for Heart Pioneer” describing the dust-up, and providing some additional damning details that don’t exactly improve the credibility of Dr. Jarvik or Pfizer.

Here’s some of the juicier excerpts:

The ads depict Dr. Jarvik rowing on a lake. But…

And, for that matter, what qualifies him to pose as a rowing enthusiast? As it turns out, Dr. Jarvik, 61, does not actually practice the sport. The ad agency hired a stunt double for the sculling scenes.

“He’s about as much an outdoorsman as Woody Allen,” said a longtime collaborator, Dr. O. H. Frazier of the Texas Heart Institute. “He can’t row.”

Rep. John Dingell (D-MI), who is leading the investigation, said:

“It seems that Pfizer’s No. 1 priority is to sell lots of Lipitor, by whatever means necessary, including misleading the American people,” Mr. Dingell said.

Lipitor, the world’s single best-selling drug, is Pfizer’s biggest product, generating sales of $12.7 billion last year. But as it has come under competition from cheaper generic alternatives, Pfizer has used the Jarvik campaign, introduced in early 2006, to help protect its Lipitor franchise.

Pfizer spent $258 million from January 2006 to September 2007 advertising Lipitor, according to TNS Media Intelligence. Much of that went for the Jarvik campaign.

Spending $258 million to get $12.7 billion is a pretty good return on investment. Of course, that number doesn’t include the other promotional spending to drive up Lipitor prescriptions, such as the cost of pharmaceutical “salespeople” and free “samples.” Assume for the sake of argument that Pfizer spent as much on those types of promotion as they did on ads, for a total of a strictly-hypothetical $516 million. That’d be a return of 2,460%. Not bad at all. (Of course, not all of the spending on Lipitor in 2007 can be attributed to the marketing, but the returns are still pretty handsome.)

Moving on…

Despite the efforts by industry and government to curb drug advertising, spending on consumer drug ads increased more than 300 percent from 1997 to 2007, when it reached about $4.8 billion.

There are various estimates for how much in additional sales you get for each dollar you spend in consumer drug ads. They range from $1.50 to $4.20. Pretty good returns no matter how you slice it.

And back to the row about the rowing…

A newsletter published by the Lake Washington Rowing Club in Seattle describes how one of its rowers was a stunt double in the ad for Dr. Jarvik. The sculler, a professional photographer and rowing enthusiast named Dennis Williams, was picked partly for his size and partly because, like Dr. Jarvik, he has a receding hairline, according to the newsletter, which said a crew filmed the commercial for three days at Lake Crescent, near Port Angeles, Wash.

In the ad, Mr. Williams was shown as a solitary sculler navigating an unspoiled lake. Through deft editing, he appeared to be Dr. Jarvik. But, in fact, the frames that actually included Dr. Jarvik were shot in a rowing apparatus on a platform, according to the newsletter.

So Jarvik’s not a licensed MD, not a rower. Does he really even take Lipitor? Is that really his receding hairline, or it’s a hair-double’s? (Of course if you were going to have a “hair-double,” you’d go for the full head of flowing locks, right?)

In conclusion, we have the world’s best-selling drug owing a likely-good-sized-chunk of its success to the appearance of a man whose credibility, at this point, is highly questionable. I’d suggest that, rather than shying away from featuring “doctors” in drug ads who aren’t really doctors, perhaps drug companies should embrace it. In the style of “I’m not a doctor, but I play one on TV.”

Certainly, there are many actors and other non-medical celebrities who play doctors who probably have more credibility with many viewers than real doctors. I offer here a few suggestions:

Zach Braff, who plays Dr. John Dorian on the hit comedy “Scrubs.”

Katherine Heigl, who plays Dr. Izzy on Grey’s Anatomy. (But she also starred earlier in her career in “Side Effects,” an independent film poking fun at drug company salespeople, so perhaps not… Incidentally, I appear in Money Talks: Profits before Patient Safety, a documentary about the drug industry that Kathleen Slattery-Moshkau, the director of Side Effects did as a nonfiction counterpart to her comedy feature. So if we’re playing “Six Degrees of Katherine Heigl” that means there’s just two degrees between me and Dr. Izzy. We’re practically cousins. Katherine, how come you never call?)

Dr. Teeth, bandleader of the “Electric Mayhem,” a regular staple on the Muppets in the late 70s. With the kids who grew up with the Muppet Show rapidly approaching and entering their 40s, he might be perfect.

Dr. J, aka Julius Erving, legendary basketball player

Dr. Nick, intrepid medical provider to the denizens of The Simpsons, known for his distinct “Hi Everybody!” greeting, demonstrating his solid bedside manner and approachability.

Dr. John, famed New Orleans musician.

I could go on like this all day. Other suggestions of famous doctors, medical or otherwise, that Big Pharma should recruit for drug ads? Post a comment with them…

Pfizer’s commercials for Lipitor featuring Dr. Robert Jarvik, “inventor of the artificial heart,” are probably among the most recognized drug ads on TV today. The ads rely on us viewers assuming that because Dr. Jarvik supposedly invented the artificial heart, he must be an authority on cholesterol… Right? The ad above has Dr. Jarvik saying “Just because I’m a doctor doesn’t mean I don’t worry about my cholesterol.”

Hmmm… What if the ads also said that Dr. Jarvik never actually practiced medicine, and in fact never even got licensed to practice medicine? Suddenly, he doesn’t seem like that much of an authority, does he?

Well, apparently that is the case. The Energy and Commerce Committee of the US House of Representatives is investigating “the use of celebrity endorsements of prescription medications in direct-to-consumer advertising, specific to Dr. Robert Jarvik’s appearance in Pfizer’s Lipitor Commercials,” according to the Committee’s press release:

Washington, D.C. – Reps. John D. Dingell (D-MI), Chairman of the Committee on Energy and Commerce, and Bart Stupak (D-MI), Chairman of the Subcommittee on Oversight and Investigations, announced today that they are opening an investigation into the use of celebrity endorsements of prescription medications in direct-to-consumer advertising, specific to Dr. Robert Jarvik’s appearance in Pfizer’s Lipitor Commercials.

“We are concerned that consumers might be misled by Pfizer’s television ads for Lipitor starring Dr. Jarvik,” said Dingell. “In the ads, Dr. Jarvik appears to be giving medical advice, but apparently, he has never obtained a license to practice or prescribe medicine.”

“Dr. Jarvik’s appearance in the ads could influence consumers into taking the medical advice of someone who may not be licensed to practice medicine in the United States,” said Stupak. “Americans with heart disease should make medical decisions based on consultations with their doctors, not on paid advertisements during a commercial break.”

It’s not surprising that Pfizer chose Dr. Jarvik as its spokesperson. In the past three years, we’ve seen a stampede of white coats in drug ads — either actual doctors or actors dressed up like doctors. The white coat conveys authority and gravity to the ads.

But there’s something very bothersome about using a “Doctor” who has no license to practice medicine, and who in fact apparently has never done so, to advertise Lipitor. And that is the fact that particularly when it comes to cholesterol medications, the prescribing details matter. The decision of whether to prescribe a statin (such as Lipitor, Crestor, Zocor, Pravachol, etc.) and which statin to prescribe are ones that require a fair amount of knowledge and experience on the part of the doctor — different patients need different statins, different statins have different side effects. So who should use Lipitor -versus another statin or even versus just changes to diet and exercise – are complicated questions requiring doctors to know a fair amount. Yet Pfizer has Dr. Jarvik, who can’t even practice medicine, advising consumers to take Lipitor!

It’s a measure of what Pfizer thinks of us lowly consumers that they use a celebrity doctor spokesperson who can’t even prescribe the product they’re endorsing.

What with the recent flap over Montel Williams, PhRMA’s patient assistance spokesperson, threatening to “blow up” a high school student, and now the revelation about “Doctor” Jarvik, it makes us wonder whether celebrities are the best choice for drug ads…

p.s. To get unbiased info on what statin makes sense for which patients, see Consumer Reports Best Buy Drugs report on statins.

See also an Associated Press article on this dust-up.

Hat-tip: FiercePharma

Yesterday IAG Research released “the latest syndicated data for the most memorable new prescription drug ads launched during the 2006/2007 TV season.”

The results were not surprising — some of the drug ads that many of us love to hate topped the list for “memorability.” What’s galling is that even those of us who hate them have been affected by them.

Not surprisingly, a number of winners of PAL’s coveted Bitter Pill Awards were among those most recalled. Our Bitter Pill Awards particularly seek to call attention to those drug ads that elevate image over substance, or that overpromote expensive brand-name drugs that most people don’t need. Among those deemed most memorable were Lunesta (see its While You Were Sleeping Award here), Lipitor (Got Cholesterol? Award here), Crestor (ditto)and Cialis (Performance Anxiety Award here)

IAG’s press release says:

Whether it is a moth, a talking bee or a dead president and beaver, this season’s ranking of the most memorable new ads is dense with unique icons that have become the cornerstone for successful campaign development in this industry. Icons have taken the shape of human and animal figures as well as symbols such as Vytorin’s “food and family” split screen comparison or Cialis “outdoor tubs”.

“The fact that Lunesta along with other prescription brands including Nasonex, Rozerem and Vytorin remain at the top is a testament to strong campaign development that continues to deliver seamless creative extensions that effectively break-through the clutter and reinforce the brand identity synonymous with the icon present in the ads,” said Ms. Fariba Zamaniyan, Sr. Vice President of IAG Research’s Pharmaceutical Practice.

In other words, the key is to find an eye-catching image that “reinforce[s] the brand identity.” What about whether the drug is effective, or what the side effects are, or how it compares to other treatments? Is this information what constitutes the “clutter?”

IAG measured memorability this way:

The Recall Score is the percentage of TV who can recall within 24 hours the ad and the brand they were exposed to during the normal course of viewing TV. These scores are then indexed against the mean score for all new ads during the period (Recall Index). 100 equals average.”

Noticeably absent is anything about whether the viewers could recall anything important about the drug after 24 hours — like the risks and side effects, and who should not take the drug. It’s safe to say that while people probably remember the Lunesta luna moth, they probably don’t remember “In rare cases, severe allergic reactions can occur. Most sleep medicines carry some risk of dependency. Do not use sleep medicines for extended periods without first talking to your doctor. Side effects may include unpleasant taste, headache, drowsiness and dizziness.”

Here’s the list for most recalled ads, courtesy of IAG:

Rank	Brand	Company	Ad Description	Recall Index
1	Lunesta	Sepracor	7-Night Challenge; luna moth flies over bridge and water and into people’s homes/tents. (:60)	157
2	Lunesta	Sepracor	7-Night Challenge; luna moth flies over a lake into couple’s home, then onto woman’s pillow. (:60)	155
3	Zyrtec	Pfizer	Story #43; clothes falls on woman and she sneezes. (:45)	140
4	Nasonex	Schering-Plough	Animated bee talks about prevention of nasal allergy symptoms while buzzing next to Nasonex bottle. (:30)	138
5	Rozerem	Takeda	Abraham Lincoln, talking beaver, man in suit and man in diving suit at a bus stop; your dreams miss you. (:60)	136
6	Lipitor	Pfizer	Dr. Robert Jarvik in white lab coat discusses risk of heart disease and stroke caused by high cholesterol. (:60)	126
	Crestor	AstraZeneca	Man at fish market near ocean whose cholesterol is out of wack; his body splits into various sections. (:60)	126
	Vytorin	Merck/Schering-Plough	Plates of food shown next to shots of relatives such as Grandpa Bow and bowtie pasta. (:60)	126
7	Valtrex	GlaxoSmithKline	Couple talks about the risks of contracting herpes; 70% of people affected got it from their partner. (:60)	124
	Cialis	Eli Lilly	Couples in various romantic places including laying in front of fireplace, in restaurant, in rowboat and laying on hammock. (:60)	124
8	Gardasil	Merck	Young women including a cowgirl, colorguard, gymnast and softball player say they want to be “One Less” (:60)	120
	Caduet	Pfizer	Woman in red vest walks along a beach; splits into two and says she has high blood pressure & cholesterol. (:60)	120

Hat tip: The irrepressible Pharmalot

In the past several months, WCVB in Boston has run two reports on insurers giving financial incentives to doctors to switch patients off the expensive brand-name cholesterol drug Lipitor (made by Pfizer [NYSE:PFE] and on to a cheaper drug, either generic or brand-name. The most recent was earlier this week: “Doctors May Not Reveal Full Truth Behind Rx Switch.” The tone of the pieces has been one of shock and disbelief, that doctors are receiving some form of payment for making these switches. These reports tell about 1/5 of the real story.

The first key fact, mentioned in passing in the story, is that most patients that need a statin don’t need Lipitor – Lipitor is the “most powerful” statin available, but as one Doctor in the story says, “the vast majority of patients you can get to goal [i.e. get to the desired cholesterol level] with Simvastatin [a generic which used to go by the brand name Zocor] and if you can get them to goal for less money, less money to society, less money to them out of pocket, that’s what we should do.” And with drugs like statins, “more powerful” is not necessarily better — but it is more expensive. If patients’ cholesterol can be lowered to the needed level with a generic, then it should be.

But what about the “payments” to doctors? The story claims that insurers are paying doctors to switch their patients — the story is noticeably silent on the details of these payments:

Many doctors get a financial benefit from insurers through a complicated formula if they switch enough patients off of brand names to generics. Patients see that they are saving money on co-pays, but do they know their physicians are making money?

The choice of phrase “complicated formula” suggests that it’s not a straight payment — i.e. switch a patient, get a check. If it were such a one to one transaction, you can be sure that the story would have made strong emphasis of that fact. So, if, as it seems, the payment is more indirect — i.e. the number of patients that a doctor switches off of Lipitor is part of a larger reimbursement formula, then is there a problem with giving doctors an incentive, even a financial one?

Maybe, maybe not. But let’s put it in context. There are numerous “incentives” pushing doctors to prescribe particular drugs. Let’s look at those incentives and ask where they really stack up:

• 100,000 drug salespeople who work for drug companies like Pfizer (maker of Lipitor) descend on doctors’ offices every day, delivering slick sales pitches on why they should prescribe their patients the most expensive brand-name drugs instead of cheaper and equally effective generics.
• These same drug salespeople come bearing pens, prescription pads, and other gadgets emblazoned with the drug’s name and logo, along with drug samples, lunches for the entire staff, invitations to meals at fancy restaurants where there will be a presentation about the wonders of their drug, and of course a healthy dose of flattery.
• These sales reps enter the office with data purchased from local pharmacies, so they know exactly how many prescriptions the doctor is writing for their drug versus their competitors, and how that rate has changed since the last visit the salesperson made — allowing them to tailor their pitch to that doctor.
• When the doctor opens up the pages of medical journals, they see them plastered with ads for the drugs the salespeople are hawking.
• The doctor may then attend a Continuing Medical Education seminars (a certain number of which doctor must attend each year to keep their license to practice) where the speaker is a paid consultant of the company.
• Doctors who are high-prescribers of the drug or well-known in their region are designated as “thought leaders” and may be invited to be a consultant or part of a “speakers’ bureau” for the company, receiving a payment in return.

And so on, and so on.

As you can see, there are many “incentives” that drug companies give to doctors to get them to prescribe a certain drug over another. Some of them are financial — some are not. But they all influence the doctors’ choice of what drug to prescribe — and more often than not, it influences them to prescribe a newer, more expensive drug, regardless of whether that drug is more expensive or not. These tactics work, otherwise drug companies would not spend more than $20 Billion a year marketing to doctors.

And let’s not forget that drug companies have enlisted us, the consumer, as an unpaid member of their sales force. The pharmaceutical industry spent around $5 Billion on “direct to consumer” drug ads in 2006. Lipitor, the best selling drug in the U.S. and the world, spent $138.2 Million on Lipitor ads in 2006 (see our post, “Top 3 Bestselling Drugs spent $460.5 Million on Ads in 2006″), most of them featuring Dr. Robert Jarvik, inventor of the artificial heart, waxing ecstatic about Lipitor. After the sales rep has visited, and the doctor has seen the ads in the medical journal, and attended the dinner at the fancy restaurant, and gone to the seminar where a colleague who’s on the drug company’s payroll has preached the wonders of the drug, into the office comes the consumer, who says they saw an ad for Lipitor on TV, and that’s the drug they want.

So into this tangled web of pharmaceutical company influence and incentives comes the insurance company, also offering an incentive. Does this make the insurance company’s incentive right? Not necessarily. But to focus only on the insurance company in this equation, to express shock and horror at their incentive while ignoring the morass of promotion and persuasion used by the drug company, is to entirely ignore the full picture and the real story.

But reporting on that whole picture doesn’t make for a nice, neat, 3 minute “news” piece, does it? And what impression does a story like this leave in viewers’ minds? A PAL staffer did a presentation yesterday at a Senior housing complex, two days after the story aired, and the attendees overwhelmingly said that they had seen the report, and that they were led to believe from it that generics are not as effective – a message that was strongly implied by the story but which is a significant distortion of the truth.

(Postscript: If you’re curious about what statins are appropriate for which people, check out Consumer Reports’ Best Buy Drugs report on them)

In the wake of the drug safety scandals of the past few years (Vioxx, Celebrex, Paxil, etc), there were widespread predictions that Direct-to-Consumer Advertising (DTCA) of prescription drugs (TV commercials, magazine ads, etc) would become less prevalent and less effective. Both predictions have proven false — spending on consumer drug ads hit an all-time high in 2006 of $4.8 billion. And the makers of the top three best-selling drugs in the U.S. in 2006 spent a combined total of $460.5 million on drug ads last year. See the chart below.

(Sources: IMS Health, “Top 10 Products by U.S. Sales”, and DTC Perspectives, June/July 2007)

Of course, not every prescription for these drugs is due to advertising. But, for each of these drugs, aggressive advertising to consumers has significantly contributed to their sales. The worst (or best, depending on your perspective) example of this is Nexium. Nexium, the so-called “healing purple pill” is nothing more than an isomer of Prilosec — in essence, Nexium is a molecular “mirror” of the Prilosec molecule. However, there’s essentially no difference between Nexium and Prilosec in terms of their effectiveness. AstraZeneca has aggressively marketed Nexium as though it were some miraculous improvement, despite an amazing lack of evidence that this is the case.

For this, Nexium earned one of Prescription Access Litigation’s coveted “Bitter Pill Awards” in 2005: The “Least Extreme Makeover Award: For Dressing Up an Old Drug with a New Name and a New Price Tag.” It is truly a strange world in which a drug that is essentially no better than its now-much-cheaper predecessor can rake in $4.3 billion in sales in the U.S. alone. The reason? Aggressive marketing — not just to consumers, but to physicians as well.

It calls to mind an excellent quotation by Dr. Marcia Angell, former editor of the New England Journal of Medicine and author of The Truth About the Drug Companies:

T]o rely on the drug companies for unbiased evaluations of their products makes about as much sense as relying on beer companies to teach us about alcoholism…The fact is that marketing is meant to sell drugs, and the less important the drug, the more marketing it takes to sell it. Important new drugs do not need much promotion. Me-too drugs do.”

And that’s enough right there to give you heartburn.