As we discussed here last week, the U.S. Supreme Court is currently deliberating over whether pharmaceutical companies can collude to reap $3.5 billion a year in excess profits from American patients. Named FTC v. Actavis (and informally referred to as “The Androgel Case”), this case addresses whether it was legal for a brand name company to pay its generic competitor to delay generic Androgel from coming to the market. Why does this matter to you? Because the generic is up to 10 times cheaper than the brand name drug and Androgel is not the only brand name drug where a generic has been delayed. As Columbia University professor Scott Hemphill puts it, “[A] pay-for-delay settlement transfers wealth from consumers to drug makers, in the form of continued high pharmaceutical prices, with brand name firms sharing a portion of that transfer with the generic firm.”
The decision in this case would have far-reaching impact on the price of at least 140 different drugs whose costs have remained high because of such back-room deals. Since the Court heard oral arguments in the case last Monday, the Washington Post, Boston Globe, and smaller newspapers such as Sonoma County’s Press Democrat have all come out in agreement with us: these payments have to stop. Why?
The financial burden of monthly out-of-pocket drug costs has forced millions of Americans without drug coverage to cut back on taking their drugs or delay other health care. Even if you have insurance, co-pays for a brand name drug whose generics have been blocked can be a significant hardship—and your insurance company pays more, too. For example, the price of the drug Provigil skyrocketed from $300 a month in 2007 to over $1,000 per month in 2010 because in 2005 and 2006, Provigil’s manufacturer, Cephalon Corp. paid $136 million to four different generic drug companies to delay generic Provigil for 6 years—while Cephalon made more than $3 billion on U.S. sales of Provigil. In response, many insurers stopped covering the drug, forcing consumers onto Cephalon’s new drug “Nuvigil,”which many consumers reported to be less effective.
Meet two patients whose lives were turned upside down by the pay-for-delay deals that kept generic Provigil off the market:
A state librarian in Fayetteville, MI, Tanna has been taking Provigil for more than ten years to treat idiopathic hypersomnia, a disease causing excessive sleep. Her son has narcolepsy, a related disease. When Tanna’s son first received his diagnosis, he was on Provigil as well, but Tanna’s insurance company forced them both to switch to Nuvigil. Neither of them could tolerate the drug and her son successfully switched to an ADHD drug for his symptoms, but Tanna has tried everything and Provigil is the only drug that works for her.
Much of Tanna’s suffering ended after she was diagnosed and prescribed Provigil. She has obtained her Master’s in Library Science and is able to work – as long as she takes her medicine.
While Tanna says Provigil has given her life back, its high price exacted a toll in return. Instead of decreasing with time, Tanna’s copay more than doubled from $35 a month in 2005 to $75 a month in 2009.
“If ten years ago, someone told me the percentage of my salary I’d be paying a month in health-related costs now, I’d say they were crazy,” Tanna said.” We’ve managed to pay our bills, but I have no savings, no safety net. We’ve done what families do – we’ve used credit cards. There’s no way I can ever think of retiring, but I always wanted to work, so I guess I’m getting my wish.”
While her doctor promised there would be a generic version of Provigil in2008, she has only seen the price reduced in the past three months (her copay is now down to $12 a month).
Tanna knows the Supreme Court decision will greatly affect everyone who relies on prescription drugs.
“If they [the drug companies] win this case then they can do whatever they want. Forever,” she said. “We’re screwed.”
Prior to Karen’s diagnosis with multiple sclerosis (MS), she barely took an aspirin. In the eight years since her diagnosis, Karen, a busy mother of three, has relied on Provigil. Unfortunately, while Provigil gives Karen the energy she needs to function, it is prohibitively expensive. A resident of Clarkston, MI, she served as a worker’s compensation administrator at a major automobile company until her MS forced her to stop working in 2005. When Karen stopped working, she had two mortgages and three young children. As she discussed with Ed Silverman on Pharmalot, between 2007 and 2010 the price Karen paid for Provigil more than doubled, from $7.26 a pill to $16.87 a pill (with her insurance company paying half). During this time, she was unable to afford her prescription in addition to her normal household expenses, either skipping doses or splitting pills to reduce costs.
In 2011, Karen had a major MS relapse. While crippled by fatigue, she was overwhelmed by the price of Provigil – she could not afford to continue paying for her medicine out-of-pocket, so she had to stop taking it, despite her doctor’s recommendation.
Since a generic version of the drug was released in October of last year, Karen has been able to take her full dose and pays only $16 every three months. The release of generic Provigil and its lower cost has enabled Karen to lead an active life, spending more time with her family, volunteering at church and even hosting a Japanese exchange student.
The Rest of Us
Tanna and Karen are not alone – if you’ve paid for Androgel, Augmentin, BuSpar, Cardizem, Cipro, K-Dur, Nolvadex (tamoxifen), or Provigil, it is almost certain you’ve paid too much because of pay-for-delay deals based on records from the FTC and other lawsuits. Legal scholars and experts also suspect (the documents are secret) that pay-for-delay agreements have delayed generic versions of nearly fifty more drugs, including Lipitor, Plavix, Nexium, Zantac, Effexor XR, Lamictal Cipro, Adderall XR*, Wellbutrin XL (150 mg), Provigil*, Altace, Niaspan, Nolvadex (tamoxifen), Caduet, Zantac and many others (see full list in box).
If you have paid for one of these drugs in the last few years, you too might have been fleeced by a pay-for-delay agreement that kept a generic off the market. Please share your story with us, like Tanna and Karen did, and join them in the fight to stop these unfair deals, once and for all.
Khadijah M. Britton, JD, Program and Policy Associate
Drugs Likely to Have High Prices from Pay-for-Delay
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-yearCorporate 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 agreementhas 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.
It’s being widely reported this morning (See, for example, the WSJ article here and the AP article here) that Pfizer (NYSE:PFE) has agreed to settle the bulk of the lawsuits against it related to the increased risk of heart attacks and strokes from the painkillers Celebrex and Bextra.
The $894 Million settlement includes $745 million to settle 90% of the personal injury suits brought by patients who were allegedly physically injured by the drugs, $60 million to resolve primarily Bextra suits brought by Attorneys General in 33 states and the District of Columbia, and $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 into paying for them when they otherwise would not have.
Even after the increased risks of Celebrex, Vioxx and Bextra became common knowledge, Pfizer kept Celebrex on the market, and even resumed TV ads for it, running an unusually long ad which extensively described the drug’s risks, but sought to downplay the risks by claiming that all NSAIDS (the class of drugs Celebrex is in) carry the same risks. Here is the ad:
At the time of this entry, no further details about the settlement were available, and the settlement itself had apparently not been filed in Court (Pfizer’s press release described the settlement as “Agreements in Principle”)
The studies examined whether Neurontin was effective for conditions other than epilepsy. As the NY Times article describes,
Pfizer’s tactics included delaying the publication of studies that had found no evidence the drug worked for some other disorders, “spinning” negative data to place it in a more positive light, and bundling negative findings with positive studies to neutralize the results, according to written reports by the experts, who analyzed the documents at the request of the plaintiffs’ lawyers.
Neurontin has been an extraordinarily profitable drug for Pfizer, and most of the prescriptions written for it were not for epilepsy, but were “off-label” (prescribed for a use not approved by the FDA). In 2004, Pfizer paid $430 million to settle a criminal and civil case brought by federal prosecutors that charged that Warner-Lambert, which Pfizer acquired in 2000, had illegally promoted Neurontin for “off label” purposes in the 90s.
That $430 million settlement reimbursed state and federal health care programs (like Medicaid) that had paid for off-label prescriptions of Neurontin, but did not compensate consumers or “third party payors” (health plans, union benefit funds and others) that had also paid for such prescriptions. A number of class action lawsuits were brought against Pfizer, and they were consolidated in the U.S. District Court for the District of Massachusetts. The ongoing lawsuit is In re Neurontin Marketing and Sales Practices Litigation, MDL #1629, Docket #04-10981.
That case has been pending for several years, with the parties exchanging documents and arguing before the Court about whether a national class of consumers and third party payors can be “certified,” which is the prerequisite to the case going forward as a class action.
The documents that were recently released were part of “expert reports” submitted by the lawyers for the plaintiffs in the case. The reports both contain and analyze documents from Pfizer about its alleged illegal offlabel promotion of Neurontin.
Now that the reports and documents have been filed with the Court, they are a matter of public record. We here at Prescription Access Litigation subscribe to the maxim that “sunlight is the best disinfectant.” We are posting these reports and documents in their entirety so that the public can see them for themselves. They paint an interesting picture.
Note: There is a separate class action lawsuit in Calfornia state court against Pfizer for the same alleged off-label marketing of Neurontin in California, brought by several members of Prescription Access Litigation’s coalition. To read more about that suit, and the underlying allegations (which are the same as in the Massachusetts case), go here.
A $125 million settlement has been announced in a major class action lawsuit involving members of the Prescription Access Litigation (PAL) coalition. The case, In re Pharmaceutical Industry Average Wholesale Price Litigation, was originally filed in 2002, and claimed that the defendant drug companies intentionally inflated reports of the Average Wholesale Prices (AWPs) on certain prescription drugs administered in doctors’ offices and paid for by Medicare Part B. The PAL member organizations that are plaintiffs in the lawsuit are:
Until 2006, the published AWP was used to set the price that Medicare and consumers making Medicare Part B co-payments pay physicians for these drug. Private insurance companies and other third-party payors also use the AWP to determine how much to pay physicians. The lawsuit contends that
consumers and third-party payors paid more than they should because of the drug companies’ false AWP reporting.
The settlement includes branded and generic drugs used primarily in the treatment of cancer, HIV and other serious illnesses. Under the terms of the settlement 82.5 percent of the settlement fund is designated for third-party payors’ claims and the remaining 17.5 percent is designated for consumer claims.
The defendants included in today’s settlement are:
Aventis Pharmaceuticals Inc.
Hoechst Marion Roussel
Baxter Healthcare Corp.
Baxter International Inc.
Fujisawa Healthcare, Inc.
Fujisawa USA, Inc.
Pharmacia & Upjohn LLC
Gensia Sicor Pharmaceuticals, Inc.
Watson Pharmaceuticals, Inc.
ZLB Behring, L.L.C.
Drugs covered in this settlement include Aranesp, Epogen, Neupogen, Neulasta, Anzemet, Ferrlecit and Infed. A full list of the drugs covered by the settlement is available here.
Medicare Part B recipients, health plans and individuals who paid for these drugs but were not on Medicare will be eligible to receive payments from this settlement once the Court finally approves it. The following types of individuals and entities will be eligible:
Patients on Medicare Part B who paid a percentage (i.e. not a fixed copayment, but 10%, 20%, etc.) of the cost of one of the drugs in the case, taken between Jan. 1, 1991 and Jan. 1, 2005.
Health Plans and other Third Party Payors who paid all or part of a Medicare Part B recipient’s percentage co-insurance for one of the drugs.
Individuals not on Medicare Part B who paid all or part (a percentange) of the cost of one of the drugs taken between Jan 1, 1991 and March 1, 2008.
Health plans and other Third Party Payors who paid all or part of the cost of one of the drugs taken by an individual not on Medicare part B between Jan 1, 1991 and March 1, 2008.
The Court will hold a “preliminary approval” hearing this Friday. If the Court grants preliminary approval to the settlement, notices will be mailed to Medicare Part B recipients and Third Party Payors, and published online and in a variety of national publications. Class members will have the opportunity to file a claim form, object to the settlement, opt out of the settlement or file an appearance with the Court. The court will eventually hold a final hearing to approve all settlement details.
This settlement is the third one announced in this AWP litigation. Iin August 2006, GlaxoSmithKline (NYSE: GSK) agreed to a nationwide $70 million settlement and in May 2007 AstraZeneca agreed to a $24 million settlement to Medicare Part B Zoladex users nationwide. After a trial in late 2006 and early 2007, the court in November 2007 ordered AstraZeneca (NYSE: AZN) and Bristol-Myers Squibb (NYSE: BMS) to pay nearly $14 million to insurance companies and consumers in Massachusetts for the companies’ roles in unfair trade practices. Those companies are appealing that ruling.
The court is expected to set a trial date for remaining claims against AstraZeneca and BMS on behalf of insurance companies and consumers outside of Massachusetts.
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.
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.
[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.
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.)
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…
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.
Readers of this blog know that we here often get our knickers in a twist over federal preemption arguments by pharmaceutical defendants seeking to avoid liability in lawsuits. Prescription drug and medical device companies have been arguing with increasing frequency in recent years that lawsuits against them brought under state law are “preempted” by the FDA’s authority under federal law. (Remember that 8th Grade U.S. Civics course? Under the Constitution’s “Supremacy Clause,” federal law trumps state law when the two conflict).
Unfortunately, the FDA has been aiding and abetting them by intervening in products liability lawsuits and by adding a preamble to a Guidance on Drug Labellng, making the same arguments. Given the FDA’s abdication of its responsibility to aggressively enforce drug and device safety, this amounts to “We won’t enforce it, and we won’t let anyone else either.”
There’s a pendulum effect to corporations’ approach to federalism, and we’re at one apex of its swing. When the federal government is aggressive with regulation and enforcement, business is all about “states’ rights.” When the federal government moves away from enforcement and regulation, states step in to fill the void. Suddenly, the federal government is paramount to business, and those pesky states are “interfering” in the unique and exclusive prerogatives of federal agencies. We’ve witnessed the recent odd spectacle of various industries pushing for federal regulation, as ably documented in this recent New York Times article: “In Turnaround, Industries Seek U.S. Regulations” (Sept. 15, 2007). The shifting allegiance of course reeks of what it is – opportunism.
But the Constitution remains, and its delicate balance of federal and state powers. (Digression into the 10th Amendment omitted for your comfort). The Supreme Court has agreed to hear two cases concerning whether federal law preempts the rights of consumers to bring lawsuits under state law against drug and device manufacturers. The first, Riegel v. Medtronic, is summarized below, by Public Citizen Litigation Group, which represents the Riegels:
After suffering serious injury when a balloon catheter burst while he was undergoing an angioplasty procedure, Charles Riegel and his wife sued the catheter’s manufacturer, Medtronic, Inc (NYSE:MDT). Medtronic moved to dismiss the lawsuit, arguing that the Food, Drug, and Cosmetic Act expressly preempts state-law damages actions brought by patients who have been injured by medical devices that received premarket approval from the Food and Drug Administration. The court agreed and dismissed the case.
Public Citizen represented the Riegels on appeal and represents them now before the U.S. Supreme Court. The Supreme Court granted cert. on June 25, 2007, and will hear the case next Fall. The question before the Court is whether the express preemption provision of the Medical Device Amendments to the Food, Drug, and Cosmetic Act preempts state-law claims seeking damages for injuries caused by medical devices that received premarket approval from the FDA.
[PAL joined an amicus curiae ("friend of the Court") brief submitted by Community Rights Counsel to the Supreme Court. That brief can be found here.]
The case involves a product liability lawsuit against Pfizer’s (NYSE:PFE) Warner-Lambert unit. A group of Michigan plaintiffs led by Kimberly Kent in April 2000 sued Warner-Lambert Co. over alleged injuries caused by its Rezulin diabetes drug. Rezulin was ordered off the market in March 2000 by the Food and Drug Administration after it was linked to nearly 400 deaths and hundreds of cases of liver failure.
The District Court dismissed the case, arguing that a Michigan state law that prohibits virtually all lawsuits against drug companies applied, and then also ruling that a narrow exception in that law — that suits are allowed when the drug company misled the FDA to get the drug approved — was preempted. Talk about damned if you do, damned if you don’t! The Court basically ruled that state law applied, except when it might benefit the injured consumers, in which case federal law applied and preempted the exception written into state law. The 2nd Circuit Court of Appeals disagreed, reinstating the suit, and of course Warner Lambert appealed to the Supreme Court, which agreed to hear the case.
Hopefully the Supreme Court will rein in the running joke that federal preemption has become, acknowledge that state law litigation does not interfere with the FDA’s regulation of drugs (a position the FDA itself took for years, and only changed under the current administration) and restore the balance set out in the Constitution that protects the states’ historic “police powers” to protect the health and safety of their citizens.