Another hangover for pharma...
May/24/2007 06:09
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Well one look at
today's Wall Street Journal section on
pharmaceuticals is enough to make a portfolio manager
downgrade all pharma stocks. Avandia could cause
heart attacks, Amgen gets a subpoena from the New
York, and a Novartis drug could cause kidney failure.
What does this all mean? Well for pharmaceutical
companies it could mean that portfolio managers are
going to direct more investment dollars away from
pharma and biotech but there are also some serious
implications for DTC marketers.
We live in the information age thanks to the Web and
portable handheld devices. Often when people wake up
in the morning or get to the office the first thing
they do is go to the Web to catch up on the news.
Stories about pharma have been everywhere and are
hard to ignore. There is a transformation taking
place in the environment in which we market:
-Customers have more power than ever before and
information can no longer be "pushed" to them.
-Transparency at the highest levels is becoming the
norm for all industries and CEO's.
-There is a new FDA chairman who is facing intense
pressure from a new Congress to implement changes at
the FDA including the way the FDA approves drugs.
All this happening at a time when the biggest
demographic segment in the US is reaching ages when
they are going to need more and more prescription
drugs to maintain their lifestyles. Now most DTC
marketers will ignore these trends and act like they
still need to push the brand message to consumers but
I believe this is a big mistake. If customers
research and compare detergents don't you think that
they would do the same for prescription drugs that
they put into their bodies?
It used to be that we could rely on physicians to
tell us what drugs we should take but that is
changing. Physicians don't have the time to sit with
us and talk about medication side effects or choices.
In fact research shows that consumers will go to
product websites when receiving an Rx to determine if
the medication is right for them and examine
potential side effects. It has been my experience
that one of the top pages within product websites is
always the side effects and warnings pages.
Explanation
of ongoing clinical trials
So what can the industry do to calm patient
apprehension about prescription drugs? Well first the
industry has to make clear that all medications have
risks. Yes I know that is what fair balance is
supposed to do, but it has to be more in a consumer
friendly format that is easier to understand like
Pfizer has done in their print ads. Second, the FDA
and drug companies need to inform and educate
patients about ongoing clinical study findings. If
for example a new medication causes weight gain in
some patients I would want to know that so that I can
gauge the risk(s) and benefits of taking the
medication.
For DTC marketers these events are going to present
more of a challenge. Consumer can no longer be "told"
what to buy so marketers are also going to have to be
transparent in their marketing messages. Don't
oversell the message and inform and educate
patients/consumers. Separate promotional messaging
from factual disease state messages. Ensure that the
message in all channels is consistent and monitor
BLOG's and chat rooms for buzz on your products.
Listen to what your customers are saying about your
drug and find ways to embrace Web 2.0 (if you don't
know what this is your already in deep trouble).
There are challenges to be overcome but great
marketers know how to turn challenges into
opportunities. They embrace new channels and listen
to what consumers want and need to make decisions.
Pharma marketers need to understand that the
environment is changing so rapidly that only those
that keep pace are going to succeed.
Do drug labels now need to be localized?
May/22/2007 06:44
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In a way
Shakespeare was right...shoot all the lawyers ! Let's
face it, lawyers should be thanking the pharma
industry for all the business they getting. The
latest comes from a woman in Vermont who is suing
Wyeth because the FDA approved label "didn't go far
enough". She won a $6.8 million judgement but now it
maybe up to the Supreme Court to determine if in fact
there is any liability here.
Product labels negotiations are often intense between
the FDA and pharmaceutical companies. The language in
the label can lead to increased sales and marketing
messages or a very narrow indication which would
limit it's use. When negotiating with the FDA drug
companies try and incorporate language which can be
used to market the product to HCP's and consumers as
the label is the "bible" for what can be communicated
to patients and HCP's. According to an article this
morning in the
Wall Street Journal:
In 2000, Diana Levine lost a hand and forearm to
gangrene after Phenergan was inadvertently injected
into an artery during a so-called push IV
injection, which is more potent and puts injected
drugs into the body faster than a normal injection.
Ms. Levine had gone to a medical facility in
central Vermont for treatment of nausea.
The drug's labeling, approved by the FDA,
included the injection method as an option but
warned of risks like gangrene if the drug were
injected into an artery. Ms. Levine sued, arguing
Phenergan's labeling was unsafe, and a Vermont jury
awarded her $6.8 million in damages. On appeal, the
Vermont Supreme Court upheld the award, ruling that
FDA drug regulations don't prevent a company from
being sued under state law over drug labeling.
You can see why the high court might want to get
involved here. The potential for endless litigation
is staggering adding hundreds of millions of dollars
to costs which ultimately will lead to higher drug
prices. Now this author doesn't feel that pharma
companies should be immune from labeling language
missteps that could lead to patients being endangered
but at sometime you have to draw a line in the sand
and say "enough is enough". The attorney who is suing
Lilly for Zyprexa, (he refused to settle with Lilly)
leaked information to the press that even a judge
said was reprehensible and the commercials recruiting
people for class action litigation can be seen
throughout the cable channels. There is no excuse for
hiding information or misleading HCP's on a drugs
side effects but if this lawsuit is heard by the
court and upheld it could open the door to massive
delays in new drug introductions. Can you imagine the
logistics of trying to prepare different labels for
different states?
I am studying law and I love what I am learning but
the law is supposed to be about the facts not
emotion. I am truly sorry that this patient lost a
limb because of the use of the drug but all drugs
have risks that is why they have to be approved by
the FDA. Patients need to understand that and lawyers
need to stop looking to big pharma for a new Lexus or
Mercedes.
Current patients can hold the key to valuable
information
May/21/2007 06:38
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Marketers
spend way too much time conducting research with
"potential patients" rather than current patients and
that's a shame as current patients can provide a
wealth of information on what made them finally take
action and ask for your brand. Rather than learn from
patients who have not made the decision to seek
treatment marketers should listen to patients who
made the move and ask "what were the keys to seeking
treatments...?".
There is a feeling in pharma that once you have a
current patient on your product that he/she is not a
valuable asset anymore. Their advertising is focused
on people who are not on the brand rather than
reenforcing the decision to stay on the brand. The
track record for patient compliance for pharma is
pretty poor but rather than abandon these customers
pharma should embrace them. What made them finally
decide to seek treatment" Can we segment this group
and identify a common barrier that was overcome?
These are all questions that may be answered by
current patients but alas pharma marketers seem to
turn a deaf ear to this audience.
Let's, for example, look at the ED market. There are
millions of men who have not sought treatment for ED
because of the psychological barriers. Yet ED brands
continue to advertise on TV and go after these men
with refined messages. What they should be doing is
talking to men who are currently on treatment and ask
them "What made you finally ask your doctor about
ED?" This way they can identify the triggers to
action and utilize marketing channels to deliver
messages that address these triggers.
Then there is the CRM component of current patients.
Pharma seems to ignore current customers and very few
brands, if any, value current patients as a valuable
resource. For medications like Lipitor, where
patients can't "feel" the benefit of taking the
medication everyday, patients need to be reminded
that they are fighting bad cholesterol while
promoting healthy cholesterol. Yes the Lipitor
website has a section for current patients but does
Pfizer really believe that people are going to go
back to the website, log-on and enter their new
numbers? That shows that Pharma is still stuck in Web
1.0 and doesn't understand how people want to use the
Web. A CRM program has to be based on a relationship
of VALUE to the PATIENT: before someone is going to
have a relationship with your brand you have to
clearly identify the value equation of your customer.
Listening is a lost art and listening to current
patients seems non-existent in most pharma DTC
programs. Yet listening to your current patients can
provide a wealth of information to your brand.
Some predicitions about the pharmaceutical industry
May/14/2007 02:32
Permalink
The environment is
which pharmaceutical companies market their products
is changing quite rapidly. Those companies that adopt
to the new environment will survive those that do not
will merge or be bought out with the loss of a lot of
jobs. Here are my predictions for the future of the
pharmaceutical business.
1. Pharma brand.product teams will be reduced in
size- There is no need for a lot of people across the
brand team. P&G managers manage billion dollar
brands with and the same will happen in pharma with
regulatory, legal and medical personnel working
across several functional areas.
2. Pharma sales forces will continue to be condensed
- Physicians don't have enough time to meet with the
reps so they eventually pharma will realize that they
cannot afford such high priced sample deliverers.
3. The Internet will be embraced more for both DTC
and DTP initiatives- Sooner or later marketers will
wake up and realize the the Web can drive business
successfully if used correctly.
4. The FDA will limit DTC but product website will
not be considered DTC unless they become overly
promotional- Pharma will have to add more credible
information and less promotional information to get
past FDA reviewers.
5. TV will become less important in the DTC mix.
6. At least 3 CEO's from top 10 pharma will step down
in the next two years.
7. Some colleges will offer a medical degree for
those people who don't want to practice medicine but
who will need an understanding of medical principles
in their careers. This will be driven by the need of
pharmaceutical companies who will need marketers with
more knowledge of medicine to market new drugs.
8. Smaller companies that are able to respond to
market place challenges will be more successful and
deemed more credible by physicians.
9. Vendors/agencies will be out...strategic partners
that have quantitative measurement criteria will be
in.
10. More venture capital money will flow into small
biotech companies that are developing new drugs with
hopes that if successful they will be purchased by
big pharma.
11. eMarketing people, people who really deeply
understand the Internet, will be in high demand while
traditional media people will be looking for work.
12. Pharma will eventually embrace Web 2.0 at a time
when other marketers are embracing Web 3.0
13. There will be more reports of medications causing
problems with continued use that will lead to more
litigation from the bloodsucking legal profession.
14. When Viagra comes off patent sales of Cialis and
Levitra will decline rapidly.
15. The days of big salaries and bonuses at pharma
will be coming to an end. The pressures on pricing
and promotion will continue to force pharma to more
performance enhanced compensation models.
Tough times agead for Amgen
May/14/2007 10:07
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I
am sure there will be some executives at Amgen who
will be reading the Long Tail after possibly losing
possibly $2 billion in sales from it's top selling
product Aranesp. What surprises me is that most
pharmaceutical companies continue to rely on
blockbusters to drive their profits at a time when it
is getting harder and harder to develop and launch
blockbuster products.
Lilly went through this when their top selling
product Prozac came off patent and Pfizer is
preparing to lose it's $10 billion drug Lipitor to
patent expiration in the near future. Pfizer tried to
develop a follow up product to Lipitor but after some
early negative press they decided to pull continued
development. This is another example of relying too
much on one product to drive sales and profits.
Investors for many years have been told to
"diversify" their portfolios but in the pharma
business it seems to be "milk the product and drive
sales for every dollar we can get back".
Today's New York Times, in its Editorial section,
called for an end of the practice of pharmaceutical
companies reimbursing physicians for using their
products. It is of course legal to do so but this is
a case when following the law may lead to the bad
practice of payments driving off label or high use by
the medical community. In any case the pharma pricing
people are going to have to formulate new pricing
models that allow drugs to succeed while limiting
payments to physicians who prescribe them. Of course
the reason that these payments are so important is
that our current health system does not allow
adequate, in some cases, cost reimbursement for using
these drugs but as long as there is money to be made
by prescribing them you can bet medical practices
will count on these dollars towards their bottom
line.
There a lot of issues with the cost of pharmaceutical
products and what I have presented here is a
simplification of one of the issues but what I am so
puzzled about is how these high paid CEO's continue
to earn the big bucks without the ensuring that their
companies are financially sound even if they lose
their biggest seller. It's called scenario planning
and in this case Amgen may be caught with their pants
down. When I was at Lilly and we lost the Prozac
patent we immediately implemented a plan called
Year-X in which ALL expenses were curtailed, raises
were kept to a minimum and bonuses were put on hold.
The result is that Lilly is slowly rebounding
although this author feels that they are relying too
much on Zyprexa sales which were $2.4 billion last
year.
During World War II, as the allies were driving deep
into Germany, General Patton prepared for a major
offensive by German forces. Many commanders felt that
essentially the war was over and that the troops
would be home for Christmas, after all the German
army was finished and they had never mounted a winter
campaign since the days of Fredrick the Great but
Patton felt that the data he looked at supported an
attack by the enemy and prepared scenarios for a
response. CEO's in a sense are commanders and even in
good times, especially in good times, they need to
anticipate worst case scenarios and be prepared to
react with speed to ensure that their company can
weather the storm. It's time for them to earn those
salaries not to retire with millions in stock
options.
$600 Million fine is not enough
May/11/2007 05:55
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The fine levied
against Purdue pharmaceuticals for aggressively
marketing Oxicontin and then lying about its
potential for addiction is not high enough to send a
message to the drug industry that this type of
behavior will not be tolerated. The FDA should have
put these executives in jail and fined the company $2
billion as this would have told drug industry exec's
that if you lie and put patients health at risk your
going to be held accountable.
This plea agreement is a sham and for Purdue pharma
will be just another expense on the balance sheet.
Oxicontin has made billions of dollars in profits
over the years and the government should have gone
after Purdue where it really hurts..their
pocketbooks. I mean here you have a drug company
admitting that they lied and as a result putting
patients health in jeopardy. This is more than
unacceptable this is an outrage and these executives
need to go to jail to be held personally accountable.
Yes they were each fined but I am sure the company
will help them out with that or that they will cash
in some of their options to cover the fines.
I
would not have accepted the plea agreement I would
have proceeded to trial and alerted opposing counsel
that their clients had better get used to group
showers and wearing orange jump suits. I would have
appointed somebody from the FDA to personally oversea
ALL of Purdue's marketing material for the next 5
years and then I would have confiscated the profits
from the product for the periods in question. This is
the only way to deal with people who put profits
ahead of patient health especially when they commit a
criminal act and lie about it. It's time to get
tougher with weasels.
Whistle blower suit against J&J (Caught with
their hands in the cookie jar?)
May/10/2007 06:11
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I
don't get it? How many ways can the pharmaceutical
industry continue to screw up and in the process put
patients health at risk in pursuit of profits? The
latest example comes from a whistle blower lawsuit
from a couple of ex J&J salespeople who have
provided the Wall Street
Journal with a wealth of
information on the promotional practices of Procrit.
If even there is a slight truth to some of the
allegations then the FDA should hit J&J where it
hurts..their pocketbook.
Documents in a
lawsuit filed against Johnson &
Johnson by two former
salesmen show how the pharmaceutical giant sought to
boost sales of its blockbuster anti-anemia drug
Procrit by offering contracts that fattened doctors'
profits and urging its salespeople to push
higher-than-approved doses. According to todays Wall
Street Journal;
Dean McClellan, who worked for 12 years at
J&J's Ortho Biotech unit selling Procrit, saved
15,000 pages of company memos, contracts and other
work-related documents in a storage unit and shed
he built off his garage. He says he was forced to
retire in 2004 because the company told him his
sales increases weren't high enough. He believes
the company wanted him out because of his age,
which was 55 at the time. Angry, he agreed to join
a whistleblower lawsuit by another former Procrit
salesman, Mark Duxbury. A brief filed by J&J
says Mr. Duxbury was fired in 1998 for racial and
sexual harassment. Through his attorney, Jan
Schlichtmann, Mr. Duxbury says he was a star
salesman for Ortho whom the company turned on after
he told the truth about their business practices at
a court-ordered deposition.
The Office of Inspector General of the Health
and Human Services department put out new
compliance guidelines in 2003 saying that marketing
the spread may be in violation of anti-kickback
laws. The Justice Department has been investigating
drug companies for such marketing practices,
resulting in big settlements of $875 million for
TAP Pharmaceuticals in 2001 and $355 million for
AstraZeneca in 2003. After extensive debate,
Congress overhauled the Medicare reimbursement
system in 2005 to prevent such practices. But drug
companies continue to offer large buyers big
rebates, which they say are lega
l.
Mr. McClellan's documents on the marketing of
Procrit show that in 2004 -- after Amgen Inc.'s
competing drug Aranesp came on the market --
J&J made offers that would allow buyers of
Procrit to receive discounts off an already-reduced
price as well as rebates. For example, an internal
company memo calculates that a physician who bought
nearly $1 million of Procrit over 15 months would
get a check for $237,885 back, or 24%.
Another J&J program offered hospitals an
incentive to buy Procrit and shun Aranesp:
discounts on purchases from across Johnson &
Johnson's product line -- including some
huge-selling drugs and medical devices sold by
different subsidiaries -- if the hospital used
Procrit at least 75% of the time when prescribing
anti-anemia drugs. In addition, J&J created a
"Right of First Refusal" contract for doctors,
requiring them to allow Ortho Biotech to make a
counteroffer if Amgen's Aranesp price undercut
Procrit
.
Mr. McClellan also alleges the company pushed
doctors to prescribe a higher dose years before it
was approved as safe and effective by the FDA. For
years, the company focused on educating health care
providers on Procrit's medical benefits, he says.
But in the mid-1990s at a national sales force
meeting, an Ortho executive announced that the
division was moving to promote what it called "QW
dosing," switching patients from three, 10,000-unit
doses a week to a single, 40,000-unit dose in
cancer patients, Mr. McClellan says.
At that time, that dose wasn't approved for
cancer patients. Many years later, the FDA approved
the dose in cancer patients, but before then,
pushing the unproved dose would have violated FDA
rules.
Where the hell was management and where the hell was
ethics in all this? Hidden under the financial
calculator no doubt. And does the pharmaceutical
industry really believe that stories like this won't
circulate among patients and HCP's? Does the pharma
industry really believe that patients are going to
continue to "buy-in" into DTC for new products with a
track record of "profits over scientific benefits"?
The successful new CEO knows that everything their
company does is transparent in a world where
information is readily available. Unfortunately the
pharmaceutical industry continues to set standards of
bad conduct in pursuit of the almighty dollar while
pretending to be concerned about patient health. Take
notice marketers: the public is not going to buy this
anymore and marketers can no longer tell people what
to think and buy.
Why the pharmaceutical industry continues to step on
mines
May/05/2007 08:29
Permalink
I
had a chance this week to go back into the New York
Times archives and research the complete stories on
Lilly's Zyprexa. Since I worked at Lilly and was
aware of the stringent regulatory environment I was
trying to understand how this could happen, but after
listening to a number of people within the industry
the question became "I am surprised this doesn't
happen a lot more". It's only a matter of time before
another product gets called under the microscope only
to find that mistakes were made along the
way....mistakes that could endanger patients health.
If there is anyone naive enough to believe that, when
drugs are being developed, drugs are marketed because
they provide better health solutions then there is a
bridge I want to sell you really cheap. Drug
development is a business decision, that means that
the key driving decision as to whether the drug will
continue in development is the potential for sales
dollars not "how many patients will it help". I know
of at least two drugs in development at major
pharmaceutical companies and what is being discussed
internally is the potential for "off label sales".
The sales people know that regardless of what the
label says that a number of physicians will use these
drugs off label and could add hundred of millions of
sales dollars to the bottom line.
On the other side of the coin I also know of a drug
that could be used to prolong the lives of patients
with a certain type of cancer but that these drugs
are getting reduced funding because the sales
potential is very low. So what does all this mean?
Well it brings us back to the age old paradox: is
profit the underlying driver in pharmaceutical
business decisions? But first let's take a step back
here...Chrysler is for sale because of sagging sales
and because the models they have introduced have
little consumer appeal. When an automobile company
decided to take a concept car to production they have
to determine their break even sales point and project
how many units need to be sold in order to maximize
investment. This is traditional, standard MBA
analysis. The difference is that these are cars, or
SUV's that take people places they are not products
that could save or enhance lives. Ahhhh, there's the
rub...profit or patients health...shareholders or
customers?
I'll be the first to admit that it's not easy being a
CEO today. You have to please board members who look
at a companies financial sheet for quantitative
measurements of performance. Wall Street analysts can
swing hundreds of millions of investor dollars to or
from your company depending on what they want to hear
and the regulatory environment is getting a hell of a
lot tougher. Still, if I was earning millions of
dollars a year and was guaranteed a golden parachute
I would embrace this challenge. The problem seems to
be, as I have written many times before on this
forum, is that there is a real lack of business
leaders in American industry today. Bill Gates is
semi-retired and Microsoft has become a huge, slow
bloated company, Steve Jobs is still a driving force
with Apple but then again his compensation is valued
well over $600 million and the auto industry
compensates a new CEO from Boeing $24 million to
report record losses and lay off thousands of people.
So what does all this mean for the pharmaceutical
industry? Well first the company slogans don't mean a
thing. "Answers that matter" should be "answers that
matter for a price", "where patients come first"
should be "where patients come first behind Wall
Street, "working for a healthier world" should be
"working for a healthier stock price". Pharmaceutical
companies are public companies and as such have a
responsibility to earn a return for investors.
George Merck in 1952 said "Medicine
is for people, not for profits.” I think that too
many people in the industry have forgotten that and
as long as they do the pharmaceutical industry will
continue to go blindly into the mine fields that
await them.
Unless you have been there don't point fingers
May/01/2007 09:40
Permalink
It
was disturbing to learn this week, according to John
Mack's survey, that BLOGS critical of the
pharmaceutical industry are viewed more credible than
BLOGS supportive of the industry. There's a lot wrong
with the pharmaceutical industry from DTC marketing
to CEO's who are so anxious to please Wall Street
that the lose site of what we should be all about but
unless you have worked in the pharma industry there
is no way that you can sit on the fence and point
fingers at people inside the house.
I don't believe that at any time in its history the
pharmaceutical industry has been facing more
challenges than the current environment. Wall Street
demands profits, Congress wants accountability,
people want real answers to health problems and CEO's
continue to be shuffled in and out. As I have written
many times on this BLOG before the industry is in
dire need of strong leadership. Working in the pharma
industry is unique and unless you have spent time on
the inside I don't believe that you can understand
the environment in which we work. In my 10 years in
the pharma and health industry I have seen some
amazing things including manipulation of data to
support more money for DTC channels, senior managers
making decisions about DTC marketing without an
understanding of how to measure ROI's and personal
agendas that lead to decisions of what is best for
the person making them not the brand.
Yet as a pharmaceutical marketer I have chosen to
make a stand and do what is right for my customers
and patients. Are there that many people out there
who purposely hide data from the FDA that could harm
patients? Are there managers who make decisions based
upon what is right for the balance sheet rather than
the patient? The answer to these questions is
probably yes. But these managers didn't just come
into a company with the idea that sales is more
important than patient health. It is started when
people don't question numbers or data or don't have
the knowledge to ask the right questions.
The pharmaceutical industry is at a crossroads. CEO's
need to communicate throughout the organization that
whatever else we do the patients always come first.
As marketers we all have to put ourselves in our
patients shoes and ask "what do they need and want".
CEO's have to be strong enough to stand up to MBA
Wall Street analysts whose slogan is "instant
gratification takes too long" and pharma marketers
have to be held accountable for everything they do.
It's easy to point fingers on the outside looking in
but frankly there are no short term fixes for any of
these problems. It's going to take time at a time
when the marketing environment is changing as we
speak. What is wrong with pharma is indicative of
what's wrong with American Business..too many
layers..too much emphasis on paychecks and not enough
emphasis on being customer centric.
Does Pharma Zoom?
Apr/20/2007 12:01
Permalink
James Citrin's book,
Zoom, details how some exceptional companies are
navigating the road to the next economy. Of course
pharma is nowhere to be found on the list of
exceptional companies and you shouldn't be surprised.
Pharmaceutical marketing is stuck in an age of old
marketing practices where spending mega dollars on TV
seems to be the only tactic they know.
Mr. Citrin states that in order to excel in the new
economy, business leaders need to master six basic
strategies:
1. Be capable of doing everything at speed (Pharma
marketing has two speeds..slow and dead slow)
2. Create a true learning organization (A lot of
pharma companies do have "shared learnings" but few
learn from innovators outside the industry. While
smart marketers are learning how to leverage consumer
generated media, pharma marketers are developing bad
DTC).
3. Obsess over the needs of the customer (Like pharma
could ever care about the customer. It's all about
ROI and driving Rx's not satisfying customer needs).
4. Reward risk taking (FDA..NOV = Trouble...enough
said)
5. Learn to live with greater uncertainty (Pharma has
no choice and seems willing to let the environment
take it where it wants to go !)
6. Master the art of deal making and partnerships
(pharma companies don't talk to each other even when
it is for the patients good)
Is it any wonder that pharma marketing is looked upon
as nonexistent? The more things change the more
pharma marketers seem stuck in a rut and it's awful
deep.
Aranesp: Death of a blockbuster
Apr/17/2007 06:20
Permalink
Amgen
Inc.'s
drug Aranesp didn't reduce the need for blood
transfusions in anemic cancer patients and was linked
to a nearly 45% increase in deaths compared with
patients taking a placebo. That's really bad news for
Amgen the maker of Aranesp but there are a number of
issues that go a lot deeper here. When did Amgen know
and why didn't this data show up in the initial, and
ongoing, clinical trials? Lot's of questions that
need to be answered and someone needs to be held
accountable.
Legislators in Congress are going to use the Aranesp
example of things that can go wrong when bad
decisions are made. Amgen's CFO has resigned, or was
shown the exit, but frankly that is not enough. Did
the CFO hold back the release of clinical trial
information because of financial considerations of
Amgen stock? If so he needs to held criminally liable
as do the other people who were involved in the
decision. The CEO must also be held accountable and
shown the door as this type of behavior starts at the
top and can be inbred through the whole organization.
How can this happen in a world where everything is
transparent and paper trails are everywhere? It
starts with a belief that shareholders and investors
are more important than patients. It tells me that
Amgen may talk the talk about patients being
important but somewhere the chain broke that people
believe that dollars are what drives pharma not
successful patient outcomes. I'm sure that Congress
is going to have a field day with this one...
The Amgen story that is coming out of Thousand Oaks
is going to be a lot more damage to an industry that
is already under fire from all sides. People make up
a company but somewhere along the way Amgen has hired
people who believe that their wallets are more
important than patient health and that is beyond
reprehensible.
A new tactic for the FDA - Are they overstepping
their authority?
Apr/11/2007 06:31
Permalink
The Food and Drug
Administration said proposed prescription painkillers
should fill an unmet medical need for patients who
have no other "relatively safer" alternatives,
suggesting Merck
&
Co.'s bid to have a Vioxx-like successor drug
approved in the U.S. faces a tough road. But who is
to say that a new drug fills an unmet medical need
for patients who have no other "relatively safer"
alternatives ? This author feels that this action by
the FDA is a dangerous precedent that could quickly
lead to major issues for consumers, insurers and
pharma companies.
I used to take Celebrex for joint pain until I read
information on the Celebrex website that said one of
the potential side effects could be "intestinal
bleeding or death". When I first received the Rx for
Celebrex I received a letter from my health insurer
informing me that OTC Ibuprofen (store brand no less)
worked just as well as Celebrex and costs a lot less.
I switched to Advil but the key point here is that it
was MY decision based upon the risks I was willing to
take from information on all types of pain relievers.
I know, as all consumers should know, that all
prescription medications have risks and potential
side effects. I can work with my HCp to determine
what is best for me but at the end of the day I am
the one who makes my healthcare decisions. To be
honest Celebrex worked better for me on my joint pain
than OTC products but I did notice some stomach
discomfort when I used Celebrex. Rather than risk
what I perceive to be more serious problems I decided
that ibuprofen will work well while not providing any
possible GI problems. I don't want the FDA making
these decisions for me I want to make them myself
with input from my HCP and no amount of DTC
advertising is going to change my mind. DTC ads may
enlighten me as to new products or treatment options
but I am the one who will go to the product.com
website and look at the side effects and warnings to
determine if the risk is acceptable for me.
The FDA obviously does not believe that consumers are
smart enough to research products on their own even
though traffic to health websites, including
prescription medications, keeps increasing. Under
this new guideline, unmet medical need for patients
who have no other "relatively safer" alternatives,
products like Ambien might not have made it to the
market. If Pfizer informed the FDA that Lipitor, the
world's biggest prescription drug, patients were
reporting more side effects would the FDA require
Pfizer to take it off the market in favor of other
cholesterol lowering medications?
This is wrong direction for the FDA to take. Instead
they should be working with the drug industry to
continually educate and inform consumers about the
risks of approved prescription drugs. They should not
determine if other "safer alternatives" are available
because under that guideline some supplements may
work better than prescription drugs with less side
effects thus the Rx should be taken off the market.
Consumer have the power now and we don't need the FDA
to limit the choices WE want to make in OUR
treatments.
Being first in the inhaled insulin market is not an
advantage for Pfizer
Apr/10/2007 06:09
Permalink
Could Pfizer have an
expensive failure on their hands with Exubera, the
first inhaled insulin? It seems like a lot of people
think so including some Wall Street analysts who are
revising the sales forecast for Exubera way down.
Pfizer has changed the selling of Exubera from the
pain management division to the CV division but what
Pfizer hasn't learned that in order for a product to
be adopted by the market it needs to be easy to use
and convenient. Exubera unfortunately doesn't have
any of these traits and companies like Lilly which
have inhaled insulin in development are taking notes
from Pfizer's mistakes.
According to an article in today's New York Times:
But Pfizer’s marketing may not be enough to
overcome the medical, economic, practical and legal
concerns that have hurt Exubera. In theory, the
drug’s biggest advantage over standard injectable
insulin is that it is more convenient and does not
require needle pricks. In reality, though, the
Exubera inhaler is bulky and can be hard to use,
doctors say. The device is nearly as large as a
tennis ball can when it is open, and must be
repeatedly pumped before the insulin can be
inhaled. Making matters worse, Exubera doses differ
from those for standard insulin, and converting
doses can be complicated, the doctors say. Also,
insurers have been reluctant to pay for Exubera,
which costs about $5 a day, compared with $2 to $3
a day for injectable insulin. In addition, the
needles now used for conventional insulin
injections are smaller and less painful than they
once were. “Out of 2,000 times or more I’ve tried
to start patients on insulin, I’ve only been turned
down twice,” said Dr. John Buse, professor of
medicine at the University of North Carolina.
Marketing 101: Ensure your product is easy to use and
understand as compared to the competition. I'm not
sure why Pfizer thought that the use of the product
would not be an issue for diabetics who currently
self inject. Then there is the use of consumer
generated media. One person has stared a campaign via
the Internet to warn people that inhaled insulin can
damage lungs. Pfizer’s clinical trials show that the
drug causes lung function to drop in some patients.
Again Marketing 101: patients view side effects and
make trade offs for product conveniences.
Unfortunately Exubera doesn't seem to have advantages
over injected insulin.
So now Pfizer is taking their message directly to
consumers. Not a good move in my opinion. Physicians
don't have the time to work with patients to explain
treatment options or how to use prescription drugs.
For patients who are used to small, less painful
needles the answer might be to just keep on "doing
what works" instead of using a new product that
requires them to change their lifestyle.
For those of you who haven't worked in pharma..
Apr/03/2007 03:02
Permalink
I
read a lot of BLOGS that have to do with pharma and
DTC but in order to truly appreciate the problems of
big pharma one has had to experience it first hand.
the endless meetings, the micromanagement the
throwback thinking and a culture that leaves dead
weight in place while people who want to think
outside the box move on to more challenging
positions. Think this is wrong? Well let me tell you
a story about my first years at Lilly....
When I first arrived at Eli lilly in Indianapolis I
was given a booklet on leadership that was written by
our CEO Sidney Taurel. I enjoyed reading the book and
made the mistake of trying to embrace some of his
principles including the need to "implement with
speed". I know that speed is a competitive advantage
and organizations have to review processes to
streamline them so that they can in fact implement
faster. What I found was resistance at every level of
the organization and my manager even told me to "slow
down" to allow people to catch up with me.
Then there was a forum that was help on DTC. While at
this forum I was told by a Director that I had to
learn more about DTC and I responded "DTC needs to
learn more from consumer marketers" upon which there
was a loud round of applause from the rest of the
audience. When I worked on the Cialis launch team I
observed first hand how data was manipulated to show
the results that supported more money for television
while leaving the Web behind. To this day the website
has not changed since I left the company and they are
still spending money on TV while the Web site suffers
from neglect. By the way 85% of the visitors to our
website the first year came from online ads and
search engines not TV although I am sure that the two
worked together to drive traffic.
Another accurate picture of working in pharma is the
endless meetings. Death by meetings is a great way to
characterize the atmosphere. Calendars are often
booked for weeks at a time and God forbid you just
stop bye someone's cube to talk over an idea? For
vendors it's even worse with endless presentations
and dollars used for trips to Indianapolis only to be
told that we had decided to use someone else.
So could it get worse? Well yes....there are a great
number of people who I know got promoted to Manager
at Lilly that were promoted because of "who they know
or how they act" rather than what they did for the
company and the brand. This while very talented
people continue to transition from careers to jobs
and collect paychecks and go through just enough to
survive. One author calls them the walking dead and
there are a lot of them within pharma. A good leader
can transform the WHOLE organization with a vision
not just words but I am afraid that this doesn't
happen much at big pharma. Companies like Amgen,
which had and edge as a biotech company, are hiring
more and more people from big pharma as they make the
transition to execute by endless meetings and at a
snails pace.
Think that this is not true? Ask anyone who works in
pharma and chances are that you will hear the stories
of long meetings and twisted data (400% ROI on a TV
campaign for example). I still believe that out there
there are some companies that believe they are in
business to help their customers but it looks like
that is getting harder to find. Maybe I'm an idealist
or maybe I just believe that we can be successful by
providing patients with the drugs they need to
continue to lead productive lives.
Should pharma get naked?
Mar/31/2007 08:14
Permalink
There is a very
interesting article in this months
Wired
Magazine. The cover story
is "Get Naked and Rule The World" and it makes
some really great points about corporate
transparency in today's wired world where secrets
are more increasingly coming out into the open.
Should pharma embrace this philosophy and what are
the potential ramifications for the industry and
patients.
The
philosophy behind getting naked is
simple:

Smart companies are sharing
secrets with rivals, blogging about products
in their pipeline, even admitting to their
failures. The name of this new game is RADICAL
TRANSPARENCY, and it's sweeping boardrooms
across the nation. Even those Office drones at
Dunder Mifflin get it. So strip down and learn
how to have it all by baring it
all.
What would this look like for the pharma industry
and what can the companies do to become more
transparent? Well for a starter pharma could update
their product websites on a regular basis with the
results from ongoing clinical trials. In fact there
should be a page on every product.com website
entitled "results from continuing clinical trials".
Rather than report the scientific results however
the results should contain a simple to read
abstract so patients can understand the data. Is
this risky? You bet but I would imagine that the
litigation commercials for Zelnorm, now that it's
been taken off the market, are only a few weeks
away from airing.
Pharma needs to inform the public that even though
the FDA has approved a drug that continuing
clinical trials may indicate that there are other
side effects and risks. Might this scare people
away? Hell yes but transparency is a philosophy
that in the long run can enhance a brand or
company.
New products are often talked about at investor
meetings but unless consumers are willing to dig
real deep it's hard to find within a companies
website. Yes pharma is restricted in what it can
say (claim) about new products but allowing the
public access to the initial data can lead to
customers becoming working partners. Before we
received approval on Cialis in the US for example
there were a number of websites talking about the
new products benefits among men with ED. Just look
at all the insights that are surfacing on the
Internet about political frontrunners Rudy Gulianni
and Barrak Obama.
Every manager needs to learn how to manage risk but
the CEO and senior managers need to set the trends
of what is acceptable risk and what is not
acceptable risk. Pharma needs to start opening up
more to customers and especially the media who has
been extremely critical of the industry. It's time
to understand that secrecy is dead and the sooner
that pharma understands this the sooner they will
be able to become better companies that are
customer focused.
So how is pharma doing compared to the S&P 500
?
Mar/25/2007 08:32
Permalink
Some pharma
companies have actually managed to out perform the
S&P 500 but it probably wouldn't surprise you
to learn that the majority of companies are not
doing so well while their CEO's pull down big
bucks.
Let's start with Eli Lilly & Company. Sidney
Taurel pulled down a total package worth more than
$15 million yet look at Lilly's performance vs. the
S&P 500.....
Lilly has never recovered from the loss of patent
on Prozac and now Zyprexa sales have reached a
peak.
Pretty dismal ha ?
If this is a scorecard for the CEO's performance
then I think it's a pretty sad shape of things
overall. The stock options that I received at Lilly
over 7 years ago are worthless and Lilly has never
recovered from the loss of patent on Prozac (the
contingency plan was called Year-X and was not
strategic at all) and now Zyprexa's days as a
blockbuster are numbered.
What about Pfizer? Surely a company that markets
Viagra and Lipitor can beat the S&P ! Think
again... The recent clinical trial setback for
their new cholesterol drug and generic competition
looming for Zoloft and Lipitor have hurt the pharma
giant while Jeffery Kindler pulled down a
compensation package of more than $9
million.
Pfizer's performance has been
dismal
Amgen is another
company, that until recently, had been doing very
well. The recent coverage of Aranesp has really
hurt their performance and the FDA has informed
Amgen to halt all DTC advertising (they weren't
doing any ?). Kevin Sharer the CEO of Amgen had a
lot of money to play with for the high cost of
living in California. His package was over $24
million !
Amgen has really been hurt by the recent
Aranesp problems
There have been
some companies that have managed to do well against
the S&P 500. Wyeth, whose CEO made a whopping
$32.9 million was one of those companies. However,
one has to ask if a compensation package over $32
million is worth this
performance?
Wyeth has had some bumps in the road but
is performing well.
Kudos go to Mr
Cornelius of BMS. His compensation was more
reasonable in all this madness at only $1.5
million. I can tell you that in New Jersey that's a
good salary but not one that could let you live as
a king. It all comes down to a philosophy of
shareholders and the board:
"Are we here to
please Wall Street and increase shareholder value?
Or are we here to provide patients with medicine
that can extend lives and ensure that we live a
better quality of life?"
I
for one believe that there is too much focus on
trying to keep Wall Street happy and not enough
focus on people. These two philosophies can coexist
but it requires someone with foresight and vision
to lead the charge. You would think for the money
these guys are pulling down they could at least try
and lead...
CEO compensation out of control
Mar/24/2007 12:14
Permalink
What if I told you
that the average compensation for the top 8 pharma
companies CEO's is $18.3 million? Upset? You should
be ! At a time when the pharmaceutical industry is
desperately looking for a leader to step forward
it's amazing that these gentlemen can pull down
this type of money. An average compensation of $18
million is more that 146 times higher than someone
making $125,000...146 times !! I don't get it and
frankly it's time for shareholders and employees to
look at the compensation of these people and ask
"are they really worth that" and "am I really worth
150% less then they are making?"
It's not easy to be a CEO of any big company today.
There are always people who are second guessing
what you do and Wall Street can be relentless in
its pursuit of earnings. But how many people who
are senior level managers would gladly take on the
challenge of leading a major company for a lot less
money? My guess is there would be a lot of
volunteers.
What are the qualities needed to be an effective
pharma CEO? Here is a list of some attributes I
believe every CEO needs to be successful:
-Lead don't follow: Set a clear direction for your
company and don't bow to pressure from the outside.
Strategic direction is an important framework for
the health of the company.
-Listening: Listen to the life's blood of your
company; your employees. Listen to what they are
saying and implement changes to allow them to
succeed.
-Implement with speed: Pharma is moving at 20 mph
while customers are moving at 100 mph. Pharma has a
huge competitive disadvantage here.
-Be a great salesperson: sell your ideas to your
senior managers, ensure they understand and get rid
of the ones that are resistant to change. Sell your
vision to Wall Street and to the Board. Make sure
they are willing to support your decisions.
-Be a marketing driven organization: The days of
the big pharma sales force are coming to an end.
Physicians don't trust pharma messages and
consumers are taking control of their healthcare
decisions. This all means that you had better learn
to change your business model from a sales driven
company to a marketing driven company quickly.
-Embrace the Long Tail: Blockbusters are going to
be few and far between. Diversify your portfolio to
include a lot more products that produce sales of
$200-$700 million rather than one product that may
account for a big part of your revenue.
-Prepare for coming storm: Lead your company
through the coming storm that is being generated by
the media and Congress. Have plans in place to so
that they can be executed at a moments notice.
-Mingle: Sit down with your employees at the
cafeteria. Talk to them, listen to them, get them
to open up.
Sounds simple but it's not. There are way too many
CEO's who sit in their big offices and have a "town
hall" meeting with employees and believe that is
all they need to do. When I was at Lilly I tried to
follow Sidey Taurel's book on leadership and ran
into brick walls again and again. If your vision is
not communicated and enforced at every level of the
organization your spitting into the wind. It's time
for changes in compensation and a new face for
pharma CEO's to emerge.

Once again the Times has pharma in the crosshairs
Mar/21/2007 02:46
Permalink
“When honest human
beings have a vested stake in seeing the world in a
particular way, they’re incapable of objectivity
and independence,” said Max H. Bazerman, a
professor at Harvard Business School. “A doctor who
represents a pharmaceutical company will tend to
see the data in a slightly more positive light and
as a result will overprescribe that company’s
drugs.” Such is a quote from a front page story in
todays NY Times. I guess the Times would have us
believe that physicians would gladly give talks and
attend events without compensation. Now who is
naive?
I have worked with a lot of physicians and I can
tell you that for most of them unless there is some
type of compensation for their time they don't want
to get involved. Take online detailing for example,
most research clearly shows that a majority of
physicians will only participate in online
detailing if there is some type of compensation
involved. When we don't offer compensation the
response rates are minimal.
Is the article one sided? Well look at this
quote...
“Drug companies are like lions,” Dr. Grimm
said of his sponsored talks. “For lions, it’s
their nature to kill zebras and eat them. For
drug companies, it’s their nature to make money.
They’re not really trying to improve anybody’s
health except if it makes them money.
So according to the NY Times they are to ask
doctors to speak on their behalf about medications
for no compensation. Drug companies have already
stopped the practice of spending sprees on lavish
resorts but the truth of the matter is that
physicians want to hear from other physicians. Can
they be impartial when they receive payments from
pharma companies? My guess is no but don't you
think that they have to believe in a product to
pitch it or does the Times believe that all
physicians are for sale?
A prescription for bias
Mar/18/2007 08:51
Permalink
From one of my
readers comes a report from the Business and
Media Institute that confirms what
a lot of us in the business already know: the media
is bias against the pharmaceutical industry.
However what puzzles this author is why the pharma
industry seems to have chosen a strategy that
involves retreat? Are industry leaders so afraid of
the environment that don't want to make waves or
are they more focused on pleasing Wall Street than
helping patients?
Among the key findings of the
report:
Industry
Ignored: While covering
everything from medical “controversies” to
breakthroughs, nearly 80 percent of the stories
excluded the viewpoint of the pharmaceutical
industry, failing to include either a company
statement or a company spokesman.
Media
Overemphasize Cost to Consumer: The broadcast
networks mentioned costs to consumers or drug
company revenues 11 times more often than they
mentioned drug development costs.
Networks
Leave Companies Unnoticed: Only 22 percent of
the stories even named the company that developed
the drug or drugs featured in the story.
What
Development Costs?: A mere 2 percent
of stories dealt with the cost of developing drugs,
and even those costs were downplayed by industry
skeptics.
Special
Treatment for Left-Wing Causes: Nineteen stories
focused on drugs that were popular liberal causes
such as the morning-after pill or HPV vaccine
Gardasil. The networks didn’t apply the same
scrutiny to those drugs and their makers as they
did to others.
Surprised? You
shouldn't be. What should surprise you is that the
pharmaceutical companies will spend millions of
dollars and thousands of man-hours to research
positioning statements or DTC messaging but when it
comes to communicating the challenges the industry
faces to the general public the lack of noise if
deafening. How many millions of people are leading
better quality lives because of prescription
medications? How many people are adding years to
their lives because of prescription medications? A
diagnosis of HIV is no longer a death sentence.
People who have cancer are living longer and
beating back this horrid disease because of the
prescription drug industry. Yet papers like the New
York Times continue to report one sided stories
which is scary because too many people believe what
they read without challenging information.
Again I believe that a leader needs to emerge from
the pharmaceutical industry to state the facts and
defend the industry. He, or she, needs to remind
people within the industry that we are here to
benefit patients and to never lose sight of that.
But more importantly this leader needs to tell the
instant gratification people on Wall Street that
the industry will continue to devote resources to
new product development and if short term profits
could take a hit at the expense of strategic or
long term company health. Help Wanted ...now
!
For copies of the report send me an
email
Of course you know this means war !
Mar/13/2007 06:11
Permalink
Well it's
started..this week the Justice Department has
issued subpoenas to J&J for marketing related
to three drugs, Amgen & J&J had to put
black box warnings on anemia drugs because
physicians were using the drugs off-label and a
jury has overturned an award in a Vioxx litigation.
It's time for the pharma industry to circle the
wagons but what is missing is the one leader who
can step forward and remind us how many people are
living longer and healthier lives thanks to the
drugs that are on the market today.
There is a fine line between cooperating with the
FDA and tucking your tail between your legs and
kissing someone's ass. If the FDA mandated that
CEO's wear clown suits I believe they would comply
! The battles looming with the FDA are all
politically motivated and the new head of the FDA
has shown that he is going to play along with
Congress and do whatever is necessary to get in
their good graces even if, in the long run,
patients are hurt. Make no mistake about it
patients will be hurt. Amgen alone lost $18 billion
in market capitalization when the black box warning
was issued. That means less money to investigate
new drugs and less products in development.
There have been accusations that the FDA is too
cozy with big pharma. I frankly don't buy that for
a second. The FDA is understaffed and overworked
and has to rely on a good relationship with
pharmaceutical companies to streamline work loads.
Drugs that may have received approval through the
normal NDA process are now being held up because
the FDA wants "more clinical studies". Most pharma
companies work with the FDA while a drug is in
development to ensure that protocols and studies
are set up correctly. The problem is that once the
data is submitted via a NDA the FDA can use
subjective criteria and tell the company that it
now wants more studies. The pharma economics of
this long process means higher development costs,
less revenue and will lead to higher drug costs
across the board.
Rather than point fingers it's time for
pharmaceutical companies to ban together and come
up with a plan to better work with the FDA,
Congress and the media. Lobbyists are not the
answer pharma needs to remind everyone of the value
they provide to society in the form of better
health and lower health care costs. Pharma will
spend billions on DTC message development but not
one leader will step forward and reach out to other
industry leaders with a plan that clearly addresses
the challenges facing the pharma industry today.
Help wanted....
The FDA overeacts to anemia drugs and issues black
box warnings
Mar/10/2007 08:14
Permalink
According to an
article in August of 2006, the Annals of
Internal Medicine "Off-label
use is the common practice of prescribing a drug
for an indication other than those approved by the
FDA. The physician rationale for prescribing
off-label is often based on the lack of
FDA-approved effective treatments, reports of
clinical effectiveness for the off-label use, or
both. A recent study confirms that off-label
prescribing continues in earnest, with 21% of drugs
listed in a data set being prescribed for off-label
uses, most with little scientific evidence of
efficacy. One then has to wonder why the FDA
issued a sweeping
safety warning about heart and cancer risks that
arise from overuse of a family of anemia treatments
that is the biotech industry's biggest drug class
with $7.3 billion in U.S. sales in
2