The reputation of the pharmaceutical industry continues to plummet. A day doesn’t go by without seeing at least one negative news story about drug pricing, either in the press or on television: stories about how unaffordable drugs are or about how a family has gone into bankruptcy as a result of paying for a lifesaving medication. But pharma’s issues go beyond drug costs. It has now become routine to read about millions of dollars paid in fines by companies for the illegal detailing of drugs. Companies continue to be dogged by accusations of hiding clinical data. Direct-to-consumer ads are also a lightning rod, as evidenced by the complaints following the most recent Super Bowl surrounding commercials for drugs to treat opioid induced constipation and toenail fungus. It’s not a happy time for the industry.
The industry’s trade association, the Pharmaceutical Research and Manufacturers of America (PhRMA) is charged with representing the industry on a host of issues, including improving its reputation. As someone who spent 30 years at Pfizer and who has a great deal of respect for the work done not just at my former company, but also at Merck, J&J, etc., this is a big deal to me. However, I have been frustrated with PhRMA’s efforts on this topic and even once vented those frustrations in a letter to the former PhRMA CEO, Mr. John Castellani. Unfortunately, the suggestions made in that letter went unheeded.
Well, PhRMA has a new leader, Mr. Stephen J. Ubl. You have to admire Mr. Ubl for his courage in taking on this role, as he couldn’t have picked a more difficult time to assume the mantel of industry spokesperson. If there is one issue that all the current candidates for the U.S. presidency seem to agree on, it is that the pharmaceutical industry needs to be reined in, particularly with respect to drug prices. There couldn’t be a bigger bullseye on the pharmaceutical industry.
Mr. Ubl was recently interviewed by the New York Times and made a variety of points that are encouraging with respect to reshaping the industry’s image. He also said a few things that are of concern. On the positive side, he expressed support for a new model of pricing in which payments by insurers are based on the results seen in patients. Novartis has recently started such a program with its congestive heart failure drug, Entresto. In an agreement with Cigna Corp. and Aetna, Inc., payments for the drug will be based on a reduction in the proportion of patients who are admitted to a hospital for heart failure. Adoption of such pay-for-performance programs for other diseases, such as cancer, could really impact drug costs. It’s refreshing to see Mr. Ubl’s support of this concept.
Mr. Ubl also called for the FDA to work to reduce the huge backlog of generic drugs awaiting approval. Such a move would not necessarily be in the best interests of the companies he serves. If there is little or no competition for brand name drugs, their sales will remain high. However, introducing generic drugs as soon as possible is a sure way to lower drug prices. It’s great to see Mr. Ubl support this.
However, Mr. Ubl has chosen to defend other questionable positions. For example, many object to new drugs that are modest modifications over older, equally effective–and likely cheaper–medicines. Mr. Ubl defended this practice, saying, “What some call small changes are often important clinical advantages.” A better answer would have been that all new drugs need to demonstrate meaningful benefits over existing medications to justify their pricing. If any new drug doesn’t add value, physicians, payers and patients should stay with the lower-cost drugs. He also needs to avoid such rhetoric as “the debate around drug pricing is myopic and misinformed.” Rather than telling people they don’t understand, it would be better to describe the value of new medicines and provide examples as to how breakthrough medicines save the healthcare system money and save people’s lives.
Mr. Ubl has the opportunity to change the tone of the current pricing debate as well as the other issues that impact the pharmaceutical industry’s reputation. In one way, he is starting at a good time. The industry’s reputation is at a pretty low point. Hopefully, he can start to turn the tide and begin to bring the industry back to the esteem that it enjoyed twenty years ago. I wish him luck.
