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Regulatory Affairs

PhRMA And Why People Dislike the Drug Industry

John LaMattina takes off after PhRMA’s effectiveness here at Forbes. His two points are release of clinical trial data and openness about consultant payments to physicians. And I agree with him on both of those – as I’ve said here many times, we’re not going to regain anyone’s trust until we stop giving people reasons to think that we’re trying to hide things from them.
The problem, though, as LaMattina shows, is PhRMA (the biggest industry association) doesn’t seem especially interested in taken on these issues. Are they stupid, or short-sighted? Possibly. But when I see something like this going on, my assumption is to assume that the people involved are rational actors, who have made an informed decision. And that means that I’m somehow not looking at things the same way that they are.
My guess is that PhRMA’s sees the public perception of the drug industry as a comparatively minor problem. The thing is, even if everyone liked the drug industry just fine, sales of prescription drugs would be about the same. They’re not purchased because people have good feelings about the companies; they’re not all that discretionary. People take medicines grudgingly, for the most part, because they’re trying to correct something that’s gone wrong.
So what’s PhRMA’s major concern? Regulatory and legislative affairs. Our industry is absolutely, crucially dependent on government’s attitude towards it. We are regulated heavily at every point once we start to close in on an actual drug. So if you’re trying to spend your time and effort in the most cost-effective way, you will go to Congress, to the regulatory agencies, to anyone at any level in government who can make and modify the rules that you have to live under. And you will spend your time and money making sure that the rules you like stay in force, that ones that you like even better are on the table, and that ones you don’t like get slowed or watered down.
It’s true that doing this would be somewhat easier if everyone had a better opinion of us. That’s especially true for avoiding the regulations and laws that you don’t like; that would be helped if you could go to the people involved with a big groundswell of public support behind you. But trying to influence the public to the point where that would reliably affect legislation is a very large undertaking. The same amount of effort (and money) will have far more impact if applied directly to the legislators and regulators themselves, rather than trying to use public opinion as a lever on them. It’s just not cost-effective. This is especially true if you’ve already worked yourself into a situation where your industry is unpopular; trying to reverse that becomes a bigger and bigger proposition, which makes the alternatives look even more effective. And this is, after all, the way that every other interest group (well, every effective one) works in a highly regulated environment. What else would one expect?
That’s my answer, then, to the question of why PhRMA doesn’t do more to improve the industry’s image. It’s not a priority. Thoughts?
Notes: LaMattina’s post is also partly a reponse to Ben Goldacre’s book “Bad Pharma”. I have been meaning to take that one on, but it’s also a large undertaking. Book-length arguments are often best addressed at book length, unfortunately. But I do plan to do a big roundup on the subject.

8 comments on “PhRMA And Why People Dislike the Drug Industry”

  1. SP says:

    According to someone who used to work there, one company heavily in biologics has roughly one lobbyist per 3 members of Congress.

  2. anon2 says:

    I was a member of one of the Pharma technical groups for a number of years. One of the key goals was to help provide a means for interaction and interface between the two “sides” in areas of need for better understanding and communication common for most in the room. But it seldom worked that way. Several people tended toward approaches which were essentially designed to tell FDA how to do their job. This seldom helped drug companies in the end, and in fact ususally back-fired to make more regulations or create more work. One member of the committee would repeatedly try to get the group to take action in areas where his/her company was having difficulties, yet were not problems for others around the table. On one specific occasion, he would not give up, and I asked the group if anyone else had the specific problem; reluctaantly, each admitted that this polint under consideration and taking up a lot of time was not of concern to them. In otherm words, the one company had a technical or strategic problem that they could not solve internally and this representative wanted their problem to become everyone’s problem. Just an example of the type of time and money that is typically wasted within Pharma and it’s subgroups.

  3. Eskimo says:

    Very relevant point. Still, if the industry is going to spend billions on television advertising, it’s worth thinking about whether that spending is effective or backfires.
    TV spending by pharma firms has fallen in the last five years, although that may be a straightforward effect of the dismal economy.

  4. simpl says:

    Madicines are one small area of healthcare, and the lobbying ability of insurers, the AMA are also high. A major point, that medicines are a small part of healthcare costs, is not welcome to the rest of healthcare, so the interests of lobbyists are currently opposed. If you keep redrawing the cake, and work on how to reduce the pharma slice, you may draw attention from other topics. In earlier times, issues like global trade or pharmacopoeal standards did have political support in the US and Europe. But needs have changed, and high-priced drug development is now a welome justification for the rest of healthcare asking for more.

  5. ChristianKl says:

    It’s quite ironic that the last article you posted was about “natural medicines versus pharmaceuticals”. You have a growing population who don’t want to buy Big Pharma drugs but go for CAM.

  6. Dr. Manhattan says:

    I think one of the things that the industry does a very poor job of explaining is the costs & risks of drug discovery/development. I think most people would be shocked at the very high failure rates that are the norm, and how much money is involved. But it’s tough to make those arguments when one sees a shower of expensive commercials for ED or acid reflux or other conditions. True, they do get information to patients, but direct to consumer advertising has also hurt the industry’s image.
    My response to someone who talks about how much less expensive generic mediactions are is to explain to them that the generic company only has to demosntrate bioequivalence to the original drug. All the really expensive reserach and clinical trials are already done by someone else. Overall, medications have probably saved much more money in other healthcare spending than they have cost.

  7. Hap says:

    1) If you don’t fix your image before it gets too bad, though, then all the lobbyists aren’t going to help to get policies that work in your favor. Ask the nuclear industry – if people mistrust you enough, then Congress can’t do anything to help you (MCs want to keep their jobs above all else). All that work under the table doesn’t matter if Congress can’t get it into law without losing their jobs.
    2) Sooner or later, the public will matter (when the cost curve really starts getting bent), and it might be better to spend money helping them to know what you do now then to try the desperate hard sell later on when it matters to you. In addition, playing under the table without any sort of a public presence implies that what you’re doing can’t stand the light of day – when someone is of a mind to damage pharma, that won’t work for you.
    3) Ceding the intellectual and moral high ground to hucksters, supplementeers, and Dunning-Kreuger wannabes ([cough]Marcia Angell{cough]) is eventually going to pay dividends, if it hasn’t already. You can’t make people discuss anything rationally, but if you don’t try, it’s certainly never going to happen.
    I think the unwillingness of PhRMA to engage the public is already bearing ill dividends – the increasing bar of safety that drugs have to pass through to be approved by the FDA is probably due in large part to the overselling of drugs via DTC ads. The FDA is responding to the perception of the honesty of drug companies – the inability of PhRMA to substantively counter that appearance makes trials more expensive and their outcomes less certain, a major part of why pharma is in the straits it’s in.

  8. Hibob says:

    “John LaMattina takes off after PhRMA’s effectiveness here at Forbes. His two points are release of clinical trial data and openness about consultant payments to physicians.”
    “So if you’re trying to spend your time and effort in the most cost-effective way, you will go to Congress, to the regulatory agencies”
    I see the effort (mandating release of information on all human drug trials, past, present, and future) failing because of this. The only way something like this will occur is if a, a large company’s clinical trial closet is inadvertently opened and a large number of skeletons fall out, or b, a senior senator or member of the Subcommittee for the FDA decides that a family member of theirs died as a result of a drug approved and marketed through selective reporting of clinical trial evidence.
    That said I think the model should be: if a company wishes to conduct a clinical trial and subsequently use it in support of an New Drug Appication:
    A. The trial and study design must be registered at before data collection begins.
    B. a report on safety and efficacy including the original endpoints for all such trials must be deposited at no later than the filing date of the NDA. Doesn’t matter where the company or the trial is located, if they want access to the US market they would have to play by those rules.
    I could see embargoing a lot of the information until the drug is approved, so long as it is all deposited on time.

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