A Ray of Sunshine?

It’s already 15 months overdue and it will be another year still before the information is public, but last week  the government  set out  the final rule for the Physician Payment Sunshine Act (Sunshine Act) in a 287 page document!

The Sunshine Act (passed in 2010 as part of the Affordable Care Act) requires manufacturers of drugs, devices, biologicals, and medical supplies to report all payments and other transfers of value to physicians and teaching hospitals. The rule was supposed to be published in October 2011, but has suffered continuous delays amongst intense lobbying both by groups keen to get the data in the public hands, such as the AARP, and those most affected by it, such as the American Medical Association (AMA).

The final rule announced February 1^st, officially puts the Industry on notice. They have until March 2014 to get their payments reporting act together. The U.S. Centers for Medicare and Medicaid Services (CMS), will then input the data, including payment information from August through December of this year, into a publicly available database which, they say, will be online by September 2014.

And its not only payments to doctors of medicine that have to be reported. Under the definitions of the Act, “physicians” include doctors of osteopathy, dentists, podiatrists, optometrists and chiropractors.

The rule also requires reporting on both the form and nature of payment or transfer of value made by a manufacturer to a physician.

Forms of payment included under the final rule :

• Cash or a cash equivalent
• In-kind items or services
• Stock, a stock option, or any other ownership interest, dividend, profit or other return on investment
• Any other form of payment or transfer of value

While, nature of payments include:

• Consulting fees
• Compensation for services other than Consulting
• Honoraria
• Gifts
• Entertainment
• Food
• Travel
• Education
• Research
• Charitable contributions
• Royalty or license
• Current or prospective ownership or investment interest
• Direct compensation for serving as faculty or as a Speaker for a medical education program
• Grants
• Any other payment

Advocates of the Sunshine Act have long argued that the public needs to know when doctors are getting paid and by who. “You should know when your doctor has a financial relationship with the companies that manufacture or supply the medicines or medical devices you may need,” said Peter Budetti, M.D. CMS deputy administrator for Program Integrity. “Disclosure of these relationships allows patients to have more informed discussions with their doctors.”

This increased transparency is also intended to help reduce the potential for conflicts of interest that physicians or teaching hospitals could face as a result of their relationships with manufacturers.

Relationships between doctors and drugmakers have been brought up in a number of cases when FDA advisory panels have ruled for or against drugs in which doctors had some interest. For example, last year an advisory panel voted 15-11 to support the approval of Bayer‘s Yaz birth control pills, but allegations later surfaced that four committee members had ties to the manufacturer.

Once the bill is introduced, doctors will get 45 days after information is submitted to vet it for accuracy.

The American Medical Association (AMA) is not happy.  The doctors’ group wants physicians to have more than 45 days to challenge information in the government’s database and add commentary to explain the payments. It also wants some corporate contributions to physicians excluded from disclosure, including sponsorships for educational activities and “indirect” payments, such as unsolicited contributions a company might make to a nonprofit group affiliated with doctors or to physicians’ employers or practices.

AMA president Jeremy Lazarus wants to ensure “the registries will provide a meaningful and accurate picture of physician-industry interactions. It is critical that the final rule provide physicians with a clear way to correct any inaccurate information and not place any substantial administrative burden on physician practices.”

And the AMA is not alone. Unsurprisingly, the Pharmaceutical Research and Manufacturers of America (PhRMA), the primary lobbying group for drugmakers, said that while it supports more disclosure, the new regulations should take into account the importance of context in the publication of physician payment information.

“Ethical interactions between biopharmaceutical companies and health-care professionals are essential to maintaining patient trust,” said Matthew Bennett, a spokesman for PhRMA. The principle behind the so-called sunshine provision “is complementary to this belief and it has great potential for helping patients understand the ways in which such collaboration benefits their health and medical innovation,”

What’s your take on this new rule? Is the government helping to let the sun shine in or is this a dark, dark day for doctors and pharma?  Let us know your thoughts.

Pharma-Physician Interactions Perceived Positively

According to a survey released last week, nearly eight out of 10 physicians view pharmaceutical research companies and their sales representatives as useful sources of information on prescription medicines.

That’s good news for pharmaceutical marketers who spent $24 billion between October 2009 and September 2010 on physician-targeted promotional spending, and an additional $1 billion on continuing medical education.

The telephone survey of more than 500 American Medical Association members found that physicians consider a range of sources useful for staying informed about medicines. In addition to sales reps and company-sponsored peer education programs, doctors also rated continuing medical education (CME) courses, peer-reviewed medical journals, and their fellow physicians as useful sources of information.

The survey also found that physicians consider a broad range of factors in making their prescribing decisions, with almost all respondents relying on their clinical knowledge and experience as well as a patient’s response to a particular medicine. More than 80% reported that they take into consideration a patient’s insurance factors, such as formulary and prior authorization requirements, with just under 70% using information provided by pharmaceutical company representatives

The survey, which was supported by PhRMA, also looked closely at how physician respondents view their interactions with pharmaceutical company representatives.

More than 90% responded that interactions with representatives allow them to learn about new indications for approved medicines, potential side effects of medicines, and both emerging benefits and risks of medicines.  In addition, 84% of physicians said that interactions with representatives allow them the opportunity to provide feedback to a pharmaceutical company about their experiences with a specific medicine.  Large majorities also found information from company representatives to be up-to-date and timely (94 %), useful (92%), and reliable (84%).

The survey also included several questions about company-sponsored peer education programs, in which physicians present to their peers. Nearly 9 out of 10 of physicians who reported attending these programs said the information was up-to-date, useful and reliable.

Physicians attending peer education programs reported gaining a range of information, including: improved clinical knowledge (98%), potential side effects of medicines (97% ), new uses of medicines (97%), the range of treatment options (97%), and emerging drug risks (95%). Importantly, 94% said the programs strengthened their ability to care for patients.

“Peer education programs allow physicians to have important dialogues with their expert colleagues. This sharing of information ultimately benefits the patients they treat,” said PhRMA’s John Castellani.

SRxA and its team of independent Clinical Advisors specializes in providing support to the pharmaceutical industry and has developed a number of highly successful and unique peer-to-peer education programs. For more information, contact us today.

Statistical Significance is Nothing to be Sneezed at Says US Supreme Court

If you have ever had a stuffy nose or invested your hard-earned cash in the stock market, the facts of a recent Supreme Court case will probably disturb you.

The case, Matrixx Initiatives Inc. v. Siracusano involved the popular homeopathic nose spray – Zicam.

This product was responsible for the vast majority of Matrixx’s revenues, and investors loved the company because the nasal remedy sold well.  The stock price soared, but then the company learned that Zicam had caused some users to lose their sense of smell.  As it turned out,  approximately 130 users had reported the adverse side effect, the medical term for which is anosmia.

Although the common view of anosmia is that it is a trivial inconvenience, it can have a number of harmful effects.  Not only do patients find food less appetizing, their loss of smell can also be dangerous because it hinders the detection of gas leaks, fire, and spoiled food. Loss of smell may also lead to the loss of libido.

Matrixx, however, concerned that the news would lead to a loss in sales, decided not to report the rare side effect to investors.    The company’s reasoning?  The side effect was not the kind of “material information” that securities laws would require it to disclose because it was not statistically significant when considered in the context of the patients who had used the drug.

The problem for Matrixx arose when national news got wind of the anosmia side effect.  This lead to the issue of FDA warnings and ultimately Matrixx’s decision to take the drug off the market, causing stock prices to fall.

So, investors sued the company saying that the undisclosed information was indeed “material” and might have caused them to make a different decision about whether to buy Matrixx stock.

During the trial, in a brief to the court, PhRMA said, “A collection of adverse event reports that is not statistically significant does not permit a reasonable inference that a particular medicine actually caused the reported adverse event.”

The Supreme Court disagreed.  In a unanimous opinion by Justice Sotomayor, it made clear that the word “material” does not equate with “statistically significant”.  Instead, the Court said, the important consideration is what information a reasonable investor would regard as relevant to the decision to buy stock; such an inquiry would include questions about the source and reliability of the information.  While not all reports to authorities about side effects would be material under this test, the Court held, those about the Zicam side effect would have been because they came from medical experts.

While almost everyone involved in pharmaceutical marketing is aware of the FDA’s “Fair Balance” requirements it seems that full disclosure must now include all corporate, as well as product, information.  In fact, the Supreme Court ruling may have greater repercussions for adverse event reporting by the drug industry than any guidelines the FDA has ever issued!

Love and Other Problems

The new movie Love And Other Drugs, starring Anne Hathaway and Jake Gyllenhaal tells the tale of a pharma salesman who meets the love of his life at a doctor’s office.  The highly-paid hero is portrayed as a vain, flirtatious pushy rep who will stop at nothing to get doctors to write more scripts for his drug.   Armed with gifts, flowers and free lunches, he pitches his marketing message from office-to-office.

Clearly neither he nor the producers ever heard of the PhRMA code, OIG or the myriad of other pharmaceutical compliance governance.

And while it succeeds as a feel-good, romantic comedy, SRxA’s Word on Health suspects that it did little to help the reputation of the much maligned pharmaceutical industry.

A further nail in the coffin has just been delivered by Vanity Fair. In the January edition of the magazine, investigative reporters Donald Barlett and James Steele have penned a scathing attack on pharmaceutical companies in an article entitled Deadly Medicine.  In it, they dub the industry a “lethal profit machine.”

Unlike the movie, it’s not pretty.

They conclude: “In 2009, according to the Institute for Safe Medication Practices, 19,551 people died in the United States as a direct result of the prescription drugs they took. That’s just the reported number. It’s decidedly low, because it is estimated that only about 10 percent of such deaths are reported. Conservatively, then, the annual American death toll from prescription drugs considered “safe” can be put at around 200,000. That is three times the number of people who die every year from diabetes, four times the number who die from kidney disease. Overall, deaths from F.D.A.-approved prescription drugs dwarf the number of people who die from street drugs such as cocaine and heroin. They dwarf the number who die every year in automobile accidents. And with more and more of its activities moving overseas, the industry’s behavior will become more impenetrable, and more dangerous, than ever.”

For pharmaceutical companies, that’s one tough pill to swallow!

So…How can we change the perception that the industry is despicable and dangerous?

And…how can pharmaceutical companies regain trust and provide real value in their conversations with physicians and patients?

First, all sides of the debate need to acknowledge a few simple facts:

• Healthcare is a business – from the largest global pharma company to the smallest single doctor family practice.
• The pharmaceutical industry is not alone in wanting to sell its products and generate profits.  That’s what all businesses do
• Billions of dollars of these profits are reinvested in new drug development
• On average only 1:50 new drugs make it to market
• The average time to develop a new drug is 10 years and the cost around 1 billion dollars
• Human beings influence and are influenced by numerous factors / people everyday – it is called life.
• In order to control costs and treat patients effectively, everyone must work together.

Second, the relationship between the pharmaceutical industry and its critics needs to change. The current confrontational environment is a lose-lose situation. Pharmaceutical companies need to be perceived as bringing value to the healthcare equation and genuinely understanding what doctors and patients need.

Thirdly, and with apologies to Jake and 20^th Century Fox, the industry needs to kill the stereotype of the “goody” toting pharma rep and reinvent the role as one of collaborator, consultant, and educator.

SRxA can help companies manage these relationships and inject real value back into the mix.  To find out more, please contact us.

No such thing as a free lunch…or pen in NY

Word on Health notes that the demonization of the pharmaceutical industry is alive and well in the Empire State.  Earlier this week, New York Governor, David Paterson announced that he wants to introduce even more prohibitions on the beleaguered industry.

The Paterson administration says that it’s important to prevent companies from influencing the prescribing habits of doctors and for New Yorkers to know they are being given medications for the right reasons.

Paterson’s plan, like those already enacted by nine other states, would bring most of the voluntary PhRMA guidelines into law. Under his proposal, pharmaceutical companies that violate the law would be fined $15,000-$250,000 per violation, while health care professionals would be fined $5,000-$10,000 per violation.

The NY state Department of Health would be responsible for enforcement, but would rely on complaints to identify violators.

Jan Faiks, Vice President of PhRMA argues that Paterson’s proposal is unnecessary because the industry already has a code of conduct and the FDA already regulates marketing practices.

While we acknowledge that there are two sides to every argument, Word on Health is concerned that further restrictions will only serve to limit the relationship between clinicians and the industry, hinder dialogue about new treatments and ultimately have a detrimental effect on patient care.

We’re also not sure how the pharma influence that he considers so heinous is any worse than the political fundraising, lobbying and spending being undertaken by himself and his opponents in order to win votes in the upcoming NY gubernatorial elections.

Just saying…