TRANSACTIONS OF THE AMERICAN CLINICAL AND CLIMATOLOGICAL ASSOCIATION, VOL. 128, 2017
PRESIDENT’S ADDRESS Physicians and the Pharmaceutical Industry DAVID C. DALE, MD, MACP SEATTLE, WASHINGTON
I am talking today about “Physicians and the Pharmaceutical Industry” because the topic is so timely and relevant to most of us. Currently, 60% of Americans are taking prescription drugs, an average of 2.2 per person above age 18 years (1). American adults over age 65 fill an average of 27 prescriptions per year. Most of us take at least something to control blood pressure, to lower cholesterol, to treat diabetes, or something just for our aches and pains. There is currently great public controversy about the costs of drugs, their benefits, and access to prescription medications. This topic is currently in the newspaper almost every day (2). My interest in this topic has grown steadily, and I have dealt with the pharmaceutical industry in many ways. • • • • • •
Prescribing drugs for patients Teaching students and residents about prescribing medications Conducting and overseeing clinical trials for new drugs Consulting for the pharmaceutical industry As an administrator and as an editor and As Chair of the Ethics, Professionalism and Human Rights Committee for the American College of Physicians
There are many parts to this story. If we turned our clocks back to the late 19th century, the physicianpharmaceutical industry relationship was very different from today. In
Correspondence and reprint requests: David C. Dale, MD, MACP, University of Washington, Box 356422, 1959 NE Pacific Street, Room AA522, Seattle, Washington 98195, Tel: 206-5437215, Fax: 206-685-4458, E-mail: [email protected]. Potential Conflicts of Interest: Dr. Dale has consulted and/or received research funds from the following companies, but none of these relationships were in conflict with his talk: Amgen, Sanofi Aventis, Cellerant, Merck, Genzyme, Galderma, Esai Pharma, Drais Pharma, Genkyotex, Boerhinger-Ingelheim, Philips, Hospira, Prolong, Coherus, Omeros, X4Pharma, Anaptysbio, Menogenix, Springer, Wolter Kluwer, Information Television Network, Medscape, National Institutes of Health, University of Washington, American College of Medical Genetics, American College of Physicians, Glaxo, and Johnson & Johnson.
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his book The Social Transformation of American Medicine, Paul Starr gives us a glimpse of these relationships (3). In the 1880s many physicians dispensed their homemade remedies — powders, pills, and elixirs — in their offices. They often owned the local drugstore. But physicians were not the only source for medicines. The patent medicine makers were everywhere, both selling drugs and distributing guides to health, and advertising widely. Starr cites the example of a Texan, William Radam, who promoted a “microbe killer containing water plus a trace of red wine and some hydrochloric and sulfuric acid” (3). By 1890 when patent medicines were at their apogee, Radam reportedly had 17 factories producing this concoction. There were many patent medicine peddlers. You may recall that John D. Rockefeller’s father, John A. Rockefeller, sold patent medicines; he was called a “quack cancer doctor” (4). In the 1890s the tides shifted. The American Medical Association grew in strength and became a vital force in American politics. It launched a campaign to force manufacturers to disclose the formulae of drugs and to end public advertising. Magazines such as the Ladies Home Journal warned against self-medication. Samuel Hopkins Adams published a very influential article in Collier’s on October 7, 1905, entitled “The Great American Fraud,” about unfounded cures for cancer, tuberculosis, syphilis, narcotic addiction, and other serious illnesses (3). In 1906 Congress passed the Pure Food and Drug Act, ushering in important safeguards (5). This was the first step to assure that US drugs are beneficial and safe. It is said that the Pure Food and Drug Act of 1906 (P.L. 59-384, 34 Stat. 768), sometimes called the Wiley Act, is the most important regulatory statute in the history of the United States. A second bill, the Food, Drug and Cosmetic Act of 1938, added new requirements and it outlawed bogus therapeutic claims. A separate law brought drug advertising under the jurisdiction of the Federal Trade Commission. In 1941, the US Food and Drug Administration (FDA) identified about 20 drugs that could be sold only through prescriptions by physicians or dentists. The Kefauver hearings in the early 1960s produced another milestone (5). A drug known as Kevadon, thalidomide, was being sold in Europe as a sedative. An FDA official reviewed data on this drug submitted by the William Merrill Company of Cincinnati. He believed that there was not sufficient safety data and resisted its approval. Despite this lack of approval, more than 1,000 US physicians prescribed thalidomide provided by Merrill, resulting in the birth of 17 newborns with severe birth defects, called phocomelia. The KefauverHarris amendments further increased the requirements for evidence of safety, before a drug could be marketed in the US (5).
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These are interesting and important historical landmarks, but my goal in introducing this topic today is not to dwell upon the “long ago,” but to bring up some contemporary issues for discussion. Healthcare is expensive. We Americans spend a lot for it —in aggregate we spent a total of $2.6 trillion in 2014 or more than $8,000 or more per person in 2015. Expenditures for hospital care accounted for nearly 40% of the total. Physicians’ fees and fees for various services are about 24%, prescription drugs 12% and all other services 27% (1). Pharmaceutical prices are in the news because these expenditures are going up faster than anything else in health care. This problem is made more apparent because for most Americans medical insurance, private or governmental, pays better for hospital care than for drugs, and insurance companies are increasing co-pays, so the general public is increasingly aware of the cost of medications. For the years 2010 through 2015, drug prices have increased at more than 10% per year (2). Right now, the hottest topic is the EpiPen (6–8). This is a syringe with a spring device to inject epinephrine, a natural hormone used for a long time to treat allergic reactions. I first learned about the escalating price of EpiPens several months ago when I tried to buy one for an emergency kit. I was astonished by the price; the UW Medical Center pharmacy told me that a package of two cost more than $700. The Mylan pharmaceutical company sells the EpiPen as well as other products. In 2007 this company bought the rights to market the EpiPen, which is manufactured by Pfizer, through a subsidiary Meridian Medical Technologies. According to investigative reporting by the Wall Street Journal (6,7) NBC (8), and others, after it acquired the EpiPen, Mylan contracted for revisions in the device and began steadily raising the price. It reportedly quadrupled its lobbying expenditures from $270,000 to $1.2 million annually. Following new legislation passed in 2010, the FDA permitted the company to change its recommendations so that EpiPens would be sold in packages of two pens, instead of one. The FDA also allowed a change in the label to recommend purchase of EpiPen for “at-risk” patients, not just patients with known allergies. Then in 2013, the government passed a law to give block grants to states to stock EpiPens in public schools. The company aggressively fought to block Teva, an Israeli pharmaceutical company, from entering this market. After acquiring the EpiPen, Mylan’s revenues grew dramatically and the total annual compensation for the CEO went from $2,453,456 to $18,931,068.
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Heather Bresch, Mylan’s CEO, recently testified before a House panel that one of the main reasons the company had to hike up the prices on EpiPens was because it had invested more than 1 billion dollars to enhance the product and make it more available. On September 30, 2016, NBC News exposed the EpiPen (8). To show how the billion dollars was spent, it showed pictures of a University of Washington emergency physician who had taken the device apart. The new device has a cover for the needle after the injection. The spring is a bit bigger. The barrel is now oval to keep it from rolling off a table. There is an easy to open flip-top carry case and upgraded instructional graphics. At hearings before the House Committee on Oversight and Government Reform, the Mylan’s CEO acknowledged that most of the billion dollars the company had spent on development of the new EpiPens went towards marketing and lobbying. Senators Amy Klobuchar and Chuck Grassley seriously questioned how such price increases could be justified. Colchicine is another old drug whose price has recently increased dramatically. Colchicine has been used for many years to treat gout (9). In the 1970s, I worked with colleagues at the National Institutes of Health in conducting the randomized clinical trials that demonstrated the benefits of colchicine for the treatment of familial Mediterranean fever. These patients take the drug daily on a long-term basis. In 2006, the FDA began encouraging investigators to conduct clinical trials to establish the safety and efficacy of old drugs, including colchicine. One company, URL Pharma, quickly saw this as an opportunity and conducted a clinical trial and got approval to market colchicine as Colcrys (9). Once this drug was approved, the FDA ordered the nonapproved versions removed from the market. Then, under the direction of its CEO Richard Roberts, URL Pharma increased the price from as little as $0.05 to $5 per pill. The possibility of profiting from this “reinvented drug” then attracted the attention of Takada, a Japanese pharmaceutical company. It paid $800 million for URL Pharma, probably not an unreasonable price because Colcrys was bringing in revenue of about $600 million annually. Another company, Hikma Pharmaceuticals, entered this market with the “competitive pricing” of about $3.00 per 0.6 mg pill, still way above the old price of 5 cents per pill (10). The company Valeant has also been in the news recently (11). This company was originally called ICN and was begun by Milan Panić, a 1950s immigrant to the US from Yugoslavia. Panić started the company in his garage in Orange County, California, but he was not very successful and returned to Yugoslavia. The company was subsequently renamed Valeant, and Mike Pearson, a businessman, became its
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CEO in 2008. Pearson is quoted as saying, “Don’t bet on science, bet on management.” His approach was to cut research and development expenses, borrow cheap money, establish off-shore offices, raise prices, and maximize profits. Valeant owns the 2 drugs used to treat Wilson disease, Cuprimine or penicillamine and Syprine or triethylenetetramine, also called trientine. Pearson raised the price of a month’s supply of Syprine to $20,000, a drug which previously cost only 1 dollar per pill or $30 per month. Cuprimine’s price was similarly increased. The company created plans for forgiveness of co-pays to keep patients on the drug, but insurance — private or governmental insurance — was expected to cover the increased price. Valeant was profitable; its stock price increased dramatically. It bought 100 other companies, including Bausch and Lomb, and its revenues exploded to more than $8 billion in 2014. This drug company came to broader public attention with its hostile takeover efforts to acquire Allergan, the maker of Botox, and when it raised the price of Nitropress by 525% and Isoprel by 212%. Warren Buffet’s colleague, Charlie Munger, publicly called Valeant’s business behavior deeply immoral (12). What would you call it? Earlier this year another company, Turing Pharmaceuticals, a company selling pyrimethamine, or Daraprim, was in the daily news because of drug pricing. This is a drug commonly taken by AIDS patients and others to treat toxoplasmosis, and it was formerly used widely to treat malaria. This company was launched only in February 2015 by CEO Martin Shkreli who immediately raised the price of Daraprim, a 1953 drug, from $13.50 to $750 per tablet. CEO Shkreli was recently arrested for defrauding investors in his previous business dealings, but the company is still in business and the drug prices are still the same (13). These may be regarded as exceptions for pharmaceutical pricing, but there is also ample recent news about extraordinary price increases by the biopharmaceutical industry and its pay scale for executives. Recent data indicates that the top 20 highest paid executives in this field have annual compensation of $14 to $42 million (14). The increases in salaries have paralleled the increase in prices for the drugs, and generics are not excused in this escalation in prices. In the debate about drug prices there is a tendency to want to blame someone else (2,15,16). The manufacturers blame the distribution companies and the pharmacy benefit programs. The manufacturers may increase list prices, but then the pharmacy benefit managers, “the middlemen,” demand high rebates in exchange for including specific drugs in their formularies (15). For example, Eli Lily, the major US manufacturer of insulin, recently reported that it receives less revenue
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from selling Humalog insulin than it did in 2009, even though it raised the price by 252%, because of the middlemen. Some blame the insurance companies who are more than willing to allow rebates and increases in patient co-pays. And some blame the pharmacists for the convoluted way they fill prescriptions. Do you ever ask the pharmacist to give you the price of a prescription drug before they fill it for you? It is hard to get a straight answer. Increasing co-pays are a major problem and a large reason for recent public outcry. On October 10, 2016, The Wall Street Journal quotes comments from a 45-year-old electrical contractor in Port Angeles, Washington, with a child with diabetes (17). She says that her out-of-pocket cost for insulin have increased from $40 to $600 for a 6-week supply because of increases in co-pays. The Mylan CEO has blamed Obamacare because it mandated cheap insurance and necessitated more co-pays. Some blame the FDA for the lengthy and detailed processes it uses to approve drugs and its failure to establish relative value of new therapeutics and to engage in setting prices. Economists blame the federal government for failing to aggressively negotiate with manufacturers to keep US drug prices at least as low as those paid for by Canadian or European governments or the Veterans Affairs (VA) health system in the United States. In California, there is an initiative on the November ballot, Proposition 61, which would bar state agencies — covering about 4.5 million persons — from paying more for prescription drugs than the US Department of Veterans Affairs, which get at least a 24% discount off list prices. According to an October 2, 2016, article in The Seattle Times, 66% of Californians favor proposition 61 (18). We can expect the next US President and the Congress will rapidly become embroiled in how to control drug prices. In the interim, is there anything physicians can do? You can do? I often say to patients, “How will you pay for your lab tests or your prescriptions?” I may follow-up by saying, “I think it is part of my job to keep you from getting sick because you are worried about paying for health care.” I see it as part of my job to be concerned about the complexities of drug costs, co-pays, and alternative treatments, but it is sometimes really hard to be helpful. For many years, the pharmaceutical industry has supported medical education in a whole variety of ways. The industry has helped to pay the cost of putting on medical education conferences, special programs, and the cost of medical publications through advertising (19). Sometimes this is directly self-serving; for example, a conference to describe a new drug and to encourage physicians to prescribe it. Other times the
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support is more subtle. I remember when Lilly gave medical students black bags to carry their new stethoscopes, reflex hammers, and other tools of the trade. A few years ago, a group of physicians started a program called “No Free Lunch” (19,20). I remember the well-dressed pharmaceutical representatives rolling into my hospital with stacks of pizza and other items for these lunches. They often seemed burdened, and I felt a bit sorry for them. In general, doctors have said that the lunch, a pen or piece of candy from a pharmaceutical company does not influence their practice. There are numerous studies, however, indicating that we are influenced by the sources of information about drugs, but because prescription practices are quite complex, it is not easy to know just why a physician prescribes a given drug (19–22). Some believe that doctors prescribe expensive drugs rather than cheap ones because they have been “bought” by the pharmaceutical industry. The “Sunshine Act” that was part of the Affordable Care Act, or Obamacare, required pharmaceutical companies to disclose all their payments in money or in kind to physicians (20,22). Before this act was passed, Massachusetts required drug companies to report payments to physicians. Yeh et al recently reported that 37% of Massachusetts’ physicians in the Medicare prescribing database in 2011 received industry payments, most frequently a sponsored meal (23). They found a statistical correlation between prescribing a brand name statin, the family of drugs that lowers cholesterol, and receipt of some sort of financial support for educational training. However, they did not find an association specifically with meals, bona fide services such as conducting studies, consulting, grants, or educational gifts. More recently, DeJong et al reported on the relationship of industrysponsored meals with prescribing the promoted brand-name drug to Medicare beneficiaries using a large data base of 279,669 physicians (20). The study showed an association of receiving a single meal and promoting the drug of interest. But this kind of study only suggests and does not prove a causal relationship. More data will be forthcoming, but I will be surprised if much of the increasing cost of drugs is due to this sort of marketing efforts aimed at physicians. One reason for saying this is because meals, drug samples, and detailing are becoming a lesser part of pharmaceutical marketing. Pharma is spending much more on direct to consumer advertising (24). New Zealand is the only other country that allows companies to advertise their product claims directly to consumers. The FDA currently holds the position that advertising informs patients and that advertising carries more benefit than harm.
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Pharma currently is shifting to use of social media to market drugs (25). It is estimated that pharmaceutical companies spend at least 25% of their marketing budgets on social media and digital technologies — websites, insertion of ads into the electronic health records, industrysponsored clinical tools, and tools for requesting samples, etc. Social media also have become channels for direct marketing to physicians. There are industry-sponsored tools to help physicians manage their continuing medical education credits while receiving either direct or subtle advertisements. Mobile/smart phone applications provide physicians with information on drug indications, interactions, insurance coverage, etc., while at the same time tracking physicians’ prescription patterns. Doctors are encouraged to prescribe specific drugs with eCoupons, discount prescriptions for patients with the bulk of the charge going to insurance or the government. Thus, marketing tools are being seamlessly and unknowingly incorporated into modern electronic health records and physician resources.
HOW SHOULD PHYSICIANS REACT TO ALL THIS? The Ethics Manual of the American College of Physicians is an anchor for physicians in this kind of discussion (26). The principal tenets in the manual related to my talk today are: • Patient care takes primacy over financial considerations. • Physicians must disclose their relevant financial interests to patients. • Physicians must acknowledge financial interest as a speaker, teacher, and author. • Most products should not be sold in the office and, if something is sold, the charges should be limited to the reasonable costs. The selling of samples is unethical. • The acceptance by a physician of gifts, hospitality, and trips is strongly discouraged. • Physicians must critically evaluate all medical information, including that provided by detail persons, advertisements, or industrysponsored educational programs. Looking back 50 years, the period of my career in medicine, it is easy to see that it has been a half century of immense progress. Social and economic changes, advances in education, and information technology have had a huge impact, but advances in medicine through new and better drugs have contributed enormously also. If you turn the clock
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back to the 1960s, myocardial infarction as a cause for hospitalization was far more frequent than it is today and the stays were longer and the outcomes for many specific conditions were far worse. Across the spectrum of medical specialties there has been enormous progress. Medical progress rests on a foundation of basic and applied clinical research. In many fields randomized control trials are the gold standards for determining if a new drug or any other therapy works. In preparing this talk, I looked at The New England Journal of Medicine for randomized controlled trials published since January 2015. Almost all were sponsored by the pharmaceutical industry. The industry is proud of its accomplishments: Advances in the treatment of dread viral diseases such as HIV and hepatitis C are prime examples. The industry is proud of its accomplishments in reducing cardiovascular disease through the development of anti-hypertensives and lipid-lowering agents. The industry is also proud of its contribution to the remarkably rapid advances in cancer diagnosis, treatment, and prevention, and its contribution to the economic health of our country. The Journal of the American Medical Association recently published two articles about the cost of prescription drugs. Kesselheim et al reviewed the history and comparative cost of prescriptions in the United States versus other countries (14). Bottom line: we pay more. Drug companies maintain high prices here because of protection from competition and negotiating power. They argue that the industry is vulnerable. They believe expenditures in research and development are overstated. They provide data indicating that as drug costs are shifted to patients, patients will reduce the use of effective medications and the health of the public will be undermined. Currently it is estimated that almost a quarter of patients do not fill prescriptions because the drugs are too expensive. This trend will only go up next year unless something is done. Non-adherence to prescribed medications is estimated to cost $105 billion annually in avoidable healthcare costs. The alternatives they suggest are: improved competition, government intervention to reduce prices, and better information for physicians and patients about the cost and benefits of drugs. In another article, Rena Conti et al from the University of Chicago cited the example of patients banding together to force the government and the pharmaceutical companies to lower prices, as occurred with the HIV epidemic and the Ryan White Act (27). They also suggested that the federal government could use its clout to purchase drugs at low prices and resell them to the public through various regulated vendors. They also suggest that the government could manufacture drugs
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or threaten to do so, as it did with the antibiotic ciprofloxacin when we had the 2001 threat of an anthrax epidemic. The Federal government also might use its taxing authority to require greater transparency of research and development expenses and might more aggressively tax marketing expenses. I believe that the next few months will be a heady time for discussion and for posturing about drug costs in America. In my own career I have spent a great deal of time studying the effects of drugs and working on developing new drug therapies. Along the way, I have been asked to consult for numerous companies, most frequently about adverse hematopoietic effects of drugs, to advise on the design and feasibility of clinical trials, and to oversee the safe conduct of clinical trials as a member or chair of a data monitoring and safety board. I have great respect for most of the people I have worked with in the pharmaceutical industry and the challenges they face. I believe academic physicians should continue to engage with industry to find new and better drugs and to use their knowledge about human health and disease to teach physicians at all stages in their careers about the best uses for the medications we prescribed. I firmly believe that we should engage with industry, the government, and the public at large to find ways to push forward with developing diseasespecific, molecularly based therapies while at the same time engaging and pushing hard to hold down the costs of drug development and the cost of medical care. The challenge is how is the best way to do this?
REFERENCES 1. The Kaiser Family Foundation State Health Facts. Data source: IMS Health Incorporated; Special Data Request, 2016. Calculations based on 2014 population estimates from the U.S. Census Bureau. Retail prescription drugs filled at pharmacies (annual per capita by age). Timeframe 2015. Available at: http://kff.org/other/state-indicator/ retail-rx-drugs-by-age?currentTimegrame=0&sortModel=%7B%22colld%22:%22Loca tion%22,%22sort%22:%22Asc%22%7D. Published 2016; Accessed September 30, 2016. 2. Thomas K. The complex math behind spiraling prescription drug prices. The New York Times. Available at: http://www.nytimes.com/2016/04/28/business/high-drugprices-explained.html?_r=0. Published April 27, 2016; Accessed September 6, 2016. 3. Starr P. The Social Transformation of American Medicine. New York, NY. Basic Books, Inc.; 1982. 4. Chernow R. Titan: The Life of John D. Rockefeller, Sr. New York, NY. Random House, Inc.; 1998. 5. U.S. Food and Drug Administration. Brochure: The history of drug regulation in the United States. Available at: http://www.fda.gov/AboutFDA/WhatWeDo/History/FOrgsHistory/CDER/CenterforDrugEvaluationandResearchBrochureandChronology/ ucm114470.htm. Updated September 24, 2015; Accessed October 30, 2016. 6. Burton TM. U.S. disputes EpiPen fees. The Wall Street Journal. October 6, 2016:B1.
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7. Maremont M, Francis T. EpiPen pact unlikely to affect pay. The Wall Street Journal. October 28, 2016:B2. 8. Popken B. Mylan’s upgraded EpiPen torn apart by experts. NBC News. Available at: http://www.nbcnews.com/business/consumer/mylan-says-it-upgraded-epipen-2009so-experts-looked-inside-n652651. Published September 30, 2016; Accessed October 11, 2016. 9. Wikipedia contributors. Colchicine. Wikipedia, The Free Encyclopedia. Available at: https://en/wikipedia.org/w/index.php?title=Colchicine&oldid=755831225. Accessed December 20, 2016 12:36 UTC. 10. URL Pharma may no longer be cash cow in Philadelphia. Pittsburg Post-Gazette. Available at: http://www.post-gazette.com/business/businessnews/2013/03/03/ url-pharma-may-no-longer-be-cash-cow-in-philadelphia/201303030209. Published March 3, 2015; Accessed December 20, 2016. 11. McClean B. The Valeant meltdown and Wall Street’s major drug problem. Vanity Fair. Available at: http://www.vanityfair.com/news/2016/06/the-valeant-meltdownand-wall-streets-major-drug-problem. Published Summer 2016; Accessed December 20, 2016. 12. Imbert F. Munger: Valeant Pharmaceuticals turned out to be a “sewer.” CNBC. Available at: http://www.cnbc.com/2016/04/30/munger-valeant-pharmaceuticals-turnedout-to-be-a-sewer.html. Published April 30, 2016; Accessed December 20, 2016. 13. Pollack A, Goldstein M. Martin Shkreli all but gloated over huge drug price increases, memos show. The New York Times. Available at: http://www.nytimes.com/2016/02/03/ business/drug-makers-calculated-price-increases-with-profit-in-mind-memos-show. html?_r=0. Published: February 2, 2016; Accessed September 8, 2016. 14. Staton, T. The top 20 highest-paid biopharma CEOs. FiercePharma. Available at: http://www.fiercepharma.com/special-report/top-20-highest-paid-biopharma-ceos. Published July 13, 2015; Accessed December 21, 2016. 15. Kesselheim AS, Avorn J, Sarpatwari A. The high cost of prescription drugs in the United States: origins and prospects for reform. JAMA 2016;316:858–71. 16. Thomas K. Drug prices keep rising despite intense criticism. The New York Times. Available at: http://www.nytimes.com/2016/04/27/business/drug-prices-keep-risingdespite-intense-critisim.html. Published April 26, 2016; Accessed September 8, 2016. 17. Roland D, Loftus P. Insulin prices climb, fueled by middlemen. The Wall Street Journal. October 10, 2016:A1-2. 18. Harrop F. Could California lower drug prices for all? The Seattle Times. October 2, 2016:A15. 19. Wikipedia contributors. Pharmaceutical marketing. Wikipedia. The Free Encyclopedia. Available at: https://en.wikipedia.org/wiki/Pharmaceutical_marketing. Published 09/04/2004; Updated 09/28/2016; Accessed October 10, 2016. 20. DeJong C, Aguilar T, Tseng CW, Lin GA, et al. Pharmaceutical industry-sponsored meals and physician prescribing patterns for Medicare beneficiaries. JAMA Intern Med 2016;176:1114–10. 21. Kirschner NM, Sulmasy LS, Kesselheim AS. Health policy basics: the physician payment Sunshine Act and the open payments program. Ann Intern Med 2014;161:519–21. 22. Agrawal S, Brown D. The physician payments Sunshine Act — two years of the open payments program. N Engl J Med 2016;374:906–9. 23. Yeh JS, Franklin JM, Avorn J, Landon J, Kesselheim AS. Association of industry payments to physicians with the prescribing of brand-name statins in Massachusetts. JAMA Intern Med 2016;176:763–8.
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24. Donohue JM, Cevasco M, Rosenthal MB. A decade of direct-to-consumer advertising of prescription drugs. N Engl J Med 2007;357:673–81. 25. Manz C, Ross JS, Grande D. Marketing to physicians in a digital world. N Engl J Med 2014;371:1857–9. 26. Snyder L; American College of Physicians Ethics, Professionalism, and Human Rights Committee. American College of Physicians Ethics Manual, 6th ed. Ann Intern Med 2012;156:73–104. 27. Conti RM, Gee RE, Sharfstein JM. Pharmaceuticals and public health. JAMANetwork. Available at: http://jamanetwork.com/journals/jama/fullarticle/2572299. Published October 20, 2016; Accessed October 25, 2016.
DISCUSSION Collier, Newark: That was a great talk, David. One of the issues that you didn’t cover is the sometimes adversarial relationship between the physicians who want to prescribe these really expensive drugs and the hospitals that don’t want to have the drugs on their formularies. And that is an increasing problem where I come from. Could you comment on that? Dale, Seattle: Well, it is a problem and I can see both sides of that. And it’s a dilemma, and I think that’s where the constructive thing to do is engage with the hospital in terms of how you make the decision. But you have to be the advocate for your patient and I find that kind of activity just like a time sink; a huge amount of effort that goes into it. I don’t know the solution other than to advocate for the individual patient. Palmer, New York City: Thank you very much for that. This is a really very important topic on how to control these prices. There is one aspect that I’d like to comment on and that has to do with the direct-to-consumer advertising which I thought for a long time was really dreadful. And it’s difficult to control that because of the problem of free speech and this has inhibited efforts to try to control direct-to-consumer advertising. But there are approaches that I think one could take that have been, let’s say, neglected. For example, it’s within the power of the government to say that direct-toconsumer advertising is not deductible as a business expense and I think you would see an enormous decrease in direct-to-consumer advertising if we try to work at it from that perspective. Dale, Seattle: That’s a good suggestion....and it is for the company regarded as a nontaxable part of their expense so they deduct it from their profits. Oates, Nashville: Thank you for stimulating us to think about this important issue. In the talk you pointed out the value of the industry and discovery and drug development. But the three egregious and really unacceptable examples that you illustrated were all from companies that were in the generic drug industry which are essentially parasitic on the efforts of those companies that are involved in drug research and drug development. I wonder if we make a mistake in putting an umbrella over these companies and the drugs companies that are responsible for discovery, and calling them all the pharmaceutical industry. Dale, Seattle: And that’s a very good comment John, and I think that the umbrella is like a broken umbrella. You know, some parts are very different from the other. The companies involved in discovery do have a very different structure in governance. But generic drugs account for 80% of prescriptions in America now. So, the traditional ethical pharmaceutical industry that is involved in discovery really is involved in the subset in
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the drug we prescribe, and we have to be concerned about both. I think there was a hope that generics would reduce cost and really work very well. Reiser, Chicago: Just a very brief question. Wonderful talk. I think the ones that really suffer from this whole debate are the residents. I think they have lost an opportunity to learn deeply about new drugs, that they would then use. I think it’s a real issue that we get very comfortable with the drugs that we all know. I get very comfortable with the drugs that I know and I am not so informed with the new ones. What I would like to see is a more realistic way of bringing some of these companies back in our training facilities in a way that it’s allowed and that there can be discussion about new drugs, new uses, and how they work. I really think that it’s sort of how it got stuck in this whole debate that we have. Dale, Seattle: So that is to engage...engage at the level of the young doctors who are training. I agree. Reiser, Chicago: How do we fix it? Dale, Seattle: Yes, find the time to hold their attention. Yes, Marshall? Wolf, Boston: I think people should leave with something that changes the way they practice. I have enjoyed your talk but I want to share with you something David Littman, a cardiologist, taught me and that is: you should use drugs when they are first released before they develop side effects. Gershon, New York City: In your talk you mentioned the cost of drugs, the hope for the generics, and the failure of the generics to lower cost, and their success at reducing the income of the ethical companies that are actually developing drugs. Also, their effects at slowing drug discovery because they take the money out of the discovery and put it into marketing. You didn’t mention why we have such disparities in the cost of drugs in the United States and in Canada and other countries and the role played by the American government in driving costs up. We don’t, for example, allow Medicare to bargain for cost of drugs and we essentially ask the public to make decisions on drugs that can kill them. You listen to these massive numbers of side effects with smiling people on the television screen “Oh, this drug can peel your skin off, it’s wonderful!” I mean, people have no concept of what they are buying and we have created a patent medicine era again. It’s been a deliberate effort from the part of our government or at least part of the congress to do that. Dale, Seattle: Well, that’s a very telling comment and as you know the FDA approves drugs but don’t help setting the prices. I once served on one of the advisory committees and I quit because I was so frustrated that they were looking at “does it work?” But relative efficacy in price was not in the consideration. And I think that is one of the areas where the government could take a more active role.
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PRESIDENT’S ADDRESS Physicians and the Pharmaceutical Industry DAVID C. DALE, MD, MACP SEATTLE, WASHINGTON
I am talking today about “Physicians and the Pharmaceutical Industry” because the topic is so timely and relevant to most of us. Currently, 60% of Americans are taking prescription drugs, an average of 2.2 per person above age 18 years (1). American adults over age 65 fill an average of 27 prescriptions per year. Most of us take at least something to control blood pressure, to lower cholesterol, to treat diabetes, or something just for our aches and pains. There is currently great public controversy about the costs of drugs, their benefits, and access to prescription medications. This topic is currently in the newspaper almost every day (2). My interest in this topic has grown steadily, and I have dealt with the pharmaceutical industry in many ways. • • • • • •
Prescribing drugs for patients Teaching students and residents about prescribing medications Conducting and overseeing clinical trials for new drugs Consulting for the pharmaceutical industry As an administrator and as an editor and As Chair of the Ethics, Professionalism and Human Rights Committee for the American College of Physicians
There are many parts to this story. If we turned our clocks back to the late 19th century, the physicianpharmaceutical industry relationship was very different from today. In
Correspondence and reprint requests: David C. Dale, MD, MACP, University of Washington, Box 356422, 1959 NE Pacific Street, Room AA522, Seattle, Washington 98195, Tel: 206-5437215, Fax: 206-685-4458, E-mail: [email protected]. Potential Conflicts of Interest: Dr. Dale has consulted and/or received research funds from the following companies, but none of these relationships were in conflict with his talk: Amgen, Sanofi Aventis, Cellerant, Merck, Genzyme, Galderma, Esai Pharma, Drais Pharma, Genkyotex, Boerhinger-Ingelheim, Philips, Hospira, Prolong, Coherus, Omeros, X4Pharma, Anaptysbio, Menogenix, Springer, Wolter Kluwer, Information Television Network, Medscape, National Institutes of Health, University of Washington, American College of Medical Genetics, American College of Physicians, Glaxo, and Johnson & Johnson.
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his book The Social Transformation of American Medicine, Paul Starr gives us a glimpse of these relationships (3). In the 1880s many physicians dispensed their homemade remedies — powders, pills, and elixirs — in their offices. They often owned the local drugstore. But physicians were not the only source for medicines. The patent medicine makers were everywhere, both selling drugs and distributing guides to health, and advertising widely. Starr cites the example of a Texan, William Radam, who promoted a “microbe killer containing water plus a trace of red wine and some hydrochloric and sulfuric acid” (3). By 1890 when patent medicines were at their apogee, Radam reportedly had 17 factories producing this concoction. There were many patent medicine peddlers. You may recall that John D. Rockefeller’s father, John A. Rockefeller, sold patent medicines; he was called a “quack cancer doctor” (4). In the 1890s the tides shifted. The American Medical Association grew in strength and became a vital force in American politics. It launched a campaign to force manufacturers to disclose the formulae of drugs and to end public advertising. Magazines such as the Ladies Home Journal warned against self-medication. Samuel Hopkins Adams published a very influential article in Collier’s on October 7, 1905, entitled “The Great American Fraud,” about unfounded cures for cancer, tuberculosis, syphilis, narcotic addiction, and other serious illnesses (3). In 1906 Congress passed the Pure Food and Drug Act, ushering in important safeguards (5). This was the first step to assure that US drugs are beneficial and safe. It is said that the Pure Food and Drug Act of 1906 (P.L. 59-384, 34 Stat. 768), sometimes called the Wiley Act, is the most important regulatory statute in the history of the United States. A second bill, the Food, Drug and Cosmetic Act of 1938, added new requirements and it outlawed bogus therapeutic claims. A separate law brought drug advertising under the jurisdiction of the Federal Trade Commission. In 1941, the US Food and Drug Administration (FDA) identified about 20 drugs that could be sold only through prescriptions by physicians or dentists. The Kefauver hearings in the early 1960s produced another milestone (5). A drug known as Kevadon, thalidomide, was being sold in Europe as a sedative. An FDA official reviewed data on this drug submitted by the William Merrill Company of Cincinnati. He believed that there was not sufficient safety data and resisted its approval. Despite this lack of approval, more than 1,000 US physicians prescribed thalidomide provided by Merrill, resulting in the birth of 17 newborns with severe birth defects, called phocomelia. The KefauverHarris amendments further increased the requirements for evidence of safety, before a drug could be marketed in the US (5).
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These are interesting and important historical landmarks, but my goal in introducing this topic today is not to dwell upon the “long ago,” but to bring up some contemporary issues for discussion. Healthcare is expensive. We Americans spend a lot for it —in aggregate we spent a total of $2.6 trillion in 2014 or more than $8,000 or more per person in 2015. Expenditures for hospital care accounted for nearly 40% of the total. Physicians’ fees and fees for various services are about 24%, prescription drugs 12% and all other services 27% (1). Pharmaceutical prices are in the news because these expenditures are going up faster than anything else in health care. This problem is made more apparent because for most Americans medical insurance, private or governmental, pays better for hospital care than for drugs, and insurance companies are increasing co-pays, so the general public is increasingly aware of the cost of medications. For the years 2010 through 2015, drug prices have increased at more than 10% per year (2). Right now, the hottest topic is the EpiPen (6–8). This is a syringe with a spring device to inject epinephrine, a natural hormone used for a long time to treat allergic reactions. I first learned about the escalating price of EpiPens several months ago when I tried to buy one for an emergency kit. I was astonished by the price; the UW Medical Center pharmacy told me that a package of two cost more than $700. The Mylan pharmaceutical company sells the EpiPen as well as other products. In 2007 this company bought the rights to market the EpiPen, which is manufactured by Pfizer, through a subsidiary Meridian Medical Technologies. According to investigative reporting by the Wall Street Journal (6,7) NBC (8), and others, after it acquired the EpiPen, Mylan contracted for revisions in the device and began steadily raising the price. It reportedly quadrupled its lobbying expenditures from $270,000 to $1.2 million annually. Following new legislation passed in 2010, the FDA permitted the company to change its recommendations so that EpiPens would be sold in packages of two pens, instead of one. The FDA also allowed a change in the label to recommend purchase of EpiPen for “at-risk” patients, not just patients with known allergies. Then in 2013, the government passed a law to give block grants to states to stock EpiPens in public schools. The company aggressively fought to block Teva, an Israeli pharmaceutical company, from entering this market. After acquiring the EpiPen, Mylan’s revenues grew dramatically and the total annual compensation for the CEO went from $2,453,456 to $18,931,068.
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Heather Bresch, Mylan’s CEO, recently testified before a House panel that one of the main reasons the company had to hike up the prices on EpiPens was because it had invested more than 1 billion dollars to enhance the product and make it more available. On September 30, 2016, NBC News exposed the EpiPen (8). To show how the billion dollars was spent, it showed pictures of a University of Washington emergency physician who had taken the device apart. The new device has a cover for the needle after the injection. The spring is a bit bigger. The barrel is now oval to keep it from rolling off a table. There is an easy to open flip-top carry case and upgraded instructional graphics. At hearings before the House Committee on Oversight and Government Reform, the Mylan’s CEO acknowledged that most of the billion dollars the company had spent on development of the new EpiPens went towards marketing and lobbying. Senators Amy Klobuchar and Chuck Grassley seriously questioned how such price increases could be justified. Colchicine is another old drug whose price has recently increased dramatically. Colchicine has been used for many years to treat gout (9). In the 1970s, I worked with colleagues at the National Institutes of Health in conducting the randomized clinical trials that demonstrated the benefits of colchicine for the treatment of familial Mediterranean fever. These patients take the drug daily on a long-term basis. In 2006, the FDA began encouraging investigators to conduct clinical trials to establish the safety and efficacy of old drugs, including colchicine. One company, URL Pharma, quickly saw this as an opportunity and conducted a clinical trial and got approval to market colchicine as Colcrys (9). Once this drug was approved, the FDA ordered the nonapproved versions removed from the market. Then, under the direction of its CEO Richard Roberts, URL Pharma increased the price from as little as $0.05 to $5 per pill. The possibility of profiting from this “reinvented drug” then attracted the attention of Takada, a Japanese pharmaceutical company. It paid $800 million for URL Pharma, probably not an unreasonable price because Colcrys was bringing in revenue of about $600 million annually. Another company, Hikma Pharmaceuticals, entered this market with the “competitive pricing” of about $3.00 per 0.6 mg pill, still way above the old price of 5 cents per pill (10). The company Valeant has also been in the news recently (11). This company was originally called ICN and was begun by Milan Panić, a 1950s immigrant to the US from Yugoslavia. Panić started the company in his garage in Orange County, California, but he was not very successful and returned to Yugoslavia. The company was subsequently renamed Valeant, and Mike Pearson, a businessman, became its
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CEO in 2008. Pearson is quoted as saying, “Don’t bet on science, bet on management.” His approach was to cut research and development expenses, borrow cheap money, establish off-shore offices, raise prices, and maximize profits. Valeant owns the 2 drugs used to treat Wilson disease, Cuprimine or penicillamine and Syprine or triethylenetetramine, also called trientine. Pearson raised the price of a month’s supply of Syprine to $20,000, a drug which previously cost only 1 dollar per pill or $30 per month. Cuprimine’s price was similarly increased. The company created plans for forgiveness of co-pays to keep patients on the drug, but insurance — private or governmental insurance — was expected to cover the increased price. Valeant was profitable; its stock price increased dramatically. It bought 100 other companies, including Bausch and Lomb, and its revenues exploded to more than $8 billion in 2014. This drug company came to broader public attention with its hostile takeover efforts to acquire Allergan, the maker of Botox, and when it raised the price of Nitropress by 525% and Isoprel by 212%. Warren Buffet’s colleague, Charlie Munger, publicly called Valeant’s business behavior deeply immoral (12). What would you call it? Earlier this year another company, Turing Pharmaceuticals, a company selling pyrimethamine, or Daraprim, was in the daily news because of drug pricing. This is a drug commonly taken by AIDS patients and others to treat toxoplasmosis, and it was formerly used widely to treat malaria. This company was launched only in February 2015 by CEO Martin Shkreli who immediately raised the price of Daraprim, a 1953 drug, from $13.50 to $750 per tablet. CEO Shkreli was recently arrested for defrauding investors in his previous business dealings, but the company is still in business and the drug prices are still the same (13). These may be regarded as exceptions for pharmaceutical pricing, but there is also ample recent news about extraordinary price increases by the biopharmaceutical industry and its pay scale for executives. Recent data indicates that the top 20 highest paid executives in this field have annual compensation of $14 to $42 million (14). The increases in salaries have paralleled the increase in prices for the drugs, and generics are not excused in this escalation in prices. In the debate about drug prices there is a tendency to want to blame someone else (2,15,16). The manufacturers blame the distribution companies and the pharmacy benefit programs. The manufacturers may increase list prices, but then the pharmacy benefit managers, “the middlemen,” demand high rebates in exchange for including specific drugs in their formularies (15). For example, Eli Lily, the major US manufacturer of insulin, recently reported that it receives less revenue
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from selling Humalog insulin than it did in 2009, even though it raised the price by 252%, because of the middlemen. Some blame the insurance companies who are more than willing to allow rebates and increases in patient co-pays. And some blame the pharmacists for the convoluted way they fill prescriptions. Do you ever ask the pharmacist to give you the price of a prescription drug before they fill it for you? It is hard to get a straight answer. Increasing co-pays are a major problem and a large reason for recent public outcry. On October 10, 2016, The Wall Street Journal quotes comments from a 45-year-old electrical contractor in Port Angeles, Washington, with a child with diabetes (17). She says that her out-of-pocket cost for insulin have increased from $40 to $600 for a 6-week supply because of increases in co-pays. The Mylan CEO has blamed Obamacare because it mandated cheap insurance and necessitated more co-pays. Some blame the FDA for the lengthy and detailed processes it uses to approve drugs and its failure to establish relative value of new therapeutics and to engage in setting prices. Economists blame the federal government for failing to aggressively negotiate with manufacturers to keep US drug prices at least as low as those paid for by Canadian or European governments or the Veterans Affairs (VA) health system in the United States. In California, there is an initiative on the November ballot, Proposition 61, which would bar state agencies — covering about 4.5 million persons — from paying more for prescription drugs than the US Department of Veterans Affairs, which get at least a 24% discount off list prices. According to an October 2, 2016, article in The Seattle Times, 66% of Californians favor proposition 61 (18). We can expect the next US President and the Congress will rapidly become embroiled in how to control drug prices. In the interim, is there anything physicians can do? You can do? I often say to patients, “How will you pay for your lab tests or your prescriptions?” I may follow-up by saying, “I think it is part of my job to keep you from getting sick because you are worried about paying for health care.” I see it as part of my job to be concerned about the complexities of drug costs, co-pays, and alternative treatments, but it is sometimes really hard to be helpful. For many years, the pharmaceutical industry has supported medical education in a whole variety of ways. The industry has helped to pay the cost of putting on medical education conferences, special programs, and the cost of medical publications through advertising (19). Sometimes this is directly self-serving; for example, a conference to describe a new drug and to encourage physicians to prescribe it. Other times the
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support is more subtle. I remember when Lilly gave medical students black bags to carry their new stethoscopes, reflex hammers, and other tools of the trade. A few years ago, a group of physicians started a program called “No Free Lunch” (19,20). I remember the well-dressed pharmaceutical representatives rolling into my hospital with stacks of pizza and other items for these lunches. They often seemed burdened, and I felt a bit sorry for them. In general, doctors have said that the lunch, a pen or piece of candy from a pharmaceutical company does not influence their practice. There are numerous studies, however, indicating that we are influenced by the sources of information about drugs, but because prescription practices are quite complex, it is not easy to know just why a physician prescribes a given drug (19–22). Some believe that doctors prescribe expensive drugs rather than cheap ones because they have been “bought” by the pharmaceutical industry. The “Sunshine Act” that was part of the Affordable Care Act, or Obamacare, required pharmaceutical companies to disclose all their payments in money or in kind to physicians (20,22). Before this act was passed, Massachusetts required drug companies to report payments to physicians. Yeh et al recently reported that 37% of Massachusetts’ physicians in the Medicare prescribing database in 2011 received industry payments, most frequently a sponsored meal (23). They found a statistical correlation between prescribing a brand name statin, the family of drugs that lowers cholesterol, and receipt of some sort of financial support for educational training. However, they did not find an association specifically with meals, bona fide services such as conducting studies, consulting, grants, or educational gifts. More recently, DeJong et al reported on the relationship of industrysponsored meals with prescribing the promoted brand-name drug to Medicare beneficiaries using a large data base of 279,669 physicians (20). The study showed an association of receiving a single meal and promoting the drug of interest. But this kind of study only suggests and does not prove a causal relationship. More data will be forthcoming, but I will be surprised if much of the increasing cost of drugs is due to this sort of marketing efforts aimed at physicians. One reason for saying this is because meals, drug samples, and detailing are becoming a lesser part of pharmaceutical marketing. Pharma is spending much more on direct to consumer advertising (24). New Zealand is the only other country that allows companies to advertise their product claims directly to consumers. The FDA currently holds the position that advertising informs patients and that advertising carries more benefit than harm.
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Pharma currently is shifting to use of social media to market drugs (25). It is estimated that pharmaceutical companies spend at least 25% of their marketing budgets on social media and digital technologies — websites, insertion of ads into the electronic health records, industrysponsored clinical tools, and tools for requesting samples, etc. Social media also have become channels for direct marketing to physicians. There are industry-sponsored tools to help physicians manage their continuing medical education credits while receiving either direct or subtle advertisements. Mobile/smart phone applications provide physicians with information on drug indications, interactions, insurance coverage, etc., while at the same time tracking physicians’ prescription patterns. Doctors are encouraged to prescribe specific drugs with eCoupons, discount prescriptions for patients with the bulk of the charge going to insurance or the government. Thus, marketing tools are being seamlessly and unknowingly incorporated into modern electronic health records and physician resources.
HOW SHOULD PHYSICIANS REACT TO ALL THIS? The Ethics Manual of the American College of Physicians is an anchor for physicians in this kind of discussion (26). The principal tenets in the manual related to my talk today are: • Patient care takes primacy over financial considerations. • Physicians must disclose their relevant financial interests to patients. • Physicians must acknowledge financial interest as a speaker, teacher, and author. • Most products should not be sold in the office and, if something is sold, the charges should be limited to the reasonable costs. The selling of samples is unethical. • The acceptance by a physician of gifts, hospitality, and trips is strongly discouraged. • Physicians must critically evaluate all medical information, including that provided by detail persons, advertisements, or industrysponsored educational programs. Looking back 50 years, the period of my career in medicine, it is easy to see that it has been a half century of immense progress. Social and economic changes, advances in education, and information technology have had a huge impact, but advances in medicine through new and better drugs have contributed enormously also. If you turn the clock
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back to the 1960s, myocardial infarction as a cause for hospitalization was far more frequent than it is today and the stays were longer and the outcomes for many specific conditions were far worse. Across the spectrum of medical specialties there has been enormous progress. Medical progress rests on a foundation of basic and applied clinical research. In many fields randomized control trials are the gold standards for determining if a new drug or any other therapy works. In preparing this talk, I looked at The New England Journal of Medicine for randomized controlled trials published since January 2015. Almost all were sponsored by the pharmaceutical industry. The industry is proud of its accomplishments: Advances in the treatment of dread viral diseases such as HIV and hepatitis C are prime examples. The industry is proud of its accomplishments in reducing cardiovascular disease through the development of anti-hypertensives and lipid-lowering agents. The industry is also proud of its contribution to the remarkably rapid advances in cancer diagnosis, treatment, and prevention, and its contribution to the economic health of our country. The Journal of the American Medical Association recently published two articles about the cost of prescription drugs. Kesselheim et al reviewed the history and comparative cost of prescriptions in the United States versus other countries (14). Bottom line: we pay more. Drug companies maintain high prices here because of protection from competition and negotiating power. They argue that the industry is vulnerable. They believe expenditures in research and development are overstated. They provide data indicating that as drug costs are shifted to patients, patients will reduce the use of effective medications and the health of the public will be undermined. Currently it is estimated that almost a quarter of patients do not fill prescriptions because the drugs are too expensive. This trend will only go up next year unless something is done. Non-adherence to prescribed medications is estimated to cost $105 billion annually in avoidable healthcare costs. The alternatives they suggest are: improved competition, government intervention to reduce prices, and better information for physicians and patients about the cost and benefits of drugs. In another article, Rena Conti et al from the University of Chicago cited the example of patients banding together to force the government and the pharmaceutical companies to lower prices, as occurred with the HIV epidemic and the Ryan White Act (27). They also suggested that the federal government could use its clout to purchase drugs at low prices and resell them to the public through various regulated vendors. They also suggest that the government could manufacture drugs
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or threaten to do so, as it did with the antibiotic ciprofloxacin when we had the 2001 threat of an anthrax epidemic. The Federal government also might use its taxing authority to require greater transparency of research and development expenses and might more aggressively tax marketing expenses. I believe that the next few months will be a heady time for discussion and for posturing about drug costs in America. In my own career I have spent a great deal of time studying the effects of drugs and working on developing new drug therapies. Along the way, I have been asked to consult for numerous companies, most frequently about adverse hematopoietic effects of drugs, to advise on the design and feasibility of clinical trials, and to oversee the safe conduct of clinical trials as a member or chair of a data monitoring and safety board. I have great respect for most of the people I have worked with in the pharmaceutical industry and the challenges they face. I believe academic physicians should continue to engage with industry to find new and better drugs and to use their knowledge about human health and disease to teach physicians at all stages in their careers about the best uses for the medications we prescribed. I firmly believe that we should engage with industry, the government, and the public at large to find ways to push forward with developing diseasespecific, molecularly based therapies while at the same time engaging and pushing hard to hold down the costs of drug development and the cost of medical care. The challenge is how is the best way to do this?
REFERENCES 1. The Kaiser Family Foundation State Health Facts. Data source: IMS Health Incorporated; Special Data Request, 2016. Calculations based on 2014 population estimates from the U.S. Census Bureau. Retail prescription drugs filled at pharmacies (annual per capita by age). Timeframe 2015. Available at: http://kff.org/other/state-indicator/ retail-rx-drugs-by-age?currentTimegrame=0&sortModel=%7B%22colld%22:%22Loca tion%22,%22sort%22:%22Asc%22%7D. Published 2016; Accessed September 30, 2016. 2. Thomas K. The complex math behind spiraling prescription drug prices. The New York Times. Available at: http://www.nytimes.com/2016/04/28/business/high-drugprices-explained.html?_r=0. Published April 27, 2016; Accessed September 6, 2016. 3. Starr P. The Social Transformation of American Medicine. New York, NY. Basic Books, Inc.; 1982. 4. Chernow R. Titan: The Life of John D. Rockefeller, Sr. New York, NY. Random House, Inc.; 1998. 5. U.S. Food and Drug Administration. Brochure: The history of drug regulation in the United States. Available at: http://www.fda.gov/AboutFDA/WhatWeDo/History/FOrgsHistory/CDER/CenterforDrugEvaluationandResearchBrochureandChronology/ ucm114470.htm. Updated September 24, 2015; Accessed October 30, 2016. 6. Burton TM. U.S. disputes EpiPen fees. The Wall Street Journal. October 6, 2016:B1.
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7. Maremont M, Francis T. EpiPen pact unlikely to affect pay. The Wall Street Journal. October 28, 2016:B2. 8. Popken B. Mylan’s upgraded EpiPen torn apart by experts. NBC News. Available at: http://www.nbcnews.com/business/consumer/mylan-says-it-upgraded-epipen-2009so-experts-looked-inside-n652651. Published September 30, 2016; Accessed October 11, 2016. 9. Wikipedia contributors. Colchicine. Wikipedia, The Free Encyclopedia. Available at: https://en/wikipedia.org/w/index.php?title=Colchicine&oldid=755831225. Accessed December 20, 2016 12:36 UTC. 10. URL Pharma may no longer be cash cow in Philadelphia. Pittsburg Post-Gazette. Available at: http://www.post-gazette.com/business/businessnews/2013/03/03/ url-pharma-may-no-longer-be-cash-cow-in-philadelphia/201303030209. Published March 3, 2015; Accessed December 20, 2016. 11. McClean B. The Valeant meltdown and Wall Street’s major drug problem. Vanity Fair. Available at: http://www.vanityfair.com/news/2016/06/the-valeant-meltdownand-wall-streets-major-drug-problem. Published Summer 2016; Accessed December 20, 2016. 12. Imbert F. Munger: Valeant Pharmaceuticals turned out to be a “sewer.” CNBC. Available at: http://www.cnbc.com/2016/04/30/munger-valeant-pharmaceuticals-turnedout-to-be-a-sewer.html. Published April 30, 2016; Accessed December 20, 2016. 13. Pollack A, Goldstein M. Martin Shkreli all but gloated over huge drug price increases, memos show. The New York Times. Available at: http://www.nytimes.com/2016/02/03/ business/drug-makers-calculated-price-increases-with-profit-in-mind-memos-show. html?_r=0. Published: February 2, 2016; Accessed September 8, 2016. 14. Staton, T. The top 20 highest-paid biopharma CEOs. FiercePharma. Available at: http://www.fiercepharma.com/special-report/top-20-highest-paid-biopharma-ceos. Published July 13, 2015; Accessed December 21, 2016. 15. Kesselheim AS, Avorn J, Sarpatwari A. The high cost of prescription drugs in the United States: origins and prospects for reform. JAMA 2016;316:858–71. 16. Thomas K. Drug prices keep rising despite intense criticism. The New York Times. Available at: http://www.nytimes.com/2016/04/27/business/drug-prices-keep-risingdespite-intense-critisim.html. Published April 26, 2016; Accessed September 8, 2016. 17. Roland D, Loftus P. Insulin prices climb, fueled by middlemen. The Wall Street Journal. October 10, 2016:A1-2. 18. Harrop F. Could California lower drug prices for all? The Seattle Times. October 2, 2016:A15. 19. Wikipedia contributors. Pharmaceutical marketing. Wikipedia. The Free Encyclopedia. Available at: https://en.wikipedia.org/wiki/Pharmaceutical_marketing. Published 09/04/2004; Updated 09/28/2016; Accessed October 10, 2016. 20. DeJong C, Aguilar T, Tseng CW, Lin GA, et al. Pharmaceutical industry-sponsored meals and physician prescribing patterns for Medicare beneficiaries. JAMA Intern Med 2016;176:1114–10. 21. Kirschner NM, Sulmasy LS, Kesselheim AS. Health policy basics: the physician payment Sunshine Act and the open payments program. Ann Intern Med 2014;161:519–21. 22. Agrawal S, Brown D. The physician payments Sunshine Act — two years of the open payments program. N Engl J Med 2016;374:906–9. 23. Yeh JS, Franklin JM, Avorn J, Landon J, Kesselheim AS. Association of industry payments to physicians with the prescribing of brand-name statins in Massachusetts. JAMA Intern Med 2016;176:763–8.
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24. Donohue JM, Cevasco M, Rosenthal MB. A decade of direct-to-consumer advertising of prescription drugs. N Engl J Med 2007;357:673–81. 25. Manz C, Ross JS, Grande D. Marketing to physicians in a digital world. N Engl J Med 2014;371:1857–9. 26. Snyder L; American College of Physicians Ethics, Professionalism, and Human Rights Committee. American College of Physicians Ethics Manual, 6th ed. Ann Intern Med 2012;156:73–104. 27. Conti RM, Gee RE, Sharfstein JM. Pharmaceuticals and public health. JAMANetwork. Available at: http://jamanetwork.com/journals/jama/fullarticle/2572299. Published October 20, 2016; Accessed October 25, 2016.
DISCUSSION Collier, Newark: That was a great talk, David. One of the issues that you didn’t cover is the sometimes adversarial relationship between the physicians who want to prescribe these really expensive drugs and the hospitals that don’t want to have the drugs on their formularies. And that is an increasing problem where I come from. Could you comment on that? Dale, Seattle: Well, it is a problem and I can see both sides of that. And it’s a dilemma, and I think that’s where the constructive thing to do is engage with the hospital in terms of how you make the decision. But you have to be the advocate for your patient and I find that kind of activity just like a time sink; a huge amount of effort that goes into it. I don’t know the solution other than to advocate for the individual patient. Palmer, New York City: Thank you very much for that. This is a really very important topic on how to control these prices. There is one aspect that I’d like to comment on and that has to do with the direct-to-consumer advertising which I thought for a long time was really dreadful. And it’s difficult to control that because of the problem of free speech and this has inhibited efforts to try to control direct-to-consumer advertising. But there are approaches that I think one could take that have been, let’s say, neglected. For example, it’s within the power of the government to say that direct-toconsumer advertising is not deductible as a business expense and I think you would see an enormous decrease in direct-to-consumer advertising if we try to work at it from that perspective. Dale, Seattle: That’s a good suggestion....and it is for the company regarded as a nontaxable part of their expense so they deduct it from their profits. Oates, Nashville: Thank you for stimulating us to think about this important issue. In the talk you pointed out the value of the industry and discovery and drug development. But the three egregious and really unacceptable examples that you illustrated were all from companies that were in the generic drug industry which are essentially parasitic on the efforts of those companies that are involved in drug research and drug development. I wonder if we make a mistake in putting an umbrella over these companies and the drugs companies that are responsible for discovery, and calling them all the pharmaceutical industry. Dale, Seattle: And that’s a very good comment John, and I think that the umbrella is like a broken umbrella. You know, some parts are very different from the other. The companies involved in discovery do have a very different structure in governance. But generic drugs account for 80% of prescriptions in America now. So, the traditional ethical pharmaceutical industry that is involved in discovery really is involved in the subset in
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the drug we prescribe, and we have to be concerned about both. I think there was a hope that generics would reduce cost and really work very well. Reiser, Chicago: Just a very brief question. Wonderful talk. I think the ones that really suffer from this whole debate are the residents. I think they have lost an opportunity to learn deeply about new drugs, that they would then use. I think it’s a real issue that we get very comfortable with the drugs that we all know. I get very comfortable with the drugs that I know and I am not so informed with the new ones. What I would like to see is a more realistic way of bringing some of these companies back in our training facilities in a way that it’s allowed and that there can be discussion about new drugs, new uses, and how they work. I really think that it’s sort of how it got stuck in this whole debate that we have. Dale, Seattle: So that is to engage...engage at the level of the young doctors who are training. I agree. Reiser, Chicago: How do we fix it? Dale, Seattle: Yes, find the time to hold their attention. Yes, Marshall? Wolf, Boston: I think people should leave with something that changes the way they practice. I have enjoyed your talk but I want to share with you something David Littman, a cardiologist, taught me and that is: you should use drugs when they are first released before they develop side effects. Gershon, New York City: In your talk you mentioned the cost of drugs, the hope for the generics, and the failure of the generics to lower cost, and their success at reducing the income of the ethical companies that are actually developing drugs. Also, their effects at slowing drug discovery because they take the money out of the discovery and put it into marketing. You didn’t mention why we have such disparities in the cost of drugs in the United States and in Canada and other countries and the role played by the American government in driving costs up. We don’t, for example, allow Medicare to bargain for cost of drugs and we essentially ask the public to make decisions on drugs that can kill them. You listen to these massive numbers of side effects with smiling people on the television screen “Oh, this drug can peel your skin off, it’s wonderful!” I mean, people have no concept of what they are buying and we have created a patent medicine era again. It’s been a deliberate effort from the part of our government or at least part of the congress to do that. Dale, Seattle: Well, that’s a very telling comment and as you know the FDA approves drugs but don’t help setting the prices. I once served on one of the advisory committees and I quit because I was so frustrated that they were looking at “does it work?” But relative efficacy in price was not in the consideration. And I think that is one of the areas where the government could take a more active role.
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