Pillhead

the personal views of a doctor in industry

Posts Tagged ‘trust

The crass is always greener on our side – Big Pharma does ASCO

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Reporting from ASCO, an article in Forbes asks the question, “Are Cancer Drugs Worth The Money?

 

Probably not, is probably the correct answer. How do we get away with charging so much for drugs that add so little in terms of extra days of life? I suspect that apart from the usual economics of it, there are two additional factors:

 

  1. Once people are given the death sentence of a terminal cancer diagnosis, they become desperate and irrational and therefore demand becomes price inelastic

  2. Cancer tends to hit in middle age and later, a time when people generally have some money put aside

 

Perhaps the pricing of cancer drugs is partly driven by the existence of a market segment of rich, desperate and irrational people.

 

What put a bee in my bonnet this ASCO? The Forbes article did, in particular two quotes in it:

 

The authors note that one trend that may further inflate the cost of cancer therapy is containment rather than cure. The big news is around the possible long term use of therapy to subdue cancer cells, the downside being that if you stop treatment the cancer comes back. William Burns, head of Roche’s pharmaceuticals division happily notes, “we have learned that it is a drug to start with and stay with”. And that phrase rolls off the tongue a little too easily for my taste.

 

But Burns is trumped by OSI Chief Executive Colin Goddard who, speaking about another drug trial that has not shown improvement in survival, noted: “We estimate we have the potential for at least $500 million in new [U.S.] business from this study”.

 

Don’t get me wrong: there is a place and a need for marketing people to do their thing, and for finance guys to do theirs. But ASCO is a medical meeting. If you do not want to look greedy then keep the commercial talk for afterwards.

 

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Written by Pillhead

June 1, 2009 at 3:36 pm

Pfizer offers free drugs to retrenched Americans

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What a good story (Free Lipitor, Viagra, 70 other drugs for jobless, and Pfizer Launches Free Medicines Program For Newly Unemployed Americans). 

By offering to cover the cost of some of their current Pfizer drugs for up to 12 months, this program does three things: 1) takes some financial worry from the shoulders of these people, 2) keeps them on Pfizer’s drugs when they would otherwise be quite likely to either switch to a cheaper version or stop therapy altogether, and 3) increases the chances that those that benefit from the scheme will stay on Pfizer meds when they get a new job.

This is the holy trinity of recession marketing goods: good PR, goodwill, and good business sense.

We also know the name of the chap behind the idea: Dr Jorge Puente, a medical man.

Written by Pillhead

May 17, 2009 at 1:11 pm

Salvation through Innovation

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One of the funniest things that I read last year was Ranbaxy’s CEO lamenting the lack of innovation in big pharma. The writer was unremarkable and did not see the joke at all. Sadly, there are many examples of articles about our industry which reveal a very superficial idea about what makes us tick.

An example that recently caught my eye added to the line of nonsense about innovation (Innovation Is the Pharmaceutical Industry’s Only Salvation, The InVivo Blog). If the “salvation” that was referred to had been about evil within big pharma, but that the Lord will forgive us if we just invent a couple more good drugs, then it would have been interestingly novel. Sadly, the piece was about the god of Mammon and consisted the sharing of thoughts from Mr Jay Markowitz, a biotech analyst.

After noting, believably, that “44% of Americans had an unfavourable view of the pharmaceutical industry”, the article veered rapidly off-piste proposing that, “the industry’s woes boil down to a single cause: inadequate innovation”. As a good friend of mine would say, this guy must be smoking the weed! Might not the BILLIONS of dollars in fines we keep paying for improper marketing practices have something to do with our reputation?

The author got himself further into trouble looking at our poor productivity: in spite of the inconvenient fact that the number of new drugs registered by the FDA last year was the highest since 2004, he noted that we need more than a “meagre” 24 new drugs to fill the patent hole.

People think of “the patent hole” as the result of some fundamental failure to innovate in our industry. This is nonsense.

The patent hole is a direct result of pharma management not doing their job very well. No company can generate the steady flow of blockbusters which are required to support a business that is overly dependant on a single big drug – or handful of them. The reason for this is simple probability. We do not know how to make one, and we do not know which of our drugs will become blockbusters even after we launch them. Sometimes we get lucky and a drug does better than expected. Sometimes a drug that was expected to do well does badly. Add to this randomness the fact that big firms tend to lose the ability to take risks appropriately, and you can see why it is unlikely that the big firms will generate a steady stream of blockbuster drugs. Management’s sin is that it fails to recognise this simple truth, and it fails to plan accordingly.

Like many people, the author confuses the few big pharma companies that he deals in with the drug industry as a whole. He confuses the need for the biggest of big pharma to produce bigger pipelines (to improve their chances of netting a big drug for themselves), with the reality that the industry as a whole is doing just fine. Innovation is apparently quite strong still, and record numbers of drugs are being registered. The question does remain, however, whether these drugs will generate the same sales as the biggest drugs today. Time will tell. There is also a real possibility that the biggest drugs among the 24 newly registered ones may not belong to today’s big players.

This analyst has failed to grasp the simple point that we do not make blockbusters, we make drugs, and if we are lucky some of them turn into billion dollar drugs.

Written by Pillhead

March 31, 2009 at 4:16 pm

Posted in Pipeline

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Big Pharma Photographs Angry Harvard Medical Students

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By now, we have all seen the picture of the handsome Pfizer sales rep taking a photo with his camera phone (Do you know this Pfizer guy?, PharmaGossip)outside the magnificent facade of Harvard Medical School. Senator Grassley has fanned the flames (Senator Asks Pfizer About Harvard Payments, NYT)and in a letter to Pfizer wrote that he was “greatly disturbed” and he wants to see the photos. The ruckus is because the target of the pictures was a group of Harvard students protesting for their school to be more independent of industry support. While recognising that I am risking being called a contrarian, I do find myself asking: so what?

The students clearly did not feel intimidated by the cameraman. They continued their protest, and later openly spoke to journalists about him. For his part, the rep was happy to identify himself to the students.

In the fallout, the Pfizer spokesman adopted his customary position. While failing to say “thank you, Sir” afterwards, he did mutter something about the pictures being for a private collection.

Perhaps I am too English, but really; mountains and molehills anyone?

Written by Pillhead

March 9, 2009 at 12:21 pm

Posted in integrity

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Access to Medicines – Andrew Witty at GSK sets the pace

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In a speech at the Harvard Medical School last week, Andrew Witty, CEO of GSK, set out a bold new agenda for increasing access to medicines in poor countries (PharmaTimes, GSK lays out plans to seriously tackle disease in developing world). It was a triumph of substance over style in which GSK identified 4 key steps that it would be taking, and encouraged other firms to join it.

1) A more flexible approach to IP. A patent pool for medicines for neglected tropical diseases including both small molecule and process patents.

2) Pricing discounts for the poorest countries. GSK will charge no more than 25% of the full price as long as this covers cost of goods.

3) Greater collaboration. GSK already has a dedicated research centre set up in Spain and offered joint ownership to other institutions that want to join the 100 scientists already there.

4) Partnership in delivering solutions in the poorest countries. GSK commited to ploughing 20% of any profits made in these poor countries back into local health infrastructure projects.

The pooling of patents is a trick that has a history in industry: an article in Bloomberg (Glaxo’s WItty to Share Research to Aid Poor Nations) notes that industrial cooperation of this sort was used in 1917 to speed the manufacture of warplanes during WWI, but this will be a first for the pharma industry.

Understandably, some are finding this all too progressive to believe (PharmaGossip, Arise Sir Andrew Witty (or is it Saint Andrew?)). Some have noted that this bold plan will not necessarily cost GSK much money as it only made about $43 million in these countries last year (FiercePharma), but to be fair to GSK, Witty said as much: “We’re not putting enormous amounts of money on the table here,” he noted at Harvard.

Rarely does a pharma executive speak with such clarity of purpose, and rarely does a pharma executive accept that he does not have a commercial obligation to try to make money from the poorest countries directly. Bravo Mr Witty on both counts.

Written by Pillhead

February 19, 2009 at 2:11 pm

Sales Reps – Pharma’s Lost Assets

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A new survey by SK&A (Physician Access Survey) makes sober reading. Remarkable in its coverage, according to  IN VIVO (Don’t Come Knokin’ On My Door) nearly all active practising physicians in the US were surveyed with a response rate of 94%, the results show that 24% of all physicians in the US now refuse to see sales reps at all. The numbers are particularly bad in large practices and hospital linked clinics; worryingly, the situation is getting worse.

Why does anyone chose not to meet with a sales person? Speaking for myself there are three common reasons: a) I do not want to listen to the person, b) I am not interested in what the person is selling, or c) I am already using the product

In terms of pharma sales, I think the first reason is where the interesting discussion lies.

Of all the relationships in healthcare, the one in which trust is most central is the Dr-Patient relationship. Drs really cannot afford to lose the trust of their patients. Unfortunately the public does not hold the pharma industry as paragons of integrity, and as a result sales reps are being banned from clinics. Drs have found themselves too closely and too publicly tied to us. They are attempting to reclaim the moral high ground following a spate of scandals involving Drs accepting large amounts of money and perks from the pharma industry; the last thing a Dr wants is to be too closely associated with our negative reputation.

But why is this changing now? The codes of conduct which our industry follows are getting ever tighter. In the US we are not even allowed to give pens away anymore (unless they are educational in nature!). Things that went on in the past would not be dreamed of today; and if they do happen then we are exposed to fairly significant legal consequences.

Some say that reps in the old days were better trained than today and in those days they were invaluable partners. Perhaps. But possibly Drs used to put up with us because they benefited considerably from the perks of the relationship. Those perks have now gone. Coupled to this is a new call for transparency which is being embraced by the healthcare industry as never before. At a time when we are trying to clean up our act, Drs are also trying to clean up theirs.

Our mistake is in making it too easy to lock us out. When Drs balance the positive and negative effects we have on their work, the balance is coming out as negative in more and more cases. We are not needed because we add too little value today.

The relationship needs to be redefined. The focus must be on integrity first and then on finding a way to be useful to our customers.

Written by Pillhead

February 15, 2009 at 3:10 pm

Posted in Sales Reps

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