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December 16, 2016 0

The arbitrary reviewers at FDA have decided that Otezla and Toujeo have music that is disturbing the peace. They have knocked on the walls of Celgene and Sanofi by issuing letters saying their television ads violate the law. How do they know they broke the law?

The beauty of the FDA system is they decide what is distracting. They don’t need to have any objective consumer based evidence of distracting music or rapid scene cuts. I have no doubt these ads pump up the music and fun. The problem, for all of us doing DTC is these two ads are fairly routine for DTC and similar ones have been on air for years. The letters are surprising and must represent some internal decision to get tough. Maybe they are being criticized for lax enforcement because the number of warning letters and untitled letters have come down.

Bob Ehrlich
“I do not think much of FDA’s evaluative process.”
-Bob Ehrlich

So, they decide to force the drug maker and agency to pull the ad, spend a small fortune re-shooting or re-editing. Judge, jury and executioner. Nice system. Evidence, they don’t need no stinking evidence.

I have seen these ads for months and never once did I think, wow, these ads are distracting and must violate a host of FDA regulations. I guess any ad with music and happy people is now under the scrutiny of FDA reviewers, who apparently have decided to crack down on happy people dancing. I know some in Congress want to go after happy DTC people having sex, but I digress.

As you can tell I do not think much of FDA’s evaluative process. These type of ads have been in vogue for years for many brands. So how slow and low must the music be, how slow the cuts from scene to scene, how long must the supers be? Is dancing limited to one actor, two? None of us know because FDA can decide what is a violation. I am sure Celgene and Sanofi can discuss it with FDA before the sentence is carried out. They have as much chance of a reversal as appealing to a North Korean court after insulting the great leader.

FDA should be forced to have real quantitative research data that supports what they say in their letters. Maybe at the very least a panel of consumers can be brought in to screen ads FDA thinks are problematic. I urge that some system of evaluation be added that can be more objective than a single reviewer. I know the reviewers believe they are acting fairly. I am sure they are bright, hard working folks just trying to do right. But they are arbitrary and inconsistent. That makes it difficult for drug makers to predict how they might react to an ad that is upbeat. For drug makers, what they need is consistency just like we want in an umpire or referee.

Maybe this is FDA getting their last regulatory licks in before the new Trump sheriff comes to town. More letters can be expected if this is how they will approach DTC ad review. Even after 20 years in DTC, the FDA can still surprise me.

Bob Ehrlich

December 12, 2016 0

We are likely to see a much freer market for health care under the new Trump administration. What does that really mean for consumers and providers? How might it affect drug companies? And to those of us in DTC marketing, does a free market help or hurt our business?

America is not currently a true free health care market and has not been for over 50 years. Our someone else pays health care system has made users of health care unaware of costs. Is my service or procedure covered is what we ask. What is my co-pay is what we care about. Our providers make more money when they do procedures and tests. Patients readily accept this extra care as long as it is paid by insurers.

Bob Ehrlich
“DTC advertising will need to deal with price/value issues.”
-Bob Ehrlich

Our government has made our system extremely complex with its variety of programs and regulations. Medicare, Medicaid, The VA, HIPPA, The ACA, the 50 different state requirements, and a myriad of other public and private agencies oversee the most opaque system in the world.

What if we went to a free market where what we spend is truly our money and costs matter? Assume the government gives you a stipend through a tax credit or a cash payment. That is what you have to spend on your healthcare subsidized by government. Anything beyond that you pay. Regulations are loosened to allow you to buy whatever insurance you want, anywhere from an approved company in the 50 states. Health care providers must compete on providing quality care at a price people can afford for services they really need.

Drug companies will need to justify price premiums because consumers are now deciding where to allocate their limited available funds. Insurance companies who are competing on offering low premiums will want to squeeze drug companies as much as possible. That means consumers will have many drug coverage options to choose from and they will not pay higher premiums for me-too drugs. DTC advertising will need to deal with price/value issues.

What about people with pre-existing conditions? This is a complex problem. After all, signing up for insurance generally assumes the negative event has not happened yet. None of us get to buy car insurance after we total our car. So what we need is some way to help people with pre-existing conditions to get help on their costs. This is not insurance, it is compassion from society that prevents people from going bankrupt or dying because they cannot afford care. Instead of calling it insurance and forcing companies to cover these folks, it makes sense to create a special high risk pool subsidized by government.

A true free market is a hard but a doable thing to implement over a decade or so. It means treating health care like other consumer products and shifting purchase decisions to the patient. If prices are transparent, and quality measures are readily available for providers, consumers will make rationale choices.

Free markets give consumers incentives to stay healthy as the cost of prevention are lower than costs of treatment. Many critics say health care is a right better managed by government. They may be right as some developed countries do it well. America can go either way but cannot continue its current system which is neither free market or single payer. Under a free market system we would unleash tremendous forces of innovation that could do great things for patients. It will be a hard road to truly get to a real free market but it is worth a try. After all, that “someone else” paying is really us through higher taxes and insurance premiums and deductibles.  We are paying higher per capita for health care than anyone else in the world so we must consider real change.

Bob Ehrlich

December 2, 2016 0

President-Elect Trump nominated Georgia Congressman and physician Tom Price to head Health and Human Services. This move proves Trump is very serious in his goal of dismantling Obamacare. Dr. Price has offered a plan in the past very different from Obamacare. I think this is move in the right direction and will eventually improve quality at lower cost.

In Price’s plan Americans would have more free market options to shop for coverage. They would be able to buy insurance across state lines, increasing their choices and hopefully getting lower premiums. There would be tax credits for health insurance purchases differing by age. All the government mandates on what a policy must cover would go away.

Bob Ehrlich
“Americans would have more free market options..”
-Bob Ehrlich

Consumers could choose a bare bones catastrophic plan or pay for a comprehensive one. Health savings accounts would increase to shift health care decisions to consumers. In Dr. Price’s view consumers would still be able to purchase coverage with pre-existing conditions but at a premium if they currently do not have coverage. His goal is to encourage continuous coverage and not to have people buy insurance only after they are sick.

Dr. Price basically wants to take the Federal government out of the insurance business by creating more options using free markets. Medicare would stay but Dr. Price wants to allow participants some options to go outside of the system. Critics worry that any options to use money outside of Medicare approved providers would weaken the system. Any inkling that Medicare might be privatized scares Democrats greatly. Republicans want to look at options for younger people knowing that Medicare may not be sustainable long term.

Of course Dr. Price will need to alter his past proposals to whatever Mr. Trump and Congress will agree to. There is no evidence Mr. Trump wants to change Medicare. He also has said recently he likes certain provisions of Obamacare on pre-existing conditions and children up to 26 staying on their parent’s policy.

It is very clear that we will see Dr. Price be implementing a consensus plan that reduces Federal involvement and loosens requirements for policies. The Price philosophy is to give consumers more responsibility for their coverage and they will have more involvement in cost/benefit of care. The idea that someone else pays has created much unnecessary care. We have never really had a free market for health care in recent times. A true free market where consumers have transparency in what they are paying for and at what price will help control costs.

The fear that consumers will be without any coverage is overblown. People who currently have coverage on exchanges will likely have several years to convert to the free market system. While it is true that many Americans can now get subsidized coverage, we as taxpayers are footing a high bill that is rising rapidly. Those who buy on the exchanges who are not subsidized are seeing very large premium increases. Things need to change.

Whether the Trump plan is the answer to providing quality care at reasonable prices will be tested. I do know that the Obamacare plan needs to be dramatically changed as it is unaffordable. Trying free market solutions will get consumers to care much more about what medical services they need and at what cost. More involved consumers using their own money will hopefully lead to a wiser use of services and force providers to compete more on price/quality.

Bob Ehrlich