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July 31, 2017 Bob Ehrlich0

The Novartis psoriasis drug Cosentyx has taken an interesting approach on use of a celebrity. Rather than have a celebrity alone plug a drug this new ad mixes Cyndi with regular folks. It makes her seem like just another psoriasis sufferer who happens to be a famous pop star rather than the celebrity spokesperson for a drug. The difference is subtle but important. You can see the add on

Celebrities are a mixed bag when promoting a drug. They can be effective or polarizing depending on how they are used. Some recent celebrity campaigns illustrate that a celebrity can be the star as well as one of the cast. Jennifer Anniston is great in Shire’s disease ed ad Eyelove. She is clearly the star and although we know that she is acting she is warm, and believable.

Bob Ehrlich
“Cyndi Lauper comes across as sincere and believable.”
-Bob Ehrlich

Here, Cyndi Lauper is being used as a member of a community that suffers from an embarrassing condition. She is not even identified with her last name but most of us would remember her, at least those over 40 years old. I like the approach which puts a celebrity with us regular folks rather than lecturing us as the obvious paid spokesperson.

Most of us know that a celebrity is not usually a knowledgeable medical expert. Having a celebrity tell us about a drug therefore has risks that we see them as paid endorsers who may not really use or like the product. In this Cosentyx ad, however, Cyndi Lauper comes across as sincere and believable. She is one of three psoriasis sufferers in the vignette ad and her presence gets attention without being dominant.

This is not the only ad to blend real people with celebrities. Enbrel does a nice job using golfer Phil Michelson with a regular person to discuss psoriatic arthritis. Both Enbrel and Cosentyx appear to recognize that celebrity use may be enhanced by toning down their star power by mixing them in with regular folks. That works in these two cases and I am not saying a celebrity cannot work being the sole presenter. My view is celebrities work well for disease education as the sole presenter because they are believable in highlighting a disease or condition. When you plug a brand, however, they may become less credible carrying the message. That does not mean it will not be effective just that it takes the right celebrity to be a sole branded spokesperson.

We all remember Sally Field was great plugging osteoporosis drug Bonita and Blythe Danner pulls it off for Prolia. There is no hard rule when you should use the celebrity as the star or mix them in with real folks. Consumers can tell, however when a celebrity is just hawking a product for money versus actually a user or concerned about a disease. There are many who make living hawking dubious products and it is obvious they have little concern about the product efficacy.

The Cosentyx campaign “See Me” has been working well for the last two years and has done good work adding celebrity Cyndi Lauper while maintaining its core strategy and executional style.

July 21, 2017 Bob Ehrlich0

With the failure of the Republicans to pass repeal and replace we are left wondering what next. We are now at increased risk of drug pricing and DTC regulation. As now it appears that Republicans and Democrats will come up jointly with a salvage plan for Obamacare, drug makers will be in the crosshairs to make concessions to reduce costs.

The lessons learned from this debacle are several. First, the public is supportive of increased government guarantees of coverage. The PR battle showing all the cases of newly insured people being saved from death and bankruptcy have been compelling. Taking away a benefit, albeit costly and unsustainable, is impossible to sell.

Bob Ehrlich
“The DTC industry is low hanging fruit…”
-Bob Ehrlich

Second, Republicans have shown they cannot explain their plan to sway public opinion. There is a lot of good in the plan but that nasty Congressional Budget Office keeps saying the plan will cause millions to lose coverage and seniors will pay much more for coverage, as will people with pre-existing conditions. Not great selling points for passage.

We can now expect Chuck Schumer to claim he is willing to make Obamacare even better and cut a deal with Republicans. Of course, we know that means throwing more money to subsidize premiums and deductibles for more people. Being an election year in 2018 most in Congress will be happy to spend more borrowed money to look like they care about American’s healthcare.

So where can Congress look for a bi-partisan villain in 2018? Give me a second to think. Oh, I know, how about everyone’s favorite scapegoat, the drug makers. We all know that healthcare costs would be dramatically lower (not) if only those drug profiteers sold their lifesaving medicines just a bit above cost. Most in Congress know that is not true but so what. It sounds good and will get lots of support for Medicare price negotiation, reimportation, shorter patent life, and restricting those pesky DTC ads which are believed to be a main driver of health costs. We all know DTC has the hypnotic power to convince gullible doctors to prescribe whatever patients request.

It is clear that Democrats are moving towards enacting single payer. As costs mount for the new Obamacare, it is only a matter of time before the great savior will be our government running all insurance. Then we can look forward to the end of private insurers and free market pricing for health services and drugs. Bernie will be happy because America will look more like Canada and Europe or perhaps Venezuela. We can all take our generics and hope the government will come up with all the new drugs. It is not that single payer cannot work, it is just that our government has not been very good at running mass programs efficiently and with great customer satisfaction.

I know Bernie Sanders thinks people all love Medicare. That may be because Medicare is really just a processor of payments to the private sector. Yes, seniors can currently pick their doctor and hospital. Wait until everyone is covered and see how fast that changes. To be affordable Medicare for all would need to greatly restrict choice. Look for new government boards to decide what options we have for covered services.

The DTC industry is low hanging fruit to be offered up at the altar for sacrifice. After all the AMA, insurers, many in state and federal government would love to see it banned. Taxing it, or adding regulations to make it hard to do in 60 seconds on television could kill it. There may still be DTC but it could be very limited to non-branded or long form print, Internet, and in-office literature. Maybe our strong lobby will head off the anti-drug forces but it is getting harder to be optimistic.

July 14, 2017 Bob Ehrlich0

Imagine there was no DTC advertising because of a government ban. Let’s put aside the free speech issues for a moment and assume the courts supported a ban. Also let’s assume the health care system is similar to what we have now. That is, it is still a mix of private insurers, Medicare, Medicaid, with free market pricing for drug makers. I am not saying a ban will happen but it is possible given the hostility towards drug companies.

Bob Ehrlich
“A world without DTC will not make the patient better off.”
-Bob Ehrlich

Let’s examine what this world of no DTC means for the constituencies of health care. First, what would happen to drug sales? If we assume an ROI of $2 per $1 invested in DTC which is probably in the ballpark then drug companies will lose about $7 billion in annual sales. That is based on an actual estimated drug company DTC spending of around $3.5 billion versus Nielsen reported at $5.2 billion. Why? Drug makers get large discounts not accounted for in the reported numbers. Insiders tell me they spend about 70% of reported numbers.

That $7 billion dollar loss is only about 2% of total drug sales so it is not an industry killer. It does hurt newer drugs more because they use DTC to accelerate the awareness curve. It may also hurt high price drugs more because advertising those drugs puts pressure on insurers to cover them.

Congress would likely be happy with no DTC because they falsely think demand would decline for branded drugs. Unfortunately, they would soon find out that drug makers will ramp up physician promotion instead and make up for lost consumer awareness. Consumers would be back to having less information and trusting that physicians and insurers have their best interests at heart. We know physicians may not be up to date on newer drugs and insurers do not want to pay for expensive drugs. So, I am afraid consumers may not be informed there are newer drugs available.

Physicians may like a ban because consumers will not ask them about an advertised drug. On the other hand, DTC brings patients in the door and that means opportunities to do reimbursed tests and services. I am sure dermatologists, psychiatrists, ophthalmologists, podiatrists, cosmetic surgeons, and other specialties benefit by increased traffic from DTC. Physicians need to get used to the new world where patient information is widely available and trying to restrict it is just not practical.

Insurers would love a no DTC world because they can negotiate without those pesky consumers wanting to know if they cover expensive drugs like Harvoni, Keytruda, or Opdivo. Drug companies will try to negotiate fast access but I suspect formulary access will be delayed without consumer pressure.

What will happen to price under a DTC ban? Drug companies will not lower prices because there is no DTC. There is a general misconception that DTC expenditures are a cause of high prices. That is false. DTC, if successful, raises demand that more than offsets the cost. Therefore sales will be less without DTC so why would a drug maker lower prices? DTC allows new brands to enter faster and create competition which will lead to lower prices. Banning DTC ensures the established brand can keep its leadership longer and prices higher.

Banning DTC may make critics feel better but will have very minor impact on demand, pricing, and overuse. Instead less information will be available to consumers who will now have to trust biased insurers and busy doctors to suggest what is best for them. We all recognize DTC is meant to advocate use of a drug and is not unbiased information. Our healthcare system, because it is a mix of profit making entities and government payers concerned about budget, is inherently subjective. Therefore, banning DTC just leaves other constituencies to their push their own biases about what is best for patients.

A world without DTC will not make the patient better off. Drug critics were complaining about drug prices before DTC and will continue even if it is banned. Unfortunately, DTC has become an easy target and will remain in the crosshairs of legislators, physician groups, and insurers. As a DTC community, we must tell lawmakers the facts and the dangers of limiting speech.

July 7, 2017 Bob Ehrlich0

Some state delegations are pushing the AMA to adopt a position to push drug makers to include the retail price in their ads. They feel full disclosure will inform consumers that some drugs are very expensive up front. The physicians pushing this idea feel drug makers will be held more accountable by the public if they disclosed prices in their ads.

Clearly these advocates hope that forcing drug makers to disclose price in ads will create pressure on drug makers to keep prices in check. The question I have is, is disclosing price a net positive or negative at the stage of awareness advertising? Consumers are entitled to know prices of what they are being prescribed. Does upfront price disclosure help them make a better decision or just add confusion?

Bob Ehrlich
“Advertising price…will not be a net positive for consumers.”
-Bob Ehrlich

In a world where the advertised price is what you pay, then disclosing it makes sense. In the drug world, however, consumers do not pay retail prices. There are many net prices to consumer depending on insurance, co-pays, formulary position, and discounts offered by drug makers. The retail price is only relevant if the consumer pays it. I understand that many expensive drugs are not a viable option unless the consumer has good reimbursement. That viability is rarely known by the consumer until they take that prescription in to be filled.

Advertising price generally will not be a net positive for consumers. An expensive drug that says it costs $100k a year may scare consumers away from asking about it even though it may in fact cost them nothing. A $20 a month drug may sound cheap but a consumer may be paying full price for it because of coverage. The only intent of this potential AMA policy is to embarrass drug makers of very high price drugs. Pressuring drug makers on price is fair game for insurance companies, PBMs, and government payers. Retail price disclosure will only cause angst and confusion among consumers.

I also have concerns that consumers are not experts on price/value of drugs. Does curing Hep C for $80,000 cost less than liver transplant, or long hospitalization? Does paying $100,000 for an extra year of life make sense for a cancer patient? These decisions are complex and required an informed factual basis. It makes sense to have independent medical third parties do research on drug price/value and have consumers and doctors made aware of those analyses. I can even support ads being required to have a web site posted that has those analyses.

I understand doctors are frustrated with drug prices. I also know some drug companies have gone too far in aggressive pricing. The solution is in self-restraint, tough negotiations by payers, and well done research on cost/benefit of drugs. Advertising retail price will not help consumers and in fact may discourage them from seeking treatment because they assume they cannot afford the drug.