U.S. Rep Introduces Bill to Limit Drug Advertising

February 25, 2016--A Connecticut representative has introduced a bill that would restrict direct-to-consumer advertising by pharmaceutical companies. Rosa DeLauro, a Democrat representing Connecticut’s third Congressional district, has introduced the “Responsibility in Drug Advertising Act,” which would require a delay of three years on any advertising of newly approved prescription drugs. 

Direct advertising to consumers by pharmaceutical companies has also been opposed by Democratic presidential hopeful Hillary Clinton and by the American Medical Association (AMA).

“At the end of the day, we should allow informed medical professionals, not advertising executives, to guide our healthcare spending,” said DeLauro in an official announcement of the bill. 

The Congresswoman added that the moratorium on advertising would minimize the perpetuation of inaccurate drug information and control costs by limiting the number of drugs that consumers can ask their physicians about directly, thereby putting more control in doctors’ hands to determine treatment options. DeLauro cited a 13% increase in prescription drug spending in 2015 to $374 billion.

The legislation would also bar ads from running after the three-year delay if the Department of Health and Human Services determines a new drug comes with “significant” side effects.

However, there has been fervent disapproval of the bill. “What [Ms. DeLauro] is saying is that if you come up with a drug that is lifesaving, you could not tell people about it for two or three years,” said Dan Jaffe, the top lobbyist for the Association of National Advertisers, in a statement to Advertising Age. 

“Cutting people off from truthful, valuable and lifesaving information is not only deceptive but unconstitutional.” Jaffe added that the ban “would paternalistically roll the clock back decades to the days when only doctors could be ‘trusted’ to receive information about important health issues.”

DeLauro’s proposed legislation is the most recent major development in an ongoing debate over the appropriateness of direct-to-consumer drug advertising. 

At the Interim Meeting of the AMA in Atlanta in November 2015, a majority of attendees voted to back a total ban on direct-to-consumer advertising and called on Congress to prohibit the practice. They stated that drug ads geared towards consumers drives demand for expensive treatments when more affordable alternatives are available.

“Today’s vote in support of an advertising ban reflects concerns among physicians about the negative impact of commercially-driven promotions, and the role that marketing costs play in fueling escalating drug prices,” said AMA Board Chair-elect Patrice A. Harris, M.D., M.A., at the Interim Meeting. 

“Direct-to-consumer advertising also inflates demand for new and more expensive drugs, even when these drugs may not be appropriate.”

On the presidential campaign trail, Hillary Clinton has stated that, in an effort to lower drug expenses, she, if elected, would not allow pharmaceutical companies to deduct their direct-to-consumer advertising costs, and would require them to invest in deeper R&D rather than marketing strategy in exchange for taxpayer support.

Before the mid-1980s, pharmaceutical companies could only advertise their products to healthcare professionals. That practice changed when the FDA approved direct-to-consumer advertising, though the agency continues to regulate ads to confirm they are not misleading. To this day, only the United States and New Zealand allow for pharmaceutical companies to advertise directly to consumers.

RxforAmericanHealth publisher says personal importation of brand-name medicines from Tier One countries. including Canada, a key element of comprehensive approach to lowering prescription medicine costs in the U.S

The publisher of RxforAmericanHealth says that a recent article in the Harvard Business Review that claims that ‘cheap drugs’ from Canada will not reduce prescription drugprices fails to acknowledge the harm to Americans’  health and well-being, as well as that of society overall,  by Pharma charging what “the traffic will bear” based solely upon its profit motives for prescription medicines.

Daniel Hines  notes in his blog at http://rxforamericanhealth.blogspot.com/2016/02/harvard-review-author-ignores-very.html  that the conclusion that ‘cheap drugs’ from Canada won’t lower prices simply because no one believes that Pharma will “lean back” and “allow” personal importation simply because they are “selling drugs at a terrific discount to Canada and other countries” does not address the harm done by the long-running opposition by Pharma to personal importation of brand-name medicines, and gives it a ‘license’ to continue its pricing abuses in the name of profit.

“Pharma has no inherent authority to either ‘allow’’ or ‘disallow’ Americans from personally importing their medicines,’ Hines notes, explaining that this is clearly the prerogative of the U.S. Congress. 

“That is why over the past 15 years, Congress has passed or considered many bills in support of personal importation of medicines, only to see behind-closed-door deals with PhRMA, the trade group of the Pharmaceutical industry leading to the passage of the Affordable Care Act (Obamacare); ‘poison-pill amendments from legislators,  who are recipients of Pharma’s  contributions,  to require ‘certification’ by the Secretary of  Health and Human Services of each and every medicine personally imported; Pharma-led efforts directed at personal importation claiming to protect product safety or intellectual property rights that were turned aside because of public outcry that the legislation would have trampled on individual liberties.”

Hines says the extent of the healthcare crisis that has been generated by the excessive costs of prescription medicines making them a major driver of rising health care costs, calls for a comprehensive, coordinated approach to lower drug prices. 

“There is a distinct role for personal importation of medicines as part of strategies that will help end the crisis caused by the pricing practices of Pharma that have denied millions of Americans access to their prescribed medicines simply because they are unaffordable.”

He also noted that there must be a recognition of the potential of the harmful effects upon society when ‘profitability’ far exceeds the basic requirements that will earn a business the funds that are necessary to guarantee its ability to maintain its operations, and to enter into new products and markets, rather than allow Pharma to continue charging what the traffic will bear.

He calls for a number of actions:

• ·         A recognition that a medicine that is unaffordable is, in and of itself, unavailable;
• ·         Brand name medicines imported from Canada—and other Tier One Countries-- are not ‘cheap drugs’. They are instead valid medicines that can provide a vital lifeline of maintenance medicines that would otherwise be denied to millions of Americans;
• ·          No one, not even the most fervent supporters of personal importation of safe, affordable prescription medicines from licensed, registered pharmacies in Tier One Countries (not just Canada) has ever suggested that personally imported medicines are the sole answer to lower medicine prices in the U.S.;
• ·         The role of personal importation prescription medicines is not an inherent authority of Pharma not the Food and Drug Administration (FDA), but is within the province of the U.S. Congress to establish the direction of prescription medicine policy, including but not limited to personal importation;
• ·         Congressional support of personal importation, is evidenced by continuing Congressional initiatives on a number of fronts including appeals to the HHS Secretary to grant waivers, as well as bi-partisan bills on behalf of personal importation;
• ·         Tell Pharma that when it threatens to curtail its Research and Development, that much of the cost of that R&D is borne by the U.S. Taxpayer, whom, after supporting such R&D, is subject to the highest prices in the industrialized world for their medicines;
• ·         Take action on the political front. Americans have traditionally expressed their dissatisfaction with the status quo at the ballot box, leading to historic changes in national policies (i.e., social security, anti-trust legislation, Medicare);

Hines noted that the 2016 Election is of watershed proportions.  He calls for voters to make sure that they now where candidates stand on the cost of prescription medicine, the right and the ability of Americans to determine the safety and efficacy of personally imported medicines and the right to have access to those vital medicines. 

To that end, he offers the ‘planks’ of a platform that he believes will lower prescription prices;

1.       Price negotiation for Medicare and other programs;

2.       A ‘stakeholder’ role for the American public that supports so much of Pharma R&D, by an increased presence of consumer advocates and private citizen in policy development, hearings, and opportunities for public comment;

3.       A revised patent policy that ensures the public investment in R&D is protected in legislation that will penalize Pharma if it is abusive in its pricing practices;

4.       Reciprocal Memorandums of Understanding between regulatory agencies of Tier One Countries as validation of the safety and efficacy of the oversight of personally imported medicines from those countries;

5.       Passing legislation that allows personal importation of brand-name medicines from licensed registered pharmacies in Tier One Countries whose standards of safety and efficacy meet or exceed those of the U.S.;

5.      Impose criminal penalties for abuse of pricing practices based on a ‘what the traffic will bear’ philosophy;

6.       Greater transparency in Pharma pricing practices;

7.       An end to direct to consumer advertising for prescription medicines

“When these steps are taken—and only then—will we remove the burden of paying the highest prices in the industrialized world for our medications,” Hines concludes.

Harvard Review Author ignores the very real—and serious—situation of Americans’ being denied their vital medicines because they are unaffordable

In a recent article in The Harvard Business Review, an author, who is ‘ a pricing strategy specialist’, exhibits an astounding example of ‘begging the question’ when he states a conclusion and then seeks a justification of his claim.

He says that ‘cheap drugs’ from Canada won’t reduce U.S. drug prices simply because no one believes that Pharma will “lean back”, and allow personal importation of safe, affordable, brand-name medicines simply because they are “selling drugs at a terrific discount to Canada.”

Admittedly, Dr. Rafi Mohammed, the author of the article, has also written an apparently successful book, “The 1% Windfall”, a guide on how to increase profitability.  He is also a contributor to journals, and is mentioned regularly in articles about the costs of prescription medicines in the U.S.

Unfortunately, Dr. Mohammed has only a clinical perspective of profits and company decision-making. He fails to understand the totality of the potential of the harmful effects upon the society when ‘profitability’ far exceeds the basic requirements that will earn a business the funds that are necessary to guarantee its ability to maintain its operations, and to enter into new products and markets, choosing instead to do as Pharma has done by charging what the traffic will bear.

He also places a great emphasis upon pricing success based on the ‘value’ of the products or services offered. 

That should cause some to wonder if the timing of the article is only coincidence, or if it was strategic timing, as it comes on the heels of an announcement of PhRMA, the trade group of Pharmaceutical manufacturers, of the launching of a PR/lobbying campaign about  the value of the contribution of that its members’ products of vital medicines makes to American health. 

Additionally, The Biotechnology Innovation Organization , whose members make the $1,000 pills and $100,000 ‘cures’, launched its own “time is precious” campaign touting that its members provide “up to a decade” more of life because of the ability of their costly bio-specialty medicines t0 cure a number of life-threatening diseases.

Or, have both just discovered Dr. Mohammed’s book and thesis.

Irrespective of the timing of the industry campaigns—and that of Mr. Mohammed-- all ignore a basic economic fact that affects ordinary, real-life Americans who are not hypothetical situations in abstract ‘what if?’ theories--simply, that if  you can’t afford a medicine it is in and of itself unavailable, and therefore of no benefit because it is  available to only a limited number of patients.

There are other problems with Dr. Mohammed’s premise  when applied to the costs of pharmaceuticals.  They include, but are not limited to:

•          No one, not even the most fervent supporters of personal importation of safe, affordable prescription medicines from licensed, registered pharmacies in Tier One Countries (not just Canada) has ever suggested that ‘cheap’ personally drugs were the sole answer to lower medicine prices in the U.S.’
•      As to his timing of the article, one must wonder if it is in response HR 2228, a bi-partisan bill that would allow personal importation, at this time only from Canada;
•      He ignores the fact that the control of personal importation prescription medicines is not an inherent authority of the Food and Drug Administration (FDA), but is within the province of the U.S. Congress to establish the direction of prescription medicine policy, including but not limited to personal importation;
•      He gives no credence to either the ‘right’ or the ability of Americans to make responsible, personal decisions to determine the safety and efficacy of brand-name medicines from Tier One Countries (as Bernie Sanders has said, “Show me the dead Canadians”;
•       He talks about pricing restrictions of many countries, but fails to note that Health Canada and many other industrialized countries also have Memorandums of Understanding (MOU) in which many they accept the oversight of participating countries to safety and efficacy; 
•      He does admit that it is unlikely that Pharma will curtail its Research and Development, but fails to note that much of the cost of that R&D is borne by the U.S. Taxpayer, whom, after supporting such R&D, is subject to the highest prices in the industrialized world for their medicines;
•      He fails to note that up to 24 percent of Americans fail to purchase their medicines prescribed by their physicians simply because they cannot afford them;
•      He attempts to make the issue on of a problem for Seniors, completely ignoring the cost of the denial of vital medicines to Americans of all ages, not just the elderly.
•       His ‘profit-driven’ one percent strategy does not take into account they historical reaction of Americans to the abuse of public policy, in this case, the health and well-being of untold numbers of Americans.
•      He shows a complete lack of understanding of the American political process, leading to his assumed absolutes based on the one percent theory complete being tossed askew
•       Americans have traditionally expressed their dissatisfaction with the status quo at the ballot box, leading to historic changes in national policies (i.e., social security, anti-trust legislation, Medicare);

o   It is only the extensive and excessive contributions made to politicians of both major parties, that has allow Pharma to gain it position of dictating much of America’s health policies;

o   As noted above, Dr. Mohammed fails to acknowledge the ‘totality’ of the challenge and the steps that need to be and likely will be taken after the 2016 elections.  He does acknowledge but dismisses the plans approached by a number of elected officials or candidates to change direction of the U.S. policy to halt the pricing strategies of Pharma that make the cost of prescription medicines—or their unavailability because of Pharma pricing practices—as being major drivers of our spiraling healthcare costs;

o   This includes, but is not limited to:

1.       Price negotiation;

2.       A ‘stakeholder’ role for the American public that supports so much of Pharma R&D,by an increased presence of consumer advocates and private citizen in policy development, hearings, and opportunities for public comment;

3.       A  revised patent policy that ensures the public investment in R&D is protected in legislation that will provide penalties if Pharma is abusive in its pricing practices;

4.       Reciprocal Memorandums of Understanding between regulatory agencies of Tier One Countries as validation of          the safety and efficacy of the oversight of personally imported medicines from those countries;

5.       Criminal penalties for abuse of pricing practices based on a ‘what the traffic will bear’ philosophy;

6.       Greater transparency in Pharma pricing practices;

7.       An end to direct to consumer advertising for prescription medicines.

If this long list is not enough to cause Pharma pause, consider his reference/explanation of  ‘differential pricing’ tactics using the model of a movie theater which, instead of having ‘the same price for everyone,’ has different and lower prices, in his example, for students and Seniors.

In his model, the goal is to ‘’tailor the ‘right’ price to various segments, thereby offering targeted discounts that will be profitable, with moviegoers who have often paid different prices seated next to each other.  

He further suggests that if the students started selling their movie tickets at a lower price to those paying a higher cost, the owners of the theater would suddenly stop offering the discounts.  He claims this would be the same if personal importation is enacted in the U.S , causing Pharma to end discounts or to impose restrictions upon medicines.

Mr. Mohammed’s ‘leap of faith’ from a health care crisis caused by unaffordable prescription medicines and  pricing abuses by Pharma leading to Americans’ health being threatened, with the cost of movie tickets as an example of how and why Pharma employs its pricing practices is , at least to me, incomprehensible and inexcusable.

So, when you see the extensive, million-dollar advertising/lobbying/public relations being unveiled by Pharma, enjoy the show. Just make sure what the cost of your ticket might be.   

Seniors Applaud President’s Proposal Allowing Medicare to Negotiate for Lower Rx Drug Prices

Max Richtman, The  Chief Executive Office of The National Committee to Preserve Social Security & Medicare, today hailed the President's proposal to negotiate Medicare prescription Prices,

  “It’s long past time for Congress to acknowledge the hard truth that the sky-rocketing cost of prescription drugs is hurting average Americans and our federal budget, " he said. 

"Medicare spends billions providing Part D drug coverage each year while beneficiaries including seniors, the disabled and their families also face rising out-of-pocket costs and higher premiums.

"All the while, drug makers continue to reap the profits of their price gouging. In his budget, President Obama has again proposed lifting the ban preventing Medicare from negotiating prices with the drug companies. 

"Big Pharma has lobbied hard to keep the ban in place but seniors expect, this time, Congress will do the right thing and finally allow Medicare to negotiate for fair prices.” 

Among the other budget provisions beneficial to seniors include:

• closing the Part D donut hole two years earlier
• additional funding for in-home services
• reforms for overpayments going to private insurers in Medicare Advantage
• a 7.44% increase in administrative funding for the Social Security Administration

However, the President’s budget was not all good news.  Once again, the budget proposes shifting even more healthcare costs to seniors by extending Medicare means-testing to the middle class and increasing out-of-pocket costs such as the home health care co-payment and the Part B deductible.

“The average Medicare beneficiary already spends nearly $4,800 per year in out-of-pocket health care costs with half of all people on Medicare having incomes of less than $24,150. People in Medicare simply can’t afford increased cost-sharing year-after-year," Richtman continued.

"What’s especially worrisome are efforts to portray expanding means-testing in Medicare as impacting only ‘high-income seniors.’  While that may be good political rhetoric the truth is, if passed, further means testing will actually target middle-class individuals," he concluded. 

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