Wednesday, December 10, 2008

Is pharma friend or foe?

I write this blog on an Amtrak train from Philly to Washington, returning from one of the occasional roundtable discussions ACP leadership has with representatives of the pharmaceutical industry. We had a lively discussion of issues of concern to both physicians and drug manufacturers, such as improving care of patients with chronic diseases, the patient centered medical home, primary care workforce, and comparative effectiveness research.

Reaching out to other stakeholders, including pharma, is an important part of my job. Sometimes, such discussions enable us to weigh in on the same side of public policy issues, with greater clout than either could bring on our own.

Other times, we end up agreeing to disagree. For instance, pharma generally opposes including cost-effectiveness in evaluations of the relative effectiveness of different drugs and medical treatments, while ACP believes it is important to consider both clinical efficacy and cost-effectiveness. ACP does not favor direct-to-consumer advertising (and we call for greater regulation to the extent it is permitted), while the pharmaceutical industry obviously supports it with lobbying and advertising dollars.

Still, I think it is better to understand our differences than to take positions uninformed by the views of the others.

Discussions among multiple stakeholders have taken on a heightened importance as the country takes up health care reform. ACP is involved in several different forums to explore the possibility of achieving a health care reform consensus among physicians, health plans, consumers, businesses, pharma, health plans, and others. The thinking is that agreement among such diverse but powerful interest groups - call us strange bedfellows, if you will - could be a breakthrough event for health care reform. The alternative is for each stakeholder to duke it out, recognizing that any one of us might have the power to block health care reform to protect our own respective interests.

I recognize that some internists have a very negative view of pharma. It is not unusual for ACP members to approach me at chapter meetings to vent - with a great deal of passion - about the high cost of prescription drugs. Some internists go as far as to advocate that ACP sever all ties with pharmaceutical manufacturers.

On the other hand, there are many ACP members who recognize the importance of pharma in developing new drug therapies and providing appropriate sponsorship and unrestricted grant support for medical education and research on quality improvement. It also is not uncommon to find ACP members in senior management positions within pharmaceutical companies.

ACP's leadership generally believes that it is better to seek a shared understanding with the pharmaceutical industry (and other health care industries) than to close off dialogue. Certainly, we have to guard against being co-opted by any industry group. We have to speak clearly for the interests of ACP members and their patients when they collide with those of industry. But I believe that respectful dialogue among all those with a stake in health care reform is healthier than categorizing each other as friend or foe.

Today's questions: What do you think - should ACP try to find common ground with drug manufacturers on public policy issues? Where do you see us having shared interests - or potentially irreconcilable differences?


Jay Larson MD said...

The desire to take medicine is perhaps the greatest feature which distinguishes man from animals.

One of the first duties of the physician is to educate the masses not to take medicine

Sir William Osler

No matter how they try to sell it, the bottom line for drug manufactures is profit and they will do whatever to achieve this goal. A great quote by Stephen Leacock (1869-1944) humorist and political economist highlights this point: “Advertising may be described as a science of arresting human intelligence long enough to get money from it.”

Over the years I have seen the costs of medications sky rocket, which makes chronic disease management difficult. Pharma are trying to sell their drugs, insurance companies are trying to limit costs, and the patient and physician are caught between the two titans.

Often drugs are priced at “what the market will bear” levels. Well, with the current state of healthcare, the market can not bear much more.

The ACP should continue to work on improving physician knowledge with focus on the patient. Partnering with “for profit” organizations can blur the goal.

Christian McTurk said...

I have found chronic diseases easier to manage with the newer drugs brought to market in the last 10 years. And then it is always possible to manage a patient as if it was 1990 with generics that are becoming less and less expensive, if they can't afford medication. Or one can recommend an assistant program that, I believe, just about every pharm co. has.

The drugs companies make a lot of money if they develop drugs that we value. The problem is when all these docs out there prescribe name brand drugs when there are equivalent generics. That is when Pharma makes money from just advertising. Restore market forces and put the patient in charge of the dollars (as is happening in some ways) and we will see less wasted $ without value.

We should partner with Pharma and try to protect them from the government, which is likely to try to remove their profit motive and ruin the value the industry provides us.

Unknown said...

The pharma system is not very efficient. Using US prices, about 10% is cost of goods sold (mfgring), about 10% is R&D. That leaves 80% of the pharma dollar for other intermediate functions, including advertising and detailing.

If you take a country where the price is half as high, it becomes 20% cost of goods sold, 20% R&D, and 60% for other factors - which might sound like enough.

Branded drugs tend to be pricest at what "the market will bear," there is not much pressure to cut prices (who wants the half price cancer drug?), and the resulting difference between the price and the cost goes to relative inefficiencies like detail reps standing shoulder to shoulder in every hallway, rather than more productive uses.

In another industry, the margin would go to product improvement (can't do that much in pharma - locked in to what you've got after you 10-year development) or improved customer service (e.g value-added services) which in healthcare would be "kickbacks".

Steve Lucas said...

This story has many variations, the one I was taught in business school goes as follows:

A maiden was walking down a rocky path and as it began to snow she hears a cry for help. Looking behind a rock she sees a snake, who once again ask for help.

She ask the snake if he will bite her if she helps, but the snake insist that will not be the case.

She places the snake in her blouse and the snake begins to warm and then purr. Suddenly she feels a sharp pain from the snake's bite.

As she lays near death she ask the snake how he could do this after she helped him.

The snake hissed: "You knew what I was when you picked me up."

Steve Lucas

Dan said...

I'm an ex pharma exec with 3 of the largest in the world for a decade.

You and they (all doctors and medical institutions, etc.) are in conflict with your conflicting objectives, so quid pro quo is taboo and a federal offense. If they placed patients before profits, you could collaborate, utopically speaking.

Don't be bought.