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DTC-In-Perspective by Bob Ehrlich

DTC Advertising and the Clutter Trap: A Call for Creativity

January 7, 2025 0

I have been a close observer of DTC advertising for about 28 years. One of the issues I have is that most DTC television ads still have a similar look. You all know the type of ad that starts with some actor patients saying they have condition X, so they asked their doctor about drug Y and then are feeling better. Then they show the fair balance scenes of active patients on the beach, hiking, playing with the grandkids. These vignette ads still seem to dominate the DTC landscape.

DTC advertisers only have about 28-30 seconds in a :60 second ad to make the selling case. It is hard to get all the information in about brand name, condition, and benefits. I assume that every drug company has a rigorous process to get consumer qualitative and quantitative feedback. Since all these pharma companies are data driven, I also must conclude that every ad aired has met some reasonable internal action standard for success. In other words, every DTC ad aired must be “good” by standard research testing methodology.

That being the case, why are so many DTC ads lacking breakthrough creativity? I have asked this question to many pharma marketers and agency people. Many agree that, aside from their own ad, this creative sameness is a problem. The reality is that most of the ads I analyze are too similar. They may test well pre-air but when on air, with so many other DTC ads in the same time block, they have challenges breaking out of the clutter. Of course we do not want creativity for its own sake. We also need consumers to remember the key selling point so they are interested enough to follow up with their doctor.

Kevin Clancy, a noted marketing guru and author, said at one of the early DTC National Conferences that an ad that tests in the top 20% is twice as effective per dollar spent than an average ad. That makes creativity a valuable goal.

Here are 5 reasons most ads fail creatively to break through:

  1. Most drug ads are trying to be straight forward and logical in their advertising. Drug companies are pretty conservative and problem / solution information rich ads are in their comfort zone.
  2. These ads may in fact test well in a research setting because they are logical. Consumers will understand them and repeat back the benefits.
  3. The internal legal and regulatory folks also appreciate the clarity of the standard ad.
  4. FDA’s OPDP may pre-clear a standard format ad faster, because they have seen hundreds just like it and are less concerned about consumer distraction.
  5. The standard ad is easier to sell up the management chain just because of the logical nature of people running drug companies.

Challenge yourselves and your agencies to do better. I know we are not selling perfume and creativity is harder to execute in drug ads. Be careful when interpreting research data that says your ad tests well with consumers. Make sure your test includes competitive category ads and other DTC ads to simulate clutter. Have a goal to excel on the creative score. There are creative DTC ads out there that also get their logical selling points across. Many cookie-cutter standard ads are still successful in ROI measures because of the level of spending. However, demand that your marketing team and ad agencies strive to get that 2X in spending effectiveness. There is no reason for being average.

Bob Ehrlich

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DTC-In-Perspective by Bob Ehrlich

Weight Loss DTC Will Boom: GLP-1 Drugs Reshape the Market

December 10, 2024 0

The obesity drug market potential is staggering. America is overweight. I am overweight. My friends are overweight. Willpower is obviously not the solution because most of us cannot sustain it. We need to get by with a little help. About 40% of adults in America are obese according to the CDC. Thankfully, we have two currently approved drugs in the GLP-1 category. Wegovy and Zepbound from Novo Nordisk and Lilly, respectively, currently lead the category. Others will follow.

There has never been a category so suitable for DTC advertising. High incidence, easy understanding of the condition, and fast action to see results are the hallmarks of a no brainer DTC drug. A JP Morgan analyst predicted the GLP-1 obesity market will grow to $71 billion by 2032. There are about 110 million Americans who could benefit from using obesity drugs. Currently only about 6% are using them according to the Kaiser Family Foundation.

Wegovy has been blasting its availability over the past year. We have all seen the great march of people down the street DTC ad. The power of “we”. Lilly’s Zepbound started DTC advertising mid-November. Supply issues made advertising unnecessary until capacity issues were resolved. Production has been recently expanded according to Lilly.

Lilly has set up its direct distribution system to consumers to offer that alternative to regular channels of retail pharmacies. They are ready to promote demand growth.

You can count on several new competitors in the next few years as the great gold rush for this market is making drug makers salivate. Lilly and Novo Nordisk know their premium priced drugs will be facing lower priced entries. The window for maximizing sales at premium prices is short. Insurers will be gradually increasing coverage because the added benefits of these drugs are exciting. At current prices, insurers are not rushing to cover them.

The weight loss category from GLP-1 drugs is set to become a massive DTC advertising spender, reshaping how America addresses obesity and its related health challenges.

Research studies are showing a litany of health outcomes beyond weight loss such as reducing blood sugar, blood pressure, heart disease, addictive behaviors, and potentially dementia. It is just a matter of time before they are covered because of the potential reduction in costs of treating heart disease, diabetes, and dementia.

The pressure will be on drug makers to make these drugs more affordable to the average American. Hearings in Congress were recently held with the Novo Nordisk CEO to pressure the company to lower prices on Ozempic and Wegovy, which run about $1,200 a month for self-pay. Discount cards are available, so the real consumer price is about $600 a month unless covered by insurance.

DTC ads will help keep demand high and new competitors will eventually drive down price. Expanding capacity will allow both Lilly and Novo Nordisk to reduce price and make it up on volume. After all, better to have more customers on these drugs for years at affordable prices than have them start and stop due to cost.

Once we see new competitors, we will see DTC ads evolve to highlight brand advantages. Those might be based on price, form of dose as in pill or injection, frequency needed, side effects, efficacy of weight loss, or other collateral health benefits. The weight loss category from GLP-1 drugs is going to be a massive DTC spender for years to come.

Bob Ehrlich

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DTC-In-Perspective by Bob Ehrlich

Revolutionizing Pharma: The Rise of Direct to Consumer Pharmaceutical Drugs

December 3, 2024 0

One of the current trends in DTC marketing is the availability of some branded drugs shipped directly from the manufacturer. Some pharmaceutical companies are starting to cut the wholesalers and retailers out of the purchase cycle. While still in its infancy, the direct to consumer operations have enormous implications for how consumers will get their drugs in the future. Eli Lilly and Pfizer are the first to offer this service.

The direct sales of drugs to consumers have been in place for nearly a decade from non-pharmaceutical companies. Hims started in 2017, and there are now many non-pharmaceutical companies diagnosing, prescribing, and shipping to consumers. Drug companies have decided to enter direct sales in the past few years.

Why are drug companies now getting into the direct sales business? There are several good reasons for this new approach. First, drug makers are now seeing a huge growth in direct sales companies offering compounded versions of their drugs. These are cheaper and, in categories like weight loss, have lots of appeal to consumers. Second, cutting out the middlemen gives drug companies better ability to lower drug prices. Third, there are enormous marketing advantages to knowing your customers and tracking their purchases over time. Fourth, drug companies are concerned about counterfeit drugs through reimportation which is a real problem for consumers ordering from the internet. Fifth, consumers like the convenience of getting diagnoses and prescriptions without having to see their doctor in person.

“Cutting out the middlemen gives drug companies better ability to lower drug prices, know their customers, and combat counterfeit medications – reshaping how consumers access healthcare”

I would expect that drug companies will greatly expand their direct to consumer programs and use traditional DTC advertising to make consumers aware of their purchase options. The direct business will not replace retail drug stores or drug wholesalers for most drugs. Most of the growth will come from lifestyle categories like weight loss, sexual dysfunction, sleep disorders, migraine, anxiety, and depression. Any category where an online survey and virtual healthcare can diagnose a consumer condition is an opportunity for direct sales.

There are legitimate ethical and policy implications to expanding direct pharmaceutical distribution. The non-pharmaceutical direct business makes it easy to get prescription meds through an online survey or telemedicine that inappropriate prescribing is possible. I expect pharmaceutical companies will have better controls in place to make sure a prescription is justified. After all, these big pharma companies have a lot more to lose in public reputation and through regulatory, public policy, and legal actions.

The Amazoning of America has certainly shown that consumers love the convenience of shopping from home. Getting a diagnoses, prescription, and delivery online is becoming accepted for many drug categories. Drug companies see the potential and expect major growth in this channel.

Bob Ehrlich

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DTC-In-Perspective by Bob Ehrlich

Trump and Pharma

November 12, 2024 0

The election of Donald Trump is having pharmaceutical companies evaluate how things may change in terms of legislation and regulation. Trump is not yet clear on his moves regarding pharma. In his first term, he criticized the drug companies for pricing higher in the U.S. than other developed countries. Republicans in Congress have generally not allowed punitive legislation on price controls. They understand the negative impact price controls would have on R&D. Trump wants lower prices and that is publicly popular.  Acting on PBMs would be one option. Another would be allowing and promoting reimportation of drugs.

The DTC Industry should be nervous about Robert Kennedy Jr. being given a large role in healthcare policy. He said on 11/4 that he wanted to get Trump back in D.C. so they can “ban pharmaceutical advertising on TV.”  Scary comment. Kennedy is known for anti-vaccine sentiment and the desire to get corporate influence reduced. He is anxious to focus on prevention of disease which he feels is neglected in budgetary decisions. Kennedy thinks DTC advertisers exert influence on editorial coverage. Anyone who has watched news coverage knows the drug industry has not historically been favorably covered.

I doubt Trump will act on DTC advertising. He did not in his first term and a Republican Congress will recognize the free speech rights to advertise. I do expect Trump to speed up the regulatory drug approval process and that should be a net positive for innovation. In fact, expansion of drug use and DTC ads promoting such should help in the disease prevention goal of Kennedy.

Will FDA be asked by Kennedy and Trump to make DTC harder to execute? It is already harder with the latest OPDP rule recently implemented. Can it be made so restrictive that DTC ads are impractical? That is certainly a possibility, but the drug, media, and advertising agency lobby is strong and persuasive. Usually, the pro advertising forces have prevailed. Republicans have historically been pro-advertising, and I expect Trump not to act even if Kennedy proposes a ban.

Uncertainty is never helpful in DTC planning and the anti-DTC proponents will make a lot of noise. I remain confident, however, that no actions will be taken to ban or further restrict DTC.

Bob Ehrlich

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DTC-In-Perspective by Bob Ehrlich

Bernie Sanders Hearing on Drug Prices

November 6, 2024 0

On September 24, Novo Nordisk CEO Lars Jørgensen testified before the Senate which I watched on C-SPAN. He was asked to appear to discuss the reasons for high prices for GLP-1 diabetes drug Ozempic and its weight loss sister drug Wegovy. The savaging of drug company pricing policies is an ongoing cause for Sen. Sanders.

Bernie pointed out in his opening statement that US prices for Ozempic and Wegovy are multiples of their price in Germany, the UK, Canada, and other European countries. With his usual outrage, Bernie demanded answers from big pharma. Mr. Jørgensen had a few reasons for higher prices, most important that the list prices are high because Pharmacy Benefit Managers (PBMs) want drugs with high list prices. This is because rebates to them are a percent of list price. According to Mr. Jørgensen, Novo only gets 26% of the list price, the rest going to PBMs.

He also said that insurance companies set the net price consumers pay, not drug companies. Bernie then said that even with PBM rebates US prices are still too high. There was no definitive answer given by Mr. Jørgensen on the reasons for the difference between US and European pricing. What was clear was neither Republicans nor Democrats were satisfied they got their answers. Senators seemed frustrated with the complex nature of drug pricing and want legislative action on how PBMs get compensated.

The reality is that US drug prices are higher because the drug makers face price controls in most other countries. Prices would be lower if PBMs were cut out of the loop but still be higher than Canada or Europe. The US consumer partially subsidizes R&D for the world. That is unfair, of course, but reality. If Bernie got his wish and drug companies charged the European price, we would have less R&D. Mr. Jørgensen pointed out Novo Nordisk is spending $30 billion on increasing manufacturing capacity and $4.2 billion on Diabetes R&D last year. He said their annual R&D budget was more than the National Institutes of Health spent. If US drug prices historically matched Europe, it is likely we would not have Ozempic or Wegovy available today.

Innovative drugs like Wegovy will come down in price as production is ramped up and competitors enter the market. The obesity market is huge and Wegovy and Lilly’s Mounjaro will grow exponentially if price comes down significantly. Their makers know this and once they have enough production capacity, they will cut prices and vastly expand usage. Their large DTC spending shows how much they think they can grow the market.

As the GLPs increasingly show health benefits beyond diabetes and obesity, such as for cardiovascular and kidney disease, it is imperative that prices are low enough to get mass use covered by insurers and affordable for direct pay patients. Our collective health may depend on a significant cut in prices.

Bob Ehrlich

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DTC-In-Perspective by Bob Ehrlich

The Implications of the Ubrelvy Letter from OPDP

October 22, 2024 0

On 8/29/24, AbbVie received a notice from FDA’s OPDP that their Serena Williams DTC television ad violated the FD&C Act. The reasons cited are for overstating the benefits of Ubrelvy. The untitled letter illustrates the difficulties pharmaceutical companies face in presenting benefit information that satisfies FDA requirements.

Ubrelvy tried to meet FDA requirements and do it in a :30 second ad. For drug ads, this is very hard to do given most drug ads need :60 and :90 seconds because of complex benefit claims and fair balance. AbbVie has used Serena Williams as a migraine relief spokesperson for several years. She has been an excellent example of a celebrity endorser. Serena has the migraine condition and the ads are presented in a unique creative style.

What happened in this case that OPDP called the ad violative? In sum, OPDP said the stated benefit of providing one dose rapid relief was not consistent with clinical data. That data showed only a minority of users got relief that quickly. The television ad claimed in a large super, “Ubrelvy Quickly Eliminates Migraine Pain”. Serena’s audio says, “One dose works fast to eliminate migraine pain.”

OPDP also had concerns that Serena, as a celebrity, further added to the potential for consumers to believe the one dose rapid relief claim was true for all users of Ubrelvy. OPDP cites several studies supporting the idea celebrities add to claim believability.

OPDP acknowledges that the ad had a small qualifying super saying “some people had pain freedom within 2 hours.” That small super was insufficient in balancing the ad’s stated claims of rapid relief. OPDP says the speed of relief and one dose claims are misleading because they do not work for everyone.

The Ubrelvy case is important because it illustrates the difficulty drug makers have distilling complicated clinical results into concise advertising claims. Ubrelvy and almost all other prescription drugs provide benefits for some but not all users. Trying to get to that one compelling benefit in DTC ads is difficult given that clinical data is mixed in patient outcomes. Drug claims need to have significant enough disclaimers on efficacy to clearly communicate the extent of the benefit.

In this case, OPDP felt Ubrelvy did not present the proven clinical benefits clearly enough. I should point out the Serena ad in question is not vastly different from the other Ubrelvy ads run from 2022. The earliest ads from 2020-2021 were less declarative, however, in the claim using the word “can” help relieve migraines.

I am not sure if OPDP questioned prior ads or had discussions with Ubrelvy during the pre-clearance process. There is a redacted paragraph in the letter that indicated previous OPDP concerns about Ubrelvy ads. This was when Allergan owned the brand before being acquired by AbbVie. Most drug ads are pre-cleared at least for the first campaign used. Sometimes new versions are not pre-cleared if similar enough to earlier ads.

AbbVie has been asked to stop running the ad and it will be interesting to see their response to OPDP. Usually if the pharmaceutical company stops running the ad, the FDA will not take further action requiring corrective advertising.

 

 

 

Bob Ehrlich

DTC-In-Perspective by Bob Ehrlich

DTC in Perspective: Importing Canadian Drugs?

August 2, 2019 0
The Trump administration wants to allow Canadian drugs to be imported to give consumers lower prices. This is also supported by almost every Congressional Democrat and many Republicans. It sounds great to allow American consumers to buy cheaper drugs from Canada and is already happening somewhat through online Canadian pharmacies. Consumers can generally save 30-50% and in some cases by a lot more.
So why is this tactic going to fail? First, drug makers do not want to sell to Canadian distributors just to have those lower priced drugs come back to the United States. They happily will sell what Canadian consumers need but will not allow much more than that to be sold into Canada. Drug companies know some Americans buy Canadian drugs but that is a relatively small amount. Once that reimportation gets to be a big business drug companies will restrict what Canadians can buy.
Bob Ehrlich
“The American people will demand a price solution…”
-Bob Ehrlich
Second, the Canadian government has already said they have experienced drug shortages and will not allow Canada to become an exporter of drugs if their own citizens face problems filling prescriptions. Drug makers will not allow their golden goose US market to be destroyed by a Canadian end run. Drug makers always have the option of not selling a drug in Canada if the approved price is too low. That could deprive Canadians of getting access which is not a good scenario.
Unfortunately for drug makers it looks like there will be some system of price indexing or outright price controls in the future. There is no strong support from either party for drug makers charging US consumers more than other developed countries. While Republicans are more friendly to drug makers, they cannot convince their constituents that it is fair to pay significantly more than the French, Canadians or Germans. While they know innovation is funded by US profits, that is a hard sell for voters having trouble affording rising health care costs.
What is the solution? Drug companies must self regulate their desire to raise prices beyond inflation. Any increase beyond that is difficult to defend. American consumers need to get a tangible benefit paying a premium price. That could be faster access to new drugs, and more price support during the introductory period to prove the value of the premium drug. While the industry’s ad campaign explaining the wonders of drug research is good, I am afraid it is insufficient to assuage concerns that Americans pay too much.
The best solution is to have one developed market price for a drug with Canadians and Europeans paying more and Americans paying less. Why would other governments agree to that? There would have to be some benefit in allowing drug companies higher prices in price-controlled markets. That could be through trade concessions in other categories. Any fair price system would take a massive negotiating effort between the drug industry and multi government regulators. Perhaps over time an index system could work as long as the drug industry could make substantially the same returns.
Another solution is to extend patent expirations in exchange for lower prices. Also, any system that speeds approval can be leveraged against high drug prices. What needs to be done is a pragmatic approach that balances need for innovation with lower prices. Saying that drug companies are greedy will not get to a workable long-term drug strategy. American consumers will not benefit if mandating lower prices leads to a cut in vital research.
What I do predict is the drug price issue cannot be successfully fought much longer by lobbyists. That can no longer be the main strategy of drug makers. The American people will demand a price solution as this ire is being stoked in every political debate. Unfortunately, the proposed solutions will not be favorable to drug maker profits. One of the ways to mitigate profit impact is to increase demand. DTC could be a beneficiary of that demand-based strategy. If drug prices are forced down, I would expect drug companies to increase marketing budgets to grow their user base and retain those users.
After so many years of drug prices debates, 2020 looks like the time action will be a reality. Of course, the extent of price action depends on who gets elected. The Sanders/Harris/Warren plan is highly punitive for drug makers while Biden and other moderates will go softer. Trump is not far from moderate Dems on his plans so drug makers will get hurt whoever wins in 2020.

Bob Ehrlich

DTC-In-Perspective by Bob Ehrlich

DTC in Perspective: Chantix Goes Slow Turkey

February 22, 2019 0

I have been in the DTC business a long time. After seeing the excellent Ray Liotta ad I might have predicted the next version would use Joe Pesci or Robert De Niro. Chantix instead cast a wild turkey as its star. Who says DTC can’t be creative?

Bob Ehrlich
“Chantix breaks out with the creative…”
-Bob Ehrlich

In what will be a very memorable spot Chantix takes the “cold turkey” expression literally by casting a turkey to represent a person who quits smoking with Chantix. The story line is that Chantix allows you to gradually quit smoking by decreasing the urge and thus you don’t need to go cold turkey but go slow turkey as the spot is named. In a world where much of the DTC Ads have become boilerplate style, Chantix breaks out with the creative device here. Sometimes using a character to represent a brand is risky. It works well when we get an Aflac Duck. The question a brand and agency must wrestle with is will using a character diminish the serious nature of an Rx drug.

For DTC we have had a number of such character representations. Digger for Lamisil, the walking bladder for Myrbetriq, a dancing stomach for Prevacid are some DTC examples. The risk is that patients who suffer from disease may not like seeing their problem in character terms. Some diseases are clearly inappropriate for creating such treatments. I doubt cancer ads would contain a singing Lung.

For Chantix I love the use of the turkey. After seeing so many testimonial ads in DTC, it was certainly attention getting to see a turkey sitting by the pool dumping its ashtray. The ad was so different from Ray Liotta that I had to go back and make sure I was seeing correctly. Yes, that was Chantix.

Sometimes an attention getting character might have stopping power but dwarf the message. In this case the Chantix story still came through well and the creative just replaced a human with the turkey in situations like lounging by the pool or mowing the lawn. I give Pfizer a lot of credit for approving a story board so different from the traditional user testimonial. Ray Liotta was very effective but so is the turkey. The agency should be applauded for recommending it as it is not always easy to bring something so different like this to the client.

My concern is that Ray may want to whack the turkey for taking over as spokesperson. A Goodfella hates rivals. I do not know how long this turkey creative can last. After all there is no saying like cold squirrel or cold cow. I am afraid the pool out potential may be limited but that depends on the acting range of the turkey. That said if the turkey is meant to get potential Chantix users to get engaged this ad will do that very effectively.

Bob Ehrlich

DTC-In-Perspective by Bob Ehrlich

DTC in Perspective: The Assault on Drug Makers Widens

January 18, 2019 0
Drug companies are under renewed attack. There is yet another new bill in the Senate to end the tax deductibility of DTC ads. The latest is from Elizabeth Warren, who will use drug companies as a campaign talking point about corporate greed. The bill would end all forms of tax benefits for any media type.
We also see the House scheduling hearings on how drug companies price their drugs. We can expect harsh treatment of drug CEOs who will be called to Washington to be attacked by Congress in public televised hearings. Another idea floating in Congress and HHS is to peg US drug prices to Europe. Congress will say that this is a fair way to set US prices as Americans should pay no more than the Germans.
Bob Ehrlich
“DTC could be a sacrificial offering to the critics…”
-Bob Ehrlich
According to a study by Deloitte, all this vitriol is happening as R&D return on investment is down to a paltry 1.9% last year. So critics want drug companies to develop drugs to fight disease with price controls and crappy returns on their R&D investments. Drug companies are in a no-win situation. The critics say drug makers make too much money and are raising prices too fast based on inflation. Yet the data shows they are having trouble recovering R&D investment. Critics want drug companies to improve health outcomes but want to prevent drug companies from free market pricing.
Drug makers are an appealing political target for both parties. Some of the criticism is valid. Drug makers have taken prices up too far too fast. A little prudence is called for if drug makers want to prevent the political hammer from dropping. On the other hand, their dilemma is how to fund that R&D while still providing decent returns to investors. Europe and Canada are getting a free ride off of American consumers. No one expects the average Parisian to volunteer to pay more. Riots in Paris over fuel costs show no chance Europe will help out on drug price support.
So here we are. What is the solution to this mismatch in drug prices? Clearly drug companies are risking draconian measures from Congress. As Dems turn left you can bet they will attack drug companies more vigorously and might even get Republicans and Trump to agree. Nothing will happen quickly but this time may be different. I am afraid it is entirely possible that DTC could be a sacrificial offering to the critics who vastly overestimate the power of DTC ads to create demand. DTC works but is not the driving force in building brands. That advertising, however, is the public face of the drug companies and critics blame DTC for raising demand for premium priced drugs. They think that keeping the information from consumers will keep prices down.
Congress and HHS will try to cajole drug makers to slow down increases. They have already decided to mandate list price be part of consumer ads. Next may be ending the tax deduction for advertising. After that price controls are a real possibility. The Democratic candidates for the 2020 Presidential election will all have a plan to nationalize health care and they will all include price controls in that platform. With Trump as anti-industry as they are we can expect violent agreement that drug makers will be targeted.
So to my colleagues in DTC advertising, buckle up and expect new regulations geared at making DTC harder to execute. I do not expect a ban, but FDA and Congress will be looking for ways to make all our professional lives more difficult.

Bob Ehrlich

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