November 19, 2024 0
Explore the potential impact of Robert Kennedy Jr.'s nomination to head HHS on the future of direct-to-consumer (DTC) pharmaceutical advertising. Understand the legal and regulatory challenges that could reshape the industry.
Explore the potential impact of Robert Kennedy Jr.'s nomination to head HHS on the future of direct-to-consumer (DTC) pharmaceutical advertising. Understand the legal and regulatory challenges that could reshape the industry.
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.
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.
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.
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?
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.
The Senate recently passed an amendment to a larger health care bill that requires drug prices be disclosed in DTC Ads. The Durbin amendment was adopted with bipartisan support. It really just gives HHS a million dollars to study a way to require the disclosure. What is clear is this idea has strong support from President Trump, Congress, HHS Secretary Azar, and the American Medical Association. So, like it or not, the drug advertisers may be forced to add some price information to ads.
On the surface, that list price disclosure seems reasonable. We see MSRP in car ads, so we know whether it is a premium or economy car. Not that we don’t know that already but it is not unreasonable. For cars, we know we will likely pay somewhat less than MSRP but we do know the range a Mercedes will cost us. Congress thinks consumers deserve to know the price of drugs they see advertised. To Congress that seems like it would help consumers decide if this advertised drug should be considered.
Drug pricing is not like car pricing. Consumers pay much less than the list price and sometimes pay nothing for the $50000 drug for cancer. Admittedly, drug pricing is a Byzantine process that confounds most of us. Each insurance company, PBM, and government payer negotiates prices. Each consumer depending on their insurance pays a different price no way near the list price. Sometimes the consumer would pay out of pocket more for their OTC cough medicine than the $50000 cancer drug.
So how should drug companies disclose drug prices? If the list price is not anywhere near what consumers pay, then how does disclosing it help them? It does not. It helps insurance companies in making DTC more difficult for drug companies to execute. The knowledgeable legislators know that if they force drug makers to talk about price that may discourage them from doing DTC Ads for expensive drugs. Drug makers advertising the $100000 cancer drug may decide that DTC is not worth trying to explain the complexities of drug pricing or face the barrage of criticism for having a sticker shock price.
I think this is the real reason for this amendment. Embarrassing drug companies they hope will put a chill on DTC for cancer drugs, biologics for arthritis, Crohn's, and other new premium drugs. Of course, all drugs will face a guidance on how pricing needs to be discussed. Somehow FDA will make disclosure a time consuming step in a DTC ad. That will add 10-15 seconds to the ad and may make them difficult to execute. Their hope is to get drug companies to stop doing DTC.
So the good news is it will take FDA a while to study and draft guidance for disclosing price. This lag may allow the powerful advertising lobby to show how impractical this disclosure requirement will be. My guess is we may have some compromise that speaks in terms of ranges of price. That is something like “most patients will pay much less than the price listed depending on your insurance coverage.” Or, drug makers may be able to say “the average price paid by consumers is x.”
It may be illegal to require drug makers to disclose price under commercial free speech grounds. I am sure the advertising lobby will argue this inhibits commercial speech. They would have a strong case based on precedent.
My advice to the agencies is to be ready to deal with adding some price statement but I am sure it will be a few years before FDA can figure out how best to do this. They research everything they do and that will take a long time to study. DTC price disclosure sounds great but is just a bad idea that will not help patients.
The latest Chantix smoking cessation DTC television ad is featuring my favorite wise guy actor Ray Liotta. Looking a little grayer and heavier Ray is still the iconic member of the De Niro/Pesci crew from Goodfellas, maybe only slightly behind The Godfather in my favorites list. Ray is also in my favorite baseball movie Field of Dreams, portraying the leader of the dead baseball players returning to Kevin Costner’s cornfield.
Ray’s lifelong bugaboo was getting to stop smoking. Pfizer is using him to promote Chantix and rather than just being a paid announcer he is actually a real patient, still paid handsomely I assume. I like him in this role. Usually I wonder how much a celebrity adds to a drug pitch. Do potential users really care that a Hollywood type uses a drug? There have been very effective celebrity campaigns, Sally Field for Boniva, Jennifer Aniston for Dry Eye, Phil Mickelson for Psoriatic Arthritis to name a few.
A celebrity campaign needs to get the audience to believe that the celebrity actually uses or really believes in the drug advertised. There are some celebrities who endorse anything and pushing garlic pills, grape juice, reverse mortgages, might hurt your credibility when pushing a cancer treatment. Drug companies need to be very careful that the celebrity chosen has limited exposure as an endorser of health products.
Ray Liotta, to my recollection is not a serial endorser. In fact I do not remember him doing any commercials. That is a good first step. Can I Imagine Ray Liotta having a smoking habit? Sure can. Is Ray credible saying he has had a lifelong problem stopping smoking? Yes. So far so good. What is interesting about the campaign is that Chantix has been on air for years with regular folks pitching their success. Maybe they felt they needed to reinvigorate the story and potential customers would stop and re-engage after all the years of real patient testimonials. Ray got my attention, maybe a bit less than Joe Pesci would have, but any Goodfella is better than none.
I do not know if this is a one off use of a celebrity for Chantix or the first in a series. One thing we know is Hollywood is likely full of smokers, and addicts of other less than legal substances. No credibility issue with Ray having a smoking addiction. I am sure Pfizer will be very careful vetting their celebrity candidates. With all the problems of celebrity reveals on past sexual harassment/assault it is important to do your homework. I think they have chosen well here. Congratulations to Pfizer and their agency for a well done celebrity campaign.