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August 18, 2017 0

In what may be a major step towards reducing the litany of risks presented in DTC television ads, the FDA released their new study that shows that less risks presented is better for consumer comprehension and retention. While saying further study is needed, FDA cleared the way for perhaps eventually changing its guidance on the number of required risks presented. This study, originally posted for public comment in January 2015, saw the results published August 2017 in an online research journal.

Bob Ehrlich
“FDA would be wise to issue a new guidance..to reduce the number of risks…”
-Bob Ehrlich

FDA studied alternate risk disclosure in three categories for this study. Insomnia, depression, and high cholesterol were tested with reduced risk disclosure. While full details were not yet published the conclusion is that consumers remembered more when less was presented. We all know the current approach is not optimal because consumers get bombarded with so many risks and side effects, both in voice overs and on screen supers.

So here we are 20 years into DTC on television and we get the widely expected answer from the FDA study. While this study is better late than never the FDA says further research is needed. FDA would be wise to issue a new guidance soon giving drug makers the chance to reduce the number of risks and side effects. Consumers could immediately benefit by retaining more of the important information. I am even supportive of keeping the ads just as long with fewer risks discussed. Supers could kept on the screen longer and a slower voice speed could be used for discussing risks.

FDA has lots on its DTC research agenda, but this area of risk presentation is of major importance. Action should be a priority because consumers are overwhelmed with risk information under current requirements. The goal of all involved in DTC should be helping consumers get comprehensible risk information. The shortened risk requirement would help in achieving that goal.

Bob Ehrlich

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August 17, 2017 0
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Every 42 seconds, someone in the US has a heart attack. Each minute, someone dies from a heart disease-related event.1

Even though heart disease remains the leading cause of death in the US, many adults are uninformed of the causes, symptoms and proper treatment of heart-related conditions. In fact, according to PatientPoint research, over half of patients who are treated for heart health said their issues were unexpected. Further studies have found 70% of adults are not familiar with symptoms associated with heart disease.2

As these statistics reveal, the need for education and support materials for patients at the point of care is paramount – and critical to pharma companies’ success. Because if heart health isn’t top of mind for most adults, it’s likely your treatment isn’t, either. And with nearly half (47%) of cardiologists now restricted, gaining awareness among physicians is also a growing challenge.3

To ensure the right message is delivered to these heart “unhealthy” patients at the right time, PatientPoint conducts in-depth research in the space. Here’s a snapshot of patients who visited cardiologist offices installed with the PatientPoint Communicate – Cardiology Waiting Room Digital Screens Program:

  • Average age: 60 years
  • Gender: 60% female
  • Race: 79% white / Caucasian
  • Employment status: 59% retired
  • 42% are accompanied by another adult
  • 59% want to lose weight
  • Top conditions identified to be at risk for or diagnosed with: high blood pressure / hypertension (72%), high cholesterol (68%), arthritis (55%), heart disease (53%), heart attack or cardiac event (48%)

This information enables us to develop content specifically tailored to these conditions, gaining unprecedented positioning as a trusted consultant to our partners – clients, physicians and patients – to ensure their message makes the most impact at each important moment.

Let’s look at each of these points a little more closely:

  • Waiting room: Patients say the waiting room is often the most stressful part of their visit to the doctor. Reinforcing your brand message alongside easy-to-understand digital information regarding heart health, healthy living tips and personalized messages from the practice will put your brand top of mind right before patients visit with the doctor. Heart patients don’t want to hear about arthritis content. We speak the patient language.
  • Exam room: Once in the exam room, patients crave in-depth education. Interactive touchscreens bring health information to life, whether it’s through a personalized quiz, short article or a brand testimonial video. Once the doctor arrives, he’s likely to use the touchscreen to show the patient exactly what’s happening in her heart via full-color, 3D anatomical models. It’s here where your brand can provide the support and savings information to help guide discussions and, ultimately, decision-making.
  • After the visit: Because the risk factors for heart disease and stroke are directly related to lifestyle choices, continual engagement between provider, pharma company and patient is important to ensure treatment success. We know those age 45-64 (the common age range for the onset of many cardiovascular conditions) still see print as a valuable information resource,4 and including your message in brochures patients can take home and reference later will help reinforce your brand as part of the solution to living a longer, healthier life.

The scale of the cardiovascular market is driving greater demands of quality outcomes data. Providing the right education to patients and providers at the right moments will help pharma companies remove barriers to access and support long-term adherence.

 

References

  1. American Heart Association, 2015
  2. Cleveland Clinic survey, 2014
  3. ZS Associates, “AccessMonitor,” 2015 Executive Summary
  4. 2015 Two Sides North America

Linda Ruschau


August 14, 2017 0

If you haven’t been living under a rock (or aren’t my parents), you are probably aware of the rise in popularity of voice search and voice enabled devices. Thanks to technology like Google Assistant, iOS Siri, and Amazon Echo, voice search is exploding in terms of both adoption and technology integration.

A comScore study in 2016 noted that 40% of adults now use voice search at least once per day and 60% of those people started using it in the last year. A recent report estimates that more than 24 million Amazon Echo and Google Home devices will be sold in 2017. As the technology behind these devices improves, people are turning to them at an increasing rate to obtain information, seek answers to their questions and incorporate them as a part of their daily routine. Because people can typically speak up to 150 words per minute versus being able to type 40 words per minute, and using voice search is seen as quicker than typing or using an app, voice search continues to grow in usage.

The manner in which people are using voice search, beyond just music playback, seems to focus on location based queries and answering basic questions. These uses line up well with the core functionality of voice search and are natural first steps for many people who are getting familiar with the voice search format.

However, there is much more potential in how voice search can be utilized to engage with searchers beyond what we’re currently seeing – this is especially true in the health information space.

Using voice search for health information
Currently, the number of voice search enabled health dedicated applications is very limited. One of the few available now is WebMD’s Amazon Alexa skill, which is essentially a custom voice search program geared towards health information. This new skill is aimed toward answering basic health questions and providing information in a quick and easy voice-enabled format.

Perhaps in the near future, voice applications could simply build on the commonly used question and answer format to help patients at the earliest stages of their health journey to identify potential health conditions and provide questions for them to ask their doctor.
However, while making use of the straightforward question and answer format is a good foundation, there is a plethora of untapped potential for the health information vertical to go even further and create truly interactive, immersive voice search experiences.

For instance, one of the real values of voice-based personal assistant devices is the way they have started to weave themselves into the daily routine of users. This adoption could be useful for people who manage their health conditions on a daily basis. People who live with diabetes, for example, have a variety of concerns they need to be mindful of which could potentially be tied in to the usage of voice based personal assistant devices. These uses could include:

  • Reminders can be given when it is time to eat, drink and check blood sugar levels
  • Using location-based weather forecasts, the assistant can give recommendations for exercises appropriate for that day and even skin care tips in order to keep skin hydrated
  • From a dietary perspective, when someone utilizes the “shopping list” feature of these devices, perhaps a diabetes app can recognize the ingredients and make suggestions for recipes to make using those ingredients that are diabetic friendly
  • Searches for recipes or restaurants can factor in diabetic restrictions when making recommendations, which will allow the voice search experience to be not only highly efficient but extremely personalized to that person’s location and health needs

As people continue to utilize voice search based devices, the amount of health information applications will continue to grow and open up new avenues to engage people with very individualized healthcare information experiences.

Taking healthcare conversations to voice search
It’s one thing to have a presence in voice search, it’s another to provide an application that people find truly helpful and improves the quality of their health journey. To create a voice search experience that is meaningful and useful, developers must provide people with trustworthy information as efficiently and accurately as possible in their moment of need. This is easier said than done, but the ability to offer such valuable and intimate service means there is the potential to become a part of each person’s daily routine.

Much of the potential value in voice search is in the organic experience it can create. Where healthcare is concerned, many people still feel that having a conversation about your health questions, such as you might have with your doctor, is a more natural and credible experience than Googling for information. Voice search and personal assistant devices have the capacity to create a conversational experience that can make people feel more comfortable and thus dive deeper into their health information search by engaging in a way that more closely mimics the interaction that might occur with their physician.

Healthcare brands and organizations who wish to make full use of voice search will have to be true to themselves and to their audience about the types of information they are seeking and how to answer those questions. For brands, this means potentially providing information that they might not normally be comfortable with discussing. Topics such as side effects and pricing are often avoided on brand websites despite searchers frequently looking for this type of information. In addition, we often see in our research that people commonly make comparison searches, essentially typing in “brand A vs brand B”. This is content that is typically not included in brand experiences. In order to feel comfortable engaging in voice search and adopting a vastly new method of searching for health information, people will need to feel as confident in the answers they are receiving as if they were coming from an unbiased source such as their own doctor.

As people embrace this new technology to seek out health related information, the healthcare world has a tremendous opportunity to make an impact. This starts with creating an experience that truly harnesses the value of voice search to empower the user to feel more in control of their own healthcare.

Richard Deede


August 11, 2017 0

The Vaccine makers have been very active using DTC to build awareness for some very serious diseases. Prevnar 13 from Pfizer has had a high spend campaign for its pneumonia vaccine. HPV has also been prominently promoted by Merck for Gardasil. Recently two new vaccines for meningitis B have hit the market and are going head to head. Pfizer’s Trumenba and GSK’s Bexsero both are going after the 10-25 year old market.

Bob Ehrlich
“We want drug makers to invest in disease prevention…”
-Bob Ehrlich

Meningitis B is a very serious bacterial disease involving inflammation of the spinal cord or brain. While rare it is deadly for about 10% of those afflicted and causes lifelong damage in many more who survive. About 10% of us have the bacteria in our saliva but overwhelmingly it does not cause meningitis. For about 600-1000 people annually the disease is devastating because it rapidly can cause death.

Trumenba became available in late 2015 and Bexsero a few months later. Trumenba began heavy DTC 3Q 2016 with Bexsero starting this June. Analysts estimate the meningitis market at about $2 billion. These are interesting case studies on DTC for a rare disease. The odds of getting meningitis are very low but the impact is so devastating that physicians, young adults and their parents are being advised by the CDC to consider these vaccines.

Drug makers have been criticized by some physicians and consumer groups for using fear based campaigns for vaccines. Why scare teens and parents? Is it right to use fear as a motivator in these DTC ads? Is it ethical to show the devastation of a disease that is rare to incentivize people to get vaccinated?

Yes, it is because untreated meningitis consequences are so bad. The vaccine is safe. It is moderate in price. The cost is usually covered by college health clinics but even self pay is reasonable at $350-600 for the series of injections. The ads for both vaccine brands are hard hitting and are directed at parents to show what could happen if the child got meningitis B. Of course, the drug makers want to increase the use of their vaccines and they know the market is wide open and incidence of use is currently low. They are trying to warn parents and yes to scare them. Sometimes we need to be scared into action. I see nothing wrong in these ads because the disease is a real, albeit low risk, and can be controlled with vaccines.

Would we have massive outbreaks of meningitis B without these vaccines? No, but saving lives and long term disability of teens and college aged kids is the issue. Society needs to balance the cost to payers for the vaccine versus the risks to the young adult population. Because the disease can spread so quickly any campus that gets a case will cause widespread fear across the community.

We want drug makers to invest in disease prevention for what we see now and may face in the future. If drug makers can develop markets through DTC they will be willing to devote more R&D investment to the vaccine segment. Vaccines and antibiotics are generally lower profit categories because use is short term. Let’s hope for success for current vaccines being advertised because one day we will need to be protected from a pandemic and must have a well developed vaccine infrastructure at big pharma.

Bob Ehrlich


August 7, 2017 0

Many recent FDA warning letters involve what they say are distracting visuals during risk discussion. Last year Otezla and Toujeo were cited for that. A recent study using eye tracking reinforced their view that visual backgrounds on TV ads are potentially hurting comprehension of risks. Drug makers frequently mention some of the risks using supers on screen.

This FDA research completed in 2016 said that consumers do not absorb information well from those supers when there are distracting visuals. Of course, what is distracting is a subjective judgement from the FDA reviewer. My concern on citing drug makers for distracting visuals is the lack of evidence for that specific ad other than reviewer opinion. I understand FDA cannot quantitatively prove distraction for every TV ad they cite and must use informed judgement. I would hope, however, that FDA is consistent between reviewers and does not change over time. In a past column I said I did not think the Otezla or Toujeo ads were any different than many others not cited by reviewers.

Bob Ehrlich
“Consumers are bombarded with information that…may not be meaningful.”
-Bob Ehrlich

The problem with the fair balance requirement is that consumers are bombarded with information that may meet an FDA requirement but not be meaningful in terms of consumer understanding. FDA is studying the potential use of less warning information under the theory that less information may be better absorbed. My concern with this risk presentation is DTC is held to a different standard than every other advertising category for lawful products. Yes, drugs are different than most categories because they can cause harm. I recognize the need for telling consumers that drugs are potentially dangerous. The current litany of risk approach is, in my view, ineffective since a long list is not likely to be absorbed.

The issue is the role of warnings and risks in a television or print ad where time and space is limited. Drug ads are meant to inform consumers of an option for treatment and that is just the beginning of the pathway to prescription. The decision to prescribe any drug is an important one and side effects and risks are important for both physician and patient to understand. My view has been that only the most serious risks with the most harmful consequences should be disclosed in an ad and some quantitative odds should be mentioned. Any more than that is not particularly useful in the ad awareness stage. I clearly would want to know if anyone has died taking the advertised drug and the odds of it happening. I do not really need to hear a litany of possible non-fatal risks at the ad stage.

I hope the drug makers and FDA can work out a DTC risk and warning strategy that meets consumer needs. Consumers should be educated on benefits and risks but fair balance must be re-evaluated in the context of what consumers can meaningfully remember in 60 seconds or one page.

Bob Ehrlich


July 31, 2017 0

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 ispot.tv.

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.

Bob Ehrlich


July 21, 2017 0

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.

Bob Ehrlich


July 14, 2017 0

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.

Bob Ehrlich


July 7, 2017 0

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.

Bob Ehrlich


June 30, 2017 0

First, I am now back writing my weekly column after taking a couple of months off to recharge my batteries. Happy to be back giving my thoughts on issues affecting our DTC community. As I was watching CNN discuss healthcare reform yesterday I was surprised to hear host Chris Cuomo say drug prices were the main driver of rising insurance costs. He said this to Senator Dick Durban a democrat from Illinois. Durbin promptly said DTC is a big culprit in rising drug bills.

Ok, Chris and Dick. You are both wrong. The drug bill in America is a relatively minor cost at 10% of total health care expenditures. DTC spending is about 1% of total drug sales, hardly a driver of rising costs. While some high profile drugs are very expensive for cancer and hepatitis C, most branded drugs are not. The facts say Americans spend about $1100 annually versus $770 in Canada and $740 in Germany. (OECD study 2014) That difference is significant but not the driver of out of control health insurance premiums and deductibles.

Bob Ehrlich
“Reducing information flow…is not the answer to lowering health care costs.”
-Bob Ehrlich

The bottom line problem in America is we have an incentive for all providers to do services to get paid. We reward treatment not prevention. Doctors and hospitals get paid for procedures not watchful waiting or advice on prevention. Defensive medicine encourages added tests to protect from lawsuits. The latest technology we all love is expensive to install and providers recover their costs by high utilization. Americans want fast answers to their health issues and providers are more than willing to accommodate us with MRI’s and diagnostic procedures.

Drug companies are under attack and the lack of facts used by reporters like Cuomo are troubling. Durbin has no basis for saying DTC is a major problem driving up prices. His actual basis is his own distorted view that if patients ask their doctor for an advertised drug, then that must be for a drug not really needed. While DTC advertising is designed to encourage patient initiated discussion it is the doctor who decides whether it is needed. Drug companies have a chance to make their case to the consumer and doctor through DTC, detailing and medical advertising. Reducing information flow as Durbin seems to want is not the answer to lowering health costs.

The better solution to health care cost control is to incentivize consumers to shop around. We can do this by total price transparency from providers and by consumers having some skin in the game with their deductibles and copays. Hospitals and doctors want their fees to be opaque to patients. As long as someone else pays our bills most consumers do not ask or care. As we all face higher deductibles we are starting to care more what we are being charged.

Obamacare has caused significant increases in premiums, deductibles and copays. If we are to continue it, then we either can care more as consumers about prices we pay or ask the government to subsidize insurance companies to keep those premiums, deductibles and copays under control. I would recommend the former. If we give consumers the knowledge and incentive to negotiate with providers for lower prices, it will happen. There are many ways to provide consumers with price and quality information on providers. We have health technology companies who have that information and are happy to provide it. If we just ask government to continue to pay insurance companies to subsidize high provider costs we continue the fee for service model.

What unfortunately is happening is each side of the political aisle has reduced the discussion to simplistic slogans. We need moderates on both sides to create a coalition to solve the problem not to say ridiculous things like millions will die if we change Obamacare or Americans must be free of government mandates. Maybe I ask too much that reasonable people emerge to create a more workable health care system. I can still dream that the warring parties will actually think more about solving problems for America than destroying the opposition.

Bob Ehrlich