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Study: Restricting #Pharma Sales Rep Access to Doctors Cuts Prescriptions for Promoted Drugs. Duh!

Study: Restricting #Pharma Sales Rep Access to Doctors Cuts Prescriptions for Promoted Drugs. Duh! | Pharmaguy's Insights Into Drug Industry News |

Restricting drug company access to doctors at academic medical centers resulted in a substantial reduction in the number of prescriptions that the physicians wrote for drugs touted by the pharmaceutical industry, a new study found.

The University of Pittsburgh School of Medicine was among 19 academic medical centers in five states that were examined in the study, which appeared in the latest issue of the Journal of the American Medical Association. The institutions represented nearly 35 percent of all prescriptions written in 2015.

The study is the latest to challenge direct pharmaceutical sales calls to doctors — a practice called detailing, which sometimes includes gifts and meals — to encourage the use of products that are often more expensive than generics and other treatment options. In the past, drug company representatives have touted new uses for existing drugs for Alzheimer’s disease, for instance, which have harmed patients.

For example, in cases involving the antipsychotic drugs Risperdal and Invega, Johnson & Johnson in 2013 agreed to pay the government $2.2 billion to settle claims that pharmaceutical representatives promoted the medications for patients with confusion or dementia, despite evidence the medications increased the risk of stoke and other problems in the elderly.

Pharmaceutical companies earned more than $60 billion for the eight detailed drugs that were part of the study while generic drugs are on average 80 percent to 85 percent less expensive than branded drugs. Eight drug classes were part of the JAMA study, including medications to lower lipids, control gastroesophageal reflux disease, treat diabetes and others.

“It’s amazing how little it takes to influence how somebody thinks about something,” said George Loewenstein, one of the study’s authors and a professor of economics and psychology at Carnegie Mellon University. “The study really supports the need for more academic medical centers to adopt stronger policies.”

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@PhRMA Does Not Gold Boldly Enough to Address Real Issue, Says Law Professor

@PhRMA Does Not Gold Boldly Enough to Address Real Issue, Says Law Professor | Pharmaguy's Insights Into Drug Industry News |

[Opinion of Rachel Sachs is an associate professor of law at Washington University in St. Louis] Earlier this month, PhRMA — the trade group representing innovator pharmaceutical companies — announced a set of new membership criteria. Going forward, PhRMA members will need to meet certain standards regarding their investment in R&D (read “@PhRMA Ousts Marathon #pharma et al”;


PhRMA may have felt it needed to take action to restore public confidence in the industry and to constrain the bad press its members have been receiving on the drug pricing front. In my view, the new rules miss the mark.


Under the new criteria, member companies must invest at least 10 percent of global sales into R&D and pour at least $200 million annually into R&D, both measured on a three-year average.


I would argue these new criteria are not narrowly tailored to the matter at hand. There is a mismatch between the goals seemingly behind these new criteria and the specific tools they have chosen to bring them about.


First, consider the substance of the criteria in context. Many PhRMA members are directly under fire for some of their pricing practices, and we have seen pledges in recent months by individual companies to publicly restrain themselves from some of the industry’s price-hiking behavior.


Why, then, tie the new criteria to the amount spent on R&D, rather than to pledges not to engage in some of the more overt bad acts of these companies? The disconnect is particularly strange when you consider that a common argument companies make when confronted with price hikes is that the increased revenue is needed to fund additional R&D.


A likely explanation can be found in PhRMA’s attempt to rebrand itself under the auspices of its big new advertising campaign, “Go Boldly.” The industry is seeking to remind customers that it is responsible for the innovative medical breakthroughs that have saved so many lives, and that so many people rely on each day (read “@PhRMA Goes Even More BOLDLY in a New Ad Campaign”;


Publicly tying membership in the organization to R&D expenditures allows PhRMA to say that each of its members shares in the “Go Boldly” vision and is committed to the mission of innovation in new medical breakthroughs. However, it does so at the cost of ignoring the particular actions that have created much of the public outrage on the subject of drug pricing.

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California Senate Moves To Restrict Gifts to Doctors

California Senate Moves To Restrict Gifts to Doctors | Pharmaguy's Insights Into Drug Industry News |

California State Senators approved legislation on Thursday, May 18, 2017, that would restrict pharmaceutical makers and other drug companies from giving gifts to doctors and other medical professionals. The legislation, SB 790, was penned by State Sen. Mike McGuire and passed by a vote of 23-13.


According to ABC affiliate KRCR, SB 790 would prohibit or restrict most gifts from drug makers to doctors. Sen. McGuire said the bill would lower the cost of drugs in California because it would prevent doctors from receiving gifts that encourage the prescription of expensive drugs.


Sen. McGuire told AP reporters that drug companies spend more than $1.4 billion every year on California doctors alone.


"While we have witnessed the cost of drugs rise over the past decade, industry profits have also grown significantly," said the Senator from west of Sacramento. "We shall be all standing for seniors and taxpayers to drive down the cost of prescription drugs."


SB 790 would still allow doctors to be paid salaries for running clinical trials, and companies can still pay for meals, as long as the costs are below $250 per year per doctors. Even with these exceptions, the bill is still fiercely opposed by the pharmaceutical industry's main lobbying group.


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Doctor with Ties to Purdue #Pharma Helped Develop Canadian Opioid-Prescribing Guidelines

Doctor with Ties to Purdue #Pharma Helped Develop Canadian Opioid-Prescribing Guidelines | Pharmaguy's Insights Into Drug Industry News |

It's a bad day when the federal health minister wants to check your work. But that's what's happening to a McMaster University committee that was assigned to develop new opioid-prescribing guidelines for Canada's doctors.


The rules from Health Canada were clear when it awarded the half-million-dollar grant to McMaster's Michael G. DeGroote National Pain Centre in 2015: No one with any ties to big pharma could be allowed to vote on the final draft of the guidelines, which were intended to help doctors make difficult decisions about opioid use for chronic non-cancer pain.


As the hand-picked experts sat around the table arguing about when doctors should prescribe the dangerous pills, everyone in the room assumed everyone else in the room was free of industry ties.


But the truth was revealed earlier this month, when the guidelines were finally published.


One of the members of the voting committee had ties to drug companies that sell opioids, including Purdue Pharma (Canada), which manufactured OxyContin, one of the most notorious prescription opioid drugs.


The guidelines on opioid-prescribing practices in Canada are now under review after it was revealed that a member of the voting committee had received financial compensation from Purdue Pharma Canada, as well as other companies that market such medications.


Dr. Nav Persaud, another member of the voting committee, said he was shocked when he learned the news.


"We were asked to complete conflict-of-interest declaration forms twice," Persaud said. "My understanding was that the declarations were going to be reviewed, and anyone with financial conflicts of interest was going to be excluded from the voting panel."


New guidelines for prescribing opioids encourage doctors to put down the pad

Yet somehow Dr. Sol Stern, a family physician based in Oakville, Ont., was allowed to become a member of the voting committee, despite disclosing he had received financial compensation from Purdue and other companies that market opioids for giving talks and serving on company advisory boards.


The entire episode shines a light on an aspect of Canada's health-care system that is widely accepted, but rarely discussed — the vast financial relationships between doctors, hospitals and the pharmaceutical industry.


Nearly half of the pain specialists on the broader expert advisory committee (six of its 13 members) also disclosed ties to drug companies that make opioid pills.

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#Pharma Disease Awareness Marketing Infiltrates Soap Operas Like General Hospital

#Pharma Disease Awareness Marketing Infiltrates Soap Operas Like General Hospital | Pharmaguy's Insights Into Drug Industry News |

Last March, Vinay Prasad, a doctor in Portland, Oregon, caught wind of an episode on the long-running soap opera General Hospital. One of the main characters on the show, a fellow at his hospital told him, had been diagnosed with an extremely rare bone marrow cancer, polycythemia vera.


Prasad’s mind started spinning. And he felt suspicious. Of all the diseases out there, why would the writers at General Hospital feature an illness that affects only two in 100,000 people?


So Prasad and his colleague Sham Mailankody began to search for answers. They published their jaw-dropping findings in a new paper in JAMA: Polycythemia vera got a mention on America’s oldest soap opera because a drug company, Incyte, asked it to.


Incyte’s only FDA-approved drug, ruxolitinib, happens to treat the cancer. The General Hospital appearance was the company’s attempt to raise awareness about the rare disease — and possibly to sell more of its drug.


“Writing a [rare disease] into a main character plot on daytime soap opera to our knowledge is unprecedented,” Prasad said.


It may also lead to more people being diagnosed with an illness they don’t actually have or more people taking a drug that’s not good for them. “If every viewer of General Hospital heard about PV and went to their doc to be tested for PV, we would find way more PV than actually exists,” he said.


General Hospital takes “disease awareness” campaigning to absurd new heights

The Food and Drug Administration regulates direct-to-consumer marketing of pharmaceutical products — but it doesn’t regulate another common pharmaceutical marketing tactic called "disease awareness."


Incyte’s partnership with General Hospital was novel: Instead of getting a celebrity on daytime talk show talking about a disease, Incyte got the show’s producers to write it right into the plot.


The episode describes polycythemia vera, and depicts a blood clot one of General Hospital’s lead characters, Anna Devane, experienced as a consequence of the cancer. Devane’s doctor warns her that if she leaves her disease untreated, she may suffer a heart attack or stroke. When the doctor suggests she start on the usual treatments for the disease — anticoagulation drugs and drawing blood, Devane asks “But this protocol sounds like you are treating the symptoms of this cancer; how do we beat it?”


According to Prasad’s paper, these comments “may constitute subtle promotion of ruxolitinib.”


With a message this subtle, “there’s no way you would ever know it was connected to the drug company,” said Lisa Schwartz, a Dartmouth professor of medicine who studies pharmaceutical marketing. “Your natural skepticism that comes up when you see advertising is totally down because you don’t know the drug company has any role in the message you’re getting.”


Will this be the first of many examples of beloved TV shows becoming stealth vehicles for selling drugs? Schwartz hoped not. “This just seems like a terrible precedent and something needs to be addressed.”


Further Reading:

Pharma Guy's insight:

In 2005, the Roseland, N.J., firm placed posters for its Nuvaring contraceptive in the backgrounds of NBC's Scrubs and CBS' King of Queens. Since then, it has added ABC's Grey's Anatomy to its list, according to brand director Lisa Barkowski. "A lot of the feedback we get is from healthcare professionals," she said. "They mention it to [our] reps, 'Wow, I saw that poster.' It reinforces in their mind; it makes them think of the product." (This Is Your Show On Drugs: Rx Brands Injected Into Action)

Tim Malone's curator insight, Today, 7:27 AM
Wow. Pharma marketers now going to extraordinary lengths to reach consumers directly.
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Trump Reportedly Considering New Budget Cuts to "Disembowel" the NIH

Trump Reportedly Considering New Budget Cuts to "Disembowel" the NIH | Pharmaguy's Insights Into Drug Industry News |

Two months ago, the Trump administration unveiled its so-called “skinny budget,” which envisioned cutting funds for the National Institutes of Health by 18 percent, or $5.8 billion (read “Trump's Budget Would Put NIH & U.S. Medical Research into a Nose Dive!”; Scientists were appalled. As my colleague Adrienne LaFrance reported, one doctor said that the cuts “would set off a lost generation in American science.”


The bulked-up version of the President’s budget for fiscal year 2018, which will be released next week, may not allay those fears. According to two sources within the NIH who were briefed on the issue, the administration may pursue a new strategy in its quest for cuts, by proposing a 10 percent cap on the NIH’s indirect costs—the money it gives to grantees to support administration, equipment, libraries, IT, lighting, heating, electricity, and other overhead.


“It’s going to make every single university president across the country call their representative,” says one of the sources, who agreed to speak on condition of anonymity.


It’s not surprising that the administration is considering a cap. In the wake of the skinny budget, Secretary of Health and Human Services Tom Price defended the cuts by arguing that indirect costs represented “inefficiencies”—money going towards “something other than the research that’s being done.” As Science reported in March, the NIH doled out $6.4 billion in indirect costs in fiscal year 2016, which was 38 percent of the $16.9 billion it spent directly on research. If the 10 percent ceiling had been installed, indirect costs would have been capped at roughly $1.7 billion, representing a saving of $4.7 billion.


“Even if you wanted to do this, you don’t do it in one year,” says Harold Varmus, a Nobel laureate and former NIH director. “It would be a tremendous blow for many of our research institutions and ignores the real cost of doing research. If you really want to disembowel a source of learning and ingenuity in America, this is what you do.”


“Instead of having an informed process where they get people together and talk about how to build efficiencies, they’re just backing into the numbers that the President put forward,” says one of the sources at the NIH.


Further Reading:

  • “Head of NIH Testifies Before Congress in Support of the Next Generation of Research Scientists”;
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Healthcare Costs for a Family of Four Will Reach $27,000 in 2017 -

Healthcare Costs for a Family of Four Will Reach $27,000 in 2017 - | Pharmaguy's Insights Into Drug Industry News |

If you had $27,000 in your wallet, would you spend it on a 2017 Kia Optima sedan, 28 shares of Amazon stock, or healthcare? $26,944 is this year’s estimate of what healthcare will cost a family of four in the U.S., based on the 2017 Milliman Medical Index (MMI). This is based on the projected total costs of healthcare for a family covered by an employer-sponsored PPO plan.


The components of costs in the MMI include: Inpatient facility care Outpatient facility care Professional services (such as visits to physicians and physical therapists) Pharmacy Other services, which covers ambulance services, durable medical equipment and supplies, prosthetics, and home care. Spending on these five components of medical costs has shifted between 2001 and 2017. While inpatient costs remain about one-third of spending, outpatient costs having grown from 14% to 19% of total, and pharmacy spending grew from 13% to 17% of costs.


The big shift happened to professional services, which comprised 40% of spending in 2001 dropping to 30% in 2017.


Prescription drug spending has “good news and bad news,” MMI writes. On the positive side of the spending ledger, rebates have grown for payers (behaving like a discount on prices) but these savings do not tend to land in consumers’/patients’ pockets.


A big driver of pharmacy costs is specialty drugs, price increases which MMI cautions to watch for inflammatory conditions, diabetes, oncology, and HIV.


As health plans, pharmaceutical companies, health service providers, and retail health companies ponder pricing and marketing healthcare, all stakeholders would be wise to consider peoples’ personal valuation of health care value. Customer experience must be embedded into the design, channeling, accessing and pricing of healthcare products and services to gain a health consumer’s share of wallet in 2017.

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@PhRMA Goes Even More BOLDLY in a New Ad Campaign

The Pharmaceutical Research and Manufacturers of America (PhRMA) today unveiled its latest advertisement as part of its groundbreaking GOBOLDLY campaign, titled New World, featuring some of the most extraordinary breakthroughs in science being discovered by biopharmaceutical researchers.


“Biopharmaceutical researchers are driving unimaginable innovation in science, which is revolutionizing how the most complex diseases are treated,” said Stephen J. Ubl, president and chief executive officer of PhRMA. “We truly are in a new world of medicine and on the verge of something even greater and more impactful. This promises a future with endless potential of scientific advances.”


The TV, print and digital advertisement highlights the new world of science where immunotherapy is replacing chemotherapy, where researchers attack the causes of disease, not just the symptoms and where medicines can now be tailored for the individual patient.

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It's Official. Califf Abandons Pharma & Sides With Silicon Valley to Solve Inequities in Healthcare

It's Official. Califf Abandons Pharma & Sides With Silicon Valley to Solve Inequities in Healthcare | Pharmaguy's Insights Into Drug Industry News |

My hope is that Silicon Valley and entrepreneurs nationwide will collaborate on building an environment capable of linking the more than 300 million people in the U.S. to information that helps them live healthy, productive lives. Within this broad mission, I’m particularly focused on bridging a growing divide that has led to unprecedented health disparities as functions of income, education, race, and geography. But as increasingly ubiquitous smartphones and other electronic devices allow more and more people to access amazing sources of information and knowledge, we have the essential means to reverse these trends.

Both giant information companies and our country’s universities—particularly those with large health systems—have critical roles to play in ensuring that all Americans, and ultimately the entire world, benefit from new knowledge and technological capabilities. Generating and analyzing information are not enough—we must overcome barriers to using data to improve health and healthcare. I have no illusion that I have the solutions to these problems, but I am grateful for the opportunity to work with a company and a university that are letting me give it a shot!


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Head of NIH Testifies Before Congress in Support of the Next Generation of Research Scientists

Head of NIH Testifies Before Congress in Support of the Next Generation of Research Scientists | Pharmaguy's Insights Into Drug Industry News |

Good morning, Chairman Cole, Ranking Member DeLauro, and distinguished Members of the Subcommittee. I am Francis S. Collins, M.D., Ph.D., and I have served as the Director of the National Institutes of Health (NIH) since 2009. It is an honor to appear before you today, and it was a pleasure to host many of you at NIH in February.


As the nation’s premier biomedical research agency, NIH’s mission is to seek fundamental knowledge about the nature and behavior of living systems, and to apply that knowledge to enhance human health, lengthen life, and reduce illness and disability. As some of you have witnessed first-hand on your visits to NIH, our leadership and employees believe passionately in our mission. This extends equally to the tens of thousands of individuals whose research and training we support, located in every state of this great country, and where 81 percent of our budget is distributed.


… the future has never been brighter for advances in biomedical research than right now. Imagine what this feels like for a talented and curious new investigator. Early-stage investigators are responsible for many of the advances I’ve told you about today, and our future depends on them and their bright ideas. Those young men and women are thrilled by the prospect of exploration, and driven to help people. NIH is responsible for training these scientists, and for making sure that our investment in their careers, and the potential advances they will bring to patients, are sustained into the next stage. They are our most important resource. If advances in medical research are to continue, if research is to lead to breakthroughs that can reduce health care costs, if the considerable economic return on research is to continue, and if America is to continue its global leadership in biomedicine, we need to be sure this next generation has the confidence that there will be support for them. This is a priority for me.




Further Reading:

  • “Trump's Budget Would Put NIH & U.S. Medical Research into a Nose Dive!”;
  • “PhRMA Lacks the Guts to ‘Go Boldly’ & Speak Out Against Trump’s Proposed Cuts to NIH Funding”;
  • “Congress Rebuffs Trump and Gives NIH a $2 Billion Funding Boost - 2018 Funding Still Subject to Massive Cuts”;
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Many Physicians Are Dissatisfied with the Quality of #Pharma Supplied Scientific Education Online

Many Physicians Are Dissatisfied with the Quality of #Pharma Supplied Scientific Education Online | Pharmaguy's Insights Into Drug Industry News |

Physicians often look to pharmaceutical companies' websites for educational information about their products. But as pharma firms step up digital advertising efforts, only 27 percent of physicians said they still consider pharma websites credible sources for medical data.


That finding comes from Manhattan Research's "Taking the Pulse U.S. 2017" study. The report is based on responses from 2,784 U.S. physicians across more than 25 specialties, and aimed to examine physicians' use of emerging technologies as well as their communication habits (read “#Pharma Should Dial Down Promotion & Dial Up Education for Docs to Regain Their Trust”;


Here are three key findings on physician-pharma marketing and communications.


  1. Roughly 70 percent of physicians said it is essential pharma companies provide "education resources rooted in science" to gain physician buy-in. Yet about half of physicians surveyed said no pharma company provides quality scientific information online.


  1. Physicians reported feeling overwhelmed by pharma ads. Sixty-two percent of respondents said information pharma companies offer on third-party websites for healthcare professionals are "always ads" rather than educational material.


  1. About half of physicians use online video content in their decision-making process, yet 52 percent don't believe any pharma companies are doing a "good job" at providing quality physician video content.



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The Top 15 Generic #Pharma Companies by 2016 Revenue

The Top 15 Generic #Pharma Companies by 2016 Revenue | Pharmaguy's Insights Into Drug Industry News |

Branded drugmakers weren't the only ones working through a tumultuous 2016. Generics companies faced pricing pressure, too. And while branded companies suffer pricing pain on costly cutting-edge therapies, generics outfits feel the pinch with already-thin margins, making pressure all the more agonizing.


How is the industry responding? By consolidating and hoping to save money, for one. …it's clear that some companies have made leaps too big to depend on organic growth alone.


Take Teva, which topped the 2016 list as it did in 2014. It wrapped up the biggest M&A move in recent history for the generics industry, swallowing Allergan’s unbranded offerings for $40.5 billion in August. The massive move will continue to reverberate in the generics industry for years to come.


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The 5 Most Overpaid #Pharma CEOs in the World

The 5 Most Overpaid #Pharma CEOs in the World | Pharmaguy's Insights Into Drug Industry News |

There’s no shortage of ways to rank pharma CEOs: Drug sales. Corporate profits. Even haircuts. Here at STAT, we chose to look at it from a shareholder’s perspective.


We calculated shareholder returns over the past three years at the 25 biggest drug companies in the world. Then we compared that with CEO compensation. Five outliers popped out: chief executives who got raises well out of step with what they delivered to investors.


(To determine each company’s performance, we used a widely cited metric called total shareholder return, which tracks the value of a single share over three years, including any cash paid out in the form of dividends.)


The five companies that so handsomely compensated their CEOs declined to comment specifically on the pay packages, beyond noting that their boards carefully review such matters with many factors in mind. Consultants who work in the field of executive pay, however, were not so reticent.


“It’s completely short-sighted,” said Eleanor Bloxham, CEO of Value Alliance. “There’s no justification for the level of these compensation programs. Think of all that money that could have been plowed back into R&D, or salaries, or retirement benefits — anything to create a happier, more motivated workforce.”


#5 on the list is: Joseph Papa, Valeant Pharmaceuticals


Valeant paid its 61-year-old chief executive $62.7 million in cash and stock last year, more than 500 percent more than his predecessor made in 2014. The company, which faces crippling debt, has lost 88 percent of its value over the past three years amid congressional scrutiny, allegations of fraud, and waning revenue.


Find the others here (subscription required).


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How a DTC Campaign for a Drug to Treat Laughing & Crying Sent Sales Soaring

How a DTC Campaign for a Drug to Treat Laughing & Crying Sent Sales Soaring | Pharmaguy's Insights Into Drug Industry News |

An overhead light drawing attention to his face, the actor Danny Glover drops his head into one hand and starts to cry. Then, he abruptly switches to deep belly laughs, before resuming a straight face.


“When I act, if I do this, it’s totally in my control,” he says into the camera. “But for someone with pseudobulbar affect, choosing to cry or laugh may not be your decision.”


The 60-second TV advertisement, aired widely until late last year, has raised questions about the role of direct-to-consumer advertising — typified by ads that call on you to “ask your doctor” about possible treatment — in promoting the use of medicines for uncommon conditions far beyond the narrow population of people who most benefit from them.


Pseudobulbar affect, or PBA, is a neurological condition characterized by inappropriate, uncontrolled outbursts of laughing or crying. The ad did not mention any drug by name. But it was sponsored by Avanir Pharmaceuticals, the California firm that manufactures Nuedexta, a medicine that targets the disorder. The ad ends by referring viewers to a “Facts About PBA” website and a toll-free number.


PBA mostly affects those with neurological conditions such as multiple sclerosis, a recent stroke or Lou Gehrig’s disease. Because the definition of the condition is ambiguous, estimates of its prevalence vary. Doctors may find PBA common or uncommon, depending on their specialty. Avanir sets the number at two million Americans.


The market has proved lucrative. Nuedexta’s sales rose to $218 million last year from about $37 million in 2012, according to EvaluatePharma, which tracks pharmaceutical pricing and markets.


“I suspect this disease is being redefined to include overly emotional people” through advertising, said Adriane Fugh-Berman, a doctor who teaches at Georgetown University Medical Center and has investigated pharmaceutical marketing practices. The United States is one of two countries that allows advertising of prescription drugs.


Nuedexta has also attracted attention because it is expensive, more than $700 a month for a supply of twice-a-day pills. The drug is a combination of two low-cost ingredients — an over-the-counter cough medicine and a generic heart drug — that, purchased separately, would run roughly $20 a month, according to online cost estimators.


Nuedexta doesn’t cure PBA, but it must be taken for the rest of a patient’s life to help reduce episodes of laughing or crying. While it’s the only drug approved specifically for PBA by the Food and Drug Administration, doctors have successfully used several less expensive treatments, all antidepressants, to treat the condition.


“The cost for mixing two old drugs together is unconscionable,” said Dr. Jerome Avorn, a professor at Harvard Medical School and the chief of the Division of Pharmacoepidemiology and Pharmacoeconomics at Brigham and Women’s Hospital.


The strategic marketing of Nuedexta is part of a trend in which even small pharmaceutical firms turn to the airwaves to encourage use of their products. Pharmaceutical industry spending on television ads has been on the rise — up 62 percent since 2012 to an estimated $6.4 billion — even as TV advertising for other product types has stayed flat, according to Kantar Media, a firm that tracks multimedia advertising.


By last year, drug ads were the sixth-most-common category of television advertisement — behind cars and restaurants — up from 12th just five years ago. A number of the ads, like Nuedexta’s, promote medication for unusual conditions, such as a sleep disorder that affects only people who are blind. Others target more common conditions, such as opioid-induced constipation.


After F.D.A. approval of the drug, Avanir began its pitch to consumers with a 2013 ad campaign online and on television that directed viewers to the PBA facts website. The campaign produced “an overwhelming” response, with “350,000 new unique visitors to the website or calls to the hotline,” Keith A. Katkin, the chief executive at the time, told investors that year.


But after marketing surveys found that only about one-third of potential patients and primary-care doctors who treat such patients knew about PBA, Avanir enlisted Mr. Glover’s celebrity firepower, said Lauren D’Angelo, the senior director of marketing for Avanir. The advertisement featuring Mr. Glover, who doesn’t have PBA, appeared on cable and national news programs in 2015 and through the end of last year. Mr. Glover’s publicist said he didn’t have any comment on the campaign.


After the ad ran, a subsequent survey found that awareness among primary-care doctors rose to 72 percent, and to 52 percent among patients (read “25% More People Think They Have PBA After Seeing Danny Glover Laughing Uncontrollably!”;


“It was an extremely successful campaign,” Ms. D’Angelo said. “We drove a lot of patients into doctors’ offices. The challenge was that they did not ask for Nuedexta by name.”


For sales, that was a problem. Instead of receiving Nuedexta, some patients were prescribed an antidepressant or received an incorrect diagnosis, she said.


So in 2017, the drug maker unveiled a new advertising campaign. This one, currently running on prime-time TV, features a man bursting into tears at a child’s birthday party. It specifically calls on viewers to “ask about Nuedexta.”


“We are mimicking what we want them to do — to ask about PBA and ask about Nuedexta,” Ms. D’Angelo said.

Pharma Guy's insight:

BTW, I took the PBA assessment "tool," which was developed by "healthcare professionals and is called the Center for Neurologic Study-Lability Scale (CNS-LS)." I was assured that my answers to the seven "simple questions will help your doctor determine if [I] could have PBA." Of course, I scored way above the cutoff score of 13, which "accurately predicted neurologists’ diagnoses for 82% of participants" in the above cited study. Or, as Avanir says, "may suggest PBA symptoms and should be discussed with your doctor." 


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According to Edelman, 80% of People Think #Pharma Puts Profits Ahead of People

According to Edelman, 80% of People Think #Pharma Puts Profits Ahead of People | Pharmaguy's Insights Into Drug Industry News |

The 2017 Edelman Trust Barometer paints a sobering picture of the state of trust around the world…[but] the healthcare industry is making slow but steady progress. Trust in healthcare, as well as in all five subsectors of healthcare we study (pharmaceutical/drug companies, consumer health/over the counter, biotech/life sciences, insurance and hospitals/clinics), is actually on the rise, gaining momentum from last year and reversing a backwards trend we saw last year for pharma (globally and in the U.S.) and biotech (in the U.S. only).


Pharma may be up four points in the U.S., but that gives it a score of just 51, squeaking into the “neutral” range by only one point.


[Meanwhile: “Pharma Industry Reputation Hits 7-Year Low According to Harris Poll”; This poll finds only 29% of U.S. consumers think “positively” of the pharma industry.]


Pharma in particular continues to face headwinds, with the Trust Barometer showing that globally:


  • Approximately 8 in 10 people (82 percent) believe the government needs to do more to regulate the pharmaceutical industry; and
  • 8 in 10 people (80 percent) believe that the pharmaceutical industry puts profits over people.


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PhRMA Lobbying Pays Off Again: Senate Panel Rejects Proposal to Allow Importation of Rx Drugs from Canada

PhRMA Lobbying Pays Off Again: Senate Panel Rejects Proposal to Allow Importation of Rx Drugs from Canada | Pharmaguy's Insights Into Drug Industry News |

A Senate panel on Thursday rejected a Democratic effort to make it easier for Americans to purchase medications from Canada, where prescription drugs are typically sold at significantly cheaper prices than in the United States.


The Senate Health, Education, Labor and Pensions Committee voted 13-10 along mostly party lines to kill the proposal, which was offered by Sen. Bernie Sanders (I-Vt.) as an amendment to bipartisan legislation that would reauthorize Food and Drug Administration programs.


Opponents of easing federal laws on drug importation, including the pharmaceutical lobby, say it could expose Americans to unsafe medicines that haven’t been vetted by U.S. regulators.


“This would put Americans at risk of counterfeit and substandard drugs,” Sen. Orrin Hatch (R-Utah) said at the markup. “There’s no way for Americans to ensure the drug being dispensed in a Canadian pharmacy is the same drug as what the doctor prescribed.”


Sanders said the amendment has provisions to ensure drugs imported from Canada are safe. Opposition to the proposal, he said, is being fueled by lobbying from the drug industry, not out of concern for drug safety.


“This amendment is about whether or not we have the courage to stand up to an industry which has spent more than $3 billion lobbying since 1998 to make certain that we pay the highest prices in the world for prescription drugs,” he said.


The Pharmaceutical Research and Manufacturers of America, the industry’s trade group, said it has concerns about importation proposals in Congress due to safety issues, pointing to counterfeit drugs that reached the United States from China via Mexico and Canada.


“Even Canada has said it does not and would not be able to guarantee that U.S. citizens would receive products that are safe, effective and of high quality,” PhRMA spokesman Andrew Powaleny said. “Guaranteeing patient safety is crucial, and we must have policies that ensure patients safely have access to the medicines they need.”


Further Reading:

Bernie to Trump: “Talk is Cheap.” Stand Up to Big Pharma! Support Importing Drugs from Canada!:

Senators Start a New Effort to Allow Importation of Certain Drugs from Canada. Will Trump Play Security Card?:

Pharma Guy's insight:

This is part of Sanders’ campaign to thwart president Trump’s agenda. However, Bernie is up against a much stronger opponent than Trump – the drug industry lobby headed by PhRMA, which is now firmly in Trump’s camp (read, for example, Big Pharma Struggles to Distance Itself from "Price Gouging" Small Pharma:

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Former Lilly President Says Stories of Demise of Sales Reps are “Greatly Exaggerated”

Former Lilly President Says Stories of Demise of Sales Reps are “Greatly Exaggerated” | Pharmaguy's Insights Into Drug Industry News |

Ever wish you could pick the brain of a pharma insider who not only has deep knowledge of the pharmaceutical industry, but also has their pulse on Washington?


That was exactly what Matt Wallach, co-founder and president of Veeva, did during his company’s annual Veeva Summit held in Philadelphia earlier this week when he interviewed pharmaceutical and healthcare industry expert Alex Azar in a fireside-type chat in front of more than 1,300 attendees.


Azar, who most recently served as president of Lilly USA before leaving in January to pursue other professional opportunities, also has extensive experience in the public health sector, having served first as general counsel of the U.S. Department of Health & Human Services, before becoming deputy secretary under Mike Leavitt.


Here are some brief snippets of what he had to say about the future of the sales representative:


“Stories about the death of the sales rep are greatly exaggerated,” said Azar.


He believes that in many instances the sales rep position is still the highest ROI tactic for many brands.


“As a corporate leader, there is nothing like when a sales rep goes on vacation and you get a call from the doctor’s office asking, ‘what happened to our rep?’” he said. “These people are intimately involved in helping physicians with caring for their patients.”


The problem, Azar says, can be access.


“Access [to doctors] is getting worse, but it’s not as bad as some suggest, especially if you are an established pharmaceutical company,” he said.


Azar relayed an example of how when he was with Lilly, the company created a suite of interactions to test how influential they could be at reaching physicians that categorically were considered “white space”—those that were never called on by a rep.


Over a period of six months, Lilly engaged the physician in a variety of touch points—peer-to-peer videos, direct mail, email, etc. He said the company was able to convert 18% of those who never saw a rep from its bottom tier to its top tier of advocacy.


“That tells me it can work, but I don’t think it can replace the rep,” Azar said.


When it comes to account management, he says the sales rep position plays a huge part.


“Sales reps don’t just do short sales,” he said. “They build relationships over the long term and add value over time.”


Further Reading:


  • LinkedIn: “Benefits and Risks of Limiting Pharma Sales Rep Access to Physicians”:
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@PhRMA Ousts Marathon #pharma et al to Appease Trump & His Campaign Promises

@PhRMA Ousts Marathon #pharma et al to Appease Trump & His Campaign Promises | Pharmaguy's Insights Into Drug Industry News |

Confirming yesterday's buzz, PhRMA, the pharmaceutical industry's primary lobbying group, announced changes to its membership structure today that include stricter membership requirements and the elimination of its "associate" category (read “@PhRMA Mulls Limiting Members to Appease Trump Amid Drug Price Scandal”; As a result, 22 companies lost their membership or associate membership status. The new requirements, based on a three-year average:


At least $200 million per year spent on research

Research expenditures equal to at least 10% of global sales


Former members, per PhRMA:


  • AMAG Pharmaceuticals, Inc.
  • Horizon Pharma plc
  • Jazz Pharmaceuticals plc
  • Leadiant Biosciences
  • Mallinckrodt Pharmaceuticals
  • Orexigen Therapeutics, Inc.
  • The Medicines Company


Former associate members, per PhRMA:


  • ACADIA Pharmaceuticals Inc.
  • Aerie Pharmaceuticals, Inc.
  • Avanir Pharmaceuticals, Inc.
  • BioMarin Pharmaceutical Inc.
  • CSL Behring, LLC
  • Esperion Therapeutics, Inc.
  • Ferring Pharmaceuticals Inc.
  • Grifols USA, LLC
  • Ipsen Biopharmaceuticals, Inc.
  • Marathon Pharmaceuticals, LLC
  • Shionogi Inc.
  • Sucampo Pharmaceuticals, Inc.
  • Theravance Biopharma
  • Vifor Pharma
  • VIVUS, Inc.
Pharma Guy's insight:

This is supposed to be “PhRMA's way of trying to get rid of smaller companies that engage in the controversial practice of buying older drugs and jacking up the prices.” But PhRMA knew that some of these companies gouged prices when they accepted them as members (read, for example, “PhRMA Accepts Price Gouging #Pharma Companies Into Its Tent”; and “Big #Pharma Should Secede From PhRMA, Says @John_LaMattina”;


It was only after meeting with Trump that PhRMA got religion and started to reconsider who it should accept as members (read “PhRMA Embarrassed by Marathon is Forced to ‘Review’ Membership Criteria – Is a Purge in the Cards?”; and “PhRMA Offers Up Marathon Pharmaceuticals as “Sacrificial Lamb” to Trump?”;

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Johnson & Johnson’s Legal Woes Continue to Escalate as DOJ Targets Its Rx Drug Marketing Practices

Johnson & Johnson’s Legal Woes Continue to Escalate as DOJ Targets Its Rx Drug Marketing Practices | Pharmaguy's Insights Into Drug Industry News |

As if Johnson & Johnson didn’t have enough legal woes already, with the mounting number of cases claiming a link between its talcum powder and ovarian cancer (read “J&J Bites the Talc-powder Dust in Another Trial - Ordered to Pay $110 Million”;, the pharma giant now faces a fresh round of investigations into its marketing practices.


In a quarterly filing with the Securities and Exchange Commission, J&J disclosed new investigations by the U.S. Justice Department and the U.S. Attorney's Office in Massachusetts. The probes target arthritis drugs Remicade and Simponi, hepatitis C treatment Olysio and psoriasis drug Stelara.


Most recently, in April, J&J was subpoenaed by the Massachusetts district court, which is seeking documents related to copayment-support programs the company is offering for Olysio, Simponi and Stelara, according to the SEC filing. Investigators are seeking information about how J&J reports the prices of those products to the Centers for Medicare & Medicaid Services and how it discloses rebate payments to the state’s Medicaid agencies.


J&J had previously been pulled into a separate Massachusetts investigation that involves several pharmaceutical companies. The district attorney’s office has been collecting information about ties between drug companies and nonprofits that help fund prescription purchases for Medicare patients. The office has been doling out subpoenas over the last two years, targeting Biogen, Celgene, Regeneron, Gilead and others.


In February, Pfizer disclosed in its annual SEC filing that it received two subpoenas seeking information about its relationship with Patient Access Network Foundation and other nonprofit groups that provide copay assistance to underinsured patients.


J&J hasn’t disclosed which charitable organizations the district attorney’s office asked about, but all such relationships have come under fire recently. That’s because it’s against the law for pharmaceutical companies to link their products with charitable organizations and to offer direct copay subsidies to patients covered by government-run insurance plans.


Further Reading:

  • “Giving J&J an Ethics Prize is Like Giving Strom Thurmond a Civil Rights Award”;
  • “Johnson & Johnson Guilty Again! Ordered to Pay $1 Billion in Putative Damages, the Largest This Year”;
  • “The $70 Million Breast Job: That's What J&J Must Pay to Male Teen Who Took Risperdal and Developed Large Breasts”;
  • “America’s Most Admired Lawbreaker”;
  • "How Gorsky Drove 46% - 66% of Risperdal Sales for Off-Label Use";
  • “J&J Pleads Guilty for Knowingly Selling Tainted Children's Tylenol. A Failure of Corporate Accountability”;
  • “J&J #Pharma Earnings Up 18.7% Despite Being Top Fined Drug Company!”;
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Safety Events Common for Pharmaceuticals and Biologics after FDA Approval

Safety Events Common for Pharmaceuticals and Biologics after FDA Approval | Pharmaguy's Insights Into Drug Industry News |

Among more than 200 new pharmaceuticals and biologics approved by the U.S. Food and Drug Administration from 2001 through 2010, nearly a third were affected by a postmarket safety event such as issuance of a boxed warning or safety communication, according to a study published by JAMA.


The majority of pivotal trials that form the basis for FDA approval for therapeutics (pharmaceuticals and biologics) enroll fewer than 1,000 patients with follow-up of six months or less, which may make it challenging to identify uncommon or long-term serious safety risks. These risks may only become evident when new therapeutics are used in much larger patient populations and for longer durations in the postmarket period. Postmarket safety events can change how these therapeutics are used in clinical practice and inform patient and clinician decision making.


Joseph S. Ross, M.D., M.H.S., of the Yale University School of Medicine, New Haven, Conn., and colleagues examined safety events (a composite of withdrawals due to safety concerns, FDA issuance of incremental boxed warnings added in the postmarket period, and FDA issuance of safety communications) for all novel therapeutics approved by the FDA between January 2001 and December 2010 (followed-up through February 2017).


During this time period, the FDA approved 222 novel therapeutics (183 pharmaceuticals and 39 biologics). There were 123 new postmarket safety events (3 withdrawals, 61 boxed warnings, and 59 safety communications) during a median follow-up period of 11.7 years, affecting 32 percent of the novel therapeutics. The median time from approval to first postmarket safety event was 4.2 years, and the proportion of novel therapeutics affected by a postmarket safety event at 10 years was 31 percent. Postmarket safety events were significantly more frequent among biologics, therapeutics indicated for the treatment of psychiatric disease, those receiving accelerated approval, and those with near-regulatory deadline approval. Events were significantly less frequent among those with regulatory review times less than 200 days.


The authors write that these findings should be interpreted cautiously but can be used to inform ongoing surveillance efforts.


“The high frequency of postmarket safety events highlights the need for continuous monitoring of the safety of novel therapeutics throughout their life cycle,” the researchers write.


Further Reading:


  • “Sydney Wolfe's 7-Year Drug Rule/Itch: Don't Prescribe a New Drug for 1st 7 Years After FDA Approval”;
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Boehringer Defends Pradaxa Ad as Example of "Highlighting" More Women in Ads, But Only as Caregivers, Not Patients

Boehringer Defends Pradaxa Ad as Example of "Highlighting" More Women in Ads, But Only as Caregivers, Not Patients | Pharmaguy's Insights Into Drug Industry News |

Now a year into the "Red Fish" campaign, Boehringer was pleased with the feedback and effectiveness of the fish-as-blood-clot imagery, but the German drugmaker decided it was time for an evolution of the AFib campaign. The new DTC work, created by GSW, moves away from a simple all-white background for the CGI fish and gives them the blue-water backdrop of an aquarium, while also adding in visitors walking along and watching.


“We obviously still wanted to keep the red fish because that has been the key to success with its very simple way of describing a complex problem that resonates with consumers,” David Edwards, Boehringer executive director of cardiovascular marketing, said in an interview. “We’ve evolved it in way that infuses it with a bit more, I guess you could say, 'humanity,' as it was just the fish before.”


With a couple in focus in the ad, Pradaxa not only adds that human element, but also a subtle note of the woman leading the man, Edwards said, as a way to highlight women more in the communications. Women have AFib at about the same rate as men, but through marketing research, they've also been proven as household gatekeepers and purchase influencers.


Physician feedback for the campaign has also been positive, Edwards said, with doctors noting an uptick in patients asking about the treatment represented by the red fish or wanting to discuss the AFib treatment “with the reversal.” Pradaxa is the only med in its class with an FDA-approved reversal agent, which may ease some patients' and doctors' worries about the potentially fatal bleeding side effects that come along with the new-age drugs. As in the original "Red Fish" ad, agent Praxbind is not mentioned by name, but rather referred to as the only emergency reversal treatment just for Pradaxa.


The red fish imagery also appears in Pradaxa communications with healthcare providers, as well as TV, print and digital consumer-facing work, and it will likely be around for some time. Edwards said this campaign will run through the end of the year, but he expects that thanks to its success, it will continue to evolve beyond that.

Pharma Guy's insight:

I have noted in the past ( that every anti-Afib medication DTC campaign uses similar imagery of an elderly couple and the patient is the husband (or father).

In these ads, the man is clearly the focus although women are equally as likely to have Afib. 

At the time I asked: "Why are women only portrayed as caregivers and otherwise "left out of the [Afib] picture" in these ads?"


Clearly, the BI marketers are trying to defend themselves by "highlighting women more" in the ads - but it is so subtle as to be meaningless because it actually reinforces that the man is the patient and the woman is there just to guide him.

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@PhRMA Mulls Limiting Members to Appease Trump Amid Drug Price Scandal

@PhRMA Mulls Limiting Members to Appease Trump Amid Drug Price Scandal | Pharmaguy's Insights Into Drug Industry News |

The pharmaceutical industry’s Washington lobbying group will likely adopt new membership rules this week that will oust many smaller companies that don’t spend heavily on research, people familiar with the matter said, amid increasing scrutiny of prescription drug prices.


The lobby group, Pharmaceutical Research and Manufacturers of America, or PhRMA, is proposing that to remain a member, companies will have to spend $200 million a year on research and development, based on a three-year average. They’ll also have to have to show that their research spending amounts to at least 10 percent of their global sales, according to the people, who asked not to be identified because the matter is still private.


PhRMA’s membership includes industry giants such as Eli Lilly & Co. and Pfizer Inc., as well as smaller companies that don’t have the same research pedigree. The thresholds are a high bar for some companies whose businesses have focused more on buying older drugs and raising their prices, and for smaller companies that don’t yet have drugs on the market.


The review began earlier this year after one of PhRMA’s then members, Marathon Pharmaceuticals LLC, said it would charge $89,000 a year for a drug that was being imported from overseas for about $1,000. The company had done limited new research to get the drug approved in the U.S. The drug is used to treat a rare and deadly pediatric condition.


Soon after Marathon announced the price for its drug, Steve Ubl, chief executive officer of PhRMA, said Marathon’s “recent actions are not consistent with the mission of our organization” (read “PhRMA Offers Up Marathon Pharmaceuticals as “Sacrificial Lamb” to Trump?”; and “PhRMA Embarrassed by Marathon is Forced to “Review” Membership Criteria – Is a Purge in the Cards?”; Marathon left PhRMA last month ahead of the review, which the lobbying group’s board is scheduled to vote on Tuesday, according to the people familiar with the matter. The changes would be immediate, according to a third person familiar with the matter.


Further Reading:

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Questions Trump Should Ask Biotech CEOs Today

Questions Trump Should Ask Biotech CEOs Today | Pharmaguy's Insights Into Drug Industry News |

It’s the biotechnology industry’s turn to dazzle Donald Trump — or at least to try — in a meeting at the White House on Monday. Top on the agenda: the hot debate over federal funding for biomedical research.


  1. Will Trump ask his guests why they charge so much for drugs?


Vertex Pharmaceuticals CEO Dr. Jeffrey Leiden is coming to the event, as per a guest list obtained by Bloomberg. Why do we mention that? Because Vertex’s cystic fibrosis drug Orkambi has a list price of $259,000 a year.


Executives from Celgene are slated to attend, too. Their blood cancer drug Revlimid lists at about $130,000 a year (read “Orphan Drugs Are ‘Wicked Hot’ & Profitable for Pharma to Boot!”;


Trump, of course, has famously accused drug makers of “getting away with murder.” (He also called the entire industry “disastrous.”) But when he met with key representatives from the biopharma world in late January, he was much more temperate.


If Trump does decide to come out swinging, he may find an unexpected ally in the room, in Regeneron CEO Dr. Len Schleifer. He has taken on his fellow CEOs on pricing, accusing them of letting greed darken the reputation of the industry (“Regeneron CEO Len Schleifer vs Pfizer CEO Ian Read on Drug Prices”; Schleifer famously got into a public shouting match with Pfizer’s chief executive at a health care conference last fall as he railed against yearly price increases for old drugs (“Oh Snap! Regeneron CEO Says What to Pfizer CEO Ian Read???”;


  1. Will the president of Stanford explain why he needs taxpayers to pay the light bill in his labs?


  1. Will Trump’s guests dare to bring up the NIH budget?


  1. Will Trump promise miracles?


  1. Will the talk turn to cash stashed abroad?


At least one of the companies represented at the meeting — Celgene — has a lot of money stashed overseas: $6.1 billion, to be exact.


President Trump has talked about giving companies in that situation a big tax break if they bring their wealth back to US shores. Treasury Secretary Steven Mnuchin recently said he’s working with Congress to come up with a “very competitive” plan for repatriating the money. But no details have been released.


The industry has promised that a tax break would help them create thousands of American jobs. But last time they got such a tax break, it didn’t pan out that way. Instead, drug makers used the tens of billions they brought back to the US in the mid-2000s to enrich their CEOs and drive up their stock prices. They also laid off thousands of workers.

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J&J Bites the Talc-powder Dust in Another Trial - Ordered to Pay $110 Million

J&J Bites the Talc-powder Dust in Another Trial - Ordered to Pay $110 Million | Pharmaguy's Insights Into Drug Industry News |

Johnson & Johnson on Thursday was ordered by a Missouri jury to pay over $110 million to a Virginia woman who says she developed ovarian cancer after decades of using of its talc-based products for feminine hygiene.


The verdict in state court in St. Louis was the largest so far to arise out of about 2,400 lawsuits accusing J&J of not adequately warning consumers about the cancer risks of talc-based products including its well-known Johnson's Baby Powder.


Many of those lawsuits are pending in St. Louis, where the J&J has faced four prior trials, three of which resulted in $197 million verdicts against J&J and a talc supplier.


Thursday's verdict came in a lawsuit against J&J and talc supplier Imerys Talc by Lois Slemp, a resident of Virginia who is currently undergoing chemotherapy after her ovarian cancer initially diagnosed in 2012 returned and spread to her liver.


Slemp claimed she developed cancer after four decades of using talc-containing products produced by J&J, including J&J's Baby Powder and Shower to Shower Powder.


The jury awarded $5.4 million in compensatory damages and said J&J was 99 percent at fault while Imerys was just 1 percent. It awarded punitive damages of $105 million against J&J and $50,000 against Imerys.


Reuters watched the verdict through Courtroom View Network, which broadcast it online.


"Once again we've shown that these companies ignored the scientific evidence and continue to deny their responsibilities to the women of America," Ted Meadows, a lawyer for Slemp and other plaintiffs, said in a statement.


J&J in a statement said it sympathized with women impacted by ovarian cancer but planned to appeal.

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Some #Biotech CEOs Earned Big Increases in Compensation Even as Their Companies Tanked

Some #Biotech CEOs Earned Big Increases in Compensation Even as Their Companies Tanked | Pharmaguy's Insights Into Drug Industry News |

Last year was a bruising one for the biotech industry. But a handful of biotech executives saw their compensation swell even as their companies tanked on Wall Street.


STAT reviewed federal filings from all 162 companies on the Nasdaq Biotech Index. The index as a whole fell by 19 percent last year, so it’s no surprise that CEOs as a group made 25.5 percent less in 2016 than they had taken home the year prior.


But five outliers — Cempra, Endo International, Ophthotech, Pacira Pharmaceuticals, and Seres Therapeutics — gave their executives huge raises even though their stocks actually fared far worse than the index average. One CEO got a 385 percent pay increase after his company’s shares fell by more than 70 percent.


Such disparities can be maddening to investors. Executive pay is meant to be aligned with shareholder return. If you took a bath on a stock, you’d rather the company’s CEO didn’t recoup a bonus big enough to buy an infinity pool.


“It’s something that I fret about, because my compensation is performance-related,” said Eden Rahim, a portfolio manager at Next Edge Capital in Toronto. “If I’m down, I’m not earning anything. And then you see these guys who are well-compensated and don’t really deliver the goods.”


That disconnect sometimes stems from poorly thought-out incentive plans that end up rewarding failure, said Aalap Shah, managing director at Pearl Meyer, an executive compensation consultancy in New York. Other times, bad years force boards to strike a delicate balance, paying CEOs enough to keep them around but not so much as to spark an investor revolt.


“This is something that is always very hard for shareholders to swallow, but oftentimes directors have to make the tough call to give compensation that looks misaligned,” Shah said. “They do that because they still believe the management team is the one that’s right for the company and its strategy.”


Further Reading:


  • “Glaxo to Pay First Woman CEO Less, Cites Lack of Experience”;
  • “Pharma CEOs Living in an “Alternate Reality” But Getting Paid Exorbitantly High Real World Salaries!”;

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U.S. drug spend grew by 6% in 2016, the lowest rate in two years

U.S. drug spend grew by 6% in 2016, the lowest rate in two years | Pharmaguy's Insights Into Drug Industry News |

The U.S. health system's spending on prescription drugs grew by 5.8% to $450 billion in 2016, the slowest growth rate over the last two years, according to an annual report released Thursday by the QuintilesIMS Institute. U.S. drug spend jumped 12% in 2015 to $425 billion, compared to 2014.


When accounting for rebates and other pricing concessions made by drugmakers, net spending was $323 billion in 2016 — up 4.8% compared to 2015.


Explaining the drop in growth rate, QuintilesIMS said the past two years were outliers: 2014 and 2015 were “atypical relative to the long-term trend,” the report's authors wrote. During those years, spending rates exploded, due to several factors, including broad use of expensive hepatitis-C drugs, like Gilead Sciences' Harvoni, fewer drugs losing patent protection, and higher price increases.


QuintilesIMS attributed slower growth rates in 2016 to fewer product launches and lower price increases for branded products whose patents have not yet expired. The FDA approved 22 new drugs in 2016 — a six-year low.

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Pharmaguy™ (@pharmaguy) is a "constructive critic" of the pharmaceutical industry. He is not shy about giving his opinion, which is respected by many insiders who share some of his views but who are unable to voice them on their own. See