Pharmaguy's Insights Into Drug Industry News
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Pharmaguy's Insights Into Drug Industry News
Pharmaguy curates and provides insights into selected drug industry news and issues.
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Biogen Ends Controversial Tecfidera DTC TV Ads. "Coincidently," CEO Steps Down.

Biogen Ends Controversial Tecfidera DTC TV Ads. "Coincidently," CEO Steps Down. | Pharmaguy's Insights Into Drug Industry News |

Biogen halted its direct-to-consumer campaign for multiple-sclerosis drug Tecfidera because the campaign did not clearly boost the number of prescriptions.


[Or maybe because of patient pushback? Read “More DTC Ad Backlash. This Time from Patient Bloggers!”;]

Michel Vounatsos, the company's new commercial lead, told investors during a second-quarter earnings call that the company is unlikely to wade back into broadcast TV for the foreseeable future. Biogen had launched the ad, titled Relapsing Multiple Sclerosis, in October.

“Our judgement at this point is that [the campaign] didn't have a discernible movement on scripts, and [it came] with some drawbacks as well,” Biogen CEO George Scangos said.

The TV campaign asked viewers to take “another look” at relapsing multiple sclerosis, showing a woman living her life with fewer relapses—including shots of her hiking, swimming and attending a carnival.

Omnicom agency CDMiConnect developed the creative for the ad. CMI and WPP's MEC were responsible for media buying.

A former Biogen patient consultant had criticized the ad in a blog post, writing that it missed the mark and “misrepresents MS and perpetuates all the myths we fight regularly but especially the one that others often think we can just take something like this little blue pill and get over and above our MS.”

Biogen spent $67.2 million on advertising for Tecfidera in 2015 and doled out $35.5 million in the first quarter of this year, according to Kantar Media.


Tecfidera brought in sales of $987 million in the second quarter of 2016, compared to $883 million in the same period a year ago. In the first three months of 2016, Tecfidera saw $946 million in sales.

Scangos also announced that he would be stepping down as CEO after a six-year tenure with the drugmaker. He presided over the historic launch of Tecfidera.

Pharma Guy's insight:

According to my sources (Reuters), Q1-2016 sales of Tecfidera came in at $946 million, up from $823 million last year. That's an increase of $123 million, which could be attributed to the $103 million spent on advertising. The ROI = 1.2 (for every dollar spent on ads, Biogen made an additional 20 cents). But as my friend @Richmeyer noted, sales numbers likely increased due to price increases, not new Rx's.Consequently, the ROI must have been much less than 1.


Also read "Social Media Failed to Do the Job, So Biogen Turned to DTC to Promote Tecfidera"; 


Meanwhile, the CEO may be stepping down for other reasons. Read, for example, “Biogen Too ‘Patient-Centric?’ Feds Investigating Its Patient-Assistance Programs”;

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One Thing MS Patients Should NOT Expect from #Pharma: Affordable Drug Prices

One Thing MS Patients Should NOT Expect from #Pharma: Affordable Drug Prices | Pharmaguy's Insights Into Drug Industry News |

I don’t think anything hit home for me as much as MS patients talking about the difficulty in paying for their MS drugs and struggling to cut through the bureaucracy of trying to get financial assistance to help them pay for them.  The worst for me was listening to a woman in her late 40’s talk about how she was going to afford a $17,000 monthly treatment after her $40,000 in her savings was gone.  She had insurance, but her insurer refused to pay for the treatment. When she contacted the biopharma company to ask for financial assistance she was told “she didn’t qualify” because she made too much.

For those who suffer from multiple sclerosis (MS), perhaps the only thing more shocking than receiving their diagnosis is learning how much the disease modifying drugs (DMDs) used to control it will cost.

Pharma Guy's insight:

Rich Meyer, the author of this piece, ends with this plea: 

So please spare me the self-promotional “we rode for the cause” and find a way to get more patients on therapy who can’t afford it.

Meanwhile, Novartis is hosting an innovating for patients event in Basel and talking a lot about how it understands MS patients. The company even published a pledge to patients titled "What Patients Can Expect from Novartis" (see image). Unfortunately, that pledge does NOT mention affordable drugs.

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MS Drug Marketers Don't Give a Damn About Patients

MS Drug Marketers Don't Give a Damn About Patients | Pharmaguy's Insights Into Drug Industry News |

KEY TAKEAWAY: American medicine is heading into new terrain, a place where a year’s supply of drugs can come with a price tag that exceeds what an average family earns.  Pharmacy benefit manager Express Scripts says lastyear more than half a million Americans racked up prescription drug bills exceeding $50,000.

If you read the press releases from ASCO you can plainly see that drug companies were trying to play up to Wall Street not doctors.  I don’t believe that you can serve both Wall Street and patients because the street is only interested in financial performance and today that means very expensive drugs.

MS patients have very special needs to help them navigate and get much needed drugs but as the article on NPR indicates these drugs come at a very steep price.  Bayer does a great job helping patients get the drugs they need, but Biogen’s patient help line was of very little use to an MS patient I know and in fact she said that the difficulties with their patient support line made her feel like “they didn’t give a damn about anything other than sales”.

Pharma Guy's insight:

Also read #Pharma Behaves as a Classic "Oligopoly Cartel," Says Oncologist

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How Many DTC Ads Are Worth 800 Jobs? Bingen Will Find Out, Says CEO

How Many DTC Ads Are Worth 800 Jobs? Bingen Will Find Out, Says CEO | Pharmaguy's Insights Into Drug Industry News |

Tecfidera's slowing growth trajectory has gotten maker Biogen ($BIIB) into a pickle lately, propelling it to announce more than 800 layoffs Wednesday. But the drugmaker is hoping it can put the money it saves through those cuts into marketing activities that'll help the multiple sclerosis med pick up the pace in the U.S.

As the Massachusetts company laid out with its third-quarter earnings release, the workforce reduction will save it about $250 million per year. And it plans to reinvest that money in, among other things, new DTC marketing programs for Tecfidera, CEO George Scangos told investors on a conference call, as quoted by TheStreet.

And the company doesn't intend to waste any time continuing the DTC push. It expects to invest in Tecfidera in Q4 of this year, CFO Paul Clancy told investors, and Biogen's current thinking is that DTC outreach will extend "throughout the majority of 2016."

The way Biogen sees it, that advertising will help it win over "a whole set of patients through patient awareness," Clancy said--which is currently low, according to the data the drugmaker's got. It also figures that "when a patient comes to her doctor, particularly in the United States, with a preferred therapy, that is often the therapy that the patient goes on," he said, meaning there's a "big opportunity" on the awareness side.

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Specialty Drugs Driving Growth in Rx Spend

Specialty Drugs Driving Growth in Rx Spend | Pharmaguy's Insights Into Drug Industry News |

U.S. prescription-drug spend in 2014 reached $373.9B — a 13 percent increase from the previous year and the largest increase in more than a decade, as more effective and expensive new specialty drugs came to market and existing specialty drugs saw prices rise. The cost increase in specialty drugs makes it ever more difficult for consumers to access needed therapies. It is also squeezing state budgets, constraining employer-provided benefits and consuming resources that could otherwise go toward improving critical areas of healthcare delivery.

Recent analysis of data from Blue Cross Blue Shield (BCBS) companies, the largest commercial claims database in healthcare, confirms this broader trend. BCBS companies’ data reveal that prescription drug (Rx) per-member per-month (PMPM) spend increased by 9.3 percent from 2013 to 2014. This growth outpaced even the substantial rise in outpatient costs, and it far exceeded growth in inpatient and other professional costs. More importantly, this rise in Rx spend also runs counter to other trends, such as greater use of less-expensive generic drugs. For example, in 2014, consumers chose generic drugs two-thirds (67.7 percent) of the time when a branded counterpart was available versus just over half (54.9 percent) of the time in 2012.

Pharma Guy's insight:

The driving factor behind the Rx cost trend is the cost of specialty drugs. Data confirm that in 2014, specialty drug unit costs jumped 20.1 percent, compared to 5.7 percent for non-specialty drugs. Utilization for specialty drugs also rose by 7.3 percent in 2014.

Within the specialty pharmaceutical portfolio, the top 10 drugs contribute to 61 percent of overall spend. New Hepatitis C and Multiple Sclerosis drugs have contributed significantly to the trend (e.g., Sovaldi®, a Hepatitis C treatment introduced in October 2014 priced at $84,000 for 12 week treatment, and Tecfidera® for Multiple Sclerosis priced at $55,000 for 1 year treatment).

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Drug Pricing: More proof that #Pharma Oligopoly Has Gotten Completely Non-Competitive!

Drug Pricing: More proof that #Pharma Oligopoly Has Gotten Completely Non-Competitive! | Pharmaguy's Insights Into Drug Industry News |

In the first one, a study in the medical journal Neurology tracked prices for multiple sclerosis (MS) medications during the past dozen years and uncovered an "alarming rise" that was substantially higher than even the overall price increases for prescription drugs. 

If anyone still needs a demonstration that drug prices reflect an oligopoly insulated from a competitive market, it appears in the study's finding that in the same period, prices for older MS medications -- those introduced between 1993 and 1996 -- also rose substantially after newer, more convenient medications starting appearing in 2002.  As one of the study's co-authors told the Wall Street Journal's Ed Silverman, “You would think [with a competitive market] more new drugs would lower the rate of the increases, but that didn’t happen.”

Among the newer MS meds launched after 2002, the study reported that three of them were originally priced between $8,000 and $11,000 annually.  By the time of publication, their annual per patient cost climbed to approximately $60,000.  Those price increases amounted to 21% to 36% per year.

Another interesting finding concerned the prices paid by various purchasing entities.  So for example, Medicaid receives legally mandated discounts but it still paid 36% more than the Veterans Administration which uses its purchasing power to negotiate favorable prices.  Yet both the VA and Medicaid paid more than the national health plans in the UK, Canada and Australia.  In the case of Medicaid, that price differential was 70% more than Canada/UK/Australia.  Medicare, of course, paid considerably more than even Medicaid.

Pharma Guy's insight:

Studies of Nobel laureate Joseph Stieglitz and other economists demonstrate how pharma behaves as a classic, oligopoly cartel with only negligible pricing competition. Drug prices are high, according to the economists, mainly because pharma possesses the economic muscle to keep them that way. In fact, this lack of price competition amounts to the functional equivalent of "monopolistic agreements." Read more about that here: 

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