New PhRMA Code, II: The Larger Context

In the previous post I addressed the content of the newly announced PhRMA Code on Interactions with Healthcare Professionals:

http://www.phrma.org/files/PhRMA%20Marketing%20Code%202008.pdf

In that post I took the code at its word and assumed that it would be faithfully implemented. But that of course is one of the questions, as previously there has been precious little evidence that the industry generally has been following its own stated "voluntary" code of ethics. Just recently the Vermont attorney general has released the state's annual survey of required disclosures of payments from drug companies to physicians, and these statistics continue to suggest that the rules are being broken on a fairly widespread basis. (See for example the Prescription Project statement on the new PhRMA code, http://www.prescriptionproject.org/newscenter/pressreleases?id=0015). Specifically, if anecdotal evidence had been correct as to the lavish nature of drug rep payola prior to 2002, and if drug rep behavior had changed since then as a result of the code introduced in that year, we'd have expected to see some dropoff in the total marketing budgets of the companies at least in the short term; but instead those figures have steadily grown each year.

As I reported in the other post, this new code contains a couple of statements not seen previously, suggesting the appearance of more effort being put into policing compliance. But that in turn raises the next question--can the industry expect compliance with this code, in light of its present marketing business model?

In one way, compliance can be easily assured. If the companies decide to lose the reminder items like coffee mugs and notepads, they're toast. The reps get these dang things shipped to them in huge cartons from the company. Company doesn't ship, reps don't give them away--that simple. Reps are not going to go buy generic ballpoints from Office Max and then hand-paint drug logos on them.

Once we get past that, I see a huge problem. When I wrote HOOKED, I had to rely mostly on a few interviews with anonymous former drug reps, plus a scattering of published papers. Now, several reps have published tell-all memoirs and articles. So I think I can say with confidence that we know how this system works.

The critical decisions are made at two levels of company organization--the individual drug reps, and the local district managers that oversee the reps. The reps go into the doc's office to talk, the door closes, and only two people know what is said or not said. Drug reps regularly report that the whole tone of their activity is set by the district manager. Get a new district manager, and everything changes. One district manager might be strict on following the PhRMA code, the guy in the next district over treats averything in the code with a wink and a smile. The district manager, for the most part, signs off on the drug rep's expense account. If the drug rep puts in a $1000 bill for taking a bunch of docs out golfing one Saturday (or puts in a bill for $1000 for buying them textbooks, when in truth what happened was the golf game), it's the district manager who decides whether or not to sign off on that expense.

The point here is simple. The reps get paid their bonuses based on one thing only--how much of the drug they sell. The district managers get their bonuses, and do not get fired, based on one thing only--how much of the drug they sell. If you write a code of ethics that restricts their freedom to get docs to prescribe more of their drugs, you are asking these people to forgo their bonuses and to risk getting fired. And these are the people in the trenches whose behavior has a lot more to do with "the industry" than the directives of the suits sitting in higher corporate offices.

As soon as I hear of a drug rep getting paid a bonus based on degree of adherence to the PhRMA code of ethics, instead of sales quantity, then I will start to believe that this industry leopard intends to change its spots. Until then, don't call me.

Finally, what is up when PhRMA just happens to decide to issue a new code of ethics? When the drug industry folks start to behave oddly, you can usually bet the rent that you can look over Washington way, and find what has stirred them up. (The same is true of when the AMA decides to revise its code of ethics, by the way, as is now happening around industry influence over medical education.) And just what is happening over Washington way? Well, as you may have noticed, Chuck Grassley and the Sunshine Kids are laying waste to the countryside. You would never know that the good Sen. Grassley of Iowa hailed from the GOP side the the aisle, for the vigor with which he has been attacking the drug company payola machine and especially the academic physicians and medical centers that have been feeding at the trough. Assuming that the degree of company pushback signals what the industry is most scared of, you can safely assume that the industry is somewhat petrified of a Federal sunshine act that would require the disclosure of all drug company payments to physicians.

So far so good for PhRMA. Sen. Herb Kohl (D-WI and co-leader with Grassley of the Sunshine Kids gang) immediately praised the new code, as reported by Gardiner Harris in the New York Times (http://www.nytimes.com/2008/07/10/business/10code.html?_r=1&scp=1&sq=gardiner%20harris%20drug%20industry%20revised%20code&st=cse&oref=slogin). We'll have to wait and see whether this recent move by PhRMA (supplemented, if past practices are any indication, with hefty campaign contributions to key Congresspeople) has succeeded in dampening or heading off legislative action.

New PhRMA Code, I: Defending the Line

There are basically two ways to approach the newly announced PhRMA "Code on Interactions with Health Professionals," a major rewrite of the industry group's 2002 code of ethics:

http://www.phrma.org/files/PhRMA%20Marketing%20Code%202008.pdf

In this post I will take PhRMA at its word and offer my analysis of the code, assuming that it would be enthusiastically and fully implemented (a state of affairs seldom claimed by neutral observers for the previous PhRMA code). In a subsequent post I will look at the larger context within which this Code has been brought forward.

So--what is different here than in 2002? The previous code seemed designed to defend the industry marketing status quo, throwing to critics as few sops as possible just in order to clean up the most egregious bad-taste abuses--mainly, things like buying golf balls for docs and paying for docs' spouses also to attend gala dinners. The present code is a much more serious and sober affair. You can read between the lines here that PhRMA now admits a serious credibility and integrity problem. The goal now seems to be--let's figure out the line that we can defend with all of our firepower, based on an appeal to principle, and let's withdraw all our forces behind that line and dig in. Everything that we can't take with us as we retreat behind that line, we toss to the wolves--even if it's such a time-honored emblem of Pharma marketing as the Lipitor coffee mug or the Cialis pen.

The principle on which the new line is to be defended is clearly stated: provide scientific and educational information to physicians regarding company products, and receive scientifically useful information back from selected experts.

What does the industry think it can defend, with head held high, as part of those goals?

• Detailing
• Promotional materials
• Informational meetings and presentations
• Paying physicians as company speakers, and training them to do so
• Paying selected physicians as company consultants
• Providing "modest" meals for events held in medical or educational venues
• Patient-education items for offices such as anatomic models

What is the industry willing to throw out, as creating the impression of sleaze, and as not necessary in support of the central goals?

• "Reminder items"--coffee mugs, pens, notepads, etc. emblazoned with drug logo, but not used directly for patient (or staff) education
• Lavish meals (or whatever is not "modest" according to local standards)
• Meetings held at resort venues
• Any events designed as entertainment or recreation rather than as education
• Paying docs as speakers or consultants when the real criterion for selection is amount of drug prescribed, rather than expertise

And, for good measure, the code says that yes, we really meant it back in 2002, and golf balls, sports events, and paying for your spouse are all verboten.

Continuing medical education (CME) is handled a bit differently, and in that section, the main agenda seems to be bringing industry practices strictly in line with the rulings of the Inspector General of DHHS in 2003 (see HOOKED). The industry sees an interest in continuing to fund CME programs. The code calls for such funding to be unrestricted and to be used at the discretion of the event sponsors. The division of the company that supports CME should be separated from the sales and marketing divisions. Payments directly to physicians to pay for their registration or expenses in attending a CME event is equivalent to a cash payment to those physicians and is prohibited; the company may instead give an unrestricted grant that the sponsor can use to decrease registration fees, for instance. The company cannot give funds to the CME sponsor that are specified for the purpose of paying for a meal or a reception. In essence, a clear line is drawn in this code between a CME event that adheres to official ACCME guidelines, and a company-sponsored event with a paid speaker in which CME credit is not given.

The code is not willing to forgo company approaches to docs who sit on formulary and guidelines committees. The claim is that such physicians "often have significant expeience in their fields" that "can be of great benefit to companies and ultimately to patients if these individuals choose to serve as speakers or commercial consultants". The only requirement is that the company should "require" the doc (just how is not specified) to disclose the financial relationship to the committee, and what happens then is their business.

What about compliance? PhRMA says it will post the names of companies who agree to follow the code on a website and require an annual cetification of compliance as a condition of the company being listed. It also "encourage[s]" companies "to seek external verification" at least once every three years that it is following the code, and promises later to prepare a specific set of guidances as to how that external verification might be conducted. You might say this is mostly toothless but it at least offers a few more appearances of teeth than was present in the old code.

Drug Industry Innovation and Zinger of the Week

Here's a nice exchange in the Wall Street Journal. First we have on opinion piece from Benjamin Zycher of the Manhattan Institute, extolling the role of the pharamceutical industry in new product innovation, and taking issue with the criticisms of Marcia Angell (among others) that the industry often just buys ideas from investigators sponsored by public funds, and then claims that their in-house staff invented the whole thing:

http://online.wsj.com/article/SB121460680460712083.html?mod=Letters

Marcia Angell, not about to take this lying down, fired off her letter in reply:

http://online.wsj.com/article/SB121539733302831535.html

...and in the process got off what I will nominate for the Zinger of the Week award: The only really innovative thing about this industry today is the claims of its apologists.

If They Tell the Truth, Shut Them Down: Drug Industry Attacks the UBC Therapeutics Initiative

Both in writing HOOKED and in other work that I do related to evidence-based medicine, I periodically rely on the reports of the Therapeutics Initiative at the University of British Columbia. As there are relatively few bodies around the world that have adequate staff and budget to really comb through the published data on pharmaceuticals and look behind the industry spin for the scientific truth, groups that perform this role are especially precious to those of us who care about doing what's best for the patient. (Just to give one example, the group at the Therapeutics Initiative was among the first to lay out carefully the case against the COX-2 drugs like Vioxx, several years before the rest of the medical world caught on to their risks and nearly-absent benefits.)

You will now not be too surprised to learn that the reaction of the drug industry to the existence of such an operation is--shut it down.

As Anne Silversides reports in the Canadian medical association journal CMAJ(http://www.cmaj.ca/cgi/content/full/179/1/26) the Initiative is supported by a $1M grant from the province of BC. The provincial government was apparently arm-twisted to appoint a Pharmaceutical Task Force, made up almost completely of industry supporters. The Task Force has now issued a report accusing the Initiative of being "narrow, insular and resistant to meaningful stakeholder engagement," arguing ultimately that the Initiative must be replaced. The Initiative has previously been given high marks in several external reviews and is currently being reviewed by the Faculty of Medicine at UBC.

So what does "insular" and "resistant to significant stakeholder engagement" mean? Apparently for this Task Force it means--independent of the drug industry and those physicians who freely accept its money. The article in CMAJ quotes such international experts as Andrew Herxheimer and Jerome Kassirer as strongly defending the independence and integrity of the Initiative as it now functions.

There may indeed be problems with how the Initiative handles some of its work that require some tweaks in its procedures. As to any basic revisions in the way the Initiative operates, I hope that UBC and the province see through this transparent industry power play, and protect a vital international resource for evidence-based prescribing.

On Making Drugs Affordable and Fixing the Industry

Merrill Goozner has put together a thoughtful review of the book by Stan Finkelstein and Peter Temin:

http://www.nature.com/nature/journal/v453/n7197/full/453855a.html

In Reasonable Rx: Solving the Drug Price Crisis (FT Press, 2008), Finkelstein and Temin argue (as Goozner summarizes): For years, the industry has justified its high prescription-drug prices — at least in the United States, where there are no price controls and purchasers have little bargaining power — by claiming they are a prerequisite for innovation. That policy has been an abject failure. The failure is of two sorts--first, the new drugs emerging from the pipeline are unaffordable to far too many people; and second, there simply are very few truly useful and innovative drugs coming out of the pipeline. In short, from a social-benefit viewpoint, the entire blockbuster-dominated business model of the industry is a flop. (A point argued a bit less forcefully in the Epilogue of HOOKED.)

Ultimately, the authors argue (and Goozner seems to agree, though he wished they had provided more details) that the function of the industry must be split under two corporate structures. The first industry would perform R&D in the public interest under a sort of competitive prize system, where the public purse would pay out bigger prizes for discovering really useful and needed drugs. The second industry would function like the generic drug industry, putting out bids to manufacture newly discovered drugs at lower prices.

Pfizer and CME Support: A Second Shoe Drops?

Thanks to the Pharmalot blog and Ed Silverman for this fascinating news:

http://www.pharmalot.com/2008/07/pfizer-ending-support-for-cme-by-third-parties/

Now, what Ed does not tell us is that this posture of Pfizer's--ceasing the funding of continuing ed for docs (CME) via the for-profit medical education and communication companies (MECCs to the trade)--is almost for sure a reaction to recent events on Capitol Hill; but the antecedents go back to a bit of old history that was reviewed in HOOKED.

Act One of the drama occurred in 2003, when the Office of the Inspector General, DHHS, issued a report that got the industry's attention--by threatening drug company execs with Federal prison on racketeering charges if they violated the anti-kickback law. OIG-DHHS helpfully explained to the drug companies (and to doctors, had any been listening) that in order to be in violation of this Federal statute, all you have to do is give anything of value, to a physician who receives reimbursement from a Federal program such as Medicare or Medicaid or the VA, with even the partial purpose of influencing whether or not she prescribes your product.

Having explained that every encounter between a drug rep and a physician in which a gift is given, is technically a violation of Federal law, the OIG reassured the companies that they were not out to police individual contacts with docs. Rather they were going to be looking in the future at broad issues of corporate practices, and would view certain practices as being in compliance, and others as raising red flags. One red flag behavior was paying for CME out of your marketing budget. The OIG said instead that if they ever investigated a drug company, they'd be seeking evidence that the company had erected a financial firewall between its CME funding actiity and its marketing activity.

As I went on to report in HOOKED, the industry sat up and paid attention. The budding industry attack on strict new CME guidelines issued by the national accrediation counsel (ACCME) melted away and ACCME adopted its tougher guidelines with nary a whimper from industry. Companies reportedly were working to construct the needed firewalls and to separate much more formally their marketing budget from CME support and to make the latter more obviously no-strings-attached.

However, the result of Act One was not a refusal to channel industry CME money through MECCs. Rather it was the creation of the needed firewall to be able to claim that CME and marketing were being kept separate.

Now we come to Act Two--the newly aggressive efforts in the Senate (especially) to push for a sunshine law revealing all industry payments to docs, and Sen. Grassley's recent campaign to publicize egregious cases of conflicts of interest among academic physicians. I interpret the Pfizer move to demonstrate that at least some companies have decided that the heat is now turned up too high to permit things that seemed okay even after the OIG-DHHS report, and so the companies are responding to the heat by getting out of the MECC kitchen. But it's my guess that Act One was a necessarily prelude to this more recent development.

When I initially logged onto the Pharmalot blogsite, there were two comments to the story about Pfizer, each of which raised an interesting point. The first suggested that this is not necessarily going to improve integrity in CME, but rather drive the funding stream deeper underground; Pfizer admitted that it would keep sending its money to the MECCs if they could do so via a third-party broker. (Example: Pfizer gives a professional medical society a major grant to fund a stop-smoking campaign; the professional society independently contracts with a MECC to manage the campaign; and merely by chance, the campaign urges that docs prescribe Pfizer's Chantix to get people to quit smoking.) A second commentor suggested that this development is a good thing because now instead of giving their money to slimy MECCs, the drug company will give its CME money to groups of integrity, like "university-based CME providers." I am afraid that this commentor has not been to a university-based CME event lately to see how commercial even those venues have often become when they are heavily funded by industry.

New Survey: Yes, the Public Wants Sunshine

Our friends over at the Prescription Project have recently completed an important survey--see news release and summary at http://www.prescriptionproject.org/assets/pdfs/PPSA%20Survey%206-18-08.doc, and the complete survey results at http://www.prescriptionproject.org/assets/pdfs/Prescripton%20Project%20Survey_0618.pdf.

The basic question is: does Jane Q. Public really care about the debate now going on in Congress about physician payment sunshine laws? Or is this really a public non-issue that politicians are jumping on for the bandwagon ride? The survey offers a resounding affirmation that the public at large is truly concerned and that the pols may actually be responding to real public pressure. (Indeed, I have to admit, almost too resounding--had the results been the opposite, and had the survey been paid for by the drug industry, it would never pass the sniff test. But I cannot offhand spot any methodological flaws.)

Some key data from the telephone poll of about 1000 Americans conducted in early June by International Communications Research for the Prescription Project: more than half (52%) believe that the pharmaceutical industry has a large or extermely large influence on the physician's choice of a medication. Significant majorities believe that many common gifts or payments (which I have taken to calling "bribes") to physicians should be prohibited:

• Travel--86%
• Free dinners--84%
• Fees for speaking at company-sponsored conferences--80%
• Free lunch for office staff--78%
• Free pens and note pads--70%
• Free attendance at continuing ed courses--62%

By contrast, only 51% favored banning "free" drug samples, but note that that is still a majority.

Sixty-four percent said it was important to know about their physician's ties to the pharmaceutical industry. (Though only 36% said they personally would be likely to ask their physicians this question directly.) Sixty-eight percent said they supported legislation requiring companies to disclose payments to docs. And 71% were likely to support legislation that would provide non-commercially biased, expert drug information to physicians (such as "academic detailing").

So in sum it appears that people are very concerned about the influence exerted by these bribes, are unwilling to ask their physwicians flat out about their industry ties, and so would like the reassurance of knowing that these ties are being reported through some public oversight mechanism--as well as to be sure their docs have access to an alternative, less biased source of information.