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Studies sound alarm over drug ads
March 3, 2005
Toronto Star

Bringing a drug to market is an expensive endeavour. Building a market for a drug can be pricey too.

Pharmaceutical companies contend drug prices must be high to fund research and development.

Yet these same companies typically spend twice as much on marketing and administration as they do on drug discovery.

"How about you contribute some more to research and development and do less advertising?" said Uwe Reinhardt, a professor of economics and public affairs at Princeton University who is critical of drug industry spending habits.

Pharmaceutical companies have long targeted their advertising at doctors. But increasingly drugs are being marketed directly to the public like any other product, notwithstanding they are only supposed to be prescribed by doctors for legitimate medical reasons.

The practice took off in the late 1990s after the United States relaxed laws restricting prescription drug advertising. Today more than $2.5 billion (U.S) is spent each year on direct-to-consumer drug advertising (in industry lingo, DTCA) such as TV commercials and advertising spreads in mass-market magazines. Studies show that these ads do persuade people to ask for prescriptions, and doctors admit it is sometimes easier to give the patient what they want, even if it isn't medically warranted.

In Canada, the ad game has only just begun. Direct-to-consumer prescription drug ads still are restricted here. Companies have found ways around those laws. Meanwhile, Canadian broadcasters are lobbying Health Canada (which oversees such ads) to remove the restrictions so they can earn some of the billions of dollars that might be up for grabs.

Sally Pipes, formerly of the conservative-leaning Fraser Institute, a public policy research group, said she believes direct-to-consumer ads benefit the investors and the public. They may be advertising, but they are also information, and "information is power," said Pipes, now president of the Pacific Research Institute, a public policy think tank in San Francisco. Even a little knowledge might encourage someone to approach his or her doctor with a medical concern, she maintains.

Industry-giant Pfizer Inc., which on the World Wide Web bills itself "the world's largest research-based pharmaceutical company," spent $16.9 billion (U.S.) on "selling, informational and administrative expenses" but only $7.7 billion (U.S) on research and development in 2004.

Figures for other drug companies including AstraZeneca, Allergan Inc., Bristol-Myers Squibb Company and Wyeth show a similar ratio.

The drug companies note the numbers do not reflect only spending on ads; they say their financial reports lump advertising costs with significant other costs of doing business, including administration, accounting and information technology. Advertising would thus be a smaller proportion of expenditure than the raw numbers suggest. But Pfizer, for one, refused to break out ad spending as a separate figure.

Spending on research and development typically makes up between 11 and 16 per cent of a pharmaceutical company's revenue, and the industry maintains that's reasonable. "If you look at computer software . . . or the automotive industry, we invest a greater percentage of sales than most other industries," said Jill McKinlay-Morris, a spokesperson for GlaxoSmithKline Inc. (GSK) in Canada.

Comparison with other sectors suggests big industrial companies, such as automakers, spend less, and technology companies more than pharmaceuticals. According to statistics gathered by the Institute of Electrical and Electronics Engineers, Inc., Ford Motor Company, DaimlerChrysler AG, Toyota Motor Corp., and Volkswagen AG all spent less than 5 per cent of their sales on research and development in 2003. Technology companies Microsoft Corp. and Sun Microsystems Inc., both spend more than 17 per cent of their sales on research and development.

Kazi Borkowski, vice-president of medical affairs for drug firm AstraZeneca Canada Inc., said that at a pharmaceutical company a board of directors would only tolerate so much spending on science. "Coming from a research and development background myself, I would welcome additional investment in (that area)," he said. "At the same time I think we have to recognize that publicly trading companies have a fiduciary responsibility to directors."

Reinhardt, the Princeton economist, isn't convinced the the industry is getting a high enough rate of return on money spent on advertising. But he believes advertising does drive prescription drug sales, "in particular spending for brand name drugs that are only marginally better than what they replace, but are much more expensive."

The Washington, D.C.-based, non-profit National Institute for Health Care Management found that the number of prescriptions for the 50 most-advertised drugs rose by 24.6 per cent from 1999 to 2000, while the number of prescriptions for all other drugs combined rose by only 4.3 per cent.

Many Canadians wrongly believe that prescription drug advertising is illegal in Canada and that all those commercials they see on TV are appearing on American channels.

In fact, Health Canada reinterpreted the drug advertising regulations in the mid-1990s, such that under current Canadian law some direct-to-consumer advertising for prescription drugs is now allowed, though oddly it is not always clear to the consumer what the drug is for, or that a drug is being advertised.

So called "reminder ads" are permissible. Such ads can mention a prescription drug by name and its price - but not the associated disease. The reverse is also allowed. These ads, called "help-seeking messages" by Health Canada, are allowed to talk about a disease but not a specific prescription drug. Critics argue those rules have left us with confusing billboards and commercials that often lack essential information.

"It's an inappropriate way to tell people about a prescription drug because it gives the impression that there are no risks," said Terence Young, chair of an advocacy group called Drug Safety Canada. (Young's teenaged daughter died after taking a heartburn medication five years ago. He has since made it his goal to ensure Canadians are informed about possible drug complications.)

Young said the current ad campaign for the Hoffmann-La Roche Ltd. weight-loss drug Xenical is a classic example of a Canadian direct-to-consumer prescription drug ad because it lacks information about the drug or its possible side effects.

Each ad begins with the words "I am Julie," and asks the reader what they would do with "a few pounds less." The ad also suggests readers talk to their doctor about "Julie's story." There is no further information in the ads, only pictures: one is of a slender woman in a garter belt, while another has a picture of her in a bikini. A third shows naked mannequins and suggests how nice it would be to shop for trim-fitting clothes.

Young finds it interesting that the ads use sexy images yet fail to reveal anything about the drug's possible side effects, which include gas and fecal incontinence. "How sexy is that?" he asks.

Young also notes that Xenical is a drug intended to treat people with significant weight problems. He doubts the woman featured in the ad would have been considered obese even if she hadn't lost a few pounds.

Leigh Funston, a spokesperson for Hoffmann-La Roche, defends the Xenical ads. The medicine is for obesity management, she said, but the ads are intended to show that the drug can still be useful for someone who only has 25 pounds to lose but has a high body mass index.

"It is important to stress that the images used in the commercials are aspirations," said Funston, adding that the ads do meet current guidelines. "One in two Canadians are overweight but only one in five speak to their doctor about weight loss." The ads, she said, are intended to encourage communication between patients and medical professionals.

Young says other direct-to-consumer ads violate advertising codes because they use fear to sell products. He points to a drug advertisement with a picture of a toe tag attached to a dead body and the headline, "Which would you rather have, a cholesterol test or a final exam?" The website given on the poster tells about various treatments for high cholesterol including several prescription drugs. The site is owned by Pfizer Canada Inc.

Clearly, advertisers have figured out ways to work within the current Canadian rules. But with billions of dollars a year spent on ads for prescription drugs in the United States, it's not surprising that many major Canadian broadcast networks would like to see the restrictions removed.

Last September, several Canadian television executives said they expected the federal government would end the ad ban.

The Canadian Association of Broadcasters declined to be interviewed for this story or provide an update on its lobbying efforts to get the restrictions removed. A spokesperson did say it continues to be an area of interest to association members.

Health Canada declined requests for an interview, but a spokesperson for the government agency indicated that it expects to move forward with new legislation regarding direct-to-consumer advertising for prescription drugs in 2006.

Several of the new regulatory models under consideration still limit such advertising but in a different way. Integrating information about a disease and a particular drug might be allowed, for example, but the ad might have to meet standards for information accuracy and balance or include details about possible risks.

In the United States, display advertising for prescription drugs must provide information about risks, but like the Canadian ads the U.S. ones also tend to send out a mixed, even bizarre message.

A two-page spread promoting Topamax, a migraine medicine made by Ortho-McNeil Pharmaceutical Inc., appeared in the Dec. 27, 2004 issue of People, and an image from it is also on the drug's Internet home page. It presents a happy mother and daughter having fun, singing into hairbrushes as though they were microphones. "More laughs, more songs," says a caption in the magazine version.

But the text warns, "Important safety information: serious risks associated with Topamax may include increased eye pressure (glaucoma), decreased sweating, increased body temperature, kidney stones, sleepiness, dizziness, confusion, and difficulty concentrating. Tell your doctor immediately if you have blurred vision or eye pain. More common side effects are tingling in the arms and legs, loss of appetite, nausea, diarrhea, taste change and weight loss.

"Please see a brief summary of full prescribing information on the next page," the copy goes on to say, though what follows to meet regulations is not so brief - two more paid pages in People, using very small print.

Princeton's Reinhardt, wondering if prescription drug advertising makes sense financially, nonetheless believes pharmaceutical companies should have the right to advertise products as they see fit. For him it's a matter of free speech. He doesn't think such advertising is harmful, so as long as the final decision on medication, treatment or testing is made after a conversation between the doctor and patient.

"The physician should have the authority to tell the patient that [the ad] is nonsense or suggest a more cost-effective drug," Reinhardt said.

Doctors appear to have that authority, but do they use it?

A 2001 study by one group of American and British universities found that when patients request medicine or tests based on information in a drug ad they usually get what they want. According to a survey of 535 U.S. doctors, 49 per cent of requests stemming from direct-to-consumer ads were "clinically inappropriate." The survey indicated that physicians gave in to those "clinically inappropriate" requests 69 per cent of the time.

A separate study by the Royal Liverpool University Hospital and the University of Liverpool in the United Kingdom found some doctors felt they had to prescribe a drug when it was requested by certain patients. Sometimes the patient was so forceful the physician prescribed the drug even if it wasn't warranted, for the sake of the doctor-patient relationship.

"Patients' requests for medicines are a powerful driver of prescribing decisions," states a joint study on the subject by researchers at the University of British Columbia and University of California, Los Angeles, and that was summarized in the Canadian Medical Association Journal. "In most cases physicians prescribed medicines but were often ambivalent about the choice of treatment. If physicians prescribe requested drugs despite personal reservations, sales may increase but appropriateness of prescribing may suffer." The report, published in 2003, said concerns about permitting direct-to-consumer drug ads in Canada and Europe were well-justified.

"We don't think that information about drugs is necessarily something to be advertised," said Albert Schumacher, president of Canadian Medical Association and a family physician in Windsor. "It may promote inappropriate utilization by people who don't need it."

Schumacher says what's needed are public service announcements with objective information instead of emotional images.

In a book critical of the pharmaceutical industry, The Truth about the Drug Companies, a Harvard Medical School lecturer, Marcia Angell, argues ad spending is out of line and that the industry exacerbates the problem by spending major research dollars tweaking non-essential drugs.

"If you have a truly important drug, if you had discovered the cure for cancer you wouldn't have to market it. The world would beat a path to your door," said Angell.

Pharmaceutical companies spend far too much cash on "trivial variations of top selling drugs" instead of conducting innovative research, she said.

McKinlay-Morris, of GlaxoSmithKline, counters that there's no lack of innovation at her company. Spokespeople for other drug companies all made similar statements.

"We have 148 products in clinical development, among those are 90 new chemical entities . . . including vaccines for cervical cancer and medication for breast cancer," McKinlay-Morris said.

She argues that the medications Angell calls "me too" drugs provide a significant benefit to patients and doctors by providing more options. Pipes, of the Pacific Research Institute, agrees. "Angell has been talking about 'me too' drugs and saying that they are the same. Well they aren't the same," she said. One drug might be better suited to a particular patient because of its rate of absorption, for example.

Angell argues that producing these drugs is more about turning a profit than filling a medical need.

"It's less expensive to improve slightly on an existing drug than come up with completely novel drug," she said.

Apart from that debate, recent events affecting the drug industry suggest real innovation is likely to get more expensive. With several recent high-profile drugs pulled off the market, the Canadian government is considering greater scrutiny for new drugs. Health Minister Ujjal Dosanjh plans to establish a safety advisory board that would oversee drugs before and after they go on the market.

While this might provide the public with greater protection, it could also be cited as another justification for high drug prices - possibly without much mention of the millions of dollars more that is spent on advertising, marketing, and selling prescription drugs. Marketing prescription medicine directly to consumers is dangerous, and a bad use of resources, critics say. But Big Pharma's doing it, and the numbers tell why.

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