General Articles

Governmental attention to grant-supported continuing medical education (CME) has never been higher. This past April, the Senate Finance Committee (SFC) issued its report The Use of Educational Grants by Pharmaceutical Manufacturers. The SFC report was the result of a two-year investigation of CME and concluded that oversight of accredited CME providers is "insufficient to guarantee the required independence" of medical education and that there are still risks of kickbacks, veiled advertising of drugs, efforts to bias clinical protocols, and off-label promotion.

The Office of the Inspector General and Department of Justice have brought—and continue to bring—numerous cases against pharmaceutical and devices companies in the risk areas outlined by the SFC. In addition to those agencies, several states now have their own fraud and abuse legislation and successfully prosecute such actions at the local level.

Governmental attention to grant-supported continuing medical education (CME) has never been higher. This past April, the Senate Finance Committee (SFC) issued its report The Use of Educational Grants by Pharmaceutical Manufacturers. The SFC report was the result of a two-year investigation of CME and concluded that oversight of accredited CME providers is "insufficient to guarantee the required independence" of medical education and that there are still risks of kickbacks, veiled advertising of drugs, efforts to bias clinical protocols, and off-label promotion.

The Office of the Inspector General and Department of Justice have brought—and continue to bring—numerous cases against pharmaceutical and devices companies in the risk areas outlined by the SFC. In addition to those agencies, several states now have their own fraud and abuse legislation and successfully prosecute such actions at the local level.

Most of us prefer good-looking people to less attractive ones. Pharma seems to believe that doctors do, too. A recent New York Times article examined the industry's recruitment of cheerleaders, most of whom are attractive young women ("Gimme an Rx! Cheerleaders Pep Up Drug Sales," November 28, 2005). In the article, Dr. Thomas Carli of the University of Michigan observes, "There's a saying that you'll never meet an ugly drug rep." Hiring the beautiful might be good for business, but it also might be challenged as discrimination in a court of law.

Until recently, employers have mostly been free to discriminate against the unattractive. In the United States, only a few places, like the District of Columbia and Santa Cruz, California, have laws prohibiting discrimination in employment based on physical appearance. Elsewhere, employers can factor looks into employment decisions without fear of reprisal.

Thinner and Cuter

Blair Gibson

Put your cash where it's doing the most good. Although that seems like a simple idea, most pharma strategists don't allocate promotional resources effectively—they overinvest in some brands, and underinvest in others. Given that top companies have several hundred drugs each, all with different growth rates and market shares, these are certainly complicated decisions. But executives can better direct their resources, and make smarter investments, by using portfolio analysis.

While Pfizer, Eli Lilly, and Bristol-Myers Squibb use portfolio analysis, it is generally underused in the industry: Less than half of the top 20 firms integrate it into their annual planning process. As such, companies continue to throw money into drugs that are rapacious cash eaters and fail to move the market-share needle.

Learn the Lingo

The market is asking for more post-marketing research. How can companies handle that demand? Hugo Stephenson, MD, president of Quintiles' Strategic Research Services, offers insight into the struggles pharma faces, and the solutions they're finding, to financing post-approval clinical trials.

Pharm Exec: Who conducts strategic research?

Stephenson: Historically, the Phase IIIb and IV market was split evenly among big contract research organizations (CROs), the small "mom and pop" CROs, and academic research organizations.

How is that changing?

The small CROs are cheap and nimble. But you wouldn't want them to conduct a study that had a chance of being audited. Before medical registries, these studies were under the radar. Now, there's full visibility, and all studies in the post-Vioxx era run the risk of being audited, or worse still, reviewed by lawyers as part of a court case.

Pharma companies are used to having to work hard to keep regulators happy, so dealing with FDA inspections and keeping tabs on side-effects of marketed medicines ensure that regulatory affairs departments remain busy. But now there's something else they're going to have to worry about in Europe—new chemicals legislation.

The legislation—Registration, Evaluation and Authorization of Chemicals (Reach)—is at the second-reading stage in the European Parliament, having undergone significant amendments since it was first introduced. It is designed to replace a sprawling array of more than 40 different pieces of legislation; a final agreement by the European Parliament is expected in the fall of this year.

Around 30,000 existing substances will have to be registered within an 11-year phase-in period. How much data is required will depend on how much of each chemical is produced, and whether they are dangerous, such as carcinogens, mutagens, or bioaccumulative chemicals.

Understanding how drugs are bought and paid for has always been a bit complicated. People used to say that pharma had two customers—physicians and patients. Only one of them used the drug, and neither of them knew the price. My, how times have changed. Now the industry has so many customers, it needs to stop and get to know them all over again. And that's at a time when drugs worth tens of billions of dollars are going off patent. To map pharma's shifting landscape, Pharm Exec convened a group of top market researchers to discuss the issues shaping an evolving industry. Topics ranged far and wide, from the advent of Medicare Part D, to the new focus on adherence, the role of international markets, even the brave new world of marketing to seniors' children.

When the conversation turns to science and scientists, and the tone threatens to get a bit elevated, I try to keep my feet on the ground by remembering the most down-to-earth, human account of science I've ever read: John D. Watson's The Double Helix. It's a quirky tale. On the one hand, it's the story of one of the great scientific discoveries of our time, the structure of DNA. On the other, it's a sort of comedy of errors about how a pair of overconfident, underinformed young men—Watson and his collaborator Francis Crick—could skip the preliminaries, get the chemistry wrong, play a little fast and loose with other people's data, generally blunder around, and still come up with a heartbreakingly elegant insight about the world. It is inspiring, not because it shows human beings transcending their natures, but because it shows what you can accomplish even with a raft of imperfections.

The food and drug administration started 2006 with a bang, unveiling a long-anticipated final rule that significantly overhauls the way drugs and biologics are labeled. This new regulation, designed to improve the communication of risks and benefits, has been in the works for years, but has been delayed by industry concerns that it could expose companies to more liability suits. Implementation will be a massive, costly undertaking, but at this point industry has little choice but to comply.

This final decision on the format and content of professional labeling sets the stage for FDA to move forward with other initiatives. For example, the agency recently required manufacturers to submit all labeling

Reducing Research Failures