Obama Policies Reshape Pharma Marketing - Pharmaceutical Executive


Obama Policies Reshape Pharma Marketing

Pharmaceutical Executive

Disclosing payments

Pharmaceutical marketing is the clear target of the Open Payments or "Sunshine" program, which requires manufacturers to submit data to the Centers for Medicare and Medicaid Services (CMS) on transfers of value to physicians and medical centers. After many delays, the program finally is getting off the ground, with pharma companies preparing to submit initial 2013 payment data in May.

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But disputes continue over whether and how to value "publication assistance" to clinicians, such as providing medical writing services and other support, and whether such activities should be reported at all. A related topic is the value of journal reprints and other educational materials provided prescribers and whether the program should even count textbooks and journal reprints as "gifts" to doctors. "It's odd," comments John Kamp, executive director of the Coalition for Healthcare Communication (CHC), that while FDA has issued new guidance to clarify appropriate dissemination of scientific and medical publications, CMS reporting requirements raise questions about the value of such information. Even before the "Sunshine" data comes to light, though, it seems to be having an impact on pharma marketing. The public interest media group Pro Publica unveiled a "Dollars for Docs" report in March indicating a big drop in pharma speaking fees to doctors from 2010 to 2011. This development, says ProPublica, reflects "increased attention from regulators, academic institutions and the public to pharmaceutical company marketing practices."

GlaxoSmithKline made big cuts in this area, and announced last December that it would stop paying speaker fees altogether. But other marketers have not taken that step. And companies say that the decline in marketing outlays may reflect a dearth in new drugs coming to market, as well more generic competition for leading blockbuster drugs – and not the prospect of greater public scrutiny.

Part D controversies

Although the Obama administration has pulled back from adopting major revisions to the Medicare drug program, namely reducing "protected" drug classes and re-examining the "non-interference" clause that prevents Medicare from weighing in on negotiations between drug plans and manufacturers or pharmacies, a number of important policy changes remain under discussion. CMS is examining the effect of reduced copays offered by preferred pharmacy networks and efforts to crack down on "abusive" and "fraudulent" prescribing, primarily of prescription painkillers. And the agency proposes to expand the medication therapy management program for Medicare beneficiaries who use multiple prescriptions to treat chronic conditions, despite concerns about the program's effectiveness. A number of analysts consider MTM a waste of money and support shifting to other payment and quality measurement strategies to improve appropriate medication use by high-cost patients.

Part D, moreover, could experience additional changes through annual program updates and the federal budget process. The administration's budget plan for 2015 proposes to impose rebates on drugs provided to low-income Medicare patients in Part D plans, to require rebates on drugs that experience price hikes faster than inflation, and to encourage greater use of generic drugs by these "dual eligible" beneficiaries. Another proposal would require manufacturers to provide discounts to cover 75% of the cost of drugs prescribed to patients in the Part D coverage gap – up from 55% discounts proposed in the CMS "call letter" for 2015 that sets rates and policies for Medicare Advantage and for Medicare drug plans for next year. Although these new policies are not expected to gain much traction on Capitol Hill, the budget provides a roadmap to Obama administration goals and spending priorities for the near future.

Jill Wechsler is Pharm Exec's Washington correspondent. She can be reached at


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