George Koroneos, Online Content & News Editor

Just days after watching a $30,000-a-month chemotherapy drug receive approval; Democrats took pharma to task for bumping the price of drugs up 9.3 percent in the past year.

A subcommittee of the House Energy and Commerce Committee debated the issue at a heated hearing on Tuesday with commentary from pundits ranging from pharma economics professor Stephen Schondelmeyer to Rick Smith, senior vice president of the Pharmaceutical Research and Manufacturers of America. A vocal group within the committee noted that drug prices tend to rise when there is legislation pending, such as the case with the healthcare reform bill currently plodding through Congress. Pharma claims that the spike is due to looming patent expirations for blockbuster drugs and a slim pipeline of new drugs on the horizon. 

Rep. Henry Waxman (D-CA) took pharma to task for raising prices at a time when the economy is in a slump and unemployment is high. “When it comes to prescription drugs and the drug industry, nothing surprises me anymore, but increases of this magnitude are really shocking,” Waxman said. He argued that such a n increase in drug prices increase cause a chain reaction that spikes out-of-pocket costs for drugs, as well as insurance premiums and cost to the Medicare Part D program, and forces some patients to skip their treatment. 

“It’s hard to escape the conclusion that industry is positioning its pricing for enactment of the new health[care] reform legislation,” Waxman concluded. 

The 9.3 percent figure being bandied about at the hearing was taken from an AARP study that examined 500 drugs (both brand-name and generic), and came to the conclusion that this is the highest annual increase in pricing since 1992. 

Pharma supporters claimed that the report was flawed since it only looked at wholesale prices, which are often substantially higher than retail prices, and noted that the report had not been peer reviewed. 

“The price data we used was submitted by the drug companies,” said Schondelmeyer, who authored the report. “I ask, if they are so concerned about those prices not being accurate, why are they reporting inaccurate numbers to the price database?” 

Articles

Drug manufacturers came under fire at a hearing of the House Energy and Commerce?s health subcommittee for bumping drug prices 10 percent this year. Pharma claims rumors that it?s boosting costs in anticipation of healthcare reform are baseless, but the industry could be facing an uphill battle.

Pharma Comes Under Fire for Jump in Rx Prices

The pharma industry has been quiet lately when it comes to sweeping layoffs; with the exception of the looming redundancy cuts at Pfizer and some small scale-backs here and there, drug firms have, in recent months, slowed the flow of jobs going down the drain. 

Alas, nothing ever stays quiet in the pharma. Word broke on BNET on Monday that Sanofi-Aventis is planning to eliminate upward of 1,200 positions due to generic competition in the cancer space and looming patent expirations for Plavix and Avapro. 

BNET’s Jim Edwards took Sanofi-Aventis to task on Tuesday for veiling its layoffs and failing to release a press statement. “It told its work force immediately before the Thanksgiving break that they should stay at home on the following Monday, and await a phone call telling them whether their job was safe or gone,” Edwards 

When Pharm Exec reached out for comment, Sanofi spokesperson Jack Cox responded promptly with the following:

"We currently are in the process of contacting about 750 sales professionals to let them know their jobs have been eliminated,” Cox stated in an email. “In our General and Specialized Therapeutics Business Units, the notification process is complete. In the Oncology Business Unit, the process will continue until mid-month.”

Cox also stated that the laid-off employees can apply for open positions within the company, and personnel released from the company will received appropriate severance packages. 

"These hard decisions were necessitated by shifting customer needs, the diminishing effectiveness of traditional marketing practices, and, in particular, generic competition to some of our key brands,” Cox said. “While sales professionals and managers will remain integral to our business, we're creating an organization that more appropriately reflects our product portfolio and the realities of the market."

About a year ago, Sanofi announced that it was cutting 800 sales positions due to a thin pipeline. No word on whether more layoffs are forthcoming at the French drug firm.

With the fourth quarter quickly coming to a close, talks of job cuts are once again in the air. The first major layoffs could be coming at Sanofi-Aventis, which is rumored to be slashing up to 1,500 positions.

Layoffs and Job Cuts Brewing at Sanofi-Aventis

After months of hemming and hawing, a flurry of warning letters, and public outcry for guidance, FDA chose to address the issue of social media head-on last week, with a two-day forum broaching topics from Twitter to Sidewiki. 

 At one point during the jam-packed hearing, a speaker compared the event to speed dating-and the analogy wasn’t far from the truth. Sixty-nine speakers crammed 77 presentations into 10 to 15 minute pitches-and almost every one called for some form of regulatory action.

 “This is the Super Bowl of Part 15 hearings,” Peter Pitts, president of the Center for Medicine in the Public Interest, said to the FDA panel. “Social media is a social movement. Healthcare companies must engage in social media. If a consumer with no financial ties to drug companies puts a comment on a health site, should it be considered regulated speech? In this case letters to the editor should be regulated.”

 “The Internet is the go-to media for more than half of Americans looking for information, but also a breeding ground for bad information,” said the Coalition for Healthcare Communication’s John Kamp, early last Thursday. “FDA policy can make it possible for consumers to find reliable information on the Internet. We suggest FDA look at ways to scrutinize widespread health inaccuracies on the Web.” 

 Kamp suggested that FDA create a list of “can dos” for advertising on the Web, similar to guidelines from the Federal Trade Commission.

 PhRMA’s Jeffrey Francer called for FDA to approve use of a logo with a standard warning like: All drugs have risks, click for more information. The tool could be used on microblog posts like Twitter. However, FDA noted that this poses a problem, because companies aren’t required to prescreen advertisements. One panelist said that she wasn’t sure how the FDA logo would be included if ads aren’t actually approved. 


A large contingent of presenters spoke in support of a one-click rule, or the ability to post risk information within one click of a short-form text advertisement. Pharma came under fire in April after FDA sent warning letters to companies that were running branded search ads with disease information, but no risk information.

“People don’t care what marketers or the FDA has to say. They care about themselves, and when they look for information online they are hyper-focused,” said Fard Johnmar, founder of Envision Solutions. “People look for information based on what is on the page and what the link is associated with. If the information is weak or misleading, they will look somewhere else.” 

 Google’s Health Director Mary Ann Belliveau told FDA that ads with both brand and benefit information are more informative to a user query, and that users are more likely to click on an ad if it contains a URL that they recognize. Google recommended a standard format across the Web for sponsored links. Customers must click the full listing with short description of risk, two direct links, brand info, and health info. No word yet on how these ads will sit with FDA, but you can read more about the ads here.

 “Risk-value proposition is more valuable to consumers than risk,” said James Sandino of Integrated Media. “What’s missing is a sense of clarity, ownership, and a sense of responsibility for what has been put forth. If you build a site, they will come, and then comment. And if you write ‘go here for more information,’ they will.” 


Another sticking point at the hearing was the matter of how pharma should handle conversations about off-label use and adverse reactions to drugs mentioned in third party forums or blogs.

“Does an anonymous comment on a site warrant an investigation?” asked AdvaMed Advertising and Promotion Working Group Co-Chair Tony Blank. Christopher Schroeder, CEO of HealthCentral, agreed that advertising on a page with user-generated comments shouldn’t be penalized.

“The mass of adverse events reported on social media sites doesn’t meet FDA requirements,” John Mack, editor of Pharma Marketing News said on Friday. “Few companies have standard operating procedures for processing adverse events from social media sites.”

 Mack suggested that pharma companies should monitor third party sites and make a concerted effort to correct information. It should only be mandatory for them to correct their own sites. He also suggested making drug companies use “hashtags” to help FDA find drug topics on sites such as Twitter.

 Michele Sharp, Lilly’s senior director, US regulatory affairs, said that there are several unanswered issues around Internet promotion, and explained how Lilly launched a blog on Medscape to share information with physicians. “We are prescreening all comments, and not mentioning products because they don’t know what the fair balance rules would be,” Sharp said. “We are concerned that if we offer product information it could lead to off-label discussions.”

 “Exchange of information on the Internet can last for years,” said Allan Coukell, director, Pew Prescription Project. “Why should manufacturers be responsible for information transmitted through a third party about their drugs? Companies are not responsible for information created by third parties and hosted on third party sites, such as Wikipedia.”

Nearly 70 pharma execs, new media mavens, and even Joe Q. Public packed last week's FDA social media hearings to plead for some form of guidance on how to handle Tweets, blog comments, and off label discussions online.

A Call for Social Media Guidelines

Pfizer is wasting no time merging Wyeth into its corporate structure. The pharma giant announced its global research facility strategy on Monday, punctuated by the closing of six sites including its massive New London facility, which opened in 2001.

The company will now house its research labs in five sites located in Cambridge, MA; Groton, CT; Pearl River, NY; La Jolla, CA; and Sandwich, England. Pfizer notes that two of the main research sites are legacy Wyeth sites. 

“We looked at the full portfolio of the combined companies and said that we know what we want to achieve and we want to utilize the best facilities to do that,” said Pfizer spokesperson Ray Kerins said. “The hard part of [the story] is that we have to close a number of sites around the world-that impacts many families and that’s a very unfortunate thing to have to do.”

Pfizer will end R&D operations in Princeton, NJ; Chazy, NY; Rouses Point, NY; and Plattsburgh, NY; Sanford, NC and Research Triangle Park, NC; and Gosport, England and Slough/Taplow, England. The New London staff will be transitioned to Groton, CT. 

The news hammers home Pfizer’s promise to merge the two companies significantly faster than had been done in previous deals. Before the ink was even dry on the contract, Pfizer had announced that it was bringing on-board eight senior executives from Wyeth to lead new divisions. 

“In less than a month, we have made complex business decisions needed to combine these two R&D organizations thoughtfully yet quickly,” stated Martin Mackay, president, Pharma Therapeutics Research & Development, in a release. “Moving forward on our aggressive timeline, we are analyzing the combined portfolio and prioritizing research projects that will address unmet medical need and bring Pfizer’s scientific and competitive advantage to the benefit of patients.” 

The company has yet to release the actual number of employees being released, but reports indicate that 1,500 employees at the New London, CT, location will be transitioned to the Groton building. 

"In Groton and New London, there will be a minimal headcount effect," 

 Mackay. "Our presence in Connecticut will be approximately the same ... it's about 5,000 now, and that number will continue, though the makeup will change around the edges."

Plans are still underway to announce the combined drug portfolio within 30 to 60 days. It has not been confirmed whether or not the pipeline will be publicly unveiled within that time frame. 

Following through with its promise to waste no time in merging Wyeth and Pfizer, the pharma giant announced restructuring plans for its global research network.

Author | George Koroneos, Online Content & News Editor

Articles

Pharma Comes Under Fire for Jump in Rx Prices

Layoffs and Job Cuts Brewing at Sanofi-Aventis

A Call for Social Media Guidelines

Pfizer Quick on the Draw with R&D Location Plans