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ScienceWeek
SCIENCE POLICY: CONFLICTS OF INTEREST, PHYSICIANS, AND PHARMA
The following points are made by D.M. Studdert et al (New Engl. J. Med. 2004 351:1891):
1) The past two years have witnessed extraordinary regulatory ferment in the area of conflicts of interest involving physicians, especially conflicts arising in relationships with the pharmaceutical industry. Professional regulatory bodies, the pharmaceutical industry, and the government have all decided that physicians and drug manufacturers need stronger advice about appropriate relationships. In 2002, three leading professional organizations -- the American Medical Association,[1] the American College of Physicians,[2] and the Accreditation Council for Continuing Medical Education[3] -- issued or revamped guidelines regarding physicians' interactions with drug companies. In July 2002, acting through its trade association, the Pharmaceutical Research and Manufacturers of America, the industry adopted a broad code of conduct for its constituencies.[4] In April 2003, the Office of the Inspector General of the Department of Health and Human Services released a set of guidelines with which manufacturers were urged to comply in order to guard against the risk of liability.[5]
2) Why has there been such a sudden increase in oversight of these relationships? A combination of forces appears to be at work. First, there is a growing realization, inside and outside medical circles, of the troubling influence that pharmaceutical marketing can have on patient care. Second, the Medicare program has adopted a prescription-drug benefit, and widespread concern about the costs of this new program will fuel federal prosecutors' interest in policing conflicts of interest that could increase public expenditures. Third, a body of federal law dealing with "fraud and abuse" has evolved to the point where it can and is being used by prosecutors to punish pharmaceutical companies and physicians involved in marketing practices that were once fairly common. Thus, the law has begun to annex terrain previously controlled by professional ethics.
3) The pharmaceutical industry and professional organizations have anticipated some elements of the gathering storm. Their voluntary initiatives in this heretofore largely unregulated area could be interpreted as an attempt to forestall sterner measures by addressing the kinds of activities that have drawn the attention of federal prosecutors.
4) Apprehension over conflicts of interest in medicine is rooted in a concern that professional judgments about the welfare of patients may be inappropriately influenced by a secondary interest -- in this case, the personal gain derived from relationships with pharmaceutical companies. A drug company's primary interest is to maximize sales of its product. Physicians do not (or should not) share this goal, but they are the chief conduit for sales. Consequently, physicians have been the central target of marketing strategies, and they remain so even after the rise of direct-to-consumer marketing. The pharmaceutical industry spends approximately $12 billion annually on gifts and payments to physicians.
5) To a significant extent, growth in promotional activity has paralleled the rise of the industry's importance as a funder of mainstream research and education. Approximately 60 percent of biomedical research and development today is privately funded. Pharmaceutical companies' share of funding for clinical trials is more than 70 percent and has grown sharply during the past decade. The industry also shoulders more than half of the costs of formal programs of continuing medical education.
6) Financial entanglement has bred close ties between the industry and physicians. Contacts with trainees come early and adhere as physicians move to practice. There is hardly a physician practicing today who has not been the beneficiary of small "educational" gifts such as pens and memo pads or lunch for the office staff. Many physicians attend dinners to hear a hired expert talk about a product, take educational trips to resorts, or receive funds (explicitly without strings attached) in the form of research grants, trainee support, or lucrative consulting fees.
References (abridged):
1. American Medical Association. Opinion of the Council on Ethical and Judicial Affairs, E-8.061 http://www.ama-assn.org/ama/pub/category/4001.html
2. Coyle SL. Physician-industry relations. 1. Individual physicians. Ann Intern Med 2002;136:396-402
3. Accreditation Council for Continuing Medical Education. Standards for commercial support of continuing medical education. http://www.accme.org/incoming/17_system98_essential_areas.pdf
4. Pharmaceutical Research and Manufacturers of America. Code on interactions with healthcare professionals. http://www.phrma.org/publications/policy/2004-01-19.391.pdf
5. Department of Health and Human Services, Office of Inspector General. OIG compliance program guidance for pharmaceutical manufacturers. Fed Regist 2003;68:23731-23743
New Engl. J. Med. http://www.nejm.org
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PUBLIC HEALTH: PHYSICIANS AND DRUG COMPANIES
The following points are made by David Blumenthal (New Engl. J. Med. 2004 351:1885):
1) When a great profession and the forces of capitalism interact, drama is likely to result. This has certainly been the case where the profession of medicine and the pharmaceutical industry are concerned. On display in the relationship between doctors and drug companies are the grandeur and weaknesses of the medical profession -- its noble aspirations and its continuing inability to fulfill them. Also on display are the power, social contributions, and occasional venality of a very profitable industry whose products contribute in important ways to the health and longevity of the American people, but an industry that at times employs methods that are deeply troubling and even criminal. Government also plays a part as it tries with limited success to help the profession stay true to its own tenets and to deter the industry's most egregious excesses. The spectacle is profoundly human and, like most such spectacles, seems never to end or to lose its fascination.
2) The interaction of doctors and pharmaceutical companies is also extremely consequential for patients, doctors, and the larger society. The drug industry manufactures, distributes, and publicizes powerful chemical and biologic agents that have proven benefits and that physicians sometimes fail to use as often as they should, or in sufficient doses.(1) In this sense, industry's efforts to encourage the use of some agents by physicians can be seen as contributing to the public health. At the same time, the marketing by the drug industry of its products to physicians is manifestly aimed also at improving industry profits. In the process, such marketing may contribute to less savory social consequences, including increasing drug costs and the misuse or overuse of medications in ways that may adversely affect patients.(2)
3) Several recent developments have focused renewed attention on the relationship between drug companies and doctors. One is the surge in spending on prescription drugs, which totaled $162.4 billion in 2002 after years of double-digit percentage increases.(3) A second is the publicity surrounding a number of prominent legal cases in which drug manufacturers have been convicted of crimes related to their marketing of drugs to physicians or have made huge payments in the settlement of civil suits for similar noncriminal violations.(4,5) A third is an increasing recognition by both pharmaceutical companies and physicians that, in certain respects, the relationships between drug companies and doctors have become embarrassing to both parties and need to change.
4) Interactions between drug companies and doctors are pervasive. Relationships begin in medical school, continue during residency training, and persist throughout physicians' careers. The pervasiveness of these interactions results in part from a huge investment by the pharmaceutical industry in marketing. In 2002, the industry expended 33 percent of its revenues on "selling and administration." In 2001, one company, Novartis, reported spending 36 percent of its revenues on marketing alone.(2) The marketing expenditures of the drug industry have been estimated variously at $12 billion to $15 billion yearly, or $8000 to $15,000 per physician. In 2001, the industry's sales force of drug detailers, whose job is to meet individually with physicians and promote company products, numbered nearly 90,000 in the United States(2) -- one salesperson for every 4.7 office-based physicians.
5) Moynihan (2003) catalogued 16 different ways in which drug companies relate directly or indirectly with doctors. These range from the seemingly trivial (e.g., the ubiquitous dispensing of gifts such as pens and pads with drug names inscribed) to the much more troubling (e.g., the ghostwriting of articles for academic physicians, the payment of large honoraria and consulting fees to prominent physicians who extol the virtues of company products, and the support of lavish trips and entertainment for physicians who commonly prescribe company products).
6) Surveys of residents indicate that they receive an average of six gifts from pharmaceutical companies annually. In a survey of 106 directors of emergency-department programs in 2002, 41 percent responded that their programs allowed residents to be taught by representatives of drug companies, 35 percent reported that residents received free industry samples at work, and 29 percent said that residents' travel to meetings was sometimes dependent on the availability of company support. According to another report, residents in a psychiatry program in Toronto attended up to 70 lunches that had been sponsored by drug companies and received 75 promotional items over the course of one year.
7) As physicians mature, their relationships with drug companies also change, becoming more likely to involve consulting and honoraria and less likely to involve luncheon seminars. A 2001 survey of a random sample of US physicians by the Henry J. Kaiser Family Foundation found that 92 percent of physicians received free drug samples from companies; 61 percent received meals, tickets to entertainment events, or free travel; 13 percent received "financial or other in-kind benefits"; and 12 percent received financial incentives to participate in clinical trials. A 1997 study by Ferguson et al found that 83 percent of internists with the Department of Medicine at the University of Maryland had met with drug-company representatives in the previous year. Wazana (2000) reported that on average practicing physicians meet with drug-company representatives four times a month.
References (abridged):
1. Quality of health care delivered to adults in the United States. N Engl J Med 2003;349:1866-1868
2. Relman AS, Angell M. America's other drug problem. The New Republic. December 16, 2002:27-41
3. Levit K, Smith C, Cowan C, Sensenig A, Catlin A. Health spending rebound continues in 2002. Health Aff (Millwood) 2004;23:147-159
4. Petersen M. Suit says company promoted drug in exam room. New York Times. May 15, 2002:C1
5. Dembner A. TAP officials on trial today in fraud case. Boston Globe. April 20, 2004:1
New Engl. J. Med. http://www.nejm.org
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Related Material:
PUBLIC HEALTH: ON THE PHARMACEUTICAL INDUSTRY
The following points are made by F.M. Scherer (New Engl. J. Med. 2004 351:927):
1) For more than four decades, beginning with an investigation chaired by Senator Estes Kefauver in the 1950s, debate has raged over the economics of the pharmaceutical manufacturing industry. Critics point to monopolistic pricing and high profits; defenders emphasize the advances in medical therapy achieved by the industry.
2) The bounds of the industry are indistinct. From statistics compiled by the industry's principal trade association, "Big Pharma" companies reported US prescription-drug sales in 2002 of $145 billion.(1) Included in this figure are drug sales of companies that have successfully marketed new biopharmaceutical products. A higher estimate, $192 billion, comes from Intercontinental Marketing Services, a leading independent collector of industry data. The latter figure includes the sales of smaller companies, generic drug specialists, and some over-the-counter drugs.(2) In 2000, prescription-drug outlays made up 9 to 10 percent of total US health care expenditures.(3,4)
3) The pharmaceutical industry is the most research-intensive of US industries that support their research and development with private funds (as distinguished from defense and space contractors). In 2002, Big Pharma companies devoted 18 percent of their sales revenue to research, development, and testing activities.(5) The much lower percentages often reported in the press are misleading because they use companywide data, including the sales of less research-intensive activities such as pharmacy benefit-management services and the production of high-purity chemicals, cosmetics, prosthetics, over-the-counter drugs, vitamins, and so forth. Excluded from the 18 percent figure was roughly $10 billion of activity by start-up companies in biotechnology doing little else but research and development that had not yet yielded salable products.
4) From the industry's research-and-development efforts has come a stream of new therapeutic products, most offering modest variations on existing therapies but some providing groundbreaking new approaches to the treatment of disease. From 1963 to 1999, the number of new chemical entities (or molecules) approved for marketing in the United States averaged 18.7 per year, with an upturn to 27 (plus 4 new biologic entities) per year during the 1990s and a downturn in number more recently. Using advanced statistical techniques with available (but necessarily limited) data, a recent study found that the use of new drug therapies contributed appreciably to the extension of life spans and the reduction of hospital stays. The study estimates that during the last two decades of the 20th century, drug innovations that were rated "priority" by the Food and Drug Administration (FDA) increased life expectancy in the US by an average of 4.7 months.
5) Pharmaceutical companies customarily apply for patent protection on new chemical entities shortly before clinical tests in humans commence. The basic statutory patent life is 20 years, and by the time commercial marketing is allowed, approximately 12 to 13 years of basic product patent life remain, under regulatory conditions of the late 1990s. Drug patents provide particularly strong protection against competition from other companies because even a slightly different molecular variant must undergo the full panoply of clinical tests required by the FDA. Numerous cross-industry surveys have shown that managers of pharmaceutical research and development assign unusually great importance to patent protection as a means of recouping their investment in research, development, and testing. Striving to prolong the period of patent protection, pharmaceutical companies have obtained patents on minor variants in product formulation and production processes, and some have entered into agreements delaying entry of generic manufacturers challenging their patents. Several of these competition-impeding agreements were abandoned in recent years after antitrust complaints.
6) Only about 21 to 23 percent of the new chemical entities that are subjected to human testing emerge at the end of the process with marketing approval; the rest fail at various stages. A recent survey estimated that the cost of research, development, and evaluation of new chemical entities approved by the FDA, mostly during the 1990s, was $802 million on average, with the costs of preclinical research and failed tests allocated to the "winners." However, this estimate must be regarded with caution. Only about half the estimated price tag entailed actual out-of-pocket costs; the remainder was an estimated 11 percent annual cost of financial capital invested in research and testing. Also, the voluntary sample from which the estimates were drawn numbered only 10 companies, including mainly Big Pharma members that placed a disproportionate emphasis on drugs for chronic diseases, which require extensive testing to identify long-term effects. Higher costs for testing may also have been incurred to differentiate a drug's efficacy from that of rival products. There is reason to believe that drugs used to treat acute symptoms and those directed toward small "orphan" markets are developed at a much lower average cost. On the other hand, some costs are ignored -- notably, those incurred for academic research that often identifies molecules likely to have therapeutic effects.
References (abridged):
1. Pharmaceutical industry profile: 2003. Washington, D.C.: Pharmaceutical Research and Manufacturers of America, 2003:79
2. Kumar P, Zaugg AM. Steady but not stellar. IMS Health Business Watch. May 2003
3. Statistical abstract of the United States. 2002. Washington, D.C.: Bureau of the Census, 2002:Section 3
4. Medicare and Medicaid statistical supplement. Table 4
5. Pharmaceutical industry profile 2003. Washington, D.C.: Pharmaceutical Research and Manufacturers of America, 2003:76
New Engl. J. Med. http://www.nejm.org
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