Beware phony transparency

Beware phony transparency

By Jon Bigelow • Executive Director of the Coalition for Healthcare Communication

Developing highly effective and extremely safe COVID-19 vaccines within a single year was an amazing accomplishment, exemplifying the phenomenal work of biopharma in developing pharmaceuticals that reduce mortality and morbidity and improve quality of life. 

The R&D process is paramount, but clear and accurate communication –presented in terms and formats that are accessible to the end user – is also critical. After all, it took years, long after clinical benefit was demonstrated, to establish inhaled corticosteroids as a core element in managing asthma patients; similar examples of delayed uptake of innovative therapies abound in other diseases. 

Yet too often Washington decision makers ignore the importance of informing healthcare practitioners (HCPs) and patients about therapeutic innovations. Perhaps that’s why they find it so hard to let go of “feel good” ideas intended as tools to limit healthcare communications, especially direct-to-consumer (DTC) promotion. 

The “DTC Act”

One of those flawed ideas is to require that DTC advertising include the list price. This was a cornerstone of former President Trump’s 2018 “blueprint” to lower drug prices, but his proposed regulation provoked a lawsuit and died in federal court.

Also in 2018, Sens. Chuck Grassley (R-Iowa) and Dick Durbin (D-Ill.) tried to accomplish the same goal through legislation, and they came close to succeeding. Their proposal was incorporated into the annual budget bill and was approved by the Senate but died in the House during final negotiations.

Now the idea is back: On June 24, Sens. Grassley and Durbin joined with Angus King (I-Maine) to introduce S.-2034. Dubbed the “Drug-price Transparency for Competition (DTC) Act,” this bill would require that DTC ads include the wholesale acquisition cost (WAC) – often referred to as the list price – “so that patients can make informed choices amid an onslaught of drug commercials,” to quote from a press release by Sen. Durbin. Unlike the Trump administration’s regulation, which was limited to television commercials, this legislation would apply to advertising in all media.

The bill’s text dismisses the purpose of DTC promotion as “an attempt to boost demand for [pharma manufacturers’] products and thereby raise the price that consumers are willing to pay, increase the quantity of goods sold, or achieve some combination of the two.” 

This should be a non-starter

The strong sentiment in Congress and the White House to reduce prescription drug prices – stoked by the uproar over the approval, pricing, and marketing of the new Alzheimer disease drug Aduhelm – extends into wanting to take action against DTC advertising. And amidst the wheeling and dealing around competing infrastructure proposals, the fiscal 2022 budget, the federal debt limit, and other high-visibility issues, the Grassley-Durbin-King proposal could be added to one of the must-pass legislative packages.

But it shouldn’t be. As the Coalition for Healthcare Communication stated in our formal “Comments” on the 2018 proposed regulations, there are many problems with this idea.

True, it is hard to argue when S.-2304 says prescription prices “remain shrouded in secrecy and limited to those who subscribe to expensive drug price reporting services,” but to simply take WAC as a single metric of cost represents phony transparency. The problem here is the convoluted payment system for pharmaceuticals: The amount actually paid by a typical patient depends on the type (and plan details) of the insurance the patient has, the formulary structure, rebates to pharmacy benefit managers, copays, deductibles, patient assistance programs, and other factors. In this setting, WAC certainly is not a good proxy for the actual cost of a prescription drug, and to highlight WAC in an advertisement as though it is the price typically paid by the patient is inaccurate and highly misleading. 

It also is potentially harmful to patients to the extent it discourages them from having important conversations with their HCPs about possible diagnoses and available therapies. The senators also ignore the independent judgment of those HCPs: even if the patient remembers the name of the advertised drug, HCPs will use their own best judgment and prescribe the advertised product (or any drug) only if they believe it is indicated for the patient’s condition and circumstances.

There are serious legal concerns as well. To require advertisers to include WAC flies in the face of First Amendment protections. Just as the First Amendment prohibits the government from restricting or censuring speech, it also prohibits the government from compelling someone to convey particular messages. While S.-2034 addresses only DTC promotion, the precedent it would set would affect all communications about pharmaceutical innovations, including to HCPs, formulary committees, and other stakeholders. 

Nor is this proposal likely to lower prescription drug costs, which appears to be the premise of the three Senators. In the complex drug pricing ecosystem, numerous other factors would interfere with a manufacturer lowering WAC based on this specific proposal.

The bigger picture

It is not in the Coalition’s mission to advocate for high drug prices. The United States pays far more for healthcare than other developed nations, yet our clinical results are not better. What’s needed is a rational discussion about the many drivers of high costs (hospital charges, duplicated tests, unnecessary procedures, and so on), and it is fair that prescription drug prices should be part of the conversation.

The Coalition generally favors more, not less, information about therapeutic options, and we do not oppose including prices in drug advertising per se. But the information in an advertisement must be, to use the FDA’s standard, accurate and not misleading. Simply throwing the list price into a DTC ad fails that test.

We will continue to oppose the DTC Act, but sadly, proposals like this will keep popping up because many in Washington see pharma marketing (especially DTC) as a problem rather than an opportunity, and don’t understand the cost ecosystem. Perhaps there is an opportunity here for pharma to build on the goodwill it earned during the rollout of COVID-19 vaccines: Be certain messages are clear, credible, and compelling; make responsible pricing decisions; and highlight the typical price patients pay, which is far lower than the list price.