The latest effort by state governments to reduce prescription drug spending attempts to beat the pharmaceutical industry at its own game.
States, including Pennsylvania, West Virginia and New Hampshire, are training and employing representatives to visit doctors’ offices and deliver “unsales” pitches.
Question: What is an “unsales” pitch?
While representatives that deliver unsales pitches also visit doctors one-on-one and carry graphs, charts and fast-facts like their counterparts from the pharmaceutical industry, they have a different agenda.
The purposes of an unsales pitch are to:
- explain to doctors that generic medications or older versions of new medications are just as effective as name-brand pills in treating various diseases,
- counsel doctors about the specific cases where foregoing prescription drugs might be a viable alternative, and
- encourage doctors to prescribe the least expensive treatments whenever possible.
The mastermind behind unsales pitches is Dr. Jerry Avorn, a physician and professor at Brigham and Women’s Hospital, a teaching affiliate of Harvard’s medical school.
Dr. Avorn believes that the only way to reduce the influence of pharmaceutical advertising on prescription drug spending is to provide doctors with unbiased information in these one-on-one unsales sessions.
Question: How does pharmaceutical advertising influence prescription drug spending?
First, pharmaceutical marketing drives up the amount spent on prescription drugs.
- Prescription drug spending is a relatively small portion of national health care spending (10% in 2004), but it is one of the fastest growing components.
- Prescription drug spending is increasing for three reasons:
- Greater use of drugs overall,
- Increased use of newer, higher costing drugs in place of older, cheaper drugs and
- Manufacturer price inflation for existing drugs.
Pharmaceutical advertising is also directly responsible for the use of newer, more expensive drugs.
This is because the pharmaceutical industry spends vast sums on both direct-to-consumer and direct-to-doctor advertising to market its newly developed products.
- Pharmaceutical companies spend $19 billion per year worldwide on marketing campaigns, $7 billion of which is directed towards doctors.
- Direct-to-consumer ads encourage individuals to “ask their doctor” about newly developed medications, which leads to patients visiting their doctor and requesting prescriptions, even if they don’t need to be taking anything.
- This form of advertising is one of the main reasons that prescription drug usage has skyrocketed in recent years.
- From 1994 to 2005, the number of prescriptions purchased increased 71% (from 2.1 billion prescriptions to 3.6 billion), compared to a U.S. population growth of around 13%.
- In 2006, the number of prescriptions per person (both new and refills) bought in retail pharmacies, ranged from 6.5 prescriptions in Alaska to 17.2 prescriptions in West Virginia, with a U.S. national average of 11.1, approximately one prescription per month per American.
- When it comes to direct-to-doctor ads, the industry tends to present skewed or biased information during one-on-one sales pitches with doctors. Sales representatives are unlikely to discuss the efficacy of older, generic medications in comparison with new drugs since the purpose of their visit is to help increase sales and make profits for the drug company and its shareholders.
- Unfortunately, even the most conscientious doctors are pressed for time when it comes to doing their own comparative research between drugs.
- Direct-to-doctor advertising tends to increase the number of prescriptions written for new, name-brand medications as a result.
In comparison, unsales representatives use unbiased information to show doctors that generic and older medications are often just as effective as their name-brand counterparts (and that there are many conditions where it is just as wise to go without any medication at all).
Question: Are generics or older versions of brand-name drugs just as effective?
More often than not, the answer is yes. Only 35% of the 1,035 new drug applications introduced between 1989 and 2000 represented real medical improvements. The rest were me-too drugs: no safer or more effective than drugs already available (but certainly pricier).
In fact, the FDA currently allows new drugs to be less effective than current drugs as long as they’re more effective than a placebo. And generic drugs are simply imitations of their more-expensive counterparts that are produced as patents become outdated.
Question: How will unsales pitches rein in prescription drug spending?
The hope is that doctors will use the information given during unsales pitches to prescribe cheaper medications, or forego writing a prescription altogether. If doctors changed their prescribing habits on a wide scale, it could help to reduce overall spending on prescription drugs, both for individual consumers and for the government.
- Doctors are often happy to receive the information. It allows them to write a cheaper prescription for a patient and be sure that the quality of care is the same.
Question: Why is Pennsylvania spending taxpayer dollars to fund an “unsales” program?
While individual consumers pay for the majority of drug spending, government programs that assist consumers (like Medicare Part D) have seen their costs increase exponentially.
- 21.5% of spending on prescription drugs is paid for by the government, with many states spending a sizable sum of their budgets on prescription drug plans that aid Medicare recipients.
- Pennsylvania contributed $338 million in 2006 to cover Medicare Part D prescription benefits for the nearly 360,000 elderly enrollees in the state. This amount has increased by 30% in the last decade.
In an effort to reduce the state’s spending on the prescription drug program, Pennsylvania invests $1 million annually (since 2005) to run the Independent Drug Information Service (IDIS). The IDIS employs 11 “unsales” representatives, whith is just a fraction of the 90,000 representatives employed by drug makers.
Question: What is the result in Pennsylvania?
While the verdict is out on whether unsales programs are more cost-effective than other measures used to reduce drug spending, the Pennsylvania program more than pays for itself in savings.
Question: Are unsales pitches a smart use of government resources that reduce pharmaceutical influence and cut program expenses, or are they an example of unnecessary government involvement in the marketplace?
Feel free to post your response below.
More on the steps that hospitals, providers and different branches of government are taking to reduce the influence of pharmaceutical sales representatives on prescribing practices to come…