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Booming Sales Of Unapproved Drugs: Do We Need “Safe In India” Campaign For Medicines?

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“To sin by silence when they should protest makes cowards of men”                      - Abraham Lincoln

Not just the Federal Drug Administration of the United States (USFDA), global concerns are being expressed regularly about the laxity of drug regulatory and clinical trial standards in India, exposing patients to health safety related risks.

The problem is significantly more with the Fixed Dose Combination (FDC) Drugs for various reasons. This is worrisome because; the domestic market for FDCs is very large and growing much faster, in sharp contrast to the western world. For example, in 2011-12 FDCs accounted for more than half of all NSAID and oral anti-diabetic drug sales, and one-third and one-fifth of anti-psychotic and anti-depressant/benzodiazepine sales, respectively, according to a recent study.  Both the domestic and multi-national pharma players market FDCs in India

Alarmingly, a plethora of FDCs unapproved by the drug regulators of India on their rationality, efficacy and safety, have flooded the domestic pharma market, in large quantities.

All such drugs are being actively promoted by the respective pharma players, widely prescribed by the doctors, openly sold by the chemists and freely consumed by the patients without any apprehension or having no inkling of the magnitude of the possible health hazards that such drugs might cause, both in short and long term.

Public health safety hazard arising out of this scenario does not seem to have ever been estimated by the Indian drug regulators, despite indictments even by the Parliamentary Standing Committee, nor is there any properly functional system in place to capture such data for meaningful analysis.

As the saying goes ‘better late than never’, a credible report on this menace has just been published on May 12, 2015 by independent experts, which I shall discuss in this article.

Is the situation out of control?

On the ground, the situation seems to be out of control of even the Central Drugs Standard Control Organization (CDSCO).

This is vindicated by a March 2013, written reply of the Minister for Health and Family Welfare, where the Government reportedly informed the Lok Sabha (the lower House of the Parliament) that in twenty three cases of new FDC, licenses have been granted by the State Licensing Authorities (SLAs) without the mandatory approval of the DCGI and action will be taken in all these cases.

However, no one seems to know, as yet, what action the Government has taken against those errant officials.

The latest investigative report on the criticality of the situation:

The May 12, 2015 issue of “PLOS Medicine” – a Peer-Reviewed Open-Access Journal, published the results of an investigation on CDSCO approval for and availability of oral FDC drugs in India from four therapeutic areas – analgesia (non-steroidal anti-inflammatory drugs (NSAIDs), diabetes (metformin), depression/anxiety (anti-depressants/benzodiazepines), and psychosis (anti-psychotics).

This study was done based on the Department Related Parliamentary Committee on Health and Family Welfare’s 2012 Report, stating that manufacturing licenses for large numbers of FDCs had been issued by state authorities without prior approval of the CDSCO in violation of rules, and considered that some ambiguity until 1 May 2002 about states’ powers might have contributed to this worrying consequences.

I shall also discuss the above Parliamentary Committee report in this article.

Booming sales of unapproved drugs: 

‘PLOS Medicine’ report highlighted the following:

A. They obtained information on FDC formulations approved between1961 and 2013 in each therapeutic area from the CDSCO.

B. FDC sales details were obtained for the period 2007 to 2012 from PharmaTrac database of drug sales in India. Over the five years included in the time-trend analysis, FDCs accounted for an increasing proportion of total sales volumes. By 2011–2012, FDCs accounted for more than half of all NSAID and oral anti-diabetic drug sales, and one-third and one-fifth of anti-psychotic and anti-depressant/benzodiazepine sales, respectively.

C. Of the 175 FDC formulations marketed in India in the therapeutic areas studied, only 60 (34 percent) were approved. 

Out of these, percentages of approved formulations are as follows:

-       80 percent of 25 marketed metformin FDC formulations

-       27 percent of 124 NSAID FDC formulations

-       19 percent of 16 anti-depressant/benzodiazepine FDC formulations

-       30 percent of 10 anti-psychotic FDC formulations

D. In 2011–2012, percentages of FDC sales volumes arising from unapproved formulations was:

-       43 percent for anti-psychotics

-       69 percent for anti-depressants/benzodiazepines

-       28 percent for NSAIDs

-       0.4 percent for metformin

E. Formulations including drugs of which use is banned or restricted internationally accounted for 13.6 percent and 53 percent of NSAID and anti-psychotic FDC sales, respectively.

F. While “ambiguity” in the rules prior to 2002 was advanced as a reason for some FDCs having been marketed without a record of central approval, the researchers identified no ambiguity, and in fact, following an amendment to the rules in May 2002 that extended the requirements on approval applicants, new FDCs continued to be marketed without a record of central approval.

The suggestions:

The ‘PLOS Medicine’ report concluded with the following suggestions:

Unapproved formulations should be banned immediately, prioritizing those withdrawn or banned internationally, and undertaking a review of benefits and risks for patients.

To ensure long-term safety and effectiveness of new medicines marketed in India, as well as transparency of the approval process, amendments in India’s regulatory processes and drug laws are called for. A review should be undertaken of the safety and effectiveness of FDCs currently available in India.

Indian lawmakers too pointed out this embarrassing regulatory laxity:

This saga of drug regulatory laxity in general and for the FDCs in particular, is continuing since quite a while. This is despite the fact that the Department Related Parliamentary Committee on Health and Family Welfare presented its 59th Report of 118 pages in total on the functioning of the Indian Drug Regulator – the Central Drug Standards Control Organization (CDSCO) in both the houses of the Parliament on May 08, 2012.

The report begins with a profound observation:

Medicines apart from their critical role in alleviating human suffering and saving lives have very sensitive and typical dimensions for a variety of reasons. Prescription drugs are the only commodities for which the consumers have no role to play. Nor are they able to make any informed choices, except to buy and consume whatever is prescribed or dispensed to them, because of the following reasons:

  • Drug regulators decide which medicines can be marketed
  • Pharma companies either produce or import drugs that they can profitably sell
  • Doctors decide which drugs and brands to prescribe
  • Consumers are at the mercy of external entities to protect their interests

The ‘Mission Statement’ of CDSCO is ‘Industry Oriented’ and not ‘Patient Focused:

Very interestingly, the lawmakers’ report highlights, citing the following examples, how out of line the ‘Mission Statement’ of CDSCO is, as compared to the same of other countries, by being blatantly industry oriented instead of safeguarding Public Health and Safety interests :

Drug Regulator

The ‘Mission Statement’
1.

CDSCO, India

 Meeting the aspirations…. demands and requirements of the pharmaceutical industry.
2.

USFDA, USA

 Protecting the public health by assuring the safety, efficacy, and security of human and veterinary drugs.
3.

MHRA, UK

 To enhance and safeguard the health of the public by ensuring that medicines and medical devices work, and are acceptably safe.
4.

TGA, Australia

 Safeguarding public health & safety in Australia by regulating Medicines…

Consequently, the Parliamentary Committee took a strong exception for such utter disregard and continued neglect of patients’ interest by the Drug Regulator of India. It recommended immediate amendment of the ‘Mission Statement’ of CDSCO incorporating in very clear terms that the existence of the organization is solely for the purpose of protecting the best interest of patients and their safety. It is needless to say, thereafter it would call for its stringent conformance with high precision.

A scathing remark against CDSCO:

The parliamentary Committee report made the following scathing remarks on CDSCO in its point 2.2:

“The Committee is of the firm opinion that most of the ills besetting the system of drugs regulation in India are mainly due to the skewed priorities and perceptions of CDSCO. For decades together it has been according primacy to the propagation and facilitation of the drugs industry, due to which, unfortunately, the interest of the biggest stakeholder i.e. the consumer has never been ensured.”

Allegation of possible collusion:

The report also deliberates not only on the utter systemic failure of CDSCO along with the DCGI’s office to enforce the drug regulations effectively, but also towards a possible collusion between CDSCO and the pharmaceutical industry to implement a self-serving agenda by hoodwinking the system. This is a very serious allegation, which needs to be thoroughly probed and the findings of which should be made public for everybody’s satisfaction.

The committee, therefore, felt that effective and transparent drug regulation, free from all commercial influences and callous enforcement of rules and laws, are absolutely essential to ensure safety, efficacy and quality of drugs keeping just one objective in mind, i.e., welfare of patients.

Do we need “Safe in India” campaign for drugs?

Do we need a well-hyped “Safe in India” campaign for drugs? Looking around, at least conceptually, the answer is probably ‘yes’…Seriously…I am not joking!

The reason being, despite scathing remarks of the Parliamentary Standing Committee in 2012, apparently no systematic enquiry has been undertaken by the CDSCO to ascertain the reason for continuation and the veracity of this menace, just yet.

A very significant number of unapproved medications still remain undetected by the drug regulators and continue to be abundantly available, frequently prescribed, openly sold and freely consumed by the patients without even an iota of doubt regarding possible health safety hazards that these prescription drugs might cause.

May 2015 ‘PLOS Medicine’ Report helps unraveling the underbelly of the drug regulatory scenario in India, along with its systemic decay, which fails to halt the possible serious health safety hazards that Indian patients are exposed to.

India’s image as an emerging ‘pharmacy of the world’ for cheaper generic drugs has already been dented with a number of ‘import bans’ from the US and UK for flouting the specified drug manufacturing quality standards.

The saga of ‘import bans’ for Indian drugs, together with this critical health safety related menace, probably necessitates an effective launch of a “Safe in India” campaign for medicines, in general, by the Government.

This initiative gains additional importance, as painstakingly developed reputation of the Indian drug exporters, including the largest domestic players, has now been dented. It needs to be revamped, sooner.

I addressed a related issue in my blog post of February 3, 2014, titled “FDA ‘Import Bans: Valuing Drug Supply Chain Security For Patients’ Safety.”

Conclusion:

Effective resolution of this critical issue demands high priority at the highest level of the decision making process of the Government, with commensurate sense of urgency.

Keeping that in mind, would it be a bad idea, if just like “Make in India” campaign of the Prime Minister; “Safe in India” campaign for medicines is also undertaken with equal gusto and monitored by the top echelon of the country’s rejuvenated governance machinery?

This initiative would probably help sending the very contextual ‘shape up or ship out’ signal to the drug regulators, both at the Center and also in the States to erase the prevailing menace for good.

In that process, it would eventually allay the public health safety concern with the ‘Made in India’ drugs, coming out of ‘Make in India’ campaign, not just in the country, but also beyond its shores.

The speed of action in this situation is the essence. Otherwise, the following golden words of wisdom as enunciated by Abraham Lincoln would keep haunting us, till the remedial measures taken by the Government become palpable on the ground:

“To sin by silence when they should protest makes cowards of men”

By: Tapan J. Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

Pharma Sales Communication: Would ‘Cafeteria Approach’ Be More Productive Today?

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For sales communication, quality of access of pharma Medical Representatives (MRs) to many important and busy doctors has been steadily declining over the past several years, all over the world, and India is no exception.

This is mainly because the number of patients coming to these busy practitioners is fast increasing and the doctors are trying to see all these patients within the same limited time that was available to them in even earlier days. In tandem, their other obligations of various kinds, personal or otherwise, are also overcrowding the same highly squeezed time space.

In a situation like this, increasing number of MRs, which has almost doubled in the past decade, is now fiercely competing with each other to get a share of lesser and lesser available time of the busy doctors.

Added to this, a gross mismatch between the inflow of doctors with similar prescription potential and ever increasing inflow of patients, is making the situation even worse.

According to a study done by CMI Communication Media Research, about half of physicians restrict visits from MRs in one-way or another.

Thus the critical question that needs to be answered now, from purely pharma sales and marketing perspective is:

How to make sales communication effective to such busy medical practitioners in this extremely challenging scenario?

Pharma players are trying to respond:

This pressing issue has prompted many pharma companies, across the globe, to reevaluate their traditional sales communication models, which are becoming increasingly expensive as a result of diminishing commensurate returns from the MR calls.

Some drug companies have also introduced interesting digital interventions, though within the same traditional pharma sales communication process, to add speed and novelty, especially in sales administration and its execution processes.

Experimentations are visible even in India:

In India too, pharma companies are trying with several different approaches, in various combinations to make the prescription generation process through sales communication more productive.

Some pharma players also tried to push up the overall sales productivity through additional rural market coverage. In this regard, a 2012 report of ‘IMS Consulting’ states, acknowledging the seriousness around rural consumers, many drug companies in India are now expanding their sales operation to Tier IV cities and below. Quite a few of them even succeeded in their endeavor to create profitable business models around the hinterland and rural geographies.

These pharma players believe that extra-urban geographies require different approaches, though with the same traditional sales communication models. These approaches include, different product portfolio, distribution-mix, pricing/packaging and promotional tools, considering majority of the doctors are not as busy as their counterparts in the metro cities and large towns.

Initial strategic changes:

The above ‘IMS Consulting’ paper also highlights a few of the initial changes in the following lines:

  • Business Unit Structure (SBU): To bring more accountability, manage evolving business needs and use equity of organization for reaching to the middle of the accessible pyramid.
  • Therapy Focus Promotion: Generally seen where a portfolio is specialized, therapy focused, and scripts are driven through chosen few doctors; generally in chronic segment.
  • Channel Management: Mostly adopted in OTC /OTX business; mature products with wider portfolio width.
  • Hospital Task Force: Exclusively to manage hospital business.
  • Specialty Driven Sales Model: Applicable in scenarios where portfolio is built around 2 or 3 specialties.
  • Task Force: Generally adopted for niche products in urban areas, such as fertility clinics or for new launches where the focus is on select top rung physicians only.
  • Out-Sourced Sales Force: Generally used for expansion in extra-urban geographies or with companies for whom medico marketing is secondary (such as OTC or Consumer Healthcare companies).

Pharma MNCs took greater strides:

In addition, to increase sales revenue further, many innovator pharma MNCs engaged themselves in co-promotion of their patented products, besides out-licensing. A few of them pushed further ahead by adopting newer innovative promotional models like Patient Activation Teams, Therapy Specialists, or creating patient awareness through mass media.

Brand value augmentation offering a mix of tangibles and intangibles:

Realizing quickly that patients are increasingly becoming strong stakeholders in the business, some of the pharma MNCs also started engaging the customers by extending disease management services to patients administering their products.

This is indeed a clever way of augmenting the brand perception, through a mix of well-differentiated tangible and intangible product related value offerings.

These pharma MNCs engage even the patients by providing a basket of services at their home. Typical services include:

  • Counseling
  • Starter kits
  • Diagnostic tests
  • Medical insurance
  • Personalized visits
  • Exercising equipment
  • Emergency help
  • Physiotherapy sessions
  • Call centers for chronic disease management

Related doctors are reported about the status of the patients and the patients do not require paying anything extra for availing these services from the MNC pharma companies.

Despite all these, declining productivity of the traditional pharma sales communication models continue, predominantly from the extremely busy and very high value medical practitioners/experts/specialists, as mentioned above.

Communication preferences of busy doctors need to be factored-in:

From the above facts, it appears that pharma sales communication is usually tailored to focus on customer/market types and characteristics, rather than emerging unique customer preferences towards medium of sales communication and also differentiated message requirements for specific brands.

Should status quo be maintained?

Probably not, as many still believe that MR’s quality of access to doctors for productive sales communication would continue to remain a critical issue and become increasingly complex.

Even in this changing scenario, pharma companies, by and large, have kept the basic communication medium and traditional process of messaging unchanged, except some digital tweaking here or there. Some of these innovative means and user-friendly digital interfaces, at times, may attract quality attention to sales communication for top of mind brand recall by the doctors.

Is it enough? Again, probably not, as there is an urgent need to exploring various other medium and new ways of delivering strong and effective tailor-made brand messages, based on hard data of painstaking research.

e-marketing started taking roots, though in bits and pieces:

In 2013, facing this challenge of change, Pfizer reportedly started using digital drug representatives to market medicines, leaving the decision in doctors’ hands as to whether they would want to see them.

Prior to that, in 2011, a paper published in the WSJ titled, “Drug Makers Replace Reps With Digital Tools” stated that pharmaceutical companies in the United States are downsizing their sales force with increasing usage of iPad applications and other digital tools for interacting with doctors.

Lot many other fascinating experimentations with pharma e-marketing have now commenced in several places of the world, many with considerable initial success.

However, most of these efforts seem to be swinging from one end of ‘face-to-face’ sales communication with doctors, to the other end of ‘cyber space driven’ need-based product value sharing with customers through digital toolkits.

Two key questions:

All these experimentations and developments with various pharma sales communication models would probably prompt the following two key questions:

  • Whether or not traditional sales approach would continue to be as relevant as opposed to digitally customized sales applications?
  • Whether or not MRs would continue to remain as relevant in all areas of pharma prescription generation process, in the years ahead?

Not an ‘Either/Or’ situation:

According to AffinityMonitor™ 2014 Research Report, pharmaceutical and biotech companies have today at their disposal more than a dozen of promotional channels to include in their strategy, including traditional methods, like detailing and speaker programs, and digital ones, including email, microsites and videos.

The report states, every doctor engages with these channels in his or her own unique manner. Some physicians want to interact with MRs; others restrict MR details and instead get information from their peers. One doctor might regularly use a mobile application for product information, often during a patient consultation. Conversely, another physician, who might work in the same practice, would rarely wish to surf the Web for information. And some doctors simply won’t engage with any sales communication no matter what the channels are.

Thus, ‘one size fits all’ type of sales communication, delivered even by the best of MRs, is not likely to be productive in the changing macro environment.

Many facets of communication preferences:

Today, there are many facets of doctors’ choices and preferences to brand value communication medium.

As AffinityMonitor 2014 Research Report states, based on the availability of time and interest, each doctor engages with these channels in his or her own unique manner. For example, some doctors may want to interact with the MRs, while some others may restrict MR’s product details. A few others may prefer getting information from their peers, instead

Since doctors’ engagement with pharma brands is critical for the drug companies, it has now become absolutely imperative for them to know individual affinities of the doctors in this regard, or what channels and processes each physician would typically prefer to get engaged with a brand, directly or indirectly.

Pharma companies should, therefore, gather this particular information doctor-wise, to customize both the medium and the message for effective brand value communication, accordingly.

A shift to ‘Cafeteria Approach’:

Taking all the above research inputs into consideration, it appears, when many busy physicians’ doors appear closed to traditional pharma sales communication, drug companies should have the keys to unlock them with ‘Cafeteria Approach’ of sales communication, purely based on customer research. This approach would offer the ‘difficult to meet doctors’ a variety of choices regarding both the medium and also the message, that would best suit their temperaments, needs, time and interests, as discussed above.

It is important to repeat, to ensure productive outcome of the ‘Cafeteria Approach’, customized sales communication strategy for each important and otherwise busy doctor should purely be based on contemporary customer research.

Sales force remains the top channel out of several others:

According to AffinityMonitor Research Study, though MR’s quality access to busy doctors has declined steadily over the past decade, the sales force still remains the top channel for physician engagement, closely followed by ‘Digital’ ones.

Overall, around 47 percent of all Health-Care Providers (HCPs) consider ‘face-to-face’ promotion as one of the top three channels, which includes about 80,000 physicians, who favor the sales force as their second or third-strongest channel.

Of the 514,000 HCPs examined in AffinityMonitor Research Study, 162,000 show the strong affinity for ‘face-to-face’ promotion, 118,000 for digital push and 65,000 for digital pull or personal remote channels.

Increasing just ‘Sales Force Effectiveness’ not enough:

Thus, generally speaking, even the best of global sales force excellence programs could at best increase the MR productivity primarily for these 47 percent of doctors.

Brand sales communication reach and effectiveness to a large number of rests of the doctors would, therefore, call for innovative thinking and willingness to chart the uncharted frontiers.

Conclusion:

The decline in pharmaceutical MR’s quality of access to physicians for sales communication is now well documented. For example, in 2008, 23 percent of US doctors had restrictions on MRs, but that number rose to 49 percent in 2014, according to AffinityMonitor Research Study.

Therefore, the knowledge of whether a doctor would like to engage with traditional sales communication method by seeing a MR, or would just prefer to get his/her required information through any digital medium, is critical for success in the new ball game of generating increasing number prescriptions for any pharma brand.

Majority of the doctors’ choices would, in all probability, involve MRs, while a notable number of other choices may probably be independent of MRs.

In any case, that’s not going to be the main issue, as MRs are not going to disappear – not in any foreseeable future and would continue to remain a critical part of the overall pharmaceutical selling process, all over the world.

However, closely following the emerging trend, I reckon, ‘Cafeteria Approach’ is worth considering for effective customized brand communication, ensuring productive sales outcome.

By: Tapan J. Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

 

 

No More Payment for Prescriptions: Pharma at A Crossroads?

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  • “ARE there different and more effective ways of operating than perhaps the ways we as an industry have been operating over the last 30, 40 years?”
  • “TRY and make sure we stay in step with how the world is changing.”

Those are some introspective outlooks of Sir Andrew Witty – the Chief Executive of GlaxoSmithKline (GSK) related to much contentious pharmaceutical prescription generation processes now being practiced by the drug industry in general, across the world.

The ‘Grand Strategy’ to effectively address these issues, in all probability, was still on the drawing board, when Sir Andrew reportedly announced on December 16, 2013 that GSK:

  • Will no longer pay healthcare professionals to speak on its behalf about its products or the diseases they treat to audiences who can prescribe or influence prescribing.
  • Will stop tying compensation of sales representatives to number of prescriptions the doctors write.
  • Will stop providing financial support to doctors to attend medical conferences.

These iconoclastic intents, apparently moulded in the cast of ethics and values and quite possibly an outcome of various unpleasant experiences, including in China, is expected to take shape worldwide by 2016, as the report indicates.

Acknowledgment of unbefitting global practices:

Reacting to this announcement, some renowned experts, as quoted in the above report, said, “It’s a modest acknowledgment of the fact that learning from a doctor who is paid by a drug company to give a talk about its products isn’t the best way for doctors to learn about those products.”

The world envisages a refreshing change:

A December 11 article in the Journal of American Medical Association (JAMA) stated that there exists a serious financial ‘Conflict of Interest (COI)’ in the relationship between many Academic Medical Centers (AMCs) and the drug and medical device industries spanning across a wide range of activities, including:

  • Promotional speakers
  • Industry-funded ‘Continuing Medical Education (CME)’ programs
  • Free access of sales representatives to its faculty, trainees and staff
  • The composition of purchasing and formulary committees

Such types of relationships between doctors and the pharmaceutical companies across the world, including in India, as studies revealed, have been custom crafted with the sole purpose of influencing prescription behavior of doctors towards more profitable costlier drugs, many of which offer no superior value as compared to already available cheaper generic alternatives.

Cracking the nexus is imperative:

Yet another report says, “Ghost-writing scandals, retracted journal papers, off-label marketing settlements, and a few high-profile faculty dust-ups triggered new restrictions at some schools.”

To address this pressing issue of COI, cracking the Doctor-Industry alleged nexus, which is adversely impacting the patients’ health interest, is absolutely imperative. An expert task force convened by the ‘Pew Charitable Trusts’ in 2012, made recommendations in 15 areas to protect the integrity of medical education/training and the practice of medicine within AMCs.

Some of those key recommendations involving relationships of medical profession with pharmaceutical companies are as follows:

  • No gifts or meals of any value
  • Disclosure of all industry relationships to institutions
  • No industry funded speaking engagement
  • No industry supported Continuing Medical Education (CME)
  • No participation at industry-sponsored lectures and promotional or educational events
  • No meeting with pharmaceutical sales representative
  • No industry-supported clinical fellowships
  • No ghostwriting and honorary authorship
  • No ‘Consulting Relationship’ for product marketing purpose

The above report also comments, “if medical schools follow new advice from a Pew Charitable Trusts task force, ‘No Reps Allowed’ signs will soon be on the door of every academic medical center in the United States.”

MNC pharma associations showcase voluntary ‘Codes of Marketing Practices’: 

Most of the global pharma associations have and showcase self-regulating ‘Codes of Pharmaceutical Marketing Practices’. However, the above GSK decision and hefty fines that are being levied to many large global companies almost regularly in different countries for marketing ‘malpractices’, prompt a specific question: Do these well-hyped ‘Codes’ really work on the ground or are merely expressions of good intent captured in attractive templates and released in the cyberspace for image building?

Global status overview:

In this context an updated article of December 11, 2013 states that Medical Faculty, Department Chairs and Deans continue to sit on the Board of Directors of many drug companies. At the same time, many pharma players support programs of various medical schools and teaching hospitals through financial grants.  Company sales representatives also enjoy free access to hospital doctors to promote their products.

In most states of the United States, doctors are required to take accredited CMEs. The pharmaceutical industry provides a substantial part of billions of dollars that are spent on the CME annually, using this support as marketing tools. This practice is rampant even in India.

The above article also highlights incidences of lawsuits related to ‘monetary persuasion’ offered to doctors. In one such incidence, two patients reportedly fitted with faulty hips manufactured by Stryker Orthopedics discovered that the manufacturer paid their surgeon between US$ 225,000 and US$ 250,000 for “consultation services,” and between US$ 25,000 and US$ 50,000 for other services.

However, since August 2013, ‘Physician Payment Sunshine Act’ of the United States demands full disclosure of gifts and payments made to doctors by the pharma players and allied businesses. Effective March 31, 2014, all companies must report these details to the Centers for Medicare & Medicaid Services (CMS), or else would face punitive fines as high as US$1 million per year. CMS would publish records of these payments to a public website by September 31, 2014. India needs to take a lesson from this Act to help upholding ethics and values in the healthcare system of the country.

Overview of status in India:

As reported by both International and National media, similar situation prevails in India too.

Keeping such ongoing practices in mind and coming under intense media pressure, the Medical Council of India (MCI) on December 10, 2009 amended the “Indian Medical Council (Professional Conduct, Etiquette and Ethics), Regulations 2002″ for the medical profession of India. The notification specified stricter regulations for doctors in areas, among others, gifts, travel facilities/ hospitality, including Continuing Medical Education (CME), cash or monetary grants, medical research, maintaining professional Autonomy, affiliation and endorsement in their relationship with the ‘pharmaceutical and allied health sector industry’.

However, inability of the Indian regulator to get these guidelines effectively implemented and monitored, has drawn sharp flak from other stakeholders, as many third party private vendors are reportedly coming up as buffers between the industry and the physicians to facilitate the ongoing illegal financial transactions, hoodwinking the entire purpose, blatantly.

Moreover, it is difficult to fathom, why even four years down the line, the Department of Pharmaceuticals of the Government of India is yet to implement its much hyped ‘Uniform Code of Pharmaceutical Marketing Practices (UCPMP)’ for the entire pharmaceutical industry in India. 

Learning from other self-regulatory ‘Codes of Pharma Marketing Practices’, in my view, a law like, ‘Physician Payment Sunshine Act’ of the United States, demanding public disclosure of gifts and all other payments made to doctors by the pharma players and allied businesses, would be much desirable and more meaningful in India.

Conclusion:

Research studies do highlight that young medical graduates passing out from institutions enforcing gift bans and following other practices, as mentioned above, are less likely to prescribe expensive brands having effective cheaper alternatives.

The decision of GSK of not making payments to any doctor, either for participating or speaking in seminars/conferences, to influence prescription decision in favor of its brands is indeed bold and laudable. This enunciation, if implemented in letter and spirit, could trigger a paradigm shift in the the prescription demand generation process for pharmaceuticals brands.

However, this pragmatic vow may fall short of stemming the rot in other critical areas of pharma business. One such recent example is reported clinical data fabrication in a large Japanese study for Diovan (Valsatran) of Novartis AG. Had patient records been used in their entirety, the Kyoto Heart Study paper, as the report indicates, would have had a different conclusion.

That said, if all in the drug industry, at least, ‘walk the line’ as is being demarcated   by GSK, a fascinating cerebral marketing warfare to gain top of mind brand recall of the target doctors through well strategized value delivery systems would ultimately prevail, separating men from the boys.

Thus, the moot point to ponder now:

Would other pharma players too jettison the decades old unethical practices of ‘paying to doctors for prescriptions’, directly or indirectly, just for the heck of maintaing ethics, values and upholding patients’ interest?

By: Tapan J. Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

 

‘e-detailing’: The Future of Pharmaceutical Sales?

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Pharmaceutical product detailing to doctors by Medical Representatives (MRs) is believed to fetch the single largest return on marketing investments by the pharmaceutical companies globally, as on date.

At the same time, the pharma players, across the world, are increasingly experiencing that the costs of product detailing by the MRs to the doctors are not now quite commensurate to the desired return in terms of financial results, despite bringing in many new skills and other productivity improvement measures on a regular basis.

Thus, to make such interaction between the MRs and the doctors more productive and cost efficient, increasingly the global pharmaceutical industry has been exploring various models and methods with numerous state-of-art digital Internet based applications. Some pharmaceutical companies, especially, from the western world, have already started putting such innovation into practice.

Waning productivity of traditional detailing:

This is quite apparent now that due to changing market dynamics and increasingly busy schedules of the doctors, the productivity of traditional product detailing is fast waning. As a result, pharmaceutical companies are encountering huge challenges in the process of generating prescription demand for their respective products by taking commensurate share of mind of the Physicians.

This is mainly because, the number of patients is also now fast increasing and the doctors are trying to see these large numbers of patients within their limited available time. As a result each patient is getting lesser doctors’ time, while the doctors are trying to provide optimal patient care in each patient visit. At the same time, other obligations of various kinds also overcrowd physicians’ time.

As a result, increasing number of MRs, which has almost double in the past decade, is now fiercely competing to get a share of lesser and lesser available time of the doctors. Added to this, increasing inflow of new doctors not being in line with the increasing inflow of patients is making the situation even worse.

As stated earlier, significant expenditure that the pharma companies have been incurring towards product detailing, many of them feel, is not resulting into desired top and bottom line growth for the organization, any more. Even good numbers of important specialist doctors do not seem to value this traditional MR product detailing process any longer, mainly due to immense time pressure on them and also due to their easy access to other modern product information gathering tools.

What is happening today:

Today, keeping the core concept of traditional detailing unchanged a few, especially large pharmaceutical companies in India, have introduced a number of digital interventions to eliminate some important manual processes that MRs used to follow earlier like, call planning, access to other relevant information electronically, instant reporting etc. 

Such incremental improvements in the traditional detailing model, though helpful to the MRs, do not seem to be just good enough to produce desired business results in today’s highly competitive environment. The time calls for radical technological interventions.

A new report on the trend: 

According to a new study of CMI Communication Media research report, about half of physicians restrict visits from MRs in one way or another.

It reported, just half of cancer specialists (oncologists) saying that they would interact about new products with MRs, while 47% of them indicated email as a preference.

Surveys found the oncologists being the most restrictive specialists, with only 19% allowing MRs without restrictions. On the other hand, 20% of them would not see MRs at all, with the 40% in the middle either requiring appointments or limiting visits to particular hours of the day or week.

‘e-Detailing’:

The well known consulting company Mckinsey & Company in a paper titled, ‘Making sense of e-detailing in Japan’s pharmaceutical sector’ has defined e-detailing as follows:

“e-detailing or electronic detailing refers to interacting with physicians virtually rather than physically. It often takes place through a company’s own website or through a physician portal coupled with email- driven promotions and attached explanatory videos offering up-to-date pharmaceutical product information.”

Thus, in ‘e-detailing’ Internet-based communications applications are used to provide customized services to the doctors, in many times to complement the activities of MRs.

‘e-detailing’ is now evolving as a modern technological innovation in the field of communication between MRs and doctors. It is intended to be highly customized, very interactive, more effective, quite flexible and at the same cost-efficient too. Live analytics that ‘e-detailing’ would provide instantly could be of immense use in the strategizing process of pharmaceutical marketing.

Cost effectiveness of ‘e-detailing’:

In the same paper, as mentioned above, to highlight the cost advantages of ‘e-detailing’, McKinsey & company, from its Japan experience, has reported as follows:

“While accurate, apples-to-apples data is hard to come by, we estimate each    e-detail costs between 500 and 750 Yen, depending on the scope 
of audience and the sophistication 
of content. An MR costs 7,000 Yen 
to 12,000 Yen, depending on sector, region, and hospital vs clinic The ROI (return on investment) for MR detail is in the range up to ~20x, versus ~4-6x for e-detail. In other words, the cost structure allows for sustained ROI
 for e-detailing—even when extending reach beyond the top prescribing quintiles of physicians.”

In  the Japanese context, Mckinsey & Consulting further states:

“Right now, e-detailing in Japan is more often used at the beginning of a product’s lifecycle (i.e. to win attention during product launches) or at the end (i.e. to sell established products). These are what we call ‘stay in the race’ practices; necessary, but not sufficient.”

Perceived advantages of ‘e-detailing’:

The traditional way of detailing through ‘Visual Aids’ may not be good enough today when the available time with the doctor has come down drastically.  Just providing, by and large, the usual ‘one size fits all’ types of data/information to the doctors is gradually proving to be not effective and efficient enough to generate expected outcome. There is a dire need for helping these busy doctors to get access to drug information they value and trust at a time of their need and convenience.

Thus, the process of medical detailing should be made highly flexible depending on whatever time is chosen by each doctor to satisfy his/her specific needs.

In such an environment ‘e-detailing’, as discussed above, would help creating customized, more impressive, self-guided by doctors and more focused presentations with significant reduction in the detailing cost/ product with improved productivity.

Moreover, ‘e-detailing’ would:

  • Make expensive printed promotional aids redundant
  • Eliminate time required and cost involved to deliver such material
  • Have the flexibility of change at any time
  • Ordering of just required samples online, eliminating wastage

Fast increasingly number of doctors using computers and the Internet for professional purposes, especially in the urban areas, would facilitate this process.

Key success factor:

Experts believe, besides developing an effective and user-friendly tool for e-detailing, the important success factor for such initiative by a pharmaceutical company would well depend on:

  • Well planned integration of ‘e-detailing’ into the Customer Relationship Management (CRM) strategy
  • Deep understanding of physician segments
  • Efficient application of ‘e-detailing’ to support marketing goals.

The challenges:

Though there are many benefits for ‘e-detailing’, it throws some challenges too, as follows:

  • Still many doctors continue to prefer the personal touch of the MRs in traditional detailing
  • Some doctors do give prescription support to a company based on their good relationship with the concerned MRs
  • Despite hectic schedule, many busy doctors continue to take time out to interact with such MRs.

Though such relationships do not develop with all MRs, this challenge needs to be effectively overcome to make ‘e-detailing’ successful wherever possible, probably by creating an optimal mix of traditional and ‘e-detailing’.

A recent initiative:

Recent media reports highlight one such innovation, among many others. Pfizer has reportedly come out with an interesting innovation in the field of medical detailing to the primary care doctors.  This new service of the company ‘Ask Pfizer’ claims that it can provide promotional product information to the doctors at a time convenient to them. Thus the ‘digital medical representatives’ of Pfizer leave the decision as to whether they want to see them and if so, when.

‘Ask Pfizer’, featuring in the website called ‘Pfizerline’ of the company says that the system is:

  • Simple
  • Flexible
  • Convenient
  • Calls can be arranged to suit the doctors’ busy practice schedule
  • Online meeting room provides a rich multi-media interaction where the doctor can see trained country-specific’ digital representative making product presentations and also discuss the relevant subjects with them.

Pfizer is advertising this new service called ‘digital detailing’ on the British Medical Journal (BMJ) website aiming, reportedly, at the UK doctors.

This initiative is indeed innovative, as it creates an environment of direct marketing in an indirect way with the help of simple Internet applications like Skype.

Conclusion:

Like many other industries, in the pharmaceutical industry too, across the world, communication of relevant information in an interesting way is of utmost importance. Here also. Indian pharmaceutical industry is no exception.

Since ages, the pharma players in India, in general, have been continuing to follow the traditional model of product detailing, hoping to generate more and more prescriptions from the doctors by deploying a larger and larger contingent of MRs, who highlight superiority of their respective products over competition.

Some may argue, there is nothing wrong in this model, but question would arise, is it still as productive as it used to be? This is mainly because, the doctors are now giving lesser and lesser time to the MRs.

Those pharmaceutical companies of the country who sincerely believe that innovative use of technology in the digital world of today may considerably help addressing this issue, at least in the urban areas, would possibly get a head start, as they delve into the future for business excellence in this area.

With e-detailing they will be able to provide an interesting communication option to the top-prescribers having a very busy schedule for top of mind recalls of their respective brands, leading hopefully to increase in prescription generation.

It is worth noting, though ‘e-detailing’ is emerging as an important innovation in the field of product detailing, there are still some questions that need to be answered. Some of these questions could be as follows:

  • Would many doctors prefer to schedule time for this purpose after a busy day’s schedule?
  • Would the information overload from other sources not keep them away from seeking more information through such a process?

Taking all these into consideration, the question that we need to answer:             Is ‘e-detailing’ the future of pharmaceutical sales, also in India?

By: Tapan J. Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

After Mollycoddling China Cracks Down on Pharma MNCs…But Why Now?

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In tandem with exemplary growth in the healthcare sector, China has started confronting with some consequential hazards in form of serious regulatory violations involving, besides many others, hospitals, pharmaceutical pricing and food and drug safety, which reportedly include contaminated milk powder and rat meat sold as mutton.

A recent report indicates, there are rampant kickbacks at various stages in the healthcare delivery process. For example, hospitals get kickbacks from drug and device companies, and hospital executives give a portion of these kickbacks to their doctors, involving even the pharma MNCs.

While looking back, in 1997, China took its first healthcare reform measures to mend the earlier not so good practices, when medical services used to be considered just as any other commercial product or services in the country. As a result, staggering healthcare expenses made Chinese medical services unaffordable and difficult to access for a vast majority of the local population.

In April 2009, China, a country with over 1.35 billion population, unfolded a blueprint of a new phase of healthcare reform to provide safe, effective, convenient and affordable healthcare services to all its citizens. An incremental budgetary allocation of US$ 124 billion was made for the next three years to achieve this objective.

The core principle of healthcare reform in China:

The core principle of the new phase of Chinese healthcare reform is to provide basic health care as a “public service” to all its citizens, where more government funding and supervision will play a critical role.

This reform process will ensure availability of basic systems of public health, medical services, medical insurance and medicine supply to the entire population of China. It was also announced that priority would be given to the development of grass-root level hospitals in smaller cities and rural China. The general population will be encouraged to use these facilities for better access to affordable healthcare services. However, public non-profit hospitals would continue to remain one of the important providers of medical services in the country.

Medical Insurance and access to affordable medicines:

Chinese government has planned to set up diversified medical insurance systems to provide basic medical coverage to over 90 percent of the country’s population. In tandem, the new healthcare reform measures will ensure better availability of affordable essential medicines at all public hospitals.

Highly lucrative healthcare business destination:

New Chinese healthcare reform process carries an inherent promise of a large additional spending worth billions of US dollars every year catapulting China as one of the most lucrative healthcare markets of the world.

China’s healthcare spending has reportedly been projected to grow from US$ 357 billion in 2011 to US$1 trillion in 2020.

Consequently, this huge investment has started attracting a large number of global companies of various types, sizes and nationality competing for the right size of their respective pies of profits.

In that process, as the media reports highlight, global pharmaceutical players started fast increasing both their top-line revenue and bottom-line profits from the booming Chinese healthcare market.

Pharma MNCs growing bigger, outpacing local industry:

Another report highlighted, “60% of China’s healthcare stimulus money ended up going to non-Chinese multinationals”. Quoting a recent JP Morgan report the article indicated AstraZeneca, Sanofi, Roche, GlaxoSmithKline, Novo Nordisk, Johnson & Johnson and Pfizer realized over 30 percent growth from their China operations in the early part of 2011.

With the slow down of business in Europe and in the United States, even large global pharmaceutical players like, Bayer, Sanofi, Novartis, Eli Lilly, Novo Nordisk and many more have reportedly invested huge resources for capacity building in sales and distribution channels, local manufacturing and R&D.

Chinese Government woke-up:

Kick starting the reform process and in the face of high level of corruption, Chinese government initiated monitoring the effective management and supervision of healthcare operations of not only the medical institutions, but also the health services, together with basic medical insurance system, in good earnest.

It has been reported, though the public hospitals will receive more government funding and be allowed to charge higher fees for quality treatment, they will not be allowed to make profits through expensive medicines and treatment, which has been a common practice in China.

Violations meted with harsh measures:

Accordingly, with increased vigil in many of these areas since last couple of years, Chinese regulators have started cracking down on the culprits, who are being meted out severe and harsh punishments, consequently.

In 2012, seven public hospital directors were reportedly sent to jails for accepting kickbacks. One corrupt drug regulator was even executed along with two food-company managers involved in a poisoned milk scandal, as the report mentions.

Pharma MNCs targeted for alleged corrupt practices:

As stated above, the new healthcare reform measures include regulation of prices of medicines and medical services, together with strengthening of supervision of health insurance providers, pharmaceutical companies and retailers.

China has now reportedly targeted Multinational Companies (MNCs) for allegedly corrupt practices, including price-fixing, quality issues and consumer rights. This has forced some MNCs to defend their reputations in China where global brands often have a valuable edge over local competitors in terms of public trust.

Recently, in an effort to reduce drug prices, China has initiated probes involving 60 drug manufacturers.

According to a recent report, to make the pricing system for medicines more effective, the regulatory agencies in China are investigating the costs and prices of drug manufacturers including global pharma majors like:

  • GlaxoSmithKline Plc (GSK)
  • Merck & Co.
  • Novartis AG
  • Baxter International Inc.

The regulators are expected to go through the details of 27 companies for costs and 33 companies for pricing, as per the July 2, 2013 statement posted on China’s National Development and Reform Commission’s (NDRC) Evaluation Center of Drug Pricing.

The report highlights that a possible impetus for the NDRC to probe into pricing and costs of domestic and foreign drug companies was the announcement of China’s National Essential Drugs List in March, which increased the items on the list to 500 from 305.

Clampdown on government spending:

To exercise control on public expenditure towards drugs, the government has also reportedly clamped down on drug spending, placing some foreign drug makers’ products under price controls for the first time.

Since 2011, the Chinese Government has reduced the drug prices four times, including 15 percent reduction earlier in 2013, though the price reduction will be as much as 20 percent for the expensive drugs. At the same time, the government has reduced tax rebates on investments.

Mr. Chen Zhu, Health Minister of China has reportedly expressed that healthcare in China is still too expensive and there is still inadequate control over improper use of drugs in the country.

Another report indicates that Nestlé, Abbott Laboratories and Danone are under investigation in China for “monopolistic” pricing.

Crackdown on bribery and kickbacks:

An article in a similar context mentions that the “Chinese police started an investigation into the Chinese unit of the biggest pharmaceutical manufacturers of UK – GlaxoSmithKline and Senior executives at the unit are suspected of ‘economic crimes”.

On the same subject, a different news report also indicates, a senior Glaxo finance executive in Shanghai and employees in Beijing were detained as part of a corruption investigation.

Recently a Chinese Security Ministry official has reportedly said that GlaxoSmithKline (GSK) executives in China have confessed to bribery and tax violations.

The same report quoting the ministry highlighted that the case against GSK involved a large number of staff and a huge sum of money over an extended period of time, with bribes offered to Chinese government officials, medical associations, hospitals and doctors to boost sales and prices. Concerned executives also used fake receipts in unspecified tax law violations.

Interestingly, earlier in 2012, Global CEO of GSK reportedly admitted that the company made “unacceptable” mistakes in “mismarketing” their antidepressants Paxil and Wellbutrin, which were the subject of a US$ 3 billion settlement with the Justice Department of the United States. At that time the CEO was reported to have said “very sorry” for the incident and “determined that this is never going to happen again.” 

Another very recent news highlights that currently China is investigating at least four pharma MNCs as it widens its probe. Chinese enforcers had suggested that these pharma companies were using the same tactics to boost their businesses in the country.

It is now learnt that anti-trust body of China - State Administration for Industry and Commerce (SAIC)  has also visited  Shanghai office of UCB. 

Happening elsewhere too:

Reports of similar alleged malpractices have started surfacing from elsewhere in the world too. For example, in Denmark, a country known for low incidence of corrupt practices, a Norwegian cardiologist was reportedly charged with taking 2 million kronor, or about US$ 350,000, from Merck and Pfizer, despite the fact, Danish law prohibits doctors from accepting money directly from the drug makers. The concerned doctor allegedly used the cash to buy expensive furniture and salmon-fishing holidays in his home country.

Last year, both the Department of Justice and the Securities and Exchange Commission of the United States reportedly charged Pfizer and its subsidiary Wyeth for paying millions of dollars in bribes to officials, doctors and healthcare professionals in Bulgaria, China, Croatia, Czech Republic, Italy, Kazakhstan, Russia, and Serbia during 2001-2007 in violation of the US Foreign Corrupt Practices Act. They had also set hefty fines on the two to settle the charges.

Conclusion:

To effectively address serious and longer term healthcare related issues of the country, the Chinese Government has already started implementing its new healthcare reform measures earnestly. Possibly to maintain equity, stay on course and uproot corrupt practices, they have now started cracking down on the violators in all seriousness, be they are from within the country or beyond its shores.

So far as the pharma MNCs are concerned, such harsh measures are being taken for alleged malpractices probably for the first time ever of this scale and that too with full media glare.

All these measures coupled with pricing pressure and gradual rise of local Chinese players, would make the Chinese market increasingly challenging to  pharma MNCs.

Some global players have already started feeling the scorching heat of tough Chinese measures. But China is too powerful a country and too lucrative a market for any entity to flex its muscle to stall the current juggernaut, at least, till the ‘Dragon’  achieves its objective of bringing down public healthcare expenditure to its expectations…Or is there more to the problem than meets the eye?

Thus, the key question emerges: 

Why has China, after mollycoddling the pharma MNCs for so many years, now started cracking down on them so hard?

By: Tapan J. Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.