The FDA recently held public hearings on the off-label advertising of approved medications and medical devices on November 9 and 10, 2016. “FDA is engaged in a comprehensive review of its regulations and policies governing firms’ communications about unapproved uses of approved/cleared medical products, and the input from this meeting will inform FDA’s policy development in this area.” There were specific questions asked at the hearing, but the FDA was also interested in “any other pertinent information participants would like to share.” If you weren’t able to be in Maryland for the hearing, electronic or written comments will be accepted until January 9, 2017. A videotape of the hearing will be available for one year afterwards.
Your initial reaction may be one of “Boring!” That is unless you are aware of the crossroads we are approaching with regard to the off-label advertising of medications and medical devices. On March 8, 2016, the FDA made a settlement agreement with the pharmaceutical company Amarin that allows the company to promote its drug Vascepa for off-label use. What is this important breakthrough medication? Vascepa is prescription strength fish oil. This action was the outcome of a struggle between Amarin and the FDA going back several years.
Amarin wanted to widen the population for whom they could recommend Vascepa to include patients with different cardiovascular diseases—patients other than what Vascepa was initially approved to treat. But the FDA ruled against their request. Amarin’s stock price took a nosedive. Concerned with how their investors were reacting, the company fought back by suing the FDA. Then in August of 2015, a judge ruled that Amarin could market its drug to the broader population. He also ruled the company could claim that Vascepa “may reduce the risk of coronary heart disease.” This was despite the fact that the FDA had called the claim misleading, as there was “supportive but not conclusive research” to that effect.
Amarin successfully argued that it had a First Amendment right to market its drug for a broader patient group, “despite the lack of regulatory approval and the lack of evidence of an outcomes benefit for patients.” Justin Karter noted how the FDA settlement strikes at the heart of the drug regulatory system in the U.S. Amarin argued that companies should have the right to market their products consistent with what “a judge would consider to be neither false or misleading.” Be clear on what Amarin was saying. A judge, not the FDA, should rule on whether or not the marketing claims by a pharmaceutical company for their product were truthful and not misleading.
Amarin argued that this system is unconstitutional, and that companies should instead be allowed to market their products in any way that a judge would consider to be neither false nor misleading.
Commenting on the FDA settlement agreement in Amrain Pharma v. U.S. Food & Drug Administration, lawyer and mental health advocate Jim Gottstein said he thought that for all practical purposes, the FDA ban against off-label promotion of drug companies was dead. He noted that the ruling in the Amarin case was based upon a 2012 decision in Unites States v. Caronia that reversed a criminal conviction for off-label promotion.
In light of the settlement I think it is fair to ask where things stand with the FDA’s enforcement of its ban against off-label promotion and Department of Justice prosecutions of drug companies for off-label promotion leading to false claims. I think the ban against off-label promotion is dead for all practical purposes. The FDA could try and get a different ruling in another circuit and, if successful, ask the Supreme Court to rule, but since it didn’t ask the Supreme Court to take the case in Caronia, it doesn’t seem likely that it has any intention of trying to overturn Caronia. This will give the drug companies free rein for off-label promotion. Of course, anything that is false or misleading is still grounds for charges, but that is a far harder case to make.
So if this is the supposed future for off-label drug advertising unless there is some radical change by Congress, let’s now take a look at the past—what has been taking place under the existing FDA rules. In his book Saving Normal, Allen Frances published a chart that he called the drug company “hall of shame.” Prepared by Melissa Raven, PhD, it listed the fines and settlements by Pharma companies for off-label promotion, marketing and fraudulent misbranding of 20 well know pharmaceuticals.
Here is a sampling of the companies and their total fines and settlements between 2004 and 2012 recorded in the Saving Normal chart. The fines and settlements listed below combine both civil and criminal cases. Johnson & Johnson ($1.44 billion); GlaxoSmithKline ($3 billion); Abbott ($1.5 billion); Novartis ($422.5 million); Forrest ($313 million); AstraZeneca ($520 million); Pfizer ($2.3 billion); Eli Lily ($1.415 billion); Bristol-Myers Squibb ($515 million); Purdue (almost $635 million). I think it’s clear why Pharma is going after the FDA. The sum total in fines and settlements from the chart was $12.06 billion in fines and settlements between 2004 and 2012.
On March 31, 2016, the nonprofit organization Public Citizen published an updated analysis of all major financial settlements and court judgments between pharmaceutical companies and the federal and state governments. The time period covered by their analysis ran from 1991 through 2015 and included 373 settlements for a total of $35.7 BILLION. Financial penalties have declined sharply since 2013. The most striking decrease occurred with criminal penalties. “For 2012 and 2013 combined, criminal penalties totaled $2.7 billion, but by 2014-2015, the total had fallen to $44 million, a decrease of more than 98%.”
From 1991 through 2015, GlaxoSmithKline and Pfizer reached the most settlements—with 31 each— and paid the most in penalties, $7.9 billion and $3.9 billion respectively. Six additional companies, Johnson & Johnson, Merck, Abbott, Eli Lilly, Teva, Schering-Plough, Novartis, and AstraZeneca paid more than $1 billion in financial penalties. Six of the above eight were listed in the top 14 pharmaceutical companies by global sales in 2014. Thirty-one companies entered repeat settlements. Pfizer (11), Merck (9), GlaxoSmithKline, Novartis, and Bristol-Myers Squibb (8 each) finalized the most federal settlements. It seems these fines were simply the cost of doing business.
Financial penalties continued to pale in comparison to company profits, with the $35.7 billion in penalties from 1991 through 2015 amounting to only 5% of the $711 billion in net profits made by the 11 largest global drug companies during just 10 of those 25 years (2003-2012). To our knowledge, a parent company has never been excluded from participation in Medicare and Medicaid for illegal activities, which endanger the public health and deplete taxpayer-funded programs. Nor has almost any senior executive been given a jail sentence for leading companies engaged in these illegal activities. Much larger penalties and successful prosecutions of company executives that oversee systemic fraud, including jail sentences if appropriate, are necessary to deter future unlawful behavior. Otherwise, these illegal but profitable activities will continue to be part of companies’ business model.
Since the U.S. approved direct-to-consumer advertising of prescription drugs in 1997, there has been a dramatic increase in spending on pharmaceuticals. A New England Journal of Medicine study by Donohue, Cevasco and Rosenthal in 2007 found that spending on pharmaceutical promotions increased from $11.4 billion in 1996 to $29.9 billion in 2005. This was a 330% increase. Promotion to physicians was still the primary marketing strategy, but spending on direct-to-consumer advertising increased both in absolute terms and as a percentage of pharmaceutical sales.
Becker and Midoun recently published an article that investigated the effects of direct-to-consumer advertising (DTCA) on patient prescription requests in the Journal of Clinical Psychiatry. Of the 989 articles they initially identified, they read full-text reviews of 69 articles, but only found four that met their inclusion criteria for investigating the consequences of these ads on prescription rates and treatment quality. They conclusion was: “Findings suggest that DTCA requests are typically accommodated, promote higher prescribing volume, and have competing effects on treatment quality.” They called for methodlogically stronger studies to increase the confidence in their conclusions.
Reporting for Mad in America on the study, Justin Karter noted where the U.S. is only one of three countries globally that allows DTCA. He said the pharmaceutical industry spent $3.83 billion on DTCA in 2013 and $4.53 billion in 2014. He also noted that the American Medical Association (here) and the American Society of Health-System Pharmacists (ASHP) (here) have called for a ban on DTCA. The AMA Board Chair, Patrice Harris, commented that physicians were concerned with the negative impact of DTCA and the role marketing costs play in fueling escalating drug prices. “Direct-to-consumer advertising also inflates demand for new and more expensive drugs, even when these drugs may not be appropriate.” The ASHP approved a new policy at their 2016 meeting that would advocated for Congress to ban DTCA for prescription drugs and medication-containing devices.
Pharmaceutical companies have whittled away at existing FDA regulations that restrict direct-to-consumer advertising. And they seem to be poised to begin an era of DTCA that will massively overshadow what has already taken place under the existing rules. Healthcare organizations representing physicians and pharmacists in the U.S. have publically voiced their opposition to DTCA. Individuals and organizations have an opportunity to voice their concern for this practice, which is implicated in the rising cost of healthcare and medications. Congress also has an opportunity to enact new legislation that would eliminate this predatory marketing practice. But it will have to overcome the horde of lobbyists—more than there are members of Congress—and the $272,000 in campaign donations Pharma spent per member of Congress in 2015.
