2015 Was a Golden Year for Pharma - Pharma Marketing Network

January 2016 Vol. 15, No. 1

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2015 Was a Golden Year for Pharma Epic Number of Drug Approvals, Orphan Drugs Galore, but Lite on FDA Enforcement Actions! Author: John Mack

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Pharma Marketing Network

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Pharma Marketing News

Vol. 15, No. 1: January 2016

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f you thought things couldn’t get much better for the pharmaceutical industry and pharma marketers after the banging year of 2014, then you’d be wrong! 2015 was even better as far as new drug approvals and lack of enforcement actions by the U.S. Food and Drug Administration (FDA) go. Recall that the FDA ended 2014 with a bang and a whimper (see here: http://bit.ly/1JMUN8O). In 2014, the agency approved a total of 41 new molecular entities (NMEs) and biologics (BLAs), which at that time, was the greatest number since 1996. That was the bang. FDA, however, also ended 2014 with a whimper as far as enforcement goes—the Agency sent out only a meager 10 advertising enforcement letters in 2014, the fewest ever. Another Banging Year! Enter 2015 during which the FDA approved 45 new drugs, four more than in 2014—again the highest number since 1996. Twenty-one (21) of those (47%) were “orphan” drugs. This compares to 17 orphan drugs approved in 2014 or 41% of the total (see Figure 1, below).

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Orphan Blockbusters Until a few years ago, if you asked a pharmaceutical company executive why his or her company developed and marketed an “orphan drug”—i.e., a drug for a disorder affecting fewer than 200,000 people in the U.S.—you would likely have gotten a response such as “because there is an unmet medical need” or something similar. Today, however, orphan drugs also have the potential to turn into blockbusters. That potential is being realized. As reported recently by CNBC (http://cnb.cx/1kUViSf), “Drugs approved by the Food and Drug Administration as ‘orphan drugs’ have seen sales increase from $46.6 billion in 2014 to $54 billion this year in the U.S. alone and are projected by drug industry consultant EvaluatePharma to reach above $60 billion in 2016. Worldwide, orphan drug sales are forecast to total $102 billion this year and $178 billion by 2020.” Orphan drug approvals are very profitable for the pharma industry, which often submits drugs to the FDA as orphan drugs but once approved, the drugs Continues…

Figure 1. FDA Drug Approvals (1994 through 2015). NME=New Molecular Entity, BLA=Biologic License Application; Source: FDA

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the drugs are “used broadly off-label with the lucretive orphan drug protections and exclusivity benefits,” according to the authors of a study from Johns Hopkins University School of Medicine recently published in the American Journal of Clinical Oncology (http://sco.lt/4pauhN). Seven of the top 10 drugs in global sales have received an orphan designation from the FDA. Crestor, for example, received an orphan drug designation for the treatment of pediatric homozygous familial hypercholesterolemia in 2014 (see Table 1, below).

Figure 2. FDA Warning vs. Untitled Letters (2010 through 2015)

Table 1. Orphan Blockbuster Drugs. Source: http://sco.lt/4pauhN Wimpy FDA Marketing Enforcement FDA’s Office of prescription Drug promotion (OPDP) continues to issue fewer and fewer Warning and Untitled Letters, which is good news for pharma marketers who are often blamed for the industry’s bad reputation among consumers and physicians (read, for example, “Anti-DTC Resurgence”; http://bit.ly/pmn140701h). In 2015, FDA sent out only 9 advertising enforcement letters (2 Warning Letters, 7 Untitled Letters), which beats last year’s record low of 10 letters. That was AFTER the Agency “yanked” a warning letter to Pacira Pharmaceuticals about off-label promotion. It apparently did that to avoid a lawsuit filed by the company that claimed the FDA’s regulation violated its First Amendment right (read “Strike 2! FDA Avoids Another Off-Label Court Fight by Capitulating to Pacira's Demands”; http://sco.lt/74fh0j). Figure 2, right, shows the Warning vs. Untitled letter trend from 2010 through 2015.


A Deeper Dive One Warning Letter went to Duchesnay for the promotion of Diclegis via Instagram. FDA cited 2 violations: 1) Omission of Risk Information (see “OMG. Kim Kardashian Shills for Pharma! No Worry - No Side Effects!”; http://bit.ly/omgkimkar) and 2) Omission of Material Fact (the post failed to provide material information regarding DICLEGIS’ full approved indication, including important limitations of use). The other Warning Letter went to a Valeant subsidiary for the promotion of Tussicaps. FDA cited 3 violations: 1) Omission of Risk Information, 2) Inadequate Communication of Indication, and 3) Unsubstantiated Claims. Deeper analysis reveals which violations reigned supreme. Overall, there were 12 primary violations plus 6 other violations (including inadequate communication of indication, omission of material fact, and lack of adequate direction for use). Continues…

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Risk Minimization/Omission was the most often cited violation followed closely by Unsubstantiated Claim (see Figure 3, below).

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It should be noted that an American agency was responsible for dreaming up the violative Instagram promotion of Diclegis. The agency claims to have a deep under-standing of FDA regulations especially when it comes to social media. For more on that, read “How Kim Kardashian Got Hired to Shill for Diclegis” (page 4). Are Pharma Marketers Flummoxed? Another theory suggested by Senak is that the decline may “reflect the FDA’s ‘unfinished work’ in formulating guidelines for digital media” and that this “has flummoxed drug makers, who are grappling with ways to harness social media to reach consumers while trying to avoid regulatory infractions.”

Figure 3. Primary Violations Cited by FDA in 2015. This analysis does not include letters sent by the Advertising and Promotional Labeling Branch (APLB) of the FDA. APLB regulates the advertising and promotional labeling materials for CBER products (biologics). In 2015, APLB sent one (1) Untitled Letter to Protein Sciences Corporation regarding a video promotion of Flublok anti-flu vaccine. The letter cited a Misleading Efficacy Claim (the video misleadingly implied that the higher antigen content of Flublok translates into greater protection) and Omission of Risk Information (the video failed to present any important safety information from the package insert). Why So Few Letters? Mark Senak—who works for the public relations firm Fleishman-Hillard and who writes EyeOnFDA blog— suggested a couple of theories as to why OPDP is issuing fewer warning letters these days. Senak noted that these days “letters largely involved companies that are lesser known and are likely to have fewer products on the market,” which implies that they have less experience complying with FDA regulations whereas larger pharma companies are becoming better at complying with FDA regulations. A Pharmalot blog post also suggested that “smaller drug makers [are] bigger risk takers when it comes to promotions” (see http://sco.lt/7vGJUn). Interestingly, the pharma companies that received serious Warning letters as opposed to less serious Untitled letters in 2015 were two small Canadian companies. One was Duchesnay, which received a warning letter for the Diclegis Instagram post. © 2016 Pharma Marketing Network. All rights reserved. Pharma Marketing News

It’s true that many pharma companies are shying away from social media where it is more likely to run afoul of the FDA than with more traditional media where they have more guidance from FDA. Read, for example, “Pharma Lacks Commitment To Do Facebook Well”; http://sco.lt/4xfXQv and “Pharma Brands Simply Do NOT Listen to Consumers on Social Media”; http://sco.lt/949uHR

But there has been several instances of “received wisdom” from the FDA about how drug companies can remain compliant when using social media for promotion. This includes specific guidances as well as lessons learned from letters such as the one sent to Duchesnay. What more guidance is needed? How to link to other sites? That’s about the only piece of promised guidance missing. In any case, that’s an issue already solved by the drug industry and requires no further guidance from the FDA. FDA adverse event (AE) reporting requirements have often been cited as a major impediment hindering pharmaceutical companies from sponsoring or creating truly open-ended social networking communities, even if they are not product related. Social media advocates, however, have long suggested Continues… PMN1501-01



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How Kim Kardashian Got Hired to Shill for Diclegis Alex Peterson, SVP, Health Practice Director at Makovsky—the agency that hired Kim Kardashian to do the Diclegis Instagram social media campaign—claimed that Makovsky, through social monitoring, knew that Kardashian was struggling with nausea during her first pregnancy. She’d been talking about morning sickness for weeks (read this account; http://bit.ly/1WVskDH). Makovsky said they reached out to tell Kim about Diclegis and found out that she was already taking the drug—her doctor had just prescribed it. But could Kim have been talking about her morning sickness as a prelude to working with Makovsky so that the above account by Peterson would sound perfectly plausible? If so, it may not have been the first time that a celebrity has “auditioned” for an Rx drug sponsorship deal. Phil Mickelson stunned the golf world back in 2010 when he announced that he suffered from Psoriatic Arthritis and was being treated with Enbrel. This was months before he signed the contract to be an official Enbrel spokesperson. Consequently, in news articles, he was able to say “I have no aches and pains. My back feels great. I feel stronger and more flexible than I've ever been,” which is something he would never be able to say as an official Enbrel spokesperson. For more on that, read “Is Phil Mickelson Shilling for Enbrel?”; http://bit.ly/pmenbrel Here are some questions about the deal between Kim and Makovsky: • Some experts speculate that Kim gets paid $200K per Instagram tweet (see here). Is that the fee charged by her to do the Instagram post promoting Diclegis? • The article cited above said “… they [Makovsky] knew a letter from the FDA was a possibility – so, the contract with Kardashian included the creation of a corrective post, if needed.” Did Kim throw in the “corrective message” post for free? • The post was violative because it did not mention any side effects. Why did Makovsky chance going ahead with the post and getting an FDA letter? Did the agency and/or Duchesnay feel that the publicity generated from that would more than compensate for the slap on the wrist by FDA? It’s been said that some pharma product managers frame these letters as badges of ritual regulatory passage. • The article cited above said: “The celebrity post earned 752 million social media impressions, 800+ online print articles and TV/radio segments, $12+ million advertising value, a 388% growth in trafifc to the site...” So the violative Instagram post generated $12+ million in advertising value. But how much actual dollars were spent (including agency fees) to pull this off? • Is there any data to prove that the audience that saw the original post most likely also saw the corrective message? Was the audience who read about this in the media and on TV greater than the social media audience? In terms of viewers, how would this campaign rate compared to a typical DTC TV ad, which won’t be possible for this drug for 18 months? Unfortunately, we may never learn the answers to these questions.

that it is possible to handle any adverse events reported on pharma-sponsored sites and at least one pharma company has not been afraid to do it (read Active Social Media Listening: UCB’s Approach for Achieving Better Patient Experiences”; http://bit.ly/pmn120901). Therefore, IMHO, Pharma marketers are not “flummoxed” by FDA’s inaction—there has been action as noted above. The drug industry simply won’t commit the resources/commitment necessary to fully utilize social media for marketing purposes (op cit). © 2016 Pharma Marketing Network. All rights reserved. Pharma Marketing News

Follow the Money There is a totally different, simple theory for why the FDA is issuing so few enforcement letters. It’s based on the tried and true investigative journalistic axiom; i.e., “Follow the Money.” The theory is this: The rise in Prescription Drug User Fee Act (PDUFA) payments, which now account for more than 65% of FDA's budget for regulation of drugs, discourages the FDA from issuing warning Continues… PMN1501-01



letters. See Figure 4, below, which shows the increase in PDUFA funding versus the decrease in the number of warning letters from 1997 through 2015.

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After 2002, when PDUFA fees really started to shoot up, the number of enforcement letters issued per year was significantly less than in previous years. In 2001 FDA's Chief Counsel at the time was Bushappointed Daniel E. Troy, who instituted a legal review of regulatory letters before they were issued and this policy change effectively hobbled the issuance of these letters by the FDA. Hence, fewer warning letters beginning in 2001/2. What Does OPDP Say? An FDA spokeswoman wrote Pharmalot that the OPDP “uses a risk-based approach to carefully allocate its resources … to have the greatest beneficial public health impact.” Those resources, she explained, are directed toward policy and guidance development; reviewing product labels and launches, including TV ads; enforcement; and training and communications. “It is apparent that that one cannot get a complete picture of OPDP’s program area by looking at a snapshot of time for enforcement letters. Reviewing the number of compliance actions that OPDP takes within a year time frame does not take into account the work that OPDP does on the other priorities to assist companies with compliance.”

Figure 4. PDUFA Fees vs. Enforcement Letters (Warning plus Untitled). Source: FDA. For 2015 PDUFA fee number, see: “Prescription Drug User Fee Rates for Fiscal Year 2015”; http://1.usa.gov/1JN3boP


True that. But Figure 4 is a snapshot over SEVERAL years, practically going back to the birth of Direct-toConsumer (DTC) advertising. It looks as close to a “complete picture” as we’ll ever get. Pharma Marketing News

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