October 18th, 2005
Public Perception of US Pharmaceutical Industry at All-Time Low
Pharmaceutical Business Review
Less than 13% of US consumers believe information provided by pharmaceutical companies is more trustworthy than healthcare information provided by other organizations, according to new research. The research also found that public opinion has the potential to negatively impact individual pharmaceutical firms far more dramatically than increased federal regulations.
Consumers who view information provided by pharmaceutical companies with suspicion may be less likely to approach a physician for treatment, preferring instead to remain untreated or rely on over-the-counter and herbal remedies. In addition, consumers who do seek medical help may be less likely to fill or refill a prescription.
However, despite consumers’ misgivings, the new research findings indicate that the pharmaceutical industry remains in a strong position to become a trusted source of information and services in the future, provided more stringent standards of practice are adopted - particularly as regards marketing to consumers.
The impact of public opinion
According to Datamonitor, recommendations based on the experiences of other consumers will become an increasingly influential part of patients’ decision-making processes.
While not as effective as recommendations from family members, friends or co-workers, recommendations from fellow consumers - specifically individuals who author blogs, participate in chat rooms or post to web boards - are believed to be gaining influence in the market.
Increased safety warnings attached to some drugs (such as Roche’s Accutane and GlaxoSmithKline’s Paxil) and the complete market withdrawal of others (for example, Merck & Co’s Vioxx) have undermined consumer confidence in both the pharmaceutical industry and the products it produces. As a result, consumers now question whether pharmaceutical companies have their best interests in mind when marketing a product.
These doubts, in combination with soaring drug costs and shrinking product pipelines, pose an imminent danger to an industry that relies increasingly on word-of-mouth to create brand awareness and loyalty.
Repairing damaged reputations
On July 29, 2005, the Pharmaceutical Researchers and Manufacturers of America’s (PhRMA) board of directors approved the pharmaceutical industry’s Guiding Principles on direct-to-consumer (DTC) advertising. By adopting these principles (the new PhRMA guidelines go into effect January 1, 2006), the US pharmaceutical industry is proactively assuming an increasingly rigorous self-regulatory role.
As many of the new PhRMA Guiding Principles are more stringent than current FDA requirements, this action should both reassure consumers and make further federal regulation unnecessary. Compliance with PhRMA’s Guiding Principles will undoubtedly improve the reputation of the pharmaceutical industry in the eyes of consumers.
Despite the fact that there is no statutory responsibility to do so, several companies have independently established codes of conduct that are even more restrictive than those suggested by PhRMA. Most notably, Bristol-Myers Squibb has voluntarily established a 12-month ban on DTC promotional advertising following the launch of a new product. The Guiding Principles specify only that ‘companies should spend an appropriate amount of time to educate health professionals about a new medicine or a new therapeutic indication before commencing the first DTC advertising campaign’.
Datamonitor finds that while moratoriums on broadcast and print DTC ads may initially negatively impact sales of new products, waiting periods send the message to consumers that patient safety is a priority for the pharmaceutical industry.
Long-term however, companies may want to reconsider whether applying a set waiting period to all new products is optimal as there are many complex factors that manufacturers must take into account when deciding if a drug is publicly promotable.
- Posted by Zeke on October 25th, 2005