Ready or not, drug price info is coming to TV ads — and likely in different formats.

On one hand, the federal government is considering a requirement for drug list prices in ads. On the other, the industry has started self-policing with a different proposal. Meanwhile, pharma companies will likely each take their own approach to disclosing prices in DTC ads.

The voluntary guidelines laid out by trade group PhRMA go into effect on April 15. More than 30 major drugmakers agreed to the standards, which require that DTC ads refer viewers to a webpage where they can find detailed price information, instead of the Trump administration’s recent proposal that drugmakers disclose list prices.

One company took the lead on the PhRMA guidelines. Eli Lilly began including a website and phone number for more information on prices in ads for diabetes treatment Trulicity in January.

Another company took a different route. Johnson & Johnson stated the list price outright in ads for blood thinner Xarelto, along with referring viewers to more information.

Although the two strategies are similar, J&J’s approach is closer to the Trump administration’s proposal, which the drug industry has argued could confuse patients.

“Many people’s thinking has evolved,” said Peter Pitts, president and cofounder of the Center for Medicine in the Public Interest. “It is becoming an opportunity to educate patients, not only to what the list price means versus their co-pay, which is most important to patients, but also to continue to educate them on patient assistance programs, for example.”

Transparency is key

In their announcements about new ad formats, both companies said the move is part of their efforts to be more transparent about drug prices. However, a main concern from experts is making sure the companies have research to back up their approaches.

Both Eli Lilly and J&J have said they conducted extensive research on how to present the data. Both companies are also continuing to monitor the ads and are open to adjusting them.

It is becoming an opportunity to educate patients, not only to what the list price means versus their co-pay, which is most important to patients, but also to continue to educate them on patient assistance programs Peter Pitts, Center for Medicine in the Public Interest

“We understand it’s not going to be perfect. We thought it was more important to open the communications channel two ways by asking questions on social media and through an 800-number,” explained Eli Lilly chief media officer Lina Shields.

“We got out there the best as we could and are doing continued research for our other brands by opening communications.”

With the Trump administration focused on lowering drug prices for more than two years, the public has become even more hyper-aware of their own drug costs.

A Kaiser Family Foundation poll found that 80% of Americans say the cost of prescription drugs is unreasonable. A large majority (78%) also said pharma companies making too much money is a major reason for rising healthcare costs, while hospitals and insurance companies got less of the blame.

“Pharma realizes the public sentiment is very concerned about the level of drug prices and the more information it can provide, the better,” said Jon Bigelow, executive director of the Coalition for Healthcare Communication. “It’s more in its interest to show it’s being proactive and taking steps to provide information than waiting for government regulation.”

Bigelow
Executive director of the Coalition for Healthcare Communication Jon Bigelow says pharma realizes it’s better to be proactive about drug pricing.

Experts don’t expect pharma to ditch DTC drug advertising, despite some of the public saying it’d be better off gone.

Eli Lilly said it jumped on the new PhRMA guidelines first because it believed in the importance of giving patients all the information they need to make health decisions.

“The reason we decided to go first is because, fundamentally, we believe this is important information for consumers to have,” Shields explained. “We thought this an important conversation to have, but it’s not going to be an easy one because it’s a complex multifaceted issue to explain to consumers.”

As regulation on DTC ads gets even more complicated, pharma marketing agencies are preparing for changes.

Experts believe the approaches will vary from company to company. The differences may be small, such as the distinction between ads from Lilly and J&J, but they add another layer of rules that pharma marketers who create ads need to follow.

“Every client has a different appetite for risk and a different appetite for proactivity,” said Mike Rutstein, founder and CEO of Strikeforce Communications.

“It’s not a total surprise that a company such as J&J has elected to proactively get out in front of the issue. There are optics around that, and the optics go way beyond just the promotion itself. It helps foster a more productive relationship with regulation and with the FDA, so it’s taking a big picture approach and acting as a leader in the space.”

The alternative would be simply waiting for an official rule from the government and then lawyering up. Industry experts said the Trump administration could be on shaky ground if its pricing in ads rule is implemented and the pharma industry sues.

The industry could argue the rule is in violation of the First Amendment because it is compelled speech. Pharma companies have won these types of lawsuits in the past. Most recently, Amarin won a suit in which the FDA tried to bar the company from stating off-label uses in its promotions for Vascepa.

“It’s a step forward that, rather than litigating what is clearly an unconstitutional position, the industry is looking at it as an opportunity to educate the public,” Pitts noted. “That’s laudable.”

Confusing consumers?

While the industry is embracing being more transparent about prices, many are still worried about confusing and misleading consumers with complex price information.

The Department of Health and Human Services proposed changes to the requirement that the list price for a 30-day course of treatment, or typical regimen, be included in ads with a caveat that reads, “If you have health insurance that covers drugs, your cost may be different.”

“It could be harmful to state a misleading price in a DTC ad if it scares patients away from having important conversations with their health providers,” Bigelow explained. “We also said that before CMS imposes any formal regulation, we thought the FDA should vet the impact of the way the price is presented, just as the FDA conducts social science research on how other parts of the DTC message are received.”

Bigelow predicts an official rule could be months away, potentially delayed further by the recent government shutdown.

It could be harmful to state a misleading price in a DTC ad if it scares patients away from having important conversations with their health providers Jon Bigelow, Coalition for Healthcare Communication

There’s also a chance the Trump administration will not even issue a rule, now that the pharma industry has started self-regulating.

Even if the rule isn’t official, those 33 pharma companies that signed on to the new PhRMA advertising guidelines will be changing their TV DTC ads as planned.

“There’s also a possibility that CMS will not pursue the rule any further, feeling it has already made its point,” Bigelow said.

“If pharma companies are showing responsiveness and get those websites launched as they are supposed to do and if the information is already out there, then maybe there is no need for the regulation.”