By John Kamp, Coalition for Healthcare Communication Executive Director
May 16, 2018 — Pharma fared quite well Friday at a White House press briefing outlining ways to reduce drug prices. Indeed, Wall Street responded by increasing the share prices of major drug companies, and even the share prices of payers and insurers, longtime marketing “frenemies.”
As telegraphed in weeks of speculation, the Trump administration plan for drug prices eschewed such drug industry-hated ideas as allowing imports from Canada or direct price negotiation by government programs. Instead, President Donald Trump and HHS Secretary Alex Azar focused on market reforms and intra-industry competition — ideas much more comparable with mainstream Republican ideas than the more populist reforms suggested one day earlier by leading Democrats.
Undoubtedly you heard on Friday that the White House suggested a new disclosure on consumer ads. Tell your creative teams it’s NOT time to add list prices to the already dreadfully long list of required disclosures. Not just yet anyway.
Although talk of such disclosures likely will flood the trade and consumer coverage of drug price controversy for some time, the day when it will actually happen may take months, maybe years, or even decades to come. Indeed, maybe not ever.
While the idea is new and interesting, it’s fraught with policy and practical peril.
First, as a practical matter, publishing list prices of drugs in ads would almost certainly be misleading to the public and the consumers most likely to buy the products. In current practice, list prices are paid by nearly no one, and would not accomplish any transparency goals. Indeed, although drug pricing transparency is a major issue targeted by the President and Secretary Azar, putting list prices in ads would further compound the problem.
Second, as a matter of good public policy and Constitutional law, compelling more disclosures is likely unconstitutional. As a form of compelled speech, it’s unlikely to be found consistent with the First Amendment in any U.S. court.
And third, it’s just a long way from here to there. It’s not at all clear that the FDA statute gives the FDA power to demand list prices in ads. (Sure, an aggressive FDA may assert it has such power and get away with it for a while. But it’s doubtful that the lawyers at this more careful FDA will recommend such aggressive action.) That means Congress must agree to put the power in the statute. Don’t hold your breath on that.
So, for now, just gather intelligence. The Coalition for Healthcare Communication’s Rising Leaders Conference on Healthcare Policy, held May 22-23 in Washington, D.C., is a great opportunity to start to gaining insights on where this is all headed.
The Coalition will continue to work the halls of Congress and the FDA, listening carefully and providing the hard facts and Constitutional law required to fully understand the issue. We also will coordinate closely with the 4As and The Advertising Coalition to expose the peril in the idea of listing drug prices in drug advertising.
Our advice to you: Carry on. Stay on top of new developments (the Coalition will help with that). Create compelling advertising under the existing rules and hope that the FDA does the right thing, i.e., REDUCING, rather than increasing, the required disclosures.
We look forward to seeing you at the Rising Leaders Conference, where you can hear the experts talk about this issue and a whole panoply of issues relevant to our business. For more information on the conference and how to register, go to: http://cohealthcom.org/coming-up/.