[Senate Hearing 109-317]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 109-317
 
                 THE IMPACT OF DIRECT-TO-CONSUMER DRUG
          ADVERTISING ON SENIORS' HEALTH AND HEALTH CARE COSTS

=======================================================================

                                HEARING

                               before the

                       SPECIAL COMMITTEE ON AGING
                          UNITED STATES SENATE

                       ONE HUNDRED NINTH CONGRESS

                             FIRST SESSION

                               __________

                             WASHINGTON, DC

                               __________

                           SEPTEMBER 29, 2005

                               __________

                           Serial No. 109-14

         Printed for the use of the Special Committee on Aging



                    U.S. GOVERNMENT PRINTING OFFICE
25-879                      WASHINGTON : 2006
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                       SPECIAL COMMITTEE ON AGING

                     GORDON SMITH, Oregon, Chairman
RICHARD SHELBY, Alabama              HERB KOHL, Wisconsin
SUSAN COLLINS, Maine                 JAMES M. JEFFORDS, Vermont
JAMES M. TALENT, Missouri            RUSSELL D. FEINGOLD, Wisconsin
ELIZABETH DOLE, North Carolina       RON WYDEN, Oregon
MEL MARTINEZ, Florida                BLANCHE L. LINCOLN, Arkansas
LARRY E. CRAIG, Idaho                EVAN BAYH, Indiana
RICK SANTORUM, Pennsylvania          THOMAS R. CARPER, Delaware
CONRAD BURNS, Montana                BILL NELSON, Florida
LAMAR ALEXANDER, Tennessee           HILLARY RODHAM CLINTON, New York
JIM DEMINT, South Carolina
                    Catherine Finley, Staff Director
               Julie Cohen, Ranking Member Staff Director

                                  (ii)

  
?

                            C O N T E N T S

                              ----------                              
                                                                   Page
Opening Statement of Senator Herb Kohl...........................     1
Opening Statement of Senator Gordon Smith........................     3
Opening Statement of Senator Ron Wyden...........................     4

                           Panel of witnesses

Rachel E. Behrman, MD, MPH, deputy director, Office of Medical 
  Policy, Center for Drug Evaluation and Research, and director, 
  Cross-Centers Initiatives Task Force, Office of the 
  Commissioner, U.S. Food and Drug Administration, Department of 
  Health and Human Services......................................     6
Paul Antony, MD, MPH, chief medical officer, Pharmaceutical 
  Research and Manufacturers of America (PhRMA), Washington, DC..    58
Donna Sweet, MD, FACP, chair, Board of Regents, American College 
  of Physicians, Washington, DC..................................    80
Peter Lurie, MD, MPH, deputy director, Health Research Group, 
  Public Citizen, Washington, DC.................................    87
Richard L. Kravitz, MD, MSPH, director, Center for Health 
  Services Research in Primary Care, University of California, 
  David Medical Center, Sacramento, CA...........................   100

                                 (iii)

  


 THE IMPACT OF DIRECT-TO-CONSUMER DRUG ADVERTISING ON SENIORS' HEALTH 
                         AND HEALTH CARE COSTS

                              ----------                              --



                      THURSDAY, SEPTEMBER 29, 2005

                                       U.S. Senate,
                                Special Committee on Aging,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10 a.m., in room 
SH-216, Hart Senate Office Building, Hon. Herb Kohl, presiding.
    Present: Senators Smith, Talent, Kohl, and Wyden.

             OPENING STATEMENT OF SENATOR HERB KOHL

    Senator Kohl [presiding.] Good morning and we welcome 
everyone to this hearing where we will examine today the 
effects of direct-to-consumer advertising of prescription drugs 
on patients, doctors, and health care spending. As always, we 
thank our Chairman, Gordon Smith, for working with us in a 
bipartisan manner to examine this important issue affecting 
seniors.
    We all know that Americans pay the highest prices in the 
world for medicines that are largely researched and 
manufactured here in our own country. Starting in January, the 
American taxpayers will pay hundreds of billions of dollars for 
drugs through the new Medicare benefit. So now, more than ever, 
we have a responsibility to ensure that those dollars are being 
spent wisely.
    As we look to the reasons why drug costs are so high, one 
contributing factor is the widespread advertising of drugs 
directly to consumers. Spending on advertising of prescription 
drugs more than quadrupled between 1996 and 2003 in this 
country. Companies have the right to spend as much as they 
choose to promote their products, although it should be noted 
that, aside from New Zealand, the United States is the only 
country in the world that allows direct advertising of drugs to 
consumers. We should consider whether there is a message there 
that we should think seriously about.
    But as the largest payer of prescription drug costs, the 
Federal Government has an obligation to examine the impact of 
these drugs on drug choices and health care spending. Today's 
ads often steer consumers toward newer, costlier drugs when 
older, less expensive drugs may be more appropriate. This leads 
to higher health care spending as patients demand and doctors 
prescribe more expensive medicines.
    The reason that these ads are so powerful is because they 
often are the only source of information that patients have 
about a drug. The ads paint a picture of a healthy life that 
can be theirs only if they just ``ask their doctor.'' 
Unfortunately for consumers, this is not always the complete 
picture as most patients have no idea whether the new drug is 
better than the older one that they have been taking for years.
    It should not be left solely to the drug industry to 
educate patients and doctors about new medicines. We need more 
unbiased research, perhaps through the NIH, that will compare 
new and old drugs to help doctors and patients determine which 
is the best, most cost-effective medicine for them.
    We also need to give doctors time to fully understand the 
benefits and risks of a new drug once it reaches a market. Ads 
for newly approved drugs hit the airwaves immediately, sending 
patients to their doctors to request what they have seen. We 
should consider a moratorium on advertising for newly approved 
drugs to provide doctors enough time to fully understand their 
effects.
    Finally, we also know the FDA has limited enforcement 
measures at their disposal to crack down on misleading 
advertising. Providing stronger enforcement tools to the FDA 
will help prevent unnecessary utilization costs and potentially 
harmful outcomes to patients.
    I am working on legislation to address some of these 
issues, and I know that other Senators, including Senator 
Wyden, who is here today, have also begun working on 
legislative answers. I have also joined with Senator Frist to 
ask the GAO to study the effect of DTC advertising on drug 
costs and utilization. I look forward to working with all of my 
colleagues on this important issue. Clearly, companies have the 
right to advertise their products, but with the new Medicare 
drug benefit starting soon, taxpayers are about to foot the 
bill for billions of dollars in drug costs. They deserve to 
know that doctors and patients have the best information 
available to choose the most appropriate and the most cost-
effective medicines.
    We thank everybody for their participation here today. 
Before we turn to Senator Smith, I want to mention that we have 
a roll call vote at 11:30 which requires all Senators to be in 
the chamber. I hope we can move forward with this hearing and 
maybe conclude so that we will not have to recess for an 
extended period of time and return.
    So now we turn to our esteemed chairman, Gordon Smith, for 
his opening remarks.

     OPENING STATEMENT OF SENATOR GORDON H. SMITH, CHAIRMAN

    The Chairman. Thank you, Senator Kohl. It is a pleasure to 
work with you. This hearing is very appropriate, very timely, 
and it was your idea, and we thank you for your leadership.
    Also, my colleague in the Senate, Senator Wyden, thank you 
for your service on this committee as well. Ron Wyden's 
commitment to seniors and the elderly is legendary in my State, 
and appropriately so.
    We welcome all of you and wish you a good morning. While 
national health care spending has slowed in recent years, it is 
projected that total national spending on health care goods and 
services will reach 18.4 percent of the Nation's gross domestic 
product by 2014. How the Government and individual citizens 
spend their health care dollars will continue to be an 
important policy discussion on Capitol Hill.
    One area of health care in which spending is projected to 
increase significantly in coming years is prescription drugs. 
Advances in pharmaceutical sciences have provided millions of 
Americans with the opportunity to live longer, healthier lives, 
but often at a significant cost.
    Over the last several decades, the pharmaceutical industry 
has spent billions of dollars to promote new prescription drugs 
to both doctors and consumers. Direct-to-consumer advertising 
is just one component of a larger marketing effort. But given 
that spending on such ads has quadrupled since 1998, it is an 
area that deserves further exploration, especially in 
connection to how it affects consumer safety and overall 
prescription drug consumption.
    From a positive standpoint, direct-to-consumer drug 
advertising may encourage individuals who might otherwise not 
seek health services to see their doctors. This is especially 
true for individuals who may be suffering from a mental 
illness, such as depression or bipolar disorder.
    A 2003 study showed that approximately 25 percent of 
surveyed individuals who had discussed an advertised drug with 
their physicians reported receiving a new diagnosis. Evidence 
would suggest that advertising can encourage individuals to 
learn more about symptoms they might suffer from and get 
treatment for undiagnosed conditions.
    Beyond advertising's ability to prompt individuals to seek 
out health care, there are many other issues that should be 
explored further by policymakers, industry representatives, and 
health care advocates. For instance, does the content of 
direct-to-consumer advertisements appropriately inform 
individuals of the benefits and risks of new prescription 
drugs, or are they aimed more at building product loyalty? This 
is an especially important question to ask in regard to new 
products entering the market, whose effect on the general 
population may not be fully known. I am hopeful some of the 
discussion today can address this concern, as well as other 
issues relating to better informing consumers through direct-
to-consumer ads.
    In terms of physician prescribing behavior, it is still 
unclear how direct-to-consumer advertising affects the decision 
to prescribe a certain type or brand of prescription drug. We 
will hear today about recent research that suggests patient 
requests for specific drugs may influence doctors' prescribing 
behavior. However, while such findings highlight an interesting 
dynamic of the patient-physician relationship, it may be more 
difficult to explicitly link drug requests to direct-to-
consumer advertising.
    I should also note that in considering the issue of 
prescribing behavior, we should not ignore other types of 
promotional activities, especially those targeted towards 
physicians and their office staffs.
    I invite all witnesses to share their thoughts on the 
relationship between direct-to-consumer advertising and overall 
health care consumption. Additionally, I would appreciate any 
suggestions witnesses might have to offer that improve the 
process by which information regarding prescription drugs is 
communicated to the public.
    I look forward to a thoughtful exchange today, and I hope 
this hearing will prompt a broader discussion of the steps 
interested parties can take to further ensure a more consistent 
balance between promotional and education content in all forms 
of prescription drug advertising. Ultimately, we should all be 
working toward the goal of keeping consumers well informed of 
important developments in pharmaceutical science so that they 
can improve their overall health and well-being.
    Thank you, Senator Kohl.
    Senator Kohl. We thank you, Mr. Chairman, and now we would 
like to hear from the very fine Senator from Oregon, Ron Wyden.

             OPENING STATEMENT OF SENATOR RON WYDEN

    Senator Wyden. Well, thank you, and I guess I should thank 
all the chairmen that are here today, and I think it is 
terrific, Senator Kohl, that you developed this idea, but these 
hearings don't just happen by osmosis. They happen because the 
Chair wants them to, and I commend Senator Smith, and I very 
much share his view about the need to educate consumers as 
well.
    I have come to the conclusion on this that the people of 
this country think prescription drug advertising has just 
gotten completely out of hand, and that much of the 
advertising--not all of it, but much of it goes way beyond the 
legitimate interest in educating the consumer and is primarily 
used to increase demand and increase profits for the 
pharmaceutical companies. I have been struck and have actually 
asked the pharmaceutical representatives why it is that if 
education is the primary interest here, why is it that only the 
blockbuster drugs seem to be the ones that get advertised. You 
don't seem to see the ones, the orphans that can't generate 
much profit. They don't seem to be the ones that get 
advertised.
    So the question then becomes: What would be an appropriate 
approach to deal with this issue that particularly is 
consistent with the Constitution? There is a First Amendment 
right to communicate, and certainly the companies have asserted 
it. The companies also get a tax break for using that First 
Amendment right, so when those purple pills dance across 
somebody's television set, there is already a taxpayer subsidy 
for that particular activity. But in fairness to the companies, 
it is also correct that if somebody advertises for their pizza 
parlor or some other business, they get a tax break for that as 
well.
    So the question that I have said at least ought to be the 
start of this debate is: Should there be a double subsidy for 
these prescription drug ads? The pharmaceutical people already 
get one subsidy. Should they get a second one? Senator Sununu 
of New Hampshire and I have concluded that that is where we 
would draw the line. We would say let us now take the 
advertising expenses out of the costs at least of Government 
programs like Medicaid.
    Senator Smith in particular has done extraordinary work on 
the Medicaid program. It is clear that there are going to have 
to be reforms. The Congressional Budget Office has told us that 
given the fact that we are going to spend $4 billion a year on 
prescription drug ads--not my figure; that is from the Wall 
Street Journal. According to the figures from the Congressional 
Budget Office, we could get close to half of the savings that 
are needed for the Medicaid budget target just if we stop the 
companies from getting a double subsidy and took advertising 
expenses out of the cost of Government health programs like 
Medicaid.
    So Senator Sununu and I are going to continue to work on 
that legislation. It is S. 1128, the Pharmaceutical Advertising 
and Prudent Purchasing Act. It was introduced in May. I want to 
wrap up just by giving a couple of comments on some charts that 
we have developed. We have put together some charts that 
outline the advertising situation.
    The first shows the most advertised drugs in our country as 
of 2003, and you can see many drugs that the consumer and the 
public is familiar with.
    The second chart is the one that I think is particularly 
troubling. It shows the drugs that are most used by the 
Medicaid program. These are the top ten drugs that Medicaid 
pays for with taxpayer dollars for low-income people at a time 
when the Medicaid program faces the draconian cuts. You can see 
that of the ten most commonly used drugs in the Medicaid 
program, four of them are paid for with this double subsidy 
that I think is so troubling.
    The last chart I brought is an indication that highlights 
the point Senator Kohl made of what is to come. We, of course, 
are starting very shortly a Medicare prescription drug benefit. 
We are now talking here about the ten most commonly used drugs 
in the Medicare program, and virtually all of them are 
advertised. So, once again, Medicare, like the other programs--
the VA, the Public Health Service, and other programs--
Government health programs will pay a double subsidy. It seems 
to me that if the companies get to exercise their First 
Amendment rights, they get a tax break for exercising their 
First Amendment rights, at some point you ought to draw the 
line and say we are not just going to subsidize them again and 
again and again. Senator Sununu and I have drawn that line in 
S. 1128 where we would take the advertising expenses out of the 
cost of government health programs.
    I thank the two Chairs, and particularly for giving me a 
little extra time to walk through our legislation, and I look 
forward to working with both of them and thank them both for 
their kind words.
    Senator Kohl. Thank you, Senator Wyden.
    At this time we will call our first witness, Dr. Rachel 
Behrman. Dr. Behrman comes from the Food and Drug 
Administration. She is the deputy director of FDA's Office of 
Medical Policy, which oversees the Division of Drug Markets, 
Advertising, and Communications.
    Dr. Behrman, we are very pleased that you are here today, 
and we welcome your testimony.

   STATEMENT OF RACHEL E. BEHRMAN, MD, MPH, DEPUTY DIRECTOR, 
   OFFICE OF MEDICAL POLICY, CENTER FOR DRUG EVALUATION AND 
 RESEARCH, AND DIRECTOR, CROSS-CENTERS INITIATIVES TASK FORCE, 
OFFICE OF THE COMMISSIONER, U.S. FOOD AND DRUG ADMINISTRATION, 
            DEPARTMENT OF HEALTH AND HUMAN SERVICES

    Dr. Behrman. Thank you, Senator Kohl, Senator Smith, and 
Senator Wyden. Good morning. As you mentioned, I am Dr. Rachel 
Behrman, deputy director of the Office of Medical Policy and 
director of the agency's Cross-Centers Initiatives Task Force.
    Thank you for this opportunity to discuss FDA's role and 
experience in overseeing the promotion of prescription drugs to 
consumers. Today I will briefly discuss some of the issues 
behind the ongoing debate about DTC advertising, many of which 
have just been touched upon, and then summarize several agency 
initiatives.
    One of our top priorities is ensuring that Americans are 
educated about their health and treatment options with clear 
and accurate information. We have all been exposed to DTC ads 
in print and on television, for example, and perhaps have felt 
that although DTC advertising has the primary intent of 
promoting a product, it also has the potential to promote 
awareness of undiagnosed or undertreated diseases, to promote 
an understanding of possible treatments, and to foster health-
related discussions with physicians. In other words, it is an 
opportunity for two different interests to align.
    But this can only happen if the promotion is done properly 
if, in addition to being truthful and not misleading, the 
promotion is clear and accessible to consumers.
    Direct-to-consumer advertising has always been legal in 
this country, although historically it was aimed primarily at 
physicians, and our regulations do not distinguish between the 
two audiences. DTC advertising remains a small percentage of 
all prescription drug promotion, but it has increased sharply 
since the mid-1990's as broadcast DTC has become more 
prevalent. This increase has sparked an intense debate about 
the impact of DTC and about the role of regulation.
    Monitoring DTC advertising is a top priority for us, but 
truthful advertising cannot be achieved unless it accurately 
communicates and balances the benefit and risk information 
about a prescription drug. Thus, FDA has undertaken a number of 
important initiatives to improve the communication of 
prescription drug information to consumers.
    In 2004, we issued two draft guidance documents aimed at 
improving the quality and usefulness of DTC advertising. The 
first addressed alternative ways of disclosing risk information 
in consumer-directed print advertisements. The goal of the 
guidance is to encourage manufacturers to abandon the dense, 
tiny-type presentation of risk information and replace it with 
clear, comprehensible, succinct, and visually accessible paper 
that can serve as an educational tool and can stimulate 
discussion between patients and their health care providers.
    The other guidance addresses and encourages what are common 
called help-seeking advertisements. These are ads that do not 
mention a particular product but are intended to raise 
awareness of a particular disease or condition.
    In addition, FDA is finalizing a regulation that will 
completely overhaul the information required to be distributed 
with prescription drugs. Known as ``the package insert,'' it is 
the long, complicated, tiny-print label that is tucked into 
prescription drug packages. When this regulation issues, it 
will require that a high-level summary of the most important 
information precede the detailed prescribing information 
contained in the package insert. This summary, which will be 
reviewed and approved by the FDA, will enable us and the 
industry we regulate to more rapidly and easily identify the 
risk information that should be included in advertising.
    This regulation, once issued, will also support the 
agency's electronic health initiatives, for example, ultimately 
making it possible for FDA to provide concise, reliable, and 
up-to-date medical product information available immediately 
and free of charge on the Internet and in an easily searchable 
format.
    The key issue in the DTC debate is whether it helps or 
harms Americans. Answering this question requires data. We must 
know what consumers understand, how they perceive risk 
information, and what helps them make informed choices, to name 
just a few of the questions facing us. Therefore, FDA continues 
to conduct research and last fall published a comprehensive 
report on patient and physician attitudes and behaviors 
associated with DTC advertising of prescription drugs.
    Our data demonstrate that DTC advertising clearly provides 
an opportunity to inform. This number will not be a surprise: 
81 percent of patients responding to our surveys have been 
exposed to DTC advertising, and many of them went on to seek 
more information, usually about the drug but sometimes about 
their health condition.
    On the other hand, our data also show that approximately 60 
percent of patients and physicians believe that DTC 
advertisements overstate the benefits of the product and almost 
as many believe that the ads understate the risks. This is a 
problem that must be addressed by the industry we regulate, and 
so we welcome PhRMA's recent announcement of voluntary 
guidelines to improve the quality of DTC advertising. These 
guidelines in particular emphasize compliance with FDA 
regulations and require advertising to be neither false nor 
misleading, to make claims only when supported by substantial 
evidence or substantial clinical experience, and to 
appropriately balance the risk and benefit information.
    Another recent initiative involves the re-evaluation of our 
regulations. Are these regulations, implemented in the 1960's 
and without a consumer audience in mind, effective for DTC 
advertising? To help answer that question and many others 
surrounding DTC, we have scheduled a public hearing on November 
1 and 2 of this year, and we hope to hear a broad range of 
opinions.
    DTC advertising is advertising, but it is also an 
opportunity--an opportunity to help Americans become better 
informed about their health and to reach Americans who may be 
unaware of or ignoring important health problems. This 
opportunity should not be missed. Therefore, the agency will 
continue our research to better understand the effects of DTC 
advertising and how best to communicate the important 
information about risks and benefits. We will also continue to 
closely monitor DTC advertising while working within industry 
to ensure that all promotion is fully compliant with applicable 
laws and regulations; and when it is not, we will take 
appropriate enforcement action.
    Finally, we look forward to beginning a thorough evaluation 
of the regulations that govern promotion, and DTC promotion in 
particular.
    Thank you, and I will be happy to answer any questions.
    [The prepared statement of Dr. Behrman follows:]

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    Senator Kohl. Thank you, Dr. Behrman.
    Dr. Behrman, in the last year, I understand that FDA has 
issued 17 warning letters to drug companies regarding 
misleading advertising. While this may not seem like a lot, it 
is considerably more than in the past two years.
    Dr. Behrman. Yes.
    Senator Kohl. To what do you attribute this increase? Is it 
a push for greater scrutiny from your agency? Is it that more 
drugs are on the air than ever before or more misleading drugs 
on the air?
    Dr. Behrman. There are two parts to the answer to that 
question. One, I believe, part of what you are asking me is are 
the ads getting worse, and the other is why this shift in more 
warning letters as compared to what we call untitled letters, 
which are lesser violations. In part, we have, because of 
resource constraints, made a very conscious and determined 
effort to focus on the most egregious violations and, 
therefore, focus more on the kinds of ads that might prompt a 
warning letter. That is part of the answer, and, again, part of 
the answer might be that it appears to us--and, again, we tend 
to see the worst--that there has been somewhat of a trend to 
ads we consider more violative.
    Now, just in the last few months, we have been encouraged 
in that we have seen a couple of ads that really have broken a 
new mold and actually have done what we have all been talking 
about a little bit this morning, which is take more of an 
opportunity to inform and educate at the same time promoting 
the product.
    Senator Kohl. Dr. Behrman, as you know, spending on DTC 
advertising of prescription drugs more than quadrupled between 
1996 and 2003, yet there has not been a comparable increase in 
your staff and budget at the FDA to police all of these ads. 
PhRMA's new guidelines are calling for companies to submit all 
new TV ads to the FDA before they air. Does the FDA have the 
resources to do their job? What additional tools would you 
need?
    Dr. Behrman. Well, I am not here asking for resources, 
although asking a manager if they want more resources, I think, 
is very much like asking a child if they want another cookie. 
It is always very hard to say no.
    We are very proud of our efforts. We prioritize. We target. 
We have not increased to the same extent, obviously, that 
advertising has. As you said, it is a program, if you will, the 
promotions are over $20 billion a year. DDMAC, the Division of 
Drug Marketing, Advertising, and Communications, is staffed by 
a staff of 40, a very dedicated and capable staff, but a staff 
of 40. So we prioritize, and we believe that we have a vibrant 
program.
    Senator Kohl. As you, of course, know, Bristol-Myers Squibb 
recently announced a 1-year moratorium on ads for all newly 
approved drugs in an effort to allow physicians enough time to 
fully understand the appropriate use of their medicines. Would 
the FDA support a similar moratorium on all newly approved 
drugs?
    Dr. Behrman. Again, there are two parts to the answer. One, 
under our regulations and under our law and under our 
Constitution, DTC advertising is legal. I think what is of keen 
interest to the agency, which I tried to point out, are our 
other efforts to make sure that physicians and patients and 
consumers have other avenues of access to information. We as an 
agency are extremely good at analyzing data. We have not been 
as good in the past about providing that data, improving our 
website, improving the package insert, which, when our content 
and format reg is finalized, will revolutionize package insert 
information and make it accessible in hand-held and make it 
accessible over the Internet. So we are focused very much on 
other avenues of information.
    Senator Kohl. Thank you, Dr. Behrman.
    Mr. Chairman.
    The Chairman. Thank you, Senator Kohl.
    Dr. Behrman, I am going to ask this question just for my 
own interest about your relationship with PhRMA and drug 
companies when you work out disclaimers. I always get a chuckle 
out of their ads, frankly, because they claim hypothetically if 
you take this, it will cure your hemorrhoids, but you are going 
to have a heart attack. What kind of dynamic is there between 
you? Is it contentious, or do the companies see these tag 
lines, these disclaimers, these warnings, as protecting them 
against liability? They certainly would cause me not to take 
the drugs.
    Dr. Behrman. I cannot speculate on what PhRMA thinks or 
what actually any individual company thinks because, remember, 
the ads are developed by the company, not by PhRMA.
    The Chairman. Right.
    Dr. Behrman. It is also worth pointing out, as I am sure 
you know, that our enforcement process is post hoc. Companies 
are not, except in very rare circumstances, obligated to show 
us an ad before it airs. They are obligated to show us the ad 
at the time it airs, and then we are in this post hoc 
enforcement mode.
    Just of note, there have been ads for certain conditions 
where the side effect profile is so unappealing--and this is 
for some of the obesity drugs--that DTC advertising was, I 
believe, deemed by the companies as, again, not sensible. But 
we are very interested in how to properly communicate risk 
information and to do it in such a way that it doesn't--you 
know, the hemorrhoid/heart attack example is an example, but 
what if you truly have a serious condition such as diabetes, 
but you find the recitation of whatever frightening? This is 
not what we want. We want clear, accurate communication of 
information and in a balanced way in the ad. That is what we 
believe the regulations demand, and that is what we are doing 
research to better understand how to accomplish.
    The Chairman. Well, I think it is important that accurate 
appear in ads, frankly, because while there is a First 
Amendment right, we don't live in a snake-oil age. They need to 
have information regarding risks.
    Dr. Behrman. Exactly. One question we are bringing to this 
public meeting, this Part 15 hearing in November, is given that 
it is to a consumer audience, what is the bare minimum, if you 
will, of contextual information about the disease, about the 
condition, about other therapies that must be provided so that 
it is truthful and not misleading? You have the hemorrhoid and 
heart attack. Ours is the risk information is in Italian and 
the ad is in English. Is that permissible?
    The Chairman. Yes. Well, I just think you are performing 
very important work for consumers. If the companies, are going 
to exercise their right to advertise directly to consumers, it 
is important that people know whether the cure is worse than 
the disease.
    Dr. Behrman. Worse, or inappropriate for them and they 
should not even bring it up.
    The Chairman. There really does need to be an educational 
component that may be at cross purposes with building brand 
loyalty. But that is the world we live in.
    Thank you.
    Senator Kohl. Thank you, Mr. Chairman.
    Senator Wyden.
    Senator Wyden. Thank you, Mr. Chairman. Both of you have 
asked good questions. I just have a couple of quick follow-ups.
    What do you do by way of defining when a company goes over 
the line? You said that you try to deal with the most egregious 
kinds of claims, which certainly is in the public interest. But 
how do you define that? How do you, in effect, go about the 
task of saying this one is over the line and we are going to 
send them a warning letter, we are going after them, this one 
is within bounds? How do you go about that?
    Dr. Behrman. It is a very good question. It is a very 
difficult decision. Anything, obviously, that requires that 
kind of judgment is not black and white and cannot be clearly 
articulated, although we try very hard to set standards that 
are easily understood by the industry we regulate in terms of, 
for example, developing more guidance because, in part, they 
need to produce quality ads, but in part, if we haven't made it 
clear to them what the standards are, it becomes harder for 
them to do. It also is a question sometimes of what comes to 
our attention. Remember, we are inundated with advertising, as 
we have all discussed. It is a $20 billion a year expenditure. 
So we don't look at every ad. It could be a complaint. It could 
be we see one at home. It could be a family member brings it to 
our attention. But then we have to make an assessment of 
whether indeed it is violative or not.
    Senator Wyden. You said $20 billion. I have been using this 
Wall Street Journal figure of direct-to-consumer advertising as 
$4 billion.
    Dr. Behrman. I am sorry, $4 billion for--yes, I am thinking 
of the entire mission of the division.
    Senator Wyden. OK. With respect to what is ahead, have you 
all given some thought to including cost-effectiveness as part 
of the whole debate about what goes into one of these ads? 
Because I think that as people look in the future--and we are 
certainly going to see more of this--that is one of the things 
they really want to know.
    Dr. Behrman. Cost-effectiveness of the therapy?
    Senator Wyden. Yes, and data that points to this drug that 
is being advertised as being more cost-effective than what is 
out there.
    Dr. Behrman. Well, our standard for putting a claim in an 
ad is that it be supported by substantial evidence, and if 
there was to be a cost claim, it would have to be supported by 
evidence that would be adequate.
    Senator Wyden. I am asking about whether you all are 
looking at requiring something like that or asking for it.
    Dr. Behrman. Asking for cost-effectiveness data, no, we are 
not.
    Senator Wyden. Do you think that would be in the public 
interest?
    Dr. Behrman. To ask FDA to evaluate cost information?
    Senator Wyden. No, no. To say that that should be included 
in the claim. No, you wouldn't be suddenly out there trying to 
make those assessments, but that that should be required as 
part of an ad.
    Dr. Behrman. Again, I am not an attorney. I think it would 
be very difficult for us to require certain types of speech or 
claims in any ad. We are required to evaluate the ads that come 
before us to see whether they are compliant with regulations. 
But other than, for example, requiring that it be consistent 
with labeling, we are not required to have certain types of 
information in the advertisement.
    Senator Wyden. So where do you look then on the label? If 
labeling is going to be the sort of lodestar here, you know, 
what do you look at in terms of labeling? Because I think that 
is something that the public wants to know. I mean, the public 
wants to know about whether it is going to be effective for 
them from the standpoint of their health, and the public wants 
to know if it is going to be cost-effective.
    Dr. Behrman. Well, again, whether it is going to be 
effective for them is a discussion they have to have with their 
health care provider. Whether it is going to be cost-effective 
for them, I am still at a loss of quite how to understand how 
to evaluate that. I can understand how to balance as a 
physician the risks and benefits for a particular patient, but 
I am not quite sure how I would understand how to balance how 
much it costs them.
    Senator Wyden. I guess what I am saying is I think this is 
something the Government ought to look into, because what we 
are seeing is enormous amounts of money spent on drugs that 
incrementally better than what is out there, but are much more 
expensive, and it just continues this spiral of cost.
    I thank you, Doctor. I would only ask, Mr. Chairman, when I 
cited the Congressional Budget Office, I probably low-balled 
the number in terms of the amount of advertising, and I would 
just ask that that full discussion with Douglas Holtz-Eakin be 
put into the record, because essentially when I have said that 
if you take advertising out of the expenses of Medicaid, you 
could come close to half of the target. I used the Wall Street 
Journal figure, the $4 billion figure. I probably could have 
gone higher with Douglas Holtz-Eakin. In fairness and so that 
the committee has the accurate record, I would ask that Douglas 
Holtz-Eakin's entire set of remarks on that point be put into 
the record.
    Senator Kohl. It will be done.
    [The information referred to follows:]

    Senator Wyden. I wanted to also explore with you a topic 
you and I have talked about. Senator Sununu and I have been 
concerned about the fact that public programs, programs like 
Medicaid, the Public Health Service, the VA, are paying for 
prescription costs, you know, advertising. In effect, those 
programs end up getting shellacked, you know, twice. There are 
tax breaks for the pharmaceutical folks to advertise on TV. 
Nobody is quarreling with that, trying to take it away. But 
after that expenditure is made with taxpayer money, then more 
money gets spent for in effect like Medicaid to pay for all 
those purple pills, you know, dancing across everybody's 
television set. So we are trying to address this, you know, 
issue and, you know, obviously advertising increases 
utilization of prescription drugs and, or course, the program.
    Let me ask it this way: The official sources on drug 
advertising seems to be that the country spends between $3 
billion and $5 billion a year on prescription drug advertising. 
According to the bipartisan experts, after the Medicare drug 
benefit kicks in, Medicaid is expected to be about 10 percent 
of the prescription drug market. That seems to be a kind of 
consensus recommendation.
    So Senator Sununu and I are interested and working on the 
language of this and would very much like your counsel so as to 
focus on utilization and focus on market share. It is our sense 
that if we do that, the government could save about $300 
million to $500 million a year on Medicaid, in effect over a 
billion dollars over a 5-year period.
    Do you feel that that is essentially a reasonable kind of 
analysis?
    Mr. Holtz-Eakin. Yes. You know given that the language was 
tight enough that could find a way to actually recoup the costs 
and that we can, you know, get a sense that the numbers are on 
the mark. They certainly seem reasonable. Yes.
    Senator Wyden. Well, I appreciate that, and I would like to 
work with you on the language because I know that the way it is 
framed so as to focus on utilization and market share is 
really, really key, and if we could follow up with your 
technical folks. They have been very helpful to us already. 
This is a bipartisan bill, and I just point it out because we 
have Chairman Smith here, and he has done excellent work on the 
Medicaid program. He is trying to get $10 billion worth of 
savings without hurting people on Medicaid, and I would just 
like to, you know, make it clear, you know, for the record that 
Dr. Holtz-Eakin has said we could get more than a 10 percent of 
the savings in the target that Chairman Smith is looking at by 
the advertising, you know, provisions along the lines of what 
Senator Sununu and I have been talking about. So we will be 
anxious to follow up with you, and we got to figure out how to 
save $10 billion on Medicaid, and we all want to do it without 
hurting people. We just on the record a way to in the ballpark 
to get 10 percent of the money. That is what we ought to be 
trying to do is sharpen our pencils.

    Senator Kohl. Thank you, Senator Wyden.
    Senator Talent is here.
    Senator Talent. I want to thank the Senator from Wisconsin 
and the chairman for sponsoring this hearing, which I think is 
an important one, and it is a subject that has troubled me and 
I have done a lot of thinking about it, because, on the one 
hand--I am not going to make a long statement, I promise. But I 
imagine you all sort of have these conflicting feelings. On the 
one hand, I don't like to interrupt the flow of information or 
treat seniors like they can't analyze this information and make 
useful decisions. On the other hand, there sure are a lot more 
of these ads than there used to be, and I have some concerns 
also.
    I think it is probably more appropriate to reserve most of 
my questions for the second panel, but, Dr. Behrman, if you 
would just--I will follow up on something that I think the 
chairman raised when I was not here. I watch these ads, and 
they talk about how great the drugs are, and I would expect 
that they would do that. There is this little voice as the end 
that mentioned, you know, ``not for people who have had liver 
problems.'' I think you went into this a little bit, but are we 
doing enough to warn people about the potential negative side 
effects of this? Particularly I wonder if you all have done as 
an agency any work in an area that was raised in another 
hearing. Let me just give you that, and then you can answer it 
in light of that.
    When we had the hearing on scams that are directed at 
seniors, one of the witnesses represented a group that had done 
a lot of work on how seniors get information and how they 
perceive it. In other words, if you remember, Mr. Chairman, 
they made the point that when you do bullet points to seniors, 
because as our memories begin to change as we get older, there 
are ways of communicating so that it really hits, and then ways 
of communicating so that they don't remember it. I wonder if, 
considering whether this is false and misleading, you have 
taken that into account, these ads that are aimed at particular 
parts of the population, if you guys have studied that to make 
certain that this information about potentially harmful side 
effects isn't being slipped in in a way that they know people 
are less likely to absorb. So if you would comment on that, I 
would appreciate it.
    Dr. Behrman. Sure. You have actually raised several 
different points, all of which are worth commenting on.
    First, in terms of--we call it ``minimization of risk 
information,'' not adequate presentation of risk information. 
It is one of the most common reasons we cite an ad for 
violation. We are very concerned. It can be buried in tiny 
print in a broadcast ad. It can be buried with loud music. 
There are many ways to bury it. That is why we have--either in 
print or broadcast, that is why we have started increasingly to 
do research on what we call the brief summary, the presentation 
of risk information, and issue guidance, and that is part of 
what we hope to hear at our public hearing.
    You are referring a little bit, I believe, to chunking of 
information, that you can access the information better if it 
is chunked. It is not just seniors. It is everybody. That is 
why we--and it was based on those principles that we are 
revamping the package insert. Once the package insert is 
revamped, it will be much easier for industry, we hope and we 
believe, to better pull out the risks because, yes, we want to 
see ads that incorporate the risk information into the entire 
ad, not leave it for the end, not bury it, and not make it hard 
to understand.
    Senator Talent. You just may want to look at--and we can 
get this information to you--some interesting studies about how 
people absorb information in different ways as they get older. 
It has nothing to do with any disability or anything.
    Dr. Behrman. Right, sure.
    Senator Talent. It is just as your memory changes. So ads 
that are directed particularly at older parts of the population 
may be able to slip information through in that fashion.
    Dr. Behrman. It would be good to see that.
    Senator Talent. But I am glad to know that is a priority, 
and I appreciate your being here.
    Thank you, Mr. Chairman.
    Senator Kohl. Thank you, Senator Talent.
    Mr. Chairman.
    The Chairman. Doctor, both Senator Wyden and I do town 
halls all over Oregon, and sometimes we do them together. One 
of the complaints that he and I invariably hear at every stop 
is about direct-to-consumer advertising. Obviously you are 
telling us your workload has gone up. The use of advertising 
has increased. Have the companies ever shared with you the 
pluses and minuses of what they are doing? Because there is 
clearly a backlash among seniors to these ads as expressed. 
This claim is not supported by data, but it is an overwhelming 
complaint that we hear constantly. Can we get cheaper drugs and 
stop these ads? Give us the money in savings and cost; these 
ads are driving us crazy. These are folks who are coming out of 
assisted living facilities to hear a couple Senators talk, and 
this is what is on their minds.
    Do they ever share with you the tradeoffs that they go 
through?
    Dr. Behrman. No, but--and, again, you will have the 
opportunity to speak with them on the next panel, but they have 
put out voluntary guidelines, and the guidelines do talk about 
appropriateness of the audience, if you will, in terms of air 
time. So I would--and this is a guess on my part. I would 
assume it is on their minds, and I would also just add that it 
is not just seniors, it is parents of growing children like 
myself who also would appreciate it if things were----
    The Chairman. You don't like the Levitra ads during a 
football game?
    Dr. Behrman. At a very young age, my boys had me explain 
erectile dysfunction to them.
    The Chairman. OK.
    Senator Kohl. Thank you very much, Dr. Behrman. Your 
testimony has been good, and your responses to questions have 
been very helpful.
    Dr. Behrman. Thank you.
    Senator Kohl. We have four panelists for our second 
presentation. The first witness will be Dr. Paul Antony of the 
Pharmaceutical Research and Manufacturers of America. Dr. 
Antony is PhRMA's chief medical officer. In this role, he 
serves as PhRMA's principal advocate on all health care and 
medical policy issues.
    Our second witness will be Dr. Donna Sweet of the American 
College of Physicians. Dr. Sweet is chair of the Board of 
Regents of ACP, and she is director of Internal Medicine 
Education at Via Christi Regional Medical Center-St. Francis 
Campus in Wichita, KS. ACP is the Nation's largest medical 
specialty society, and Dr. Sweet is here to share with us ACP's 
position on direct-to-consumer advertising of prescription 
drugs.
    Next we will have Dr. Peter Lurie of Public Citizen. Dr. 
Lurie is deputy director of Public Citizen's Health Research 
Group, a consumer advocacy group located here in Washington. 
Dr. Lurie has worked on a myriad of issues related to the cost 
and safety of prescription drugs.
    Finally, we have Dr. Richard Kravitz. Dr. Kravitz is 
professor of Internal Medicine and director of the UC Davis 
Medical Center, Center for Health Services Research in Primary 
Care. His research is focused on understanding social 
influences on clinical practice. He is here to discuss his 
recent research on DTC advertising of prescription drugs.
    We welcome you all here today, and, Dr. Antony, we will 
take your testimony.

   STATEMENT OF PAUL ANTONY, MD, MPH, CHIEF MEDICAL OFFICER, 
 PHARMACEUTICAL RESEARCH AND MANUFACTURERS OF AMERICA (PHRMA), 
                         WASHINGTON, DC

    Dr. Antony. Mr. Chairman, Ranking Member Kohl, and members 
of the committee, on behalf of the Pharmaceutical Research and 
Manufacturers of America, I want to thank you for allowing us 
to participate in this hearing today on direct-to-consumer 
advertising. I am Dr. Paul Antony, the chief medical officer of 
PhRMA.
    Patients are increasingly demanding more information about 
their health and treatment options, not less, and they are 
getting this information from a wide variety of sources, 
including newspapers, television, and the Internet. Direct-to-
consumer advertising is one of the many sources patients use to 
obtain health information.
    DTC advertising can be a powerful tool in educating 
millions of people and improving health. DTC advertising 
provides value to patients by making them aware of the risks 
and benefits of new drugs. It can empower patients and enhance 
public health. It plays a vital role in addressing a major 
problem in this country of under-treatment and under-diagnosis 
of disease. It encourages patients to discuss medical problems 
with their health care provider that might otherwise not be 
discussed due to a stigma being attached to the disease. It 
encourages patient compliance with physician-directed treatment 
regimens.
    Despite the very positive role that DTC advertising can 
play in educating patients about health issues and options, 
over the years there have been concerns expressed about direct-
to-consumer advertising. In order to ensure that direct-to-
consumer advertising remains an important and powerful tool to 
educate patients, on July 29 of this year, PhRMA's Board of 
Directors unanimously approved a set of guiding principles on 
direct-to-consumer advertisements about prescription medicines.
    Our principles recognize that at the heart of our 
companies' DTC communications efforts should be patient 
education. This means that DTC communications designed to 
market a medicine should responsibly educate patients about a 
medicine, including the conditions for which it may be 
prescribed. DTC advertising should also foster responsible 
communications between patients and health care professionals 
to help the patient achieve better health and a better 
appreciation of the medicine's known benefits and risks.
    Our guiding principles recognize that companies should 
spend an appropriate amount of time educating health care 
professionals about a new medicine before it is advertised to 
patients.
    Companies that sign on to these guiding principles agree to 
submit all DTC television ads to the FDA before releasing these 
ads for broadcast, giving the agency an opportunity to review 
them consistent with its priorities and resources. Should new 
information concerning a previously unknown safety risk be 
discovered, companies commit to work with the FDA to 
responsibly alter or discontinue a DTC advertising campaign.
    In addition, the principles encourage companies to include, 
where feasible, information about help for the uninsured and 
underinsured in their DTC communications. Our companies offer a 
host of programs that can assist needy patients with their 
medicines.
    The principles also recognize that ads should respect the 
seriousness of the health condition and medicine being 
advertised and that ads employing humor or entertainment may 
not be appropriate in all instances.
    As a result of concerns that certain prescription drug ads 
may not be suitable for all viewing audiences, the guiding 
principles state that, ``DTC television and print 
advertisements should be targeted to avoid audiences that are 
not age appropriate for the messages involved.''
    PhRMA's Board also unanimously approved the creation of an 
Office of Accountability to ensure the public has an 
opportunity to comment on companies' compliance with these 
principles. Periodic reports will be issued by the PhRMA Office 
of Accountability to the public regarding the nature of the 
comments it receives, and each report will also be submitted to 
the Food and Drug Administration.
    PhRMA's Board also agreed to select an independent panel of 
outside experts and individuals to review reports from the 
Office of Accountability after one year and to evaluate overall 
trends in the industry as they relate to these principles. 
These principles will go into effect in January 2006.
    We believe these principles will help patients and health 
care professionals get the information they need to make 
informed health care decisions.
    Given the progress that continues to be made in society's 
battle against disease, patients are seeking more information 
about medical problems and potential treatments. The purpose of 
DTC advertising is to foster and inform conversations about 
health, disease, and treatments between patients and their 
health care practitioners. Our guiding principles are an 
important step in ensuring that patients and health care 
professionals get the information they need to make informed 
health care decisions.
    This concludes my oral testimony. I would be happy to 
answer any questions or supply any additional material 
requested by members or committee staff.
    [The prepared statement of Dr. Antony follows:]

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    Senator Kohl. Thank you very much, Dr. Antony.
    Dr. Sweet.

 STATEMENT OF DONNA SWEET, MD, FACP, CHAIR, BOARD OF REGENTS, 
         AMERICAN COLLEGE OF PHYSICIANS, WASHINGTON, DC

    Dr. Sweet. Thank you, Senator Kohl, Senator Smith, Senator 
Talent, and Senator Wyden. I am, as stated, Donna Sweet, chair 
of the Board of Regents of the American College of Physicians, 
the nation's largest medical specialty society representing 
over 119,000 doctors of internal medicine. ACP appreciates the 
opportunity to testify on the subject of direct-to-consumer 
advertising of prescription drugs.
    Internists typically provide primary and subspecialty care 
to large numbers of patients who are Medicare-eligible and have 
multiple medical problems. It is these patients who are most 
adversely affected by DTC advertising.
    Since 1998, ACP has been opposed to the practice of DTC 
advertising, which often leaves our patients confused and 
misinformed about medications. It undermines the patient-
physician relationship and impedes the practice of medicine by 
challenging the individual physician's medical judgment.
    ACP recognizes the value of consumer education. The medical 
community has an obligation to empower consumers by educating 
them about health conditions and possible treatments. A healthy 
physician-patient relationship can lead to better health 
outcomes through appropriate use of safe and effective 
medications. The College also acknowledges the need for the 
pharmaceutical industry to market its products, but believes 
public education programs that do not promote a particular drug 
product and are financially supported by pharmaceutical 
companies are a better approach.
    The pharmaceutical industry spends millions of dollars to 
support the efforts of non-profit organizations, including the 
ACP, to educate the public through unrestricted educational 
grants that do not promote a specific product. As an example, 
the ACP and the ACP Foundation recently received a multi-
million-dollar unrestricted educational grant from Novo Nordisk 
to create and disseminate educational tools and information for 
physicians, patients, and other members of the health care team 
to raise awareness and teach best practices in diabetes care, 
not branded in any way with Novo Nordisk. That is how the 
industry can help both patients and physicians.
    ACP also appreciates the PhRMA-issued voluntary guidelines 
to regulate the industry's use of DTC ads and that some 
companies have even gone beyond the PhRMA guidelines by 
voluntarily agreeing to delay advertising of new drugs to 
consumers until their safety and effectiveness have been 
tested. However, voluntary guidelines in our opinion are not a 
substitute for an effective regulatory approach to DTC 
advertising.
    The power of media broadcast is huge. Pharmaceutical 
companies and ad agencies know that. That is why DTC 
advertising is done. But it does put an adversarial element 
into the physician-patient relationship. Even in a practice 
like mine, where I have the luxury of being the medical home 
for some of my seniors for the last 15 to 20 years, when I have 
to say no to something that the healthy-looking person on 
television says is good for them and will make them feel 
better, it takes some work. Most of the major drugs seen on DTC 
ads target our seniors. Thick, ugly toenails, erectile 
dysfunction, urinary incontinence, osteoporosis--all things 
that need to be discussed, but not necessarily secondary to an 
ad that says, ``This product is best.''
    Consider the toenail ad, my personal favorite. While I am 
trying to tell a senior that it is not life-threatening; that 
there really aren't little creatures with horns, legs, and arms 
under their toenails, living in sofas and chairs; that the drug 
is quite expensive; and that the risks of toxicity are 
significant and that it may not work, I lose valuable time that 
could have been directed at the underlying reason they have 
those toenails--their diabetes, their vascular disease, their 
cholesterol, their overall health.
    Some ads, like those that tell people that there is help 
for embarrassing problems--urinary incontinence as an example--
have opened dialog, but the ads promote the more expensive 
brand names when generics often work equally as well.
    Last, some of the ads are just embarrassing. I was talking 
to a senior last week from Arkansas who was watching sports on 
TV with his grandkids, and he was not really paying any 
attention to the ads until his 7-year-old grandson pulled on 
his shirt sleeve and said, ``Grandpa, what is a 4-hour 
erection?''
    ACP would prefer to see Congress ban DTC advertising 
because it does not constitute appropriate patient education. 
In the absence of a prohibition, which we understand is 
probably not possible, the College calls on Congress, the FDA, 
and the industry to take actions to minimize the deleterious 
effects of DTC advertising, and we would recommend the 
following:
    Federal regulations and guidelines must be expeditiously 
strengthened to make drug advertising as honest and useful as 
possible. The FDA's retrospective regulatory process should be 
replaced with a mandatory pre-release screening of all 
pharmaceutical advertising. Marketing should be directed at 
providing clinicians with accurate information on new drug 
products. Physicians and pharmaceutical companies should 
continue to work together to create effective advertising and 
educational initiatives. Finally, the Federal Government should 
continue to fund studies to further define and measure the 
impact of DTC ads.
    Just as fast-food advertising to our kids is leading to an 
epidemic of obesity, I have to believe that DTC advertising to 
our seniors leads to an overconsumption of medications and 
sometimes outright doctor shopping if they really feel they 
have to have those medicines.
    ACP thanks the Aging Committee for addressing this subject 
and for considering the views of the American College of 
Physicians, and I would take any questions or provide 
additional information as needed.
    [The prepared statement of Dr. Sweet follows:]

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    Senator Kohl. Thank you very much, Dr. Sweet.
    Dr. Lurie.

  STATEMENT OF PETER LURIE, MD, MPH, DEPUTY DIRECTOR, HEALTH 
         RESEARCH GROUP, PUBLIC CITIZEN, WASHINGTON, DC

    Dr. Lurie. Thank you. Like all interventions in health 
care, DTC advertising should be evaluated by comparing risks 
and benefits in the context of available or potentially 
available alternatives. On balance, we believe that the clearly 
demonstrated adverse effects of DTC advertising outweigh the 
still undemonstrated effects that might be beneficial. Where 
there is any hint of a beneficial effect, we find that there 
are better ways of accomplishing it.
    Senator Kohl, you are correct that New Zealand has 
permitted direct-to-consumer advertising, but actually now 
there is a moratorium on it, and they are planning on making 
that moratorium final. The only country that has tried it has 
turned its back on it.
    I will make seven points.
    First, direct-to-consumer advertisements bear little 
relationship to public health needs. New and expensive drugs, 
those for diseases that are bothersome and incurable, are the 
ones that we see advertised. Only 14 percent of sales for the 
top 50 DTC-advertised drugs are for acute conditions, and only 
one of the top 50 DTC-advertised drugs was an antibiotic, 
presumably because people are quickly cured and there is no 
need for a refill. We see shouldered aside advertisements for 
generic drugs, such as those that might prevent heart attack or 
stroke, and, of course, any non-drug interventions, like 
behavioral smoking cessation, weight loss or exercise programs.
    Second, many DTC advertisements are misleading or 
dangerous. Part, I think, of the reason we have this hearing is 
because of what happened with Vioxx. We should remember that 
Vioxx was the No. 1 DTC-advertised drug in 2000, and at $160 
million was larger than the campaigns that year for either 
Pepsi or Budweiser. So that is one well-known example.
    I have attached to my testimony a second example, which is 
a DTC ad which might be considered a direct-to-children ad. It 
is an ad for Differin, an acne medication, and if you look at 
my testimony, you will see that teenagers are exhorted--those 
at Acne High are exhorted to take a course called ``Zit 101.'' 
Of course, they need to talk to their parents because children 
don't usually go to their doctors without their parents. If you 
can get your parent to help you out, you get to qualify for one 
of the three levels of ``cool.'' If you sign up, you get two 
free music downloads. If you get and refill a Differin 
prescription, you get seven free music downloads. If you get 
your parent to help you refill it, you get ten. This is turning 
children into the agents of the pharmaceutical industry in a 
way to get around doctors. I think that is really 
inappropriate.
    A third example, very briefly, is AstraZeneca's Crestor, a 
drug in which the industry actually managed to misrepresent the 
FDA itself by saying that the FDA had few concerns about the 
safety of the drug, when, in fact, they were on record saying 
that they did.
    Point three, consumers are being misled. Sixty percent of 
people surveyed by the FDA thought that the advertisements 
provide insufficient information about drug risks, and 44 
percent felt similarly about the benefits. Consumer support for 
DTC advertisement, as all of you have hinted, is, in fact, 
declining. There are data from the FDA's own survey comparing 
the 1999 to 2002 survey that show that more and more people are 
getting fed up with these ads and fewer ``liked seeing'' the 
advertisements, a decline from 52 percent down to 32 percent.
    Point four, doctors are being coerced. Dr. Kravitz will 
talk, I am sure, in great detail about his landmark study, but 
I will point to one part of it, which is that patients with 
adjustment disorder, only 10 percent of whom would otherwise 
have gotten a prescription for an antidepressant drug, 55 
percent of those did when they went to a physician mentioning 
an ad for Paxil that they had seen on TV. So this is a clear 
increasing of prescribing when it probably is not justified.
    Point five, the price of health care is being driven up. 
Patients are being induced to request new, more expensive 
medications instead of equally effective, older generic ones. 
The GAO concluded that, ``DTC advertising appears to increase 
prescription drug spending and utilization.'' I am sure that 
their next study that you have requested will come to the same 
conclusion, and most of that is because of increased 
utilization, not prices.
    Point six, potential benefits of DTC advertising. There is 
a comprehensive review study referenced in my testimony of the 
data on this issue. They conclude: ``The onus is on those who 
might support [DTC advertising] to produce evidence of benefit 
and, in the absence of this evidence, we must assume that the 
likely disbenefits. . . outweigh the as yet unproven 
benefits.''
    I go on to talk about Dr Kravitz's study in which he shows 
that if you want people to get prescribed more 
antidepressants--and I shan't comment on whether that is a good 
idea or not. But if one did, in fact, general entreaties to 
physicians are more effective than direct-to-consumer 
advertisements.
    My seventh and final point is that FDA enforcement is 
lackadaisical. I have attached some data for enforcement 
actions at the FDA dating back to 1997. These are all 
enforcement actions. There may be a small increase recently, 
but the overall trend is down and has been consistently so, in 
fact, going back to 1998. But there is a big drop-off after 
2001, at which point all warning letters and regulatory letters 
needed to go through the Office of the Chief Counsel at the 
FDA, which resulted in a decreased number of regulatory letters 
being released, which the GAO said had adversely affected FDA's 
oversight.
    So, in conclusion, then, we believe that the benefits have 
not been demonstrated, and to the extent that there are any 
they can be secured through other less dangerous routes, but 
the dangers are quite clear.
    Our recommendations are: Firstly, the industry, the 
guidelines--PhRMA has been aroused to produce them only because 
of criticism. The guidelines are voluntary, and are they 
recommend, for example, if the company should wait ``an 
appropriate amount of time''--whatever that is--after launching 
a new drug before initiating a DTC advertisement. Senator Frist 
has recommended a 2-year waiting period. Growth of DTC 
advertising didn't happen magically. It is because of 
deregulation by the FDA. It means the genie can be put back in 
the bottle.
    We would recommend that FDA provide proper patient 
information. The best way to do this is through medication 
guides, which the agency developed an interest in 1995. But 
there are only about 75 of those, and that is part of the 
reason the industry can get away with it--because the FDA has 
failed to provide this kind of information.
    Federal agencies should be doing more to educate patients, 
and I refer to the FDA, of course. The NIH and the Agency for 
Health Care Research and Quality could also be doing more. The 
FDA has yet to publish any regulations regarding DTC 
advertisements. You heard Dr. Behrman talk about how they use 
the prescription drug advertising rules to apply to DTC. There 
are some guidances, but they are voluntary. They have little 
ability to enforce them. They are understaffed. There is no 
pre-review of television advertising, and we also think there 
should be a ban on celebrity endorsements. Most fundamentally, 
the agency still does not have the ability to level civil 
monetary penalties.
    In conclusion, health care observers have long noted that 
health care is unlike other markets in that patients typically 
do not purchase services directly. Rather, because of the 
complexity of the decisions involved and the potentially life-
threatening nature of poor choices, the physician acts as a 
``learned intermediary'' on the patients' behalf. DTC 
advertising is nothing less than an end run around the doctor-
patient relationship, an attempt to turn patients into the 
agents of the pharmaceutical industry as they pressure 
physicians for medications that they may not need.
    Thank you.
    [The prepared statement of Dr. Lurie follows:]

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    Senator Kohl. Thank you, Dr. Lurie.
    Dr. Kravitz.

STATEMENT OF RICHARD L. KRAVITZ, MD, MSPH, DIRECTOR, CENTER FOR 
    HEALTH SERVICES RESEARCH IN PRIMARY CARE, UNIVERSITY OF 
        CALIFORNIA, DAVID MEDICAL CENTER, SACRAMENTO, CA

    Dr. Kravitz. Chairman Smith, Senator Kohl, distinguished 
members, thank you for inviting my testimony today.
    Spending on direct-to-consumer advertising has increased 
every year since the early 1990's and, as we have heard, in 
2003 totaled $3.2 billion, perhaps edging up to as much as $4 
billion today. Much of the spending is for drugs used to treat 
conditions that affect the elderly, including high blood 
cholesterol, stomach ulcers, degenerative arthritis, strokes, 
and depression. As you have heard in testimony already, the 
debate on the proper role of DTC advertising is highly 
contentious.
    While all the signs are that older Americans, just like 
their younger counterparts, are responding to DTC ads, in a 
telephone survey of Sacramento residents several years ago, 
more than half the respondents had read a DTC ad from cover to 
cover, and in a more recent survey conducted by Prevention 
magazine, 27 percent of seniors had asked their physicians 
about advertised medicines. The question is: Is there anything 
wrong with that?
    Proponents of DTC advertising argue that ads educate 
patients and encourage appropriate care-seeking, while critics 
charge, as we have heard, that ads lead to overprescribing of 
unnecessary, expensive, and potentially harmful medications.
    To shed some light on this controversy, we conducted a 
study that was published in the April 27th issue of the Journal 
of the American Medical Association. The study was designed as 
an experiment using standardized patients, or SPs. SPs are 
actors trained to portray the clinical and biographical 
features of a role and to do so accurately and reliably. The 
use of SPs allowed us to control very precisely for patient 
demographic characteristics and symptoms, allowing us to 
ascribe any differences in doctor behaviors to the kinds of 
requests the SPs made.
    We enrolled 152 physicians in three U.S. cities. Most 
physicians saw two unannounced standardized patients, for a 
total of 298 visits. We used 18 white, middle-aged actresses 
who were trained to portray six roles, which we created by 
crossing two clinical conditions with three request types. The 
clinical conditions were major depression and adjustment 
disorder. Major depression is serious and needs to be treated 
promptly. Adjustment disorder represents an exaggerated 
reaction to life events and can usually be treated with 
watchful waiting.
    As you will see in one of your handouts, the first one, 
with the little picture up in the upper right-hand corner, 
actresses portraying ``Louise Parker,'' the major depression 
role, complained of depressed mood for a month, worse in the 
past two weeks. Actresses portraying ``Susan Fairly,'' the 
adjustment disorder role, noted some sleep problems and low 
energy for a few weeks, but nothing that interfered 
significantly with function.
    The SPs were further assigned to one of three request 
groups, and that is laid out in the next handout. A third of 
the standardized patients mentioned seeing a television ad and 
made a brand-specific request for Paxil. Another third told of 
watching a TV documentary and made a general request for 
medication that might help. The last third made no request at 
all.
    We thereby created six cells, six separate conditions, with 
about 50 standardized patient visits in each one. The first 
cell, for example, contained visits in which the SP portrayed 
major depression and made a brand-specific request for Paxil, 
then major depression with a general request, no request, and 
so on.
    The next slide shows the major results. Among SPs 
portraying major depression, antidepressant prescribing was 
highest when a general request was made, 76 percent of visits; 
middling when a brand-specific request was made, 53 percent; 
and lowest when no request was made, 31 percent. These are 
among SPs who, by all rights, should well have been treated at 
the first visit.
    In adjustment disorder, prescribing occurred in 55 percent 
of brand-specific visits, 39 percent of general request visits, 
and only 10 percent of no request visits.
    We went on to define----
    Senator Talent. Mr. Chairman, can I just ask a question to 
clarify this? It is just a factual thing.
    When the drug was prescribed and when they made a brand-
specific request, did the physician prescribe the brand they 
asked for, or was there another drug, or did you keep track of 
that?
    Dr. Kravitz. We did, and, in fact, Paxil, the brand-
specific drug, was prescribed about half the time when that 
specific drug was----
    Senator Talent. So when they made----
    Dr. Kravitz. The other half the time another antidepressant 
was----
    Senator Talent. One more--was there a difference between 
how often the Paxil was prescribed between the control groups 
when they asked for it specifically or when they just said we 
have got a problem, maybe there is a drug that will help us?
    Dr. Kravitz. Very interestingly, Paxil was almost never 
prescribed in the major depression condition unless it was 
asked for specifically. It was prescribed about 20 percent of 
the time in the adjustment disorder condition when it wasn't 
asked for.
    Senator Talent. OK. So half the time when asked 
specifically and they prescribed something----
    Dr. Kravitz. Less than 20 percent otherwise.
    Senator Talent. OK. Thank you. I am sorry, Mr. Chairman.
    Dr. Kravitz. We went on to define ``minimally acceptable 
initial care'' for depression as any combination of an 
antidepressant prescription, a referral to a mental health 
professional, or a follow-up appointment within two weeks. The 
next slide in your handout shows how minimally acceptable care 
was much higher for SPs making any kind of request, either 
brand-specific or general, than for those making no request, 
over 90 percent versus 56 percent.
    So, in summary, patients' antidepressant requests are a 
powerful influence on physicians' prescribing decisions. While 
such requests clearly improve quality of care for patients in 
actual need of immediate treatment, they also lower the 
prescribing threshold when an immediate prescription may not be 
in the patient's best interest.
    To the extent that these results hold true for other 
conditions and therapies, DTC advertising is a two-edged sword, 
capable of reducing underuse of necessary treatment and 
increased overuse of unnecessary treatment both at the same 
time.
    Thank you.
    [The prepared statement of Dr. Kravitz follows:]

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    Senator Kohl. Thank you very much, Dr. Kravitz.
    We can stay here until about 11:20. Let's see how far we 
can get.
    I would like to ask the whole panel, the question is: Do 
you think that if we either rein in or even possibly eliminate 
DTC advertising and also provide more comparative studies about 
the effectiveness of drugs, we will then be able to move toward 
a goal of providing the best drugs at the best prices to the 
American people? I will start with you, Dr. Antony.
    Dr. Antony. Senator, let me start by saying the industry 
also wants to make sure we get the best drugs to the right 
patient at the right time, so we are committed to doing that.
    On the issue of whether direct-to-consumer advertising will 
affect the price and cost of medicines, I am going to refer to 
a study that was actually done by the Federal Trade Commission 
where they studied that and reported back to the FDA. From 
their own study in 2003, they state that direct-to-consumer 
advertising accounts for a relatively small proportion of the 
total cost of drugs, which reinforces the view that advertising 
would have a limited, if any, effect on price. The reason that 
is important is everyone talks about the $4 billion that is 
spent on advertising, which is a large amount. But more than 10 
times that amount is spent on research and development, more 
than $40 billion a year. So, in the overall picture, it is 
unclear whether reining in direct-to-consumer advertising would 
actually lower the price of medicines.
    Senator Kohl. Dr. Sweet.
    Dr. Sweet. I would agree. I think there is little evidence 
that it would decrease the cost of medications. But my concern 
is the overall health care costs that I know Senator Wyden is 
concerned about. Every time a physician has to see a patient 
back for toxicity, every time there is a drug prescribed when 
there might have been a lower-cost alternative drug because of 
DTC, you are increasing the overall health care cost. So, yes, 
I would agree that taking care of DTC advertising is not going 
to lower the overall cost of most medications. I am concerned 
about the overutilization, and as I stated in my testimony, we 
at the ACP believe that the pharmaceutical industry is a 
tremendous resource, and we would like to see them put those 
resources into the kinds of things that we know do help 
patients: non-branded, public relations kinds of messages that 
address things like depression and incontinence and even 
erectile dysfunction, but without specifically branding a given 
drug.
    In answer to the first part of your question, we always 
need more data, and, yes, there is a real lack of data that 
looks at these newer, more costly agents, especially in classes 
where there are older, already sometimes generically available 
medications. It would be wonderful to have more data on truly 
head-to-head analyses of the overall effectiveness.
    That is probably not going to happen just because of the 
way industry drives clinical research. But anything we could 
have as better data to suggest to our seniors that a generic 
drug for urinary incontinence works just as well as what they 
saw being carried behind the car and the outhouse would be 
helpful to us as clinicians with our patients.
    Senator Kohl. Thank you.
    Dr. Lurie.
    Dr. Lurie. While it is true that direct-to-consumer 
advertising isn't the largest fraction of all advertising for 
drugs in this country, but it is substantial, about 20 percent, 
and growing. So I do think it would make a difference.
    DTC ads, as I said, for the 25 largest therapeutic classes, 
accounted for 12 percent of drug sales growth between 1999 and 
2000, and the estimate was that it would cost $2.6 billion as a 
result, just in those 25 therapeutic classes. So I think 
emphatically it would lead to an increase in the overall cost 
of drugs. Be careful to distinguish between drug prices and 
costs. I don't think that the prices would go up, but I think 
that the overall costs go up because people get driven away 
from non-drug interventions or generic drugs interventions to 
newly patented drug interventions which are more expensive.
    The GAO estimated that a 10-percent increase in DTC 
advertising translated into a 1-percent increase in sales for 
that class of drugs, which is an enormous increase when you 
think about these drug classes that are selling in the billions 
of dollars.
    So I think absolutely it makes a difference. It may or may 
not be the most important thing. Certainly if the committee can 
pay attention to the gifts and handouts that are being given to 
physicians and where most of the pharmaceutical company 
advertising does go, I have no objection to that. But in the 
meantime, before us we have DTC advertising and emphatically it 
does contribute to the overall cost of drugs.
    Senator Kohl. Thank you.
    Dr. Kravitz.
    Dr. Kravitz. Well, asking a researcher whether there should 
be more comparative studies is kind of back to that cookie 
situation that Dr. Behrman mentioned. But, yes, I think there 
should be more comparative studies of two types. First, there 
is a desperate lack of head-to-head comparisons between 
individual drugs within a class, so that not only consumers but 
physicians have little basis to distinguish between drugs 
within a category. Second, the moratorium on DTC advertising 
for a period of time that has been proposed in several quarters 
should be extended to place a greater emphasis on more rigorous 
post-marketing surveillance so that we can use that period of 
time to actually collect some systematic, useful information.
    As far as reining in DTC, I think indeed much more could be 
done to raise the rigor of the education that is provided to 
patients, but my own view is that DTC should not, in fact, be 
banned, and that, in fact, in some situations we need not less 
DTC but more. For example, patients who are discharged from the 
hospital having suffered a heart attack should be on medicines 
called beta blockers as well as aspirin. I would be highly 
supportive of a DTC campaign to encourage patients who have had 
a heart attack to go on these two medications, which have been 
associated with a 30-percent reduction in mortality. We see 
study after study showing that somewhere between 60 and 90 
percent of patients receive these drugs, where the figure 
should really be closer to 100.
    Senator Kohl. Thank you.
    Mr. Chairman.
    The Chairman. Senator Kohl, I am tempted to ask Dr. Sweet, 
How did Grandpa answer his grandson about the 4-hour issue? 
When my son asked me that, I told him if he ever has that 
problem, we need to talk. [Laughter.]
    Dr. Sweet. He similarly dodged the issue.
    The Chairman. OK. On a more serious issue--and in fairness, 
I probably should have asked this to Dr. Behrman. But if I am 
not mistaken, wasn't Vioxx an arthritis drug broadly 
advertised? If it was broadly advertised, wasn't it later 
pulled from the market or had substantial warnings placed on it 
because in fact, it did highly elevate the risk of heart 
attack.
    What does that say about all of this? Am I right in my 
recollection, and what does it say about all of this?
    Dr. Sweet. I will start. You are very right in your 
recollection, and as testimony has said, in 2000 Vioxx was the 
most advertised directly-to-consumer drug in our nation. I 
think that is what has led all of us to believe that some sort 
of a moratorium on these new drugs prior to direct-to-consumer 
advertising so that the drug can be looked at in a larger group 
of people would be useful. When you do clinical studies, you 
have a very limited group of people that you look at, and 
generally, they are well selected. The pharmaceutical industry 
wants to make sure that their drug gets approved. It is only 
when you then put a drug into a much larger population at all 
ends of the spectrum of disease states and clinical conditions, 
liver and kidney problems, that you really see what goes on. I 
think that is exactly what happened to Vioxx.
    In my opinion, Vioxx is not a bad drug. Vioxx is a drug 
that was overused in many people who it had not been studied in 
and for which we had no data. As a result, we now have this 
real--what many people would consider a debacle in the 
industry. It is too bad because there were many people who were 
helped by Vioxx. But there were too many people that got it, 
often as a result of bringing that ad in, and it happened to me 
more than one time where somebody brings the ad in or writes it 
down from the television, and they are hurting and they want 
something to help, and, ``Doctor, this one will work this time. 
I have got to have it.'' So, yes, I do believe that actually 
some of the--and perhaps Dr. Antony wants to comment, but I do 
think some of the decrease in direct-to-consumer advertising 
that we are seeing now is a result of the industry seeing what 
happened. It is one of the reasons that the ACP certainly would 
like to see very much more data on efficacy and safety prior to 
broad-range direct-to-consumer advertising so that we know more 
about what our seniors and others are asking about.
    Dr. Antony. Chairman, I would like to respond. Dr. Sweet 
raises this very important issue of what do we do with 
information about medicines and health care as it develops and 
as we learn more information, because we never have all of the 
information when we originally release a product.
    Dr. Kravitz just mentioned the issue of beta blockers and 
their use after heart attacks, and he actually recommends that 
we do more direct-to-consumer advertising in that area. That is 
a good real-time example of what should we do with more 
information, because just this week JAMA, the Journal of the 
American Medical Association published a study that said those 
beta blockers, which we have been really pushing, encouraging 
physicians to prescribe, it looks like that in many patients it 
doesn't help them, and in certain patients it may actually harm 
them.
    So now what do we do? There was no conspiracy to hide this 
information, and what I will tell you that is interesting about 
it is I am a member of the AMA, I subscribe to that journal. 
But the way I learned about this information was a Bloomberg 
report that summarized that report. I got it on my BlackBerry, 
and it was even before the journal was published.
    So I as a clinician now--and I was telling people to take 
these medicines because that was the best information that was 
available. Now I have just learned via Bloomberg that 
apparently there is at least one study that says we have to be 
cautious.
    So in this new information age this issue that you are 
discussing now as a committee is a critical one, and all I 
would say as an individual clinician and as an industry is that 
until we sort this out, this answer that we can't share any 
information, that somehow we are not going to disclose 
information, that that is potentially dangerous, and that a 
better view is how can we make information more reliable, more 
fair and balanced, not how do we try to hide information from 
people.
    Dr. Lurie. If I may, on Vioxx, I disagree with Dr. Sweet in 
the sense that there was never a study that showed that Vioxx 
was a more effective medication than any nonsteroidal anti-
inflammatory drug on the market--aspirin, ibuprofen, naproxen, 
et cetera. There was a claim, ultimately allowed by the FDA, 
that it was less toxic to the gastrointestinal tract. So the 
patients for whom the drug made sense were those who had not 
tolerated the previous drugs well.
    However, two-thirds of the increase in drug sales between 
1999 and 2000 was precisely among those who did not have GI 
toxicity. The reason for that in part was DTC advertising, but 
also because of other advertising that the pharmaceutical 
companies undertake.
    As far as the notion of there being more direct-to-consumer 
advertising, of course, I don't agree, but we should be careful 
about what we mean when we talk about that. This conversation 
has been about those DTC ads that have linked drugs and 
diseases. But there is, in fact, a capacity for the 
pharmaceutical industry to engage in disease-only advertising, 
and those are called help-seeking advertisements. If the 
industry was that interested in those, we would be seeing a 
massive growth in that kind of advertising rather than the 
growth in product-related advertising that we do so.
    So as to the beta blocker example, we are never going to 
see a DTC advertisement for those because they have been off 
patent for many years, anyway.
    Senator Kohl. Senator Wyden.
    Senator Wyden. Thank you, Mr. Chairman.
    Dr. Antony, the heart of the case for PhRMA is that direct-
to-consumer advertising is for consumer education. You say 
that. In fact, I guess you use those words, ``The heart of our 
company's direct-to-consumer efforts is patient education.'' 
But I never see on television any drug advertised for which 
there is a small market, which it seems to me undermines the 
argument this is about patient education.
    Could you give me an example of a drug that is advertised 
on television for which there really is a need for patient 
education for which there is a small market?
    Dr. Antony. Let me respond, again, and I am going to cite a 
study that was conducted by RAND, and I am going to use 
examples of conditions where there is a need for patient 
education. This RAND study talked about.
    Senator Wyden. But if I could, because time is short.
    Dr. Antony. Sure.
    Senator Wyden. We see all these ads on TV. Could you give 
me an example of a drug advertised on TV where there is a small 
market?
    Dr. Antony. Senator, I can only address the ones that I am 
aware of, which tend to be diseases that affect a lot of people 
and they may be undertreated. So I don't--I can't answer that 
in terms of one that is for a small market because I think that 
what the companies want to go after in a mass marketing or a 
television ad is diseases that affect a lot of people. They may 
be underused--I mean, as opposed to this idea of they are going 
after things that there is already adequate treatment, and I 
will use asthma as an example of something where a lot of 
people suffer it, it is a chronic problem. I would argue it is 
more than bothersome. It is a real issue for people. So, yes, 
you are going to see advertising in those categories. Where 
with a condition that may only affect a few dozen people, I 
think it is unlikely that you would see television advertising.
    Senator Wyden. How would you reconcile the idea of 
voluntary guidelines with the fact that people who work for 
pharmaceutical companies get bonuses for increasing sales for 
drugs that are advertised? I don't see how you reconcile those 
two.
    Dr. Antony. Senator, I will answer your question, again, 
both as a clinician that was treating patients full-time before 
joining industry and the industry position. This discussion is 
on direct-to-consumer advertising. A number of years ago, there 
was significant concern about the direct markets that companies 
were doing to physicians in terms of what the sales reps were 
doing in the physician offices. The industry came together 
working with the American Medical Association to develop a code 
of conduct for how sales reps, pharmaceutical sales reps should 
interact with physicians, and it was a voluntary code. But 
there is no question that physicians saw a dramatic change in 
the behavior of those sales reps, so much so that many of them 
actually now complain to me and say, ``Why can't I take my wife 
to these continuing education dinners because I don't have very 
much time and I am losing family''----
    Senator Wyden. That is not what I am asking, Doctor. I am 
asking how the voluntary guidelines restricting direct-to-
consumer advertising can be reconciled with the fact that 
people who work for the companies get bonuses for increasing 
sales in direct-to-consumer products?
    Dr. Antony. Senator, I can't answer the specific question 
about the bonus.
    Senator Wyden. OK. Let me ask you one last question, 
because I know Senator Talent wants to get some questions in 
before the break. Why should Medicaid pay for all of these 
advertisements on television? Your companies already get a tax 
break for advertising on TV. Why should Medicaid pay this 
double subsidy at a time when the program is being cut so 
dramatically? That is, of course, what Senator Sununu and I 
would stop in our bipartisan bill, but I would like to have you 
tell me why Medicaid should pay for those advertising expenses.
    Dr. Antony. Senator, I don't know the details of how much, 
what percentage of the costs are paid by Medicaid or any other 
payer. My understanding is that Medicaid gets--the pricing to 
different groups is very different, and so I don't know what 
percentage of any cost is actually being picked up by Medicaid.
    Senator Wyden. But should Medicaid pay for advertising 
expenses, just as a concept? Is it the position of PhRMA that 
Medicaid should pay for advertising expenses?
    Dr. Antony. Senator, it is my understanding that PhRMA does 
not have a position on that specific question.
    Senator Wyden. OK. Thank you very much, Mr. Chairman.
    Senator Kohl. Senator Talent.
    Senator Talent. Thank you, Mr. Chairman, and thanks again 
for this hearing. It has been very useful to me. It has 
established some parameters. When we talk about DTC, we are 
talking about prescription drugs, not over the counter. Is that 
fair?
    We have referred to--the ranking member referred to the 
Constitution, and I think you did also, Dr. Lurie. It is your 
understanding that--I thought you did, that there are 
restrictions, and we really don't, I guess, have a witness on 
that question. But I think it is everybody's understanding that 
there are at least some limits on what we can constitutionally 
do. Is that one of the reasons you guys are not proposing--or 
some of you are saying a ban is something we cannot do? Is it 
because of your understanding of the Constitution?
    Dr. Sweet. Well, I think Dr. Behrman addressed that, and 
with the right to speech and capitalism and all of those 
things--that is why the College's position is that if we had 
our druthers, banning would be nice. But we realize that in our 
constitutional arena, it is probably not ever going to happen, 
which is why we then go to a greater degree of regulation.
    Senator Talent. I am not, by the way, trying to make a 
point here. I don't know that I would agree with that ruling, 
if that is indeed the ruling.
    Is there any evidence or do you all have a good feel, at 
least anecdotally, for how many of the drugs that are 
advertised in this fashion are generally covered by insurance 
where people have insurance and how many of the people more 
generally have to pay for out-of-pocket? With that affect your 
opinion on this issue?
    Dr. Sweet. I will answer that as somebody that does this 
every day. The drugs that Senator Wyden had on his list of 
Medicaid and Medicare drugs are absolutely the most popularly 
prescribed and generally needed drugs.
    Again, when you look into--as an example, the number of 
drugs on his list for gastroesophageal reflux disease, the so-
called proton pump inhibitors, three or four of them were up 
there.
    You get into the issue that somebody comes in and they want 
the purple pill, and yet if they have insurance, their 
formulary says they can only get the pink pill. Then you have 
to either convince them that the pink pill works as well, or 
they want you to pre-authorize the drug which is another layer 
of paperwork for clinicians. But some seniors are very adamant 
that they want the purple one, they don't want the pink one, 
the pink one is not going to work as well.
    Then you compound that with the fact that one of the drugs 
that was more heavily advertised in 2000 that Senator Wyden had 
up there, Prilosec, is now omeprazole over the counter, which 
is 68 cents a day compared to well over $3 a day for the other 
drug.
    So, again, there is this whole layer of, yes, proton pump 
inhibitors are wonderful for people who have reflux disease, 
but if you look at the clinical data--Dr. Kravitz and Dr. Lurie 
look at this all the time--in my opinion and in the opinion of 
most Medicaid programs that have looked at this, there is no 
clinically significant difference between those drugs in 
outcomes. Yes, each company's package insert is a little 
different and some of the reps will argue with me. But overall, 
clinically, they work well.
    So my job as a clinician and a Medicaid advocate and a 
Medicare advocate is to make sure that I use the best drug at 
the lowest cost--where you get into this cost-effectiveness. 
But that is a difficult debate--when you have somebody in front 
of you with the ad that says this one is going to work better. 
The general concept in our population is that generics are 
somehow not as good. Where that came from I am not sure, but I 
do think DTC advertising perhaps contributed to that feeling 
that a branded drug is better than a non-branded drug at this 
point.
    So there are so many layers, and I agree--I think Dr. Lurie 
said exactly what I said about the overall cost. Whether the 
cost of the purple pill goes down by 20 cents if you don't have 
as much advertising is not nearly as important as the fact that 
there are a lot of purple pill prescriptions written at roughly 
$100 to $110 a month when you could get by with Prilosec, over-
the-counter omeprazole.
    Senator Talent. Well, I am wondering--and maybe you would 
like to comment, Doctor--whether this does not cut both ways. 
On the one hand, a drug, unless it is the whole generic brand 
name distinction, a drug that is not likely to be covered 
because it is maybe a cosmetic or something like that, on the 
one hand, if the person is responsible for paying for it, if 
the patient is, that is sort of a countervailing influence that 
is introduced as against the advertising. On the other hand, 
those are also perhaps more likely to be the kinds of drugs for 
which there is less of a need under your criterion, Dr. 
Kravitz.
    So do you think that that cuts both ways? Should that be a 
factor in trying to figure out how to regulate this, Dr. Lurie, 
or just don't worry about that? What do you think?
    Dr. Lurie. Well, to me the consumer foots the bill no 
matter what happens, whether it is in the form of insurance 
premiums, whether it is in the form of copayments, whether it 
is in the form of taxes, whether it is in the form of what 
Senator Wyden refers to as the double subsidy. Either way the 
patient pays.
    To answer your initial question, my position would not be 
changed according to who the payer is, because ultimately the 
payer is the patient.
    Senator Talent. Yes, and I am not arguing for it. I am 
exploring it. If a person going in and asking for something 
knows they are going to have to pick up more of the cost, that 
is an incentive for them not to ask for it, notwithstanding. 
Then we have more like a typical market where you are 
advertising anything else that a person has to pay for.
    Dr. Lurie. Certainly there are data to that effect. The 
problem always has been that those kinds of copayments are very 
blunt instruments in that they can dissuade patients from 
taking both unneeded drugs or marginally needed drugs and those 
truly needed ones.
    Senator Talent. It would be very awkward to make a 
regulatory arrangement turn on that, because how do you--some 
things are covered by some policies and not by others and in 
different degrees. But it makes it look a little bit more like 
an over-the-counter drug where you are not proposing 
restrictions on that, in part because people are paying for 
that themselves, and so I think we have faith in the consumer 
to balance the claims against the price under those 
circumstances.
    Dr. Lurie. Well, the underlying assumption about the over-
the-counter drug is that the gravity of the decision in 
deciding whether or not to take the drug is one that the 
patient can make for themselves, or that the drug is needed on 
an emergency basis and you don't want to wait for the doctor. 
So I think that there is an appropriate distinction between 
OTC, and that is precisely why the concern about direct-to-
consumer advertising has not focused on them. It has focused on 
the prescription drugs and the notion that the physician, who 
has always been the arbiter of that decision, hopefully in 
collaboration with the patient, is having an end run made 
around him.
    Senator Talent. I suspect also the courts would view our 
interest in regulating advertisement of those more serious 
drugs more favorably than the other.
    Dr. Kravitz, let me ask you a couple things about your 
study to make sure I understand the conclusions. As I read it, 
in the cases where the person presented, the actor or actress, 
I guess, presented evidence of a major problem, where they made 
a brand-specific request, it seems to me like they were 
measurably less likely to get medicine prescribed than when 
they just made a general request. Is that true, and how do you 
explain that?
    Dr. Kravitz. It is true. The percentage who received 
prescriptions with a general request was about three-quarters 
and with brand-specific a little over half.
    Senator Talent. That is, obviously, statistically 
significant.
    Dr. Kravitz. That is statistically significant and 
clinically important. We did not measure the thought process of 
the clinician, and so we don't--you know, all we have is 
theories. But one theory is that clinicians may rebel a little 
bit against requests that are branded, and they may be more 
likely to retain an open mind when the requests are not 
branded, when they are more general and when they focus on a 
condition. This has been a longstanding concern about the so-
called poisoning of the physician-patient relationship with 
respect to DTC ads.
    Senator Talent. Yes, I am wondering whether--but that did 
not present--I mean, that is not the same situation when they 
had presented minor symptoms.
    Dr. Kravitz. In fact, that is right.
    Senator Talent. Isn't that interesting. So you think that 
maybe the physician involved, if they mentioned a specific 
drug, perhaps suspected some of the underlying statements, 
thinking they are just trying to get this drug, and so they 
maybe were less likely to prescribe it?
    Dr. Kravitz. Possibly, or I think they may be--in a major 
depression condition, at least, we believe that they are 
hearing the general request as, ``Do you think I might have 
this serious medical condition?'' They are hearing a brand-
specific request as, ``I am the consumer, I watch a lot of TV, 
and I want this specific drug, and your judgment to the wind.'' 
So there is a little bit of a backlash there, we think.
    Senator Talent. One more question for you then. If we go to 
the next page in your handouts, patients receiving minimally 
acceptable initial care, does that show that people were more 
likely to get minimally acceptable care in general if they made 
a request of some kind for prescription drugs?
    Dr. Kravitz. Yes, that is right, and this is a key finding. 
We found that in the absence of a request, 56 percent of 
patients, actors, with major depression received minimally 
acceptable initial care, which sounds low, but it pretty much 
precisely corresponds to what some large national studies of 
quality of care for depression and lots of other chronic 
conditions have found. That percentage went up dramatically 
with any kind of request, even a little higher with----
    Senator Talent. Dr. Sweet and Dr. Lurie, does that give you 
some pause in your desire for regulation? I mean, if it is true 
that people are more likely to get--even though we do not 
understand why, more likely to get minimally acceptable initial 
care if they have made a request for some kind of prescription 
drug, would that change at all your attitude toward regulation 
of the DTC?
    Dr. Sweet. From my perspective, no, because one of our 
``asks'' at the ACP is that there be more non-branded, disease-
specific, public information, true consumer education, and I 
think Dr. Kravitz's study supports that, especially in that 75 
versus 50 percent. Those who asked, ``in general do you think 
there is something that might help me,'' probably got better 
care in the long run.
    Senator Talent. OK.
    Dr. Lurie. No. In fact, that is what I referred to in my 
testimony. The point is that if you believe that a patient 
ought to get the antidepressant, the best way to do it is not 
through a DTC brand name advertisement. It is by a more generic 
request. So if that was the concern, this is actually not the 
most effective way. Of course, a more general public service 
announcement, for example, from the Public Health Service, 
would not have all the risks that we have otherwise talked 
about here.
    On the other hand, the brand name advertisements have 
distinctly negative effects when it comes to adjustment 
disorders. So, no, I think it shows risk without benefit, as 
far as I am concerned.
    Senator Talent. I have got to go. My staff tells me we are 
voting on confirming the next Chief Justice, and I probably 
ought to cast a vote in that. [Laughter.]
    So I am going to go ahead and go. Thank you all. This has 
been very interesting, I am sure, to all of us. I appreciate 
it, and I guess the hearing is now adjourned.
    [Whereupon, at 11:35 a.m., the committee was adjourned.]

                                 
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