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Pharma industry improves its tarnished reputation

Monday, June 15, 2015

The reputation of the pharmaceutical industry—historically not much better than that of the oil or tobacco industries—has stabilized in recent years. And public views about clinical research have improved significantly. Yet overall, the level of trust in pharmaceutical companies remains low.

Of 1,150 patient groups in 58 countries polled this year by PatientView, 39% said the global pharmaceutical industry has an excellent/good reputation, a 10% increase from 2013. The U.K.-based consultancy monitors the corporate reputation of pharmaceutical companies. And in a 2015 survey by public relations firm Edelman, 61% of respondents said they would be inclined to trust a pharmaceutical company, up from 53% in 2009. Meanwhile, a 2013 Center for Information & Study on Clinical Research Participation (CISCRP) study found only 28% of the public does not trust sponsors to inform the public quickly about safety concerns, compared to 45% eight years earlier; 94% of respondents consider clinical research studies safe, up 40%.

Among the many factors that have helped build trust in the pharmaceutical sector are initiatives, from both regulatory agencies and sponsors, to improve transparency and disclose clinical trial results. Drug companies, for the most part, have been able to avoid negative publicity in recent years. Some sponsors have incorporated programs that address social needs into their business models. Many also credit the work of patient associations and patient education groups, such as PatientsLikeMe and CISCRP, with helping to move the needle on public trust.

However, the overall perception of the industry remains low. The pharma industry once was widely respected for its integrity—from 1987 through 1993, Fortune named Merck the country’s most admired company. This year only one pharma company—Johnson & Johnson—was included in the magazine’s list of the top 20 companies with the best reputations. In a 2014 eyeforpharma survey of 971 pharma executives, 42% said they don’t believe the industry’s reputation is improving, while another 36% were uncertain.

Other recent surveys reflect a similarly negative view. In a 2015 Harris Interactive poll that measured the reputations of the most visible companies in the U.S., the pharma industry received only 37% positive mentions, only slightly higher than public trust in the financial sector or insurance companies. The PatientView survey found 35% of respondents believe the industry’s reputation has declined during the past five years, compared to only 25% who believe its overall image has improved. CISCRP’s survey, another important measure of public perceptions about the industry, found 25% of the public continues to believe study volunteers are gambling with their health.

The industry’s reputation has suffered for myriad reasons, including forced withdrawal of high-profile drugs, public suspicion about suppressed drug-safety data, inappropriate marketing of drugs and mistrust about high pricing.

John LaMattina, former president of Pfizer global R&D and author of the recently published book Devalued and Distrusted: Can the Pharmaceutical Industry Restore its Broken Image?, believes overcoming its poor image is the single biggest challenge facing the pharma industry today, even more important than R&D productivity. The lack of trust results in the public questioning the value and efficacy of new and innovative drugs brought to market and allows more credence to attacks from media, legislators or regulators.

“The industry’s poor reputation really is embedded in the thinking of everyday people,” said LaMattina, who also is a senior partner at Boston-based PureTech Ventures. “People look at me as if I was the devil when I defend or talk about the pharmaceutical industry. It’s gotten pretty bad.”

Core issue for industry

Restoring the industry’s poor image and increasing education about the important role of pharma companies in developing innovative medicines have become core issues not only for pharma companies, but also for the entire clinical research enterprise.

“For society to progress, there needs to be participation of patients in clinical drug development, participation in trials and an understanding of the potential benefits and the risks, which are carefully monitored,” said Paul Chew, M.D., chief medical officer and head of global medical affairs, Sanofi. “There needs to be support for innovation. The pharmaceutical industry cannot advance without the support of society and the public. It’s critical.”

DrugDev executive chairman Hugo Stephenson, M.D., a respected industry veteran, said the industry’s low reputation during the past decade has had a critical impact on reimbursement levels for drugs, which directly affect the amount of money available for R&D spend. Drug prices typically are set higher than the actual amount required for manufacturing a particular medicine; reimbursement requests for drugs generally factor in development costs. The gap between the manufacturing cost and the selling price funds a considerable amount of additional R&D.

Yet Stephenson said approvals for higher reimbursement amounts require trust that the industry is acting in the best interest of society and will produce new drugs that address unmet need as opposed to drugs that have the greatest commercial potential. When companies lose trust that they will “do the right thing” by investing in needed treatments for the future, Stephenson said it can result in a vicious cycle of lower reimbursements, less money for R&D, fewer dollars to spend on riskier drugs for unmet medical need, fewer clinical trials and less willingness for both investigators and patients to participate in those trials, which affects recruitment and drives up costs.

“You end up with this vicious cycle where the industry is not taking risks or trying as many new potential compounds as possible. As a result, the industry produces less and the perception that industry produces our cures of tomorrow goes down, which feeds into the negative cycle,” said Stephenson. “The reality is that we are selling today’s medicines to pay to discover and develop tomorrow’s medicines. That is the model of our industry. The moment that the community doesn’t trust that industry is actually doing that, it puts pressure on reimbursement and it affects the entire business model of the industry.” 

Poor reputation also negatively impacts industry efforts to move toward a patient-centered drug development model that actively engages patients throughout the clinical trial process. The ultimate goal is to have the patient community take ownership for the success of the research enterprise by feeling it has a vested interest in its success as an engaged partner; patient-focused development could help improve trial enrollment rates and data quality, reduce costs and, eventually, lead to better outcomes. Yet advancing this approach requires pharma companies to build greater trust with the public and convince patient groups they are concerned about curing their diseases.

“When people feel more connected to the research enterprise, they are going to be more willing to participate,” said Jill McNair, director of education, outreach and community support at CISCRP. “As the reputation goes up for all companies, enrollment will go up. People will see the value in research and see that companies are looking out for them.”

Sponsors also are concerned about having strong reputations among investigative sites, particularly as they want to push more research into community-based settings. All sponsors want to ensure investigators consider them a partner of choice for trials in today’s increasingly networked healthcare economy. A 2015 CenterWatch survey of 1,900 global sites found the reputation scores for the five highest-ranked companies—Novartis, Roche, Sanofi, GlaxoSmithKline and Pfizer—all have increased since 2013, but the overall reputation ratings aggregated across the 43 companies measured showed no significant change during the past two years.

“Reputation and trust enable effective dialogue, collaboration and partnership of the many stakeholders involved in the conduct of clinical trials,” said Barbara Grassi, global head of in-country clinical operations at GSK. “Sites are front and center in the clinical development process. We believe strongly in creating partnerships with our sites. We recognize the invaluable benefits they bring to this partnership, not just access to the patients who we enroll in our trial, but expertise that makes our clinical development programs and study protocols better. The investigators and coordinators really can validate our thinking about entry criteria and feasibility, which are critical factors to the successful conduct of a study.”

Drug companies also care about their reputation among investigators and other physicians, since they ultimately are customers that prescribe medications to their patients.

Need for public education

Misconceptions about the industry feed the low esteem in which the public holds pharma companies and hurts clinical research. LaMattina believes consumers don’t understand the crucial role of the industry in bringing new drugs to market or the risks and costs involved in R&D; he said many mistakenly think drug discovery takes place in academia. Yet new Tufts Center for the Study of Drug Development (CSDD) research found while the public sector chiefly funds basic research, industry largely bears the cost of discovery, development and commercialization of drugs.

“Unfortunately, the importance of this industry is lost on the vast majority of patients due to attacks on the industry’s credibility,” said LaMattina.

Changing perceptions and improving tarnished reputations is a huge task that will take considerable time. Patient associations and education groups have helped dispel myths and misinformation about clinical research and shift public attitudes about the industry. CISCRP, for example, has played an essential role in improving public and media perceptions of clinical research through its many outreach programs, including the Medical Heroes campaign, which recognizes the important contribution study volunteers make to clinical research, and its AWARE for All educational program, which brings together patient groups, research professionals and health advocates to educate the public about clinical research and its role in advancing public health.

“We hope that the perception of the industry as a whole will improve because people start to understand it more. Our feeling is that education is power. When people are educated, they start to understand the impact of clinical trials and how they ultimately can improve public health,” said McNair.

Companies work to restore image

Ultimately, the only way the pharma industry will restore its reputation is through its actions. The 2014 eyeforpharma survey found pharma company executives largely remain out of touch with what the public thinks about them. Yet with the credibility of the industry at stake, some forward-thinking companies have begun taking steps to rebuild trust.

Sanofi’s Chew said the best way for a sponsor to improve its public image and reputation is to deliver on innovation and address unmet medical needs that will improve patients’ lives.

“In order to make that happen, patients and doctors and the pharmaceutical industry have to have a collaboration of trust and competency. We have to have innovative products, passionate people trained in clinical trials, communication and transparency,” Chew said. “The reputation and trust of pharma is something we need to earn and not take for granted. That involves respect for patients and physicians and their cooperation in clinical trials, which are critical to bring the solutions from the bench to the bedside.”

Many companies have increased their commitments to corporate social responsibility programs, which not only improve health in underserved communities but also can help repair the industry’s damaged reputation. Sanofi, for example, has a group called Access to Medicines that invests in public health issues that have a global impact, such as malaria and  tuberculosis.

“It’s a no-profit, no-loss model. It’s really just enough to keep the manufacturing and distribution going so that the products are more affordable,” said Chew. “We have in the regulatory approval process a vaccine for dengue, a mosquito-borne disease that affects over 250 million people a year in warmer climates. An effective vaccine could improve not only the quality of lives, but also take pressure off healthcare systems that are not fully developed.”

Other pharma companies have adopted a shared value approach that can improve their competitive advantage by integrating socially responsible initiatives into the traditional business model. Eli Lilly, Novo Nordisk and Novartis are among those implementing this approach; Lilly’s Global Health Innovation Campaign, for example, aims to improve health for disadvantaged and traditionally underserved populations.

One of the chief criticisms of the industry has been the lack of transparency for clinical trial results; sponsors have been accused of hiding data or covering up side effects. In response, many companies have invested significant resources in implementing polices to increase transparency and ensure data can withstand scrutiny.

In the U.S., sponsors already are required to post clinical trial results on ClinicalTrials.gov, yet a few companies have announced policies that exceed federal requirements in making key clinical data available to the public. Pfizer, for example, has committed to submitting clinical trial results for publication in peer-reviewed journals within 18 months of study completion, no matter what the outcome, and distributes easy-to-read summaries of results to study participants. Novartis, along with a handful of others, also has developed policies that allow qualified external researchers access to patient-level data and clinical study reports from eligible studies, something that would have been unthinkable in the past.

“We inform the public about the results of our interventional clinical trials for innovative compounds regardless of the outcome,” said Vas Narasimhan, global head of development for Novartis Pharmaceuticals. “The results of Novartis clinical trials are made publicly available through peer-reviewed publications and posting on the Novartis clinical trial results database and other public databases.”

Looking ahead

Recent surveys show the pharma industry’s reputation continues to suffer. Yet as sponsors move toward patient-centered drug development models, it has become more important than ever for the industry to understand and address the factors that contribute to its poor image. Ultimately, many believe improving pharma’s reputation will require a major shift in mindset: Companies need to refocus on patients and their needs, as opposed to only profits.

“The issue of trust really comes down to: Do I trust that the industry is motivated by making the cures of tomorrow as opposed to purely financial objectives?” said Stephenson. “And if we trust the industry is motivated around coming up with meeting high unmet medical needs and the cures of tomorrow, then a lot of positive things will flow from that.”  


Karyn Korieth has been covering the clinical trials industry for CenterWatch since 2003. Her 30-year journalism career includes work in local news, the healthcare industry and national magazines. Karyn holds a Master’s of Science degree from the Columbia University Graduate School of Journalism. Email karyn.korieth@centerwatch.com.

This article was reprinted from Volume 22, Issue 05, of The CenterWatch Monthly, an industry leading publication providing hard-hitting, authoritative business and financial coverage of the clinical research space. Subscribe >>

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