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Healthy Skepticism International News

May 2005

Submission to Medicines Australia Review of the Code of Conduct


Medicines Australia (MA) is the Australian association for drug companies. MA are reviewing their self-regulatory Code of Conduct and invited many other groups to make submissions. They did not invite Healthy Skepticism to make a submission but when contacted did agree to accept one from us. Our submission has been improved by contributions from an anonymous source from the industry.

Submission to Medicines Australia Review of the Code of Conduct

Peter R Mansfield, Joel Lexchin, an anonymous source from the pharmaceutical industry, Melissa Raven, Jon Jureidini, Ralph Faggotter and Rosie Burn.

1.    The quality of drug promotion by the pharmaceutical industry can and should be improved.

2.    Improvement of drug promotion is one component of the reform agenda advocated by Healthy Skepticism with the aim of improving the quality of use of medicines and thus improving health.[1],[2]

3.    Improvements in the quality of pharmaceutical promotion would lead to less misuse of drugs and thus less profit in the short term but would have many advantages for the pharmaceutical industry, especially in the long term, including:

•      Higher sales of drugs that are currently under-used. (This could occur is several ways including a) earning increased trust amongst doctors and patients for drug companies and b) reduced unfair competition where currently misleading promotion leads to the use of inferior drugs instead of superior drugs.)

•      Improvements in staff morale. Morale suffers when staff members are not proud of their company’s promotional methods or corporate image.  Improved morale could lead to improved productivity and retention of good people.  To quote Leandro Herrero, chief executive of the UK consultancy, the Chalfont Project: “Managers may be pleasantly surprised to find that better working conditions, for example, may be considered by their employees to be a better reward than monetary compensation.”

•      Improvements in job security. Heavily promoted drugs are often prescribed to patients who should not be receiving them, resulting in large numbers of people suffering side effects. The adverse publicity from such use may result in the drug being pulled from the market or significant loss in sales which will have negative economic consequences for the company and thus job losses.

•      Improved share values by reducing the risk of unexpected profit downturns that occur when over-promoted drugs are removed from the market or suffer significant losses in sales.

•      Giving the staff of Australian subsidiaries the experience needed to gain competence in achieving higher standards.  This experience would give them a competitive advantage when competing for senior positions in other countries where standards are higher or improving or likely to improve in the future.[3]

•      Better health care for staff because health professionals would be less often misled into providing inferior care.  As well as the benefits for staff this better health care would improve productivity and make Australia a better place to work and invest.

•      More cost effective health care for the Australian population leading to lower health care costs for companies (e.g., via either lower taxation rates or pay scales that take into account living costs including health insurance) a stronger economy and thus greater capacity to pay for research and for pharmaceuticals.

4.    The main objective of the Code of Conduct system should be to improve health through promotion that leads to improvements in the quality use of medicines. 

5.    The Code is currently “approved” by the Australian Competition and Consumer Commission (ACCC) but does not meet the criteria for gaining “endorsement” from the ACCC.[4],[5]  It can and should be improved to the point where it deserves endorsement.  By contrast, we believe that the current Code of Conduct system does more harm than good by supporting low standards for drug promotion and so it currently does not even meet the ACCC’s criteria for approval.  Consequently, the Code of Conduct system as presently constituted should be reformed or shut down.

6.    Medicines Australia seems to have a corporate culture that aims to advance the short term interests of member companies rather than regulate promotion.  This bias is understandable and legitimate because Medicines Australia’s primary role is advancing the interests of its members.

One illustration of this bias is the following response from a Medicines Australia staff member on 31 January 2005 to a question from Peter R Mansfield regarding informing people about a Code of Conduct Committee finding:

Medicines Australia understands your concerns in relation Celebrex, however for the Code of Conduct and complaints process to continue to be supported by all interested parties it is important that due process and natural justice are maintained. Whilst the Code of Conduct Committee has no capacity to impose any sanction on you should you decide to publish the Committee’s decision before any appeal is considered, we do request that you allow Pfizer the opportunity for the complaint and appeal process to be completed. Pfizer has until Monday 7 February to notify Medicines Australia of their intention to appeal/not to appeal this decision.

If you propose to publish these confidential minutes or extracts from them, Medicines Australia will be obliged to inform Pfizer of your decision.

First, it currently gives higher priority to the short-term welfare of companies than to the welfare of the public. 

Second, the idea that the Code is currently supported by all interested parties is false.  As explained above, the current Code system is not supported by us.  Furthermore, it is our impression that there is little support for the Code system amongst grass roots health professionals.  Regardless of whether they are genuinely believed, false claims do not set a good example for the companies and raise doubts about Medicines Australia’s capacity to regulate misleading promotion.

Third, the Code system appears to be based on the lowest common denominator, pandering to the least compliant companies.  Instead the system should aim to protect best practice by the best companies.  Those companies that are not willing to accept higher standards should not be allowed to set the agenda.  In the words of the UK Medicines and Healthcare products Regulatory Agency such companies should be named and shamed.[6] 

7.    The regulatory paradigm is useful for dealing with performance that is below minimum standards but to achieve quality improvement above minimum standards the continuous quality improvement paradigm is likely to be more useful.

8.    The Code of Conduct of Conduct system is based on an adversarial legal paradigm of regulation. 

9.    There is evidence that the paradigm of responsive regulation incorporating restorative justice has important advantages over the adversarial legal paradigm.[7]

10.  The responsive regulation paradigm gives priority to repairing damage and making changes to ensure that similar problems do not occur again. 

•      When promotion has been found to be misleading, the company responsible should run correctional messages.  The correctional messages should be drafted by an independent panel of experts who have no competing financial interests with opportunities for input from the complainant at the start and end of the drafting process.  The correctional message should run for the same length of time and in the same formats as the misleading promotion.  After that time, a survey should be done to determine whether unjustified beliefs that were being promoted are persisting in the group targeted by the promotion.  If so, then the correctional message should continue until there is either survey evidence to show that those unjustified beliefs have been corrected or the expenditure on the correction reaches the amount of profit gained from sales of the drug during the period starting when the misleading promotion first appeared until the correction started.

•      For every breach of a specific section of the Code (e.g., Section 1.3) that is upheld at appeal, the company must provide convincing evidence, as judged by a panel independent of the industry, that it has made quality control improvements, including training of relevant staff, that are likely to be effective at preventing similar problems from recurring.  If however, the company is found in breach of the same section of the Code in future promotional activities, regardless of the product, the complaint should be treated as a repeat breach by the Committee, and consequently a stronger sanction should be chosen.

11.  The regulatory pyramid paradigm recognises that the restorative justice paradigm will not be effective in some situations.

•      One of these situations is where the cause of the Code breach is a rational calculation to maximise the chances of higher profits without due regard to considerations of appropriate prescribing and drug use. It is difficult for anyone outside the company to definitively judge whether or not this pattern of thinking is the cause of a Code breach but useful indicators include repetitive breaches of the Code for the same drug and breaking of promises to comply with the Code.  In this situation it is necessary for the probability and magnitude of fines to exceed the probability and magnitude of profits.  Consequently repeat breaches in promotion of the same drug within a 5 year period should be automatically found to be an Abuse of the Code (Section 12.3) and the limits on the size of fines reset to be up to (x + 1) times the amount of profit made from the time that the misleading promotion started until the time that correctional statements started, where x = the inverse of the probability of detection.  The detection rate is the fraction of the promotion that that is in breach of the Code that is found to be in breach by the Code system.  The reason for this recommendation is that if misleading promotion is likely to earn $y profit and the probability of detection is 1 in x then it is rational to use misleading promotion unless the fine is greater than $xy.  The Code administration body should commission an annual study of pharmaceutical promotion to estimate the detection rate.  The industry should aim to increase the detection rate and thus reduce the magnitude of fines.

A second situation is where the Code breach results from the company having a corporate culture that makes it unable to comply with provisions of the Code.  For example, it is unrealistic to expect companies to make appropriate claims for their products if the company’s perception of them is incorrect.  It is common for companies’ perceptions of their products to be distorted by “groupthink”.[8]  Useful indicators of this situation include repetition of similar errors and/or statements denying errors and/or refusing to accept the judgement of independent panels about the promotion or therapeutic value of the product in question.  In this situation it is necessary to ban the company from promoting the product until there is evidence that its perception of the appropriate therapeutic role for its product corresponds to objective scientific evidence.  Such sanctions are within the power of the Committee as market approval is dependent on compliance with the Code. 

12.  The Code of Conduct should be modified to give the Code of Conduct Committee and the Appeal Committee the power to choose all of the regulatory responses discussed above, where appropriate.  If companies do not implement the “sanction” chosen by the appropriate Committee then the Australian Competition and Consumer Commission should be asked to use its legal powers to back up the Committee.

13.  The Code of Conduct Committee and the Appeals Committee should have the power to find promotion in breach of extra sections of the Code beyond those mentioned in any complaint.  This power is especially important for complaints that are not from member companies. In particular the Code committee should consider whether or not the promotion complained against is an Abuse of the Code (Section 12.3).

14.  Ostracism of companies is unlikely to have any beneficial effects and may exacerbate noncompliant behaviour, so removal from membership of Medicines Australia should not be one of the sanctions for breaches of the Code (Section 12.2).  To support this point, there are a few pharmaceutical companies in New Zealand who voluntarily pulled out of RMI membership as they did not agree with some of the sanctions and requirements of the RMI Code.  Perhaps an alternative is substantially higher membership fees, and /or an internal audit performed by Medicines Australia for the companies who continue with noncompliant behaviour.

15.  When choosing the best therapy to recommend, health professionals need to know which therapy has the best overall ratio of benefits, harms and costs.

16.  To improve the quality of use of medicines, health professionals need information on whether or not pharmaceuticals have any clinically significant overall advantages or disadvantages re benefits, harms and costs over alternatives for the same indication.  Health professionals also need to know the strength of the evidence that this information is based on.

17.  High quality pharmaceutical promotion provides the information health professionals need without including irrelevant information or appeals.

18.  The Code of Conduct should be improved by providing a positive list of the types of information that health professionals need that should be included in all types of promotion.  This information includes whether or not pharmaceuticals have any clinically significant overall advantages or disadvantages re benefits, harms and costs over alternatives for the same indication.  It would be beneficial to have a system for continuous quality improvement for this list.

For example a clear prominent statement similar to the following in promotion for Vioxx might have prevented many adverse effects including an unknown, but probably large, number of deaths:

“Vioxx was compared with naproxen in a RCT for osteoarthritis.  There was no efficacy difference.  Vioxx had a significant gastric safety advantage but a significant cardiovascular safety disadvantage. There was no significant overall safety difference in the two products. Vioxx is more expensive.”

19.  The Code of Conduct should be improved by providing a list of the promotional techniques that are unhelpful for health professionals and should not be used.  It would be beneficial to have a system for continuous quality improvement for this list. 

For example we are not aware of any helpful reason for using qualifications of claims where the qualifications are placed elsewhere in the advertisement.  For example, the September 2003 Nexium advertisement claimed that “Nexium 40mg offers greater healing power that either omeprazole or lansoprazole” but qualified that statement elsewhere by disclosing that the dose of omeprazole was only 20mg. This type of promotional technique should be included in the list of banned promotional techniques. 

20.  The Code of Conduct should be improved by adding the following clause:

Promotion should not include statements that are false or ambiguous or appeals that are not relevant.  Promotion should not omit, or disclose only in fine print, information that is relevant for good prescribing decisions. 

21.  As in the UK, the Code of Conduct should be administered by a body that is separate from the body representing the interests of the industry.  However, consistent with the multiple stakeholder approach that is the custom for Quality Use of Medicines work in Australia, the Code of Conduct administration body should be owned in equal shares by the key stakeholders including those who use an evidence-based approach to evaluate drug promotion.

22.  The Code of Conduct administration body should contract an external organization with expertise in evidence-based medicine and assessment of drug promotion to provide monitoring by examining a random sample of all forms of promotional activities.  The results of this monitoring should be presented to the Code and Appeals Committees and the Board and should be used for the following purposes:

•      as a basis for identifying best practices and ongoing problems or lack of clarity within the Code;

•      to refine the Code; and

•      to improve internal practices within pharmaceutical companies.

23.  The Code of Conduct administration body should contract an external organization with expertise in evidence-based medicine and assessment of drug promotion to provide training for marketing staff, regulatory affairs personnel and senior staff in the companies and for members of the Code of Conduct Committee and the Appeals Committee.

24.  When complaints are made by parties other than drug companies, complainants should be supported with the equivalent of free legal advice to help ensure that their complaints are effective.

25.  Decisions of the Code of Conduct Committee and the Appeals Committee should be publicised within two business days in the following ways:

a.    by placing the full minutes (not an abridged version) on the websites of the body administering the Code of Conduct and the ACCC; and

b.    via releases to the media for health professionals and the general public.

26.  The full minutes of all Code and Appeal Committee meetings should be published on the Code administration body’s website with 5 weekdays of the meetings.

27.  Both complainants and defendants should be able to appeal against Code of Conduct Committee decisions.  When appeals are made by parties other than drug companies the appellant should be supported with the equivalent of free legal advice to help them make effective appeals.

28.  The Code states that all Medical Representatives and all Product Managers (per definition) must complete the MA CEP module relating to the Code within 12 months of commencing employment (Section 4.12).  This training should be mandatory to all staff responsible for, and involved in, the creation and approval of promotional activities.  Proof must be provided to the Code administration body of training signed off by the MD or CEO (as is the expectation for submissions to the committees currently monitoring compliance with the Code).  There should be regular training for these parties to ensure continuous and quality improvement in implementation of the Code and this training should be documented.

The duration of the entire process of adjudicating on alleged code violations should be limited to one month (there are already time limits for lodging a complaint and for intercompany dialogue – Appendix 1 Medicines Australia Code of Conduct Edn. 14). For example, the abovementioned complaint - Mansfield V Pfizer Celebrex - was in dispute for over 6 months from the time the complaint was initially forwarded to Medicines Australia on 4 November 2004 to the release of the minutes of the Appeal which as of 16 May 2005 had not happened. In cases where misleading claims could lead to serious adverse health consequences, as judged by an panel independent of industry, correctional statements should commence within one week of the complaint being received.



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