The People vs Big Pharma: tackling the industry’s trust issues

Chris Lo 20 August 2018 (Last Updated January 27th, 2020 05:08)

Price hikes, manipulative patent litigation and a rampant opioid addiction epidemic have steadily soured the public’s view of the pharmaceutical industry. Does Big Pharma has a crisis of public trust on its hands, and if so, how might it restore its credibility in the eyes of patients, policymakers and the rest of the taxpaying public?

The People vs Big Pharma: tackling the industry’s trust issues
For many, former Turing Pharmaceuticals CEO Martin Shkreli is a poster boy for pharma industry misbehaviour. Credit: House Committee on Oversight and Government Reform

“I sort of view Big Pharma, as an industry, as an octopus with many tentacles, and at the end of every tentacle is a wad of cash,” says David Mitchell, president and founder of US-based campaign group Patients for Affordable Drugs, who was diagnosed with multiple myeloma in 2010 and expects to be in continuous treatment for the rest of his life. “It reaches into academic medical centres, professional organisations, patient organisations, state houses, campaigns, Congress – they’re everywhere.”

Mitchell’s description sounds more suited to some sinister political conspiracy than an industry whose business is saving lives and curing diseases. But despite the pharma sector’s noble clinical goals, many of the industry’s business practices – monopoly pricing, blocking generics and biosimilars, spending heavily on political lobbying, an arguably relentless focus on profit – have eroded public trust in its credibility and motives. Mitchell is certainly not alone in his deep distrust of the pharma agenda.

“One of the reasons that the price of prescription drugs is a kitchen table issue is because people live it all the time,” Mitchell says. “They get a new prescription from the doctor and they find out the drug costs $5,000. Companies extend their monopolies and block cheaper generics – people know. We have 10,000 stories up on our website. People will say, ‘I’ve been taking this drug for years and there’s still no generic.’ So they’re not only mad about the high prices, they’re mad because they feel the drug companies abuse the laws, abuse our system and take advantage of people.”

In many countries, people feel exploited by drug pricing and other practices that leave them feeling more like a captive market than a patient, but especially in the US, where a lack of state-level price negotiation, high-profile price hikes and a steady stream of direct-to-consumer advertising lays bare pharma’s stark business fundamentals more clearly than almost anywhere else. Of course, an ongoing epidemic of opioid addiction, like the thalidomide disaster before it, is also bringing with it lawsuits and an increasing feeling among the public that many drugmakers are prioritising sales over patient welfare.

Survey data confirms pharma’s trust issues

Extensive survey data backs up the impression that trust in pharma is waning globally, most recently in the healthcare results from public relations firm Edelman’s 2018 Trust Barometer. The healthcare sector in general – incorporating pharma, biotech, hospitals, insurance and consumer health – saw a small decline in global trust, with 63% of survey respondents trusting the sector to “do what is right”, compared to 65% a year ago. Trust in the overall sector declined in 17 out of the 28 markets studied by Edelman, with particularly sharp falls noted among the informed public in developed markets such as the US, Germany, France and Canada.

Among the healthcare sectors, pharma remains the least-trusted at just 55% globally, far below the most-trusted healthcare groups, hospitals (72%) and biotech (62%). The pharmaceutical industry was also the sector most frequently blamed by survey respondents for the high cost of care.

“We saw a continuing decline [in trust], which we’ve seen coming year-on-year,” says Edelman’s global managing director for health and EMEA health chair Carolyn Paul. “The pharma sector has, for the last five to ten years, been in the mid-50s, and to me that’s simply not good enough for an industry that is about saving lives. It’s when you set it in the context of other sectors that I think it’s particularly worrying. When you see industries like tech, which every single year are way higher – at the top of the pack, around the 70s – and healthcare is always around the 50s, that is disturbing, I think.”

Pharma trust: a varied global picture

Paul was also surprised to see the variation in pharma trust across different markets, with a broad theme emerging that distrust of the industry seems to be particularly pronounced in the most developed markets.

“Normally all of the markets move much more in concert,” she says. “Whereas this year, if you look at the pharma sector for example, at one extreme you’ve got Indonesia, with an 85% trust level, which is the highest. And then at the other end of the spectrum you’ve got Germany at 30%, which is the lowest. Within that, we saw some really big changes – the US dropped by 13%, Germany by 12%.

“I think what is behind it is a lot of concern about drug pricing. You see that in markets like the US and Germany in particular, where you see those very big percentage drops. We have a debate about drug pricing rumbling on in the UK, but it really only comes to the fore in the media when there’s a particular case that comes to light. Whereas I think in the US and Germany, when we spoke to our local teams, they said, ‘Look, it’s just all over the place, all the time.’”

Pharma firms also arguably have a tougher public relations task in highly advanced markets, where the high-impact healthcare fruit has already been picked and where public antipathy can easily be provoked by supply chain controversies and the cost of advanced new treatments such as next-gen biologics and gene therapy.

“If you look at those countries where pharma is most trusted, like Indonesia, India, China, Malaysia and the UAE, those are perhaps countries where the pharma industry is still delivering real, genuine life-changing benefits,” says Paul. “When you get to places like Germany and the US, it’s perhaps taken a little bit for granted.”

Particular challenges in the US

Pharma companies face an uphill struggle to rebuild trust in the US, where high drug prices, the opioid scandal and anti-competitive behaviours are all big-ticket items in national media reporting and political discourse, helped along by price hike scandals such as Martin Shkreli’s price-gouging around Daraprim and Mylan’s hike in the price of EpiPens.

President Donald Trump has made drug price reform a core issue of his administration, having described pharma companies as “getting away with murder”, and Food and Drug Administration commissioner Dr Scott Gottlieb has been assertive in condemning practices such as drugmakers blocking access to reference samples for generic competitors.

“People know that the drug corporations are spending money to influence every aspect of drug development and pricing policy, and it makes them angry,” says Mitchell. “I’m a patient. So I believe that drugs should be priced to maximise public health, not to maximise profits. Right now, we have lost the balance. We need to ensure that drugs are priced at a level to be affordable and accessible while protecting a robust R&D pipeline and a reasonable return for the company that brings the drug to market. But the whole system, because it’s all about short-term profit and stock prices, has tilted to the profit side.”

One of the key differences between the US and other countries that have nationalised healthcare systems is the ability for state health agencies to assess the value of drugs and negotiate with developers. This means there are discrepancies in both drug prices and public perceptions of who’s to blame for them. In a country like the UK, where the National Institute of Clinical Excellence (NICE) routinely applies cost-effectiveness analyses and reserves the right to reject a drug’s use in the NHS, patient outcries over  being denied access to a new therapy falls as much on NICE for its decision as on the pharma firm for its list price. In the US, meanwhile, the lack of governmental negotiation over price – with a few exceptions, including the Veterans Administration – puts US pharma companies, as Paul says, “absolutely in the crosshairs on pricing”.

Trust exercises: the road to redemption

So what does pharma’s road to redemption look like? From a communications perspective, a one-step remove from patients puts pharma at a disadvantage, Paul argues.

“Contrary to the old adage that familiarity breeds contempt, it actually seems to breed trust,” she says. “So for the pharma industry, which is seldom actually interacting directly with the consumer, that’s quite difficult.”

Edelman’s broad recommendations for improving the industry’s image include a much greater focus on communicating companies’ cutting-edge research goals and achievements. With many people harbouring the unfair assumption that biotech firms house the true innovation, while pharma companies simply commercialise it, it’s no surprise that biotech is a more trusted sector than Big Pharma.

“Biotechs grow up around innovation and that’s what they talk about,” Paul says. “When you get to pharma companies, there is perhaps more around marketing and sales. In the past there’s been a tendency to just talk about how much it costs to produce a new drug. Well, nobody’s really interested in that. Why don’t we talk about how it happens and the hard work that goes into it, and maybe do something to reset those perceptions?”

This is an approach that has been embraced by some already, with US trade group Pharmaceutical Research and Manufacturers of America (PhRMA) last year updating its membership requirements to include a minimum R&D spend and launching the ‘GoBoldly’ publicity campaign to highlight pharma researchers’ “perseverance and unwavering commitment to American patients”, as PhRMA president Stephen J. Ubl put it.

Organisations, such as Patients for Affordable Drugs, are campaigning for legislative root-and-stem reform and rebalancing of the US pharma system, but what does Mitchell think pharma companies themselves can do to rehabilitate their relationship with the public? Firstly, he calls for an end to temporary pauses on drug price increases such as those announced by Allergan and others this year, describing them as “sham PR moves”.

“As if it’s a great thing that they are agreeing to keep prices high but not make them higher, temporarily,” Mitchell says. “They have to stop those PR moves and do something that’s real.” Concrete and lasting price reductions, greater transparency and playing a proactive role in discussions to reform drug pricing would be meaningful, he adds.

More open communications, highlighting inspiring stories through trusted experts and humanising the industry will certainly help to boost pharma’s flagging reputation, but no matter how savvy the PR strategy is, it is unlikely to prove decisive without the substantive reform that patients and the public at large are calling for. Fair access to affordable and life-saving new treatments is a flagship global issue of the 21st century, and it’s not going to resolve itself. To reform its image, the pharma industry must contribute to this discussion in good faith, treading a fine line between addressing patients’ distrust and maintaining healthy balance sheets.