On Sunday night, embattled pharma firm Purdue Pharma filed for bankruptcy. The maker of the painkiller OxyContin has been facing lawsuits from an estimated 2,600 government entities and other groups and had struck a tentative deal to settle many of them for somewhere between $10bn to $12bn.
The lawsuits allege that Purdue was largely responsible for sparking the opioid crisis that has ravaged the US. The plaintiffs in these lawsuits point to the company’s physician marketing efforts, which they say were deceptive. Specifically, the lawsuits claim that even though Purdue knew oxycodone, the key ingredient in OxyContin, was addictive, its marketing efforts claimed it wasn’t and also minimized the potential for abuse.
Innovation gone awry
The billionaire family behind Purdue Pharma, the Sacklers, figure prominently in the media firestorm that has engulfed Purdue as the opioid crisis rages on.
The Sackler family’s involvement in the pharma industry goes back decades. One of the family’s progenitors was Arthur Sackler. He joined medical marketing agency William Douglas McAdams in the 1940s and according to The Medical Advertising Hall of Fame, “No single individual did more to shape the character of medical advertising than the multi-talented Dr. Arthur Sackler. His seminal contribution was bringing the full power of advertising and promotion to pharmaceutical marketing.”
Perhaps Arthur’s biggest innovation was to market drugs directly to physicians through methods such as ads in publications distributed to physicians. In 1960, he even founded his own publication, the Medical Tribune, which is described as “the first medical newspaper sent directly to doctors, which reached over one million readers in 20 countries.”
While Arthur died eight years before Purdue Pharma began selling OxyContin, the kind of systematized, sophisticated and highly-efficient direct-to-physician marketing that Arthur helped pioneer is at the heart of Purdue’s opioid scandal.
Since Arthur’s time, direct-to-physician marketing has evolved. For instance, pharma companies don’t just purchase ads that target physicians. Instead, they field large sales teams equipped with marketing materials designed and tested specifically to sway physicians. Salespeople call on physicians in a practice called detailing. They offer them “gifts”, such as free samples and meals, and woo them with paid speaking engagements.
The lawsuits against Purdue paint a picture of a company that was not only incredibly aggressive at pursuing physicians using these tactics, but also amazingly adept at it. Among other things, it went so far as to create pain management and speaker-training conferences attended by thousands of physicians and medical professionals, and it recruited some of them to be a part of its speakers’ bureau.
Year in and year out, Purdue was able to turn hundreds of millions of dollars in marketing spend into billions of dollars of revenue. Put simply, the company’s marketing machine was effective a money- printing machine.
Dealing with the Purdue fallout
Purdue had seemingly perfected the art of convincing physicians to prescribe OxyContin but naturally, it was totally unable to contain the fallout from the opioid crisis that emerged and has now been blamed for hundreds of thousands of deaths, millions of ER visits and nearly $80bn a year in estimated economic losses.
The fallout has affected the entire pharma industry, which according to a new Gallup poll is now the least loved industry in the US, falling behind even the federal government. Its -31 net positive rating is the lowest Gallup has seen since it began tracking public perception of industries in this fashion in 2001.
Physician trust in pharma companies was also dwindling even before the Purdue scandal was front page news. In 2015, research by Deloitte Consulting and Gerson Lehrman Group (GLG) found that 75% of physicians lacked trust in information provided by to them by the pharma industry.
For pharma marketers, Purdue and the significant negative effects the opioid crisis it is blamed for have had on the industry raises important questions about the future of direct-to-physician marketing.
While pharma marketers will no doubt be forced to change their ways as regulators crack down on the industry’s marketing practices, Purdue is a wake-up call and provides an opportunity for pharma marketers to rethink how they should interface with physicians and medical professionals instead of designing their efforts around what they are legally allowed to do.
The good news for pharma marketers is that despite their skepticism over pharma-supplied information, a large majority (84%) of physicians indicated that efficacy and outcome data, as well as clinical guidelines, influence their drug utilization decisions and 65% of them are open to interacting with pharma firms over social channels around this type of content.
According to Chris Franck, a principal in Deloitte Consulting’s Life Sciences and Health Care practice, “Pharma should offer the proprietary clinical data and insights that drive interest but that others are not able to provide.” He also said that physicians want transparency, bias-free information and assurances that pharma companies weren’t monitoring their online discussions.
For pharma marketers who have been focused on helping move the needle, stepping back and taking approaches that are less aggressively sales-focused might be hard to do, but if the industry is ever going to fix the damage that has been wrought by Purdue and the opioid epidemic, regaining the trust of physicians is arguably going to have to become just as important a marketing goal as convincing physicians to write prescriptions for their drugs.
While these goals are not inherently at odds with each other, pharma marketers must understand that accomplishing them both will likely require a new set of timeframes and tactics driven in large part by ethics, not sales targets.
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