Drug Makers Jump Into Comparison Marketing

Have a streptokinase . . . and a smile? You’ve got a lot to live and Relafien has a lot to give? Always TPA? To truly understand the forces shaping drug design and marketing in the future, don’t think test tubes and double helixes--think Coke versus Pepsi with a biostatistical twist.

Increasingly, pharmaceutical companies are redefining and redesigning their clinical tests around head-to-head comparisons with rival drugs and rival therapies. Where the Mercks and Genentechs of the world once benchmarked primarily against placebos, they’re now benchmarking their drugs directly against each other.

The goal is no longer just to prove that a new pharmaceutical is effective; it also must be shown to be demonstrably better than the competition in terms of price and performance.

“In this environment, drug companies need to be more combative,” says Nomura Securities pharmaceutical analyst Jami Rubin. “Head-to-head clinical testing could grow from under 10% of the research budget three years ago to maybe a third or more. . . . (Direct comparisons) could become a critical part of marketing a product.”

“I expect the number of head-to-head comparisons between drugs to rise significantly,” says Ernst & Young’s Ken Lee, who tracks the biotechnology industry. “Scientific marketing will be the headline thing from 1995 to 2000 and beyond.”

The most famous--and notorious--example of head-to-head testing was Genentech’s estimated $50-million effort to prove that its $2,000-a-dose TPA “clotbuster” heart attack drug was more effective than Hoechst’s significantly less expensive streptokinase. An earlier clinical study showed no statistically significant difference between the two.

The Genentech study--scrupulously conducted--apparently shows TPA can, in some circumstances, outperform streptokinase. Of course, the issue of whether TPA is a more cost-effective drug remains unresolved.

However, it’s that very issue of cost effectiveness and performance that is accelerating this trend toward competitive testing. Health insurance companies and state Medicaid agencies are now obsessed with taking costs out of the health care system. Instead of laboriously comparing the disparate clinical evidence of placebo-based trials to decide which drug should make their “approved” formulary lists, they want results from head-to-head tests to effectively make those decisions for them.

“Do we want to see more head-to-head testing?” asks Michael Neff, who oversees drug purchases for California’s public health care system. “You bet! Yes, sir!” Neff notes that his counterparts in other states want similar data.

This desire reflects less an abdication of responsibility than recognition that head-to head testing can be a surrogate for market forces. Comparative testing gives health care reimbursers a common denominator for cost-benefit analyses. As a result, clinical tests are now becoming the place where issues of medical effectiveness are converging with the challenges of cost effectiveness.

“We are seeing the evolution of health care issues into the health economics side,” says Dr. David W. Blois, executive director of U.S. regulatory affairs for Merck Research Laboratories. “We will continue to perform the classic trials for Food and Drug Administration approval; that won’t change. What will change is that we will be performing other tests to deal with such issues as quality of life and cost effectiveness.”

However, “the prominence of those issues is increasing, but they’re not at the top of the agenda,” Blois says. He does not see the budgets for head-to-head testing disproportionately rising. Nevertheless, he concedes that direct comparison testing may become a cost-effective medium in its own right for drug companies to measure such issues as price to performance and quality of life.

For example, Nomura’s Rubin notes that SmithKline Beecham has done head-to-head testing of its non-steroid, anti-inflammatory drug Relafien in ways that stress the fact that it has a better “side-effects profile” than its competitors on the market. In other words, Relafien may cost a little more, but it purportedly generates fewer side effects.

Indeed, says Rubin, one of the main reasons pharmaceutical companies are now performing all this head-to-head “outcomes” testing is to “preserve optimal pricing flexibility” at a time when the health care industry is trying to stabilize or reduce costs. In effect, head-to-head outcomes testing becomes the new economic battleground for pharmaceutical innovation.

Don’t think for a moment that the advertising campaigns built around these head-to-head clinical findings are destined for physicians’ eyes only. As patients are asked for higher deductibles and co-payments for health care products and services, they’ll want to know which drug they’re being prescribed--and why.

Inevitably, that means that--one way or another--the results of these tests will be marketed to better “inform” consumers. And unlike Coke versus Pepsi and MCI versus AT&T;, these campaigns are ostensibly about life and death.