Pharma and Device Blog Watch

December 5, 2007

Merck Takes $670 Million Hit for Overcharging Medicaid (Pharmalot)
Merck must pay a $670 million pre-tax charge to cover investigations by the Justice Department and the Texas attorney general relating to the company’s marketing and selling practices, including nominal pricing programs and samples, Ed Silverman writes.

Nominal pricing occurs when a drugmaker offers a discount of 90 percent or more to a hospital in exchange for guaranteed market share of certain medications but without informing Medicaid, according to the blog. Medicaid is supposed to receive the best price on meds offered to any customer, with the exception of selling medication to charitable organizations.

“Several drugmakers have come under scrutiny, including Glaxo and AstraZeneca,” Silverman writes. “Merck was first investigated for this practice in 2002, according to a filing with the Securities and Exchange Commission.”

Where Do I Go for Information? (World of DTC Marketing)
Although there have been stories in the media recently about prescription drugs, such as flu and diabetes products, and potential side effects that could be lethal in some cases, pharma has done nothing to communicate to patients except with the usual public relations “garbage,” Richard Meyer writes. Recent research has shown that patients are getting more and more confused.

“While the top use for information on the web continues to be for health, the sheer quantity of all this information is overwhelming. When patients have questions about health topics they will usually turn to a number of resources including consumer-generated media like blogs and message boards,” he says.

Direct-to-consumer marketing is broken because pharma is talking down to consumers rather than with them. Once marketers have new patients on board, they don’t think it’s necessary to provide customer service or information when there is a negative story, according to the blog.

“Transparent marketing is becoming more and more mainstream to marketers who get it. Once again pharma is at the back of the line when it comes to new marketing methods that are becoming the norm,” Meyer writes.