PHILADELPHIA: Rep. Henry Waxman (D-CA) today admonished delegates of this year's Pharmaceutical Marketing Congress that the public views their industry "with a great deal of suspicion."
He said that legislators and individual companies must address reputation issues.
Waxman, who sits on the House's subcommittee on health and environment, charged the Medicare Modernization Act with exacerbating the "distrust and unhappiness with the pharmaceutical industry."
"It is not the benefit Medicare beneficiaries want or need," he said, citing drug costs that will vary by region and plan options that will confuse seniors. "The idea that Medicare beneficiaries will stop worrying about the cost of prescription drugs after the benefit won't happen."
But there are several factors, he added, that drug companies can control to reverse negative perceptions of the industry.
Companies, for instance, can no longer argue that prices are driven by research and development costs, because drug companies spend more on marketing than research, profit margins are among the highest of any industry, and most innovative research is conducted by publicly funded academic centers, Waxman said.
"I'm not here to say drug companies shouldn't make a profit," he said. "[But] the product you're dealing with here is not a run-of-the-mill consumer good."
He suggested that drug companies support two pieces of legislation: a mandatory clinical trial registry, and closing the loopholes that delay generic-drug competition.
"Many of you in the industry are going to be regulated one way or another," he said. "One thing we haven't seen is simply working together on a bipartisan basis."
From a PR perspective, when the public finds out that the industry is hiding negative study results and preventing cheaper generic competition, it resents not just the high prices, but the idea that they're being "taken advantage of," Waxman added.
"In the end, it is the credibility of the industry that will be damaged," he said. "Restoring credibility is a very worthwhile result."
The third annual Pharmaceutical Marketing Congress concludes tomorrow.