Talk about a dull week…NOT!
As we see a number of sweeping actions out of Washington, your friends at inVentiv’s Issues Management Practice are here to cover the issues that matter!
This week we ask why the White House Press Secretary is so obsessed with Dip & Dots ice cream. We profile why allergy advocates say “nuts” at American Airlines. And for the cherry and sprinkles on top, we investigate the state-based movement on drug price transparency and how hospitals are launching a new war on payer prior authorizations.
Grab a bowl of ice cream and enjoy this week’s installment of The Week That Was.
Advocates Go ‘Nuts’ over AMERICAN’S Allergy Policy
While pretzels have largely become the snack of choice on commercial airlines, peanut allergies have American Airlines breaking out in hives. Advocacy group Food Allergy Research and Education (FARE) filed a federal complaint against the airline for not allowing passengers with food allergies (peanuts included) to pre-board its flights. The complaint alleges that American’s policy violates the Air Carrier Access Act, which allows those with any type of disability to pre-board. To make matters worse, passengers say that acknowledging their food allergies pre-flight may actually get them kicked off the plane, with the airline citing “safety concerns” should a passenger experience anaphylaxis mid-flight. The Department of Transportation is investigating the complaints, which one traveler described as “Russian roulette”– since individual flight crews don’t seem to follow a clear policy.
Ambiguous policy is not good policy. American should consider taking a page out of its peers’ playbooks. Jet Blue and Delta allow pre-boarding and create nut-free “buffer zones” around allergic passengers, whereas Southwest avoids serving peanuts altogether. It may behoove American to do the same. And, forcing passengers off the flight if they inquire about peanuts being served sounds like trouble to us. You can’t leave customers to expect the unexpected – like being kicked off a plane… maybe. The fix seems pretty easy—or easy enough that the competition is doing it. Otherwise, AA will continue to face a PR mess, lose potential customers and potentially endanger passengers.
WHAT DO WE WANT? TRANSPARENCY! WHEN DO WE WANT IT? NOW!
While much of the world focused on the barrage of Executive Orders coming from 1600 Pennsylvania Avenue this week, a few policymakers, trade groups, and drug makers undertook a number of efforts to make drug pricing more transparent. On the state side, the Maryland State Senate Finance Committee targeted extraordinary drug price increases (their definition of extraordinary price increases is defined as more than 1000% within a year). The Committee invited the Institute for Clinical & Economic Review’s (ICER) Steve Pearson to testify on how states could create better pricing information and value benchmarks (i.e., no surprise that he conveniently recommended using ICER reviews to create formularies and negotiate prices). Also, New York Governor Andrew Cuomo launched his executive budget proposal, which would allow the state’s Drug Utilization Board to set a benchmark price on almost any drug and require pharmacos that charge more to provide rebates and pay surcharges.
As a response to these continued demands for clarity in drug pricing and increases, PhRMA’ s multimillion-dollar campaign “GoBoldly,” rolled out last Monday. The campaign attempts to explain the investments medical innovation requires and how these breakthroughs actually save money in the long run. The reputation-building effort described by PhRMA President Stephen Ubl as “less hoodie, more lab coats,” got off to a rocky start when pharmabro Martin Shkreli, offended by the apparent dig, took the industry to task online.
The industry is hearing the call and attempting to respond voluntarily (while they still can). This week, Merck, on its website, released figures showing the average list price increase across their drugs and vaccines for the past seven years, as well as average discounts from list prices in the same timeframe. J&J has also promised to release average list prices for its medicines—as well as what the so-called “middlemen” like PBMS pay for them. Previously silent on the issue, pharmacos are starting to reference the nuanced relationship with pharmacy benefit managers to explain complex drug pricing issues. Similarly, a new study from the Berkeley Research Group offers a sneak peek into the pharmaceutical supply chain and the “black hole” of where profits go. It found a substantial increase in the discounts PBMS and health plans have been negotiating with drug makers.
Will PhRMA’s campaign be enough to rebuild the industry’s rep and initiate an open conversation on drug pricing that includes all the players? Doubt it. Our proprietary research has shown that attempts to explain the system are interpreted as pharma “shifting the blame.” What we do expect is for states with growing power over their healthcare purses and policies to propose a slew of state bills and executive budget proposals, similar to Vermont’s transparency law that was signed last summer, and California’s SB 17, which would require pharmaceutical firms to justify and explain price increases for prescription drugs. Expect the next year to be a game of whack-a-mole where the pharma industry fights pricing bills not only at the national level, but in many states. THE FIGHT TO END PRIOR AUTH IS ON…
Last week, Modern Healthcare reported that the American Medical Association (AMA), American Hospital Association and 14 other healthcare organizations will lobby payers to streamline prior authorization (PA) requirements because the process is time consuming for providers and can negatively affect patient care. The coalition says they hope to work with America’s Health Insurance Plans (AHIP) and individual insurers, but AHIP counters that for the last ten years it’s been discussing this issue with health plans and physicians. PAs are a brewing issue beyond the provider community. Patient advocacy organizations, including some disease-specific organizations argue PAs are preventing access to needed medicines. For example, less than half of patients obtain the originally prescribed drug when one PA is required. And, when patients are denied medicines at the pharmacy due to prior authorization, about 40 percent abandon therapy altogether. On the prescriber side, 75 percent say they’ve switched treatments at least once in order to avoid dealing with the process.
Who is notably absent from these groups’ efforts to change PAs? If you haven’t guessed, it’s the pharmaceutical industry (the AMA coalition mentions building “a dialogue between providers, health plans and their third parties”). Because the process is cumbersome to patients and providers alike, it behooves manufacturers to get involved in these efforts, or at least use relevant outputs as part of patient assistance programs that help patients navigate insurance and access to their medicines.
Dip & Dots Shortage: A National Catastrophe?
A shortage in the vanilla-flavored Dip & Dots is indeed a matter of national concern, particularly if you’re asking White House Press Secretary Sean Spicer. Over the last five years, Spicer repeatedly turned to Twitter to gripe about the Dip & Dots, which he argues is not the ice cream of the future. Among the Dots alleged offenses: conspicuously running out of the vanilla flavor at the National’s baseball games. (Now, one could ask why Spicer has so much time to ponder fake ice cream… we’ll leave that puzzler for a future report.) But, the crisis for Dip & Dots came when press dredged up Spicer’s old Tweets a few weeks ago and started mocking the company across the Twittersphere. Not to be left down and out, Dip & Dots came back with an effective response that neutralized the online chatter. The CEO wrote a lighthearted letter to Spicer that was posted on the company website and tweeted. Instead of punching back, he offered free Dip & Dots for the White House Press office and the press corps. Spicer replied with a public thanks for the gesture and suggested offering the Dots to the nation’s first responders. Win/win for all.
Three cheers to Dip & Dots brilliant social media response! In an era where a politician’s Tweets have sent corporate stocks tumbling, the CEO acted quickly and used a lighthearted, positive and conversational tone on the social media channels where the conversation was happening. And on that note, if you’re worried about getting pulled into Twitter assaults from Washington – call on us! Our Issues Management 2.0 approach can help you save your image and your market value.
Until next week,
Your friends at the The Issues Management Practice @inVentiv Health PR
Want to catch up on previous issues of The Week That Was? Find them here.