One Step Forward:
The drug industry’s image problems are beginning to hurt pharmaceutical companies where it matters most – at the bottom line.
“A lot of the demand that the industry has created over the years has been through promotion, and for that promotion to be effective, there has to be trust,” said Richard Evans, an analyst covering drug stocks at Sanford C. Bernstein and Company. “That trust has been lost.”
In the third quarter, United States sales of prescription drugs fell 3 percent at Bristol-Myers Squibb, 4.5 percent at Johnson & Johnson, and 15 percent at Pfizer. Merck said its overall revenues fell 2 percent despite favorable foreign exchange trends.
“Is the public more cynical? Yes,” said Dr. John LaMattina, Pfizer’s president of global research. “There’s a perception that we don’t bring much to the party.”
And One Step Back:
Enrollment in the new Medicare drug benefit begins in three days, but even with President Bush hailing the plan on Saturday as “the greatest advance in health care for seniors” in 40 years, large numbers of older Americans appear to be overwhelmed and confused by the choices they will have to make.
“I have a Ph.D., and it’s too complicated to suit me,” said William Q. Beard, 73, a retired chemist in Wichita, Kan., who takes eight prescription drugs, including several heart medicines. “I wonder how the vast majority of beneficiaries will handle this. I fervently wish that members of Congress had to deal with the same health care program we do.”
In Kansas, Medicare beneficiaries have a choice of 40 prescription drug plans charging premiums from $9.48 a month to $67.88 a month.
Asked about beneficiaries’ confusion, Michael O. Leavitt, the secretary of health and human services, said: “Health care is complicated. We acknowledge that. Lots of things in life are complicated: filling out a tax return, registering your car, getting cable television. It is going to take time for seniors to become comfortable with the drug benefit.”