Awash in negative headlines, public condemnation and government scrutiny, the pharmaceutical industry faces a public relations problem that, left untreated, could bring new regulations or sanctions either from governments or the courts. At the same time, though, the recent scandals over price gouging could offer an opportunity for responsible, research-based companies to distance themselves from the profiteers.
The industry has come under fire at a time of unprecedented innovation. As a physician who trained in the 1990s, I am in awe of the recent breakthroughs. Immuno-oncology drugs like Keytruda (pembrolizumab) and Opdivo (nivolumab) offer hope for patients with previously untreatable cancers. Entresto (sacubitril/valsartan) – the first novel treatment in over a decade for congestive heart failure, a condition deadlier than most cancers – was approved this year. There is a cure for many forms of Hepatitis C with Sovaldi (sofosbuvir) and vaccines for dengue fever and maybe even malaria may become available soon. More patients in developing countries than expected have access to antiretroviral drugs for HIV/AIDS and companies are devoting resources to achieving the same for the new scourge of noncommunicable diseases.
At the same time, some in the industry have been seeking to tackle the image problems. Overeager sales representatives are being reined in. Financial ties to physicians and clinical trial data are being disclosed. The main industry bodies in the United States, PhRMA and BIO, disowned Turing Pharmaceuticals, the company behind the notorious 5,000 percent price increase for Daraprim, a critical drug for certain infections in immunocompromised patients.
The press and trade publications strongly endorse workplace wellness programs as a good investment for employers. Soeren Mattke, a physician and RAND senior scientist, explains why his work tells a different story.
Why are workplace wellness programs so popular?
Because employers think the programs make business sense. They are supposed to improve employees’ health, increase their productivity, help control their chronic conditions, and reduce their risk of developing a chronic disease in the longer term. Employers believe that the dollars they spend on these programs will come back to them in avoided health care costs. For example, a recently published review suggested that employers gained three dollars in health care savings for every dollar spent on a workplace wellness program.
What does a typical workplace wellness program look like?
They usually have two components: lifestyle management and disease management. Lifestyle management focuses on employees with health risks such as smoking or obesity. The goal is to help employees reduce those risks, thus steering clear of serious disease down the line. In contrast, disease management is intended to support employees who already have a chronic disease by helping them take better care of themselves, e.g., reminding them to take their medications.
So are the programs living up to their press?
Perhaps in part. We recently published a study that included almost 600,000 employees at seven firms. We found that lifestyle management reduced health risk, like smoking and obesity, but no evidence that it lowered employers’ health care spending. Our new analysis extends that finding. Looking at 10 years worth of data from a Fortune 100 employer, we found that its program generated a reduction of about $30 per member, per month in health care costs. But disease management was responsible for 87 percent of the savings.
How does this disparity translate into return on employer’s investment?
The return on investment is strikingly different. For the disease management component, the employer earned a $3.80 return for every dollar invested in the program. For lifestyle management, the return was only $.25 for every dollar invested.