> What's Black and White and Sells Medicine?
> August 27, 2000
> By MELODY PETERSEN
> Replicas of Max, a small plastic zebra, hang from the stethoscopes
> of so many pediatricians at the Children's Hospital in Boston that
> at least one family has asked whether he was the hospital's
> mascot. But no, Max is a creation of Pfizer Inc., intended to sell
> an antibiotic called Zithromax. And with Max's help, Zithromax has
> become a billion-dollar drug in just a few years.
> Pediatricians open their mailboxes to find medical journals
> wrapped in paper covered with Max's stripes. Zithromax sales
> representatives hand out stuffed zebras to doctors to help console
> their young patients. And Pfizer has donated a real zebra to the
> San Francisco Zoo and invited scores of children to a celebration
> at which the zebra was named Max.
> Last year, after federal health officials said that other
> antibiotics were not only cheaper, but worked better for children's
> ear infections, Pfizer sponsored a season of "Sesame Street,"
> enlisting Elmo, the Muppet, to help in the campaign.
> The sales effort is classic Pfizer. It is also an example of what
> makes Pfizer both the company that rivals try to emulate and a
> target of critics who worry that the use of many prescription
> drugs now has more to do with marketing than with the
> effectiveness or actual need for a drug.
> Pfizer, based in New York, spends more than any other drug
> company to advertise to consumers, and its marketing efforts have
> garnered warnings from federal regulators and criticism from
> doctors. In recent months, the complaints have grown, as state
> and federal officials have blamed aggressive consumer advertising
> by drug companies in general for the skyrocketing cost of drugs.
> Pfizer, the largest drug maker in America, was probably the first
> in the industry to transform itself so clearly from a
> research-driven company to one that operates more like Procter &
> Gamble, the maker of Tide.
> At Pfizer and a growing number of other drug companies, marketing
> executives, not scientists, are in charge. William C. Steere Jr.,
> the company's chairman and chief executive, began his career there
> as a sales representative, marketing the antibiotic Terramycin.
> Henry A. McKinnell, who will take over when Mr. Steere retires
> next year, also came from Pfizer's business side.
> In Pfizer's laboratories, marketers work side by side with
> scientists, even during a drug's early development. Using
> financial forecasts, the sales executives help to ensure that any
> drug the scientists are developing has a ready market. Other drug
> companies use this system, too, but Pfizer says it was one of the
> first to emphasize it.
> Pfizer says its worldwide army of 20,000 sales representatives is
> the industry's largest. And while the company has the biggest
> research budget in the industry, it spends more than twice as
> much on marketing and administrative expenses.
> Last year, the company spent 39 percent of its $16 billion in
> revenue on those expenses -- a rate that was about one-fifth
> higher than the industry average.
> Pfizer brushes aside the concern. In an interview, Mr. Steere
> said the company's ads were helping to improve the public's
> health, not only by supplying effective drugs to ailing patients,
> but also by prompting people long reluctant to go to the doctor to
> set up appointments. And those appointments, he said, may also
> lead to detection of other problems: some men who have gone to
> the doctor to get a prescription for Viagra, Pfizer's popular
> anti-impotence drug, have found out they had other medical
> problems, like diabetes.
> "Direct-to-consumer advertising is a good thing," he said. "We
> get more complaints about our ads from politicians than
> Pfizer's strategy has been so successful that the company expects
> to set an industry milestone this year -- eight drugs that
> bring in sales of more than $1 billion each. Six of those
> blockbuster drugs were discovered in Pfizer's labs or in those of
> Warner-Lambert, a competitor that it acquired early this year.
> Pfizer is so respected as a marketer that more and more of its
> sales come from drugs discovered by other companies that have
> hired Pfizer to help sell their drugs. SG Cowen Securities
> estimates that Pfizer's revenue from marketing just two drugs
> discovered by other companies -- Celebrex, a pain reliever from
> Pharmacia, and Aricept, a treatment for Alzheimer's, from Eisai --
> will increase to $2.4 billion by 2004 from $680 million last
> Pfizer's need to market so aggressively is, in part, a product of
> its success. Its strong performance over the last decade has
> raised investors' expectations, and its acquisition of
> Warner-Lambert brought together America's two fastest-growing drug
> companies, only adding to the Wall Street pressure for sales
> growth. Mr. Steere said this year that Pfizer planned to
> increase sales by 13 percent a year through 2002. That means more
> than $3.5 billion in new revenue this year, the equivalent of
> three new blockbuster drugs.
> "We've got to get everything out of a product in a short amount
> of time," Mr. Steere said.
> There is no doubt that Pfizer's drugs have helped millions of
> ailing patients. The company is giving away millions of doses of
> Zithromax, for example, to developing countries to help stop an
> eye infection that can lead to blindness.
> But criticism of the company's marketing tactics is growing. Last
> year, the Food and Drug Administration requested a meeting with Mr.
> Steere, wanting to discuss the repeated warning letters it had sent
> to Pfizer. The letters contended that the company failed to
> follow federal drug-marketing regulations by making claims about
> certain drugs that could not be supported.
> Pfizer has received 11 warning letters since the end of 1996,
> including one ordering it to stop using brochures that the agency
> says improperly implied that Zithromax was more effective than
> Augmentin, an antibiotic made by SmithKline Beecham. Other drug
> companies have received more warning letters from the F.D.A., but
> an agency spokeswoman said it was "rare" for a chief executive to
> be called in for a visit with Dr. Janet Woodcock, director of the
> F.D.A.'s center that approves drugs.
> Two of Pfizer's most vocal critics, Dr. Joshua Sharfstein, a
> pediatrician at Boston Medical Center, and Dr. Sidney Wolfe of
> Public Citizen, the consumer group, have complained about
> Pfizer's Zithromax campaign to Donna E. Shalala, the secretary of
> health and human services. The two doctors had obtained an
> internal Pfizer document that listed a toll-free phone number for
> pediatricians to call if they wondered whether to prescribe
> Zithromax to children. When they called, they heard recorded
> advice from Dr. Russell Steele, vice chairman of pediatrics at
> Louisiana State University's school of medicine. He said, among
> other things, that most children's ear infections would be cured
> with a drug like Zithromax.
> The Pfizer internal document said the purpose of the recorded
> advice was to "counter" recommendations of the Centers for
> Disease Control and Prevention that were published in early
> 1999. Those guidelines said other antibiotics were more effective
> than Zithromax at curing children's ear infections.
> In their complaint, Dr. Sharfstein and Dr. Wolfe argued that part
> of the advice from Dr. Steele, whose university had received a
> payment from an advertising company hired by Pfizer, was not
> based on prevailing scientific evidence.
> "There is even more evidence now that Zithromax does not work for
> many kids," Dr. Sharfstein said. "It just prolongs pain and
> suffering for many kids and is much more expensive than the other
> medications." He said, however, that he believed Zithromax was
> effective in treating pneumonia.
> Dr. Steele said that he disagreed with the C.D.C.
> recommendations, and that he stood by what he said on the
> Pfizer says any problems that regulators found with its marketing
> were isolated incidences that were corrected immediately. J.
> Patrick Kelly, the vice president for worldwide marketing, said
> the company had investigated the two doctors' complaint but did
> not find that it had done anything wrong. Mr. Kelly said that
> Pfizer regularly gives grants to outside experts to talk about its
> drugs as part of educational programs for doctors, but that the
> experts give their own opinions. "We don't control the personal
> opinion of doctors," he said.
> Dr. Michael W. Dunne, director of clinical research for Pfizer's
> anti-infective drugs, said the company had conducted studies
> comparing Zithromax to all drugs recommended by the C.D.C. panel
> and found that Zithromax was just as effective.
> Aggressive marketing of any antibiotic, whether made by Pfizer or
> its competitors, is increasingly controversial. C.D.C. officials
> say they fear that overuse of antibiotics is threatening the
> public's health as more bacteria become resistant to the drugs.
> But to drug companies, limiting the sale of an antibiotic would be
> altruism that would not be good for the bottom line.
> "There is a conflict between the public health interest and the
> industry's interest," said Dr. Scott Dowell, the C.D.C.'s acting
> associate director for global health, speaking about all drug
> companies. "The industry is concerned about resistance, but they
> need to sell their drugs."
> Mr. Kelly said Pfizer was monitoring which bacteria have become
> resistant to Zithromax. So far, he said, Zithromax is holding up
> better than many other drugs. It is now the nation's top-selling
> branded antibiotic.
> In its marketing efforts, Pfizer has addressed the government's
> concerns about antibiotic resistance, Mr. Kelly said. Company
> advertising, for example, has urged parents not to demand a
> prescription for an antibiotic from the doctor if a child's ear
> infection is caused by a virus -- a practice that is contributing
> to antibiotic resistance.
> Pfizer has acknowledged a downside to advertising. While Mr.
> Steere contends that advertising has benefited consumers, he said
> it had also helped make the industry a new corporate demon in some
> people's eyes.
> "We used to be invisible," he said, "but now we're very visible."
> Since its founding in 1849 by Charles Pfizer and his cousin,
> Charles Erhart, in Brooklyn, Pfizer has had a knack for getting
> people to take more medicine. They had their first breakthrough
> when they took a bitter treatment for parasitic worms, blended it
> with almond-toffee flavoring and shaped it into a candy cone.
> Pfizer's presence in antibiotics dates to just before World War
> II, when the company found how to produce penicillin in mass
> quantities. And in the late 1940's, Pfizer's scientists discovered
> Terramycin, which went on to become a top seller. When the drug
> was approved by the F.D.A. in 1950, eight Pfizer sales
> representatives were waiting for word at pay phones across the
> The company has been building its sales force ever since. Even
> during the early 1990's, amid the uncertainty over managed care
> and President Clinton's plan for a national health care system,
> Mr. Steere took a gamble by hiring people when other drug
> companies were firing them.
> With the Warner-Lambert merger, Pfizer now has 8,000 sales
> representatives in the United States alone, the most in the
> Pfizer plans to spend about $4.7 billion this year on research --
> an amount that is more than the budget of the National Science
> Foundation in Washington. The company's 12,000 scientists are
> focused both on finding drugs and, with the help of sales
> experts, creating an ever greater market for them.
> At the main laboratory in Groton, Conn., the scientists call
> that teamwork "Cram," for "Central Research Assists Marketing."
> About 25 percent of Pfizer's research money finances clinical
> studies of drugs that Pfizer is already selling. These studies,
> known as Phase 4, are common in the industry and are conducted
> after the F.D.A. approves a drug.
> Aimed at increasing the sales of existing drugs, Phase 4 studies
> try to show that the company's drugs can be used by patients
> suffering from other illnesses or that they work better than
> competitors' drugs. In effect, they try to expand the claims that
> Pfizer's sales representatives can make about the drugs.
> "You can't promote a feature of a drug unless you've proven it,"
> said Dr. John F. Niblack, Pfizer's top scientist and vice
> Outside the lab, Pfizer is also working hard to supplement its
> products. It has aggressively wooed other companies that are
> developing new drugs, asking to let Pfizer help sell them. In
> fact, of the four drugs in Pfizer's pipeline that the company
> estimates could become billion-dollar-a-year sellers, two were
> discovered by other companies. In a recent report, McKinsey &
> Company, the consultants, called Pfizer "superior" at getting
> these contracts. Indeed, the antibiotic that became Zithromax was
> discovered by Pliva, a company in Zagreb, Croatia. Pfizer's
> scientists came across Pliva's patent in 1981 in a search of
> records at the United States Patent Office. The companies soon
> signed a licensing agreement.
> The drug fascinated Pfizer's scientists because, in experiments,
> it stayed in the body tissue of animals longer than other
> Pfizer's marketers quickly realized that the science behind
> Zithromax would make great ad copy. Gene Michael Bright and Arthur
> E. Girard, two Pfizer scientists involved with early work on the
> drug, recalled how the marketing executives decided to send them
> to international conferences to talk about it years before it was
> At the suggestion of Pfizer's marketers, the scientists repeatedly
> used snappy phrases like "the tissue is the issue," Dr. Bright
> said, to deliver the message that Zithromax would be a powerful
> new drug.
> When Zithromax was approved in 1992, Pfizer's marketing message
> changed to focus on consumers. Because the drug stays in the body
> so long, patients need fewer doses than they would of other
> antibiotics. Pfizer's marketers knew that this would be a great
> selling point to parents struggling to get sick children to take
> medicine. The marketing message became "just five doses and you're
> Although Zithromax is approved for use in adults with pneumonia
> and other illnesses, Pfizer's marketers have focused much of
> their effort on millions of children who get ear infections.
> Federal statistics show that almost two-thirds of children under 5
> get an acute ear infection every year.
> When the pediatric formulation of Zithromax was approved in 1995,
> Dr. Candice E. Johnson was a pediatrician at a clinic at Case
> Western Reserve University in Cleveland. She said her clinic "was
> wallpapered with Zithromax zebras" supplied by Pfizer sales
> Dr. Johnson, now a pediatrics professor pediatrics at Children's
> Hospital in Denver, recalled how Pfizer representatives had
> distributed rubber ink stamps to doctors so that writing a
> prescription required only a quick stamp and signature. She
> became upset, she said, when she found that emergency-room doctors
> were prescribing Zithromax for illnesses like strep throat, which
> could be treated with less powerful medicine.
> A few years ago, she said, she asked to give a talk to the
> emergency-room personnel on the proper use of antibiotics. But
> before she spoke, a Zithromax sales representative was allowed to
> hand out pens and calendars, make a five-minute presentation and
> pay for the breakfast buffet. "It really disturbed me," she said.
> Pfizer says its use of a zebra to promote Zithromax is typical of
> the industry's approach to marketing pediatric drugs. SmithKline
> Beecham, for example, uses "Auggie the Froggie" to market
> Augmentin, and Abbott Laboratories uses a bulldog called Bix to
> sell Biaxin. Both drugs compete with Zithromax.
> Concerned early last year about the growing resistance of
> bacteria to drugs, a C.D.C. panel of doctors recommended which
> antibiotics should be used to treat children's ear infections. The
> panel recommended that a pediatrician's first choice should be
> amoxicillin, which has been used for years. As a second choice,
> the panel recommended several drugs made by Pfizer's competitors.
> Dr. Dowell, the C.D.C. official, said the panel did not recommend
> Zithromax because most studies had shown that it was not as
> effective as the recommended drugs against the bacteria that is
> the leading cause of children's ear infections, if that bacteria
> had become resistant. A growing number of ear infections are
> caused by resistant bacteria, he said.
> "We still stand by the recommendations," he said. "The studies
> that have come out since have supported them."
> But Pfizer moved quickly to offset the recommendations. Soon
> after they were published, Pfizer paid the Children's Television
> Workshop to sponsor a season of "Sesame Street," running
> 15-second Pfizer announcements at the beginning and end of each
> Then, in an unusual partnership, Pfizer and the Children's
> Television Workshop produced a video featuring Elmo going to a
> doctor with an ear infection. Zithromax was not mentioned in the
> video, which was distributed to doctors and child care centers,
> but the drug was advertised on a Pfizer Web site, KidsEars.com,
> where the video was also given away in a drawing.
> "We used something kids love," Mr. Kelly said, "to get them past
> something they don't like."
> Pfizer also paid for a children's health magazine that was
> produced by the Children's Television Workshop and included
> Zithromax ads.
> What happened next is open to interpretation. The latest sales
> statistics suggest that the C.D.C.'s recommendations could be
> changing pediatricians' minds. In the first half of this year,
> Zithromax sales fell 10 percent, compared with the corresponding
> period last year. And prescription statistics show that amoxicillin
> prescriptions began to climb in 1999 after declining for years.
> But Mr. Kelly of Pfizer said Zithromax prescriptions fell because
> the flu season was shorter this year than last, and total sales
> of all antibiotics declined. Zithromax continues to gain market
> share, he said.
> To make sure it does, Pfizer is working on two new formulations
> for children, including one that would require only one dose to
> treat an ear infection instead of five.
> The company is also working on a clinical study that could create
> a huge new market for the drug. The study, nicknamed the Wizard
> trial, is looking at whether the antibiotic could become part of
> the treatment for heart disease, the leading cause of death among
> Mr. Steere said the study was an expensive, high-risk gamble.
> "But if we win," he said, "we win big."
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