That day, Health and Human Services (HHS) Secretary Azar announced the final rule and timeline for pharmaceutical companies to include the cost of prescription drugs in direct-to-consumer TV ads.
Most healthcare leaders knew last October that the rule was coming. The majority of manufacturers had already signed an industry pledge of price transparency that became effective this April.
Yet few anticipated the short notice for implementation.
That morning’s sudden proclamation that HHS’ Centers for Medicare & Medicaid Services (CMS) is providing a 60-day deadline for pharma marketers to begin showing costs in TV ads generated a frenzy in the drug marketing world.
The rule’s stated objective is transparency, but many of us expect the actual result may be increased consumer confusion. To mitigate it, brand teams and agencies have raced to modify existing campaigns.
Adding the “cost” in the TV ads may seem simple to regulators and lobbyists. CMS states that “The DTC disclosure requirement we are finalizing in this rule requires simple, standardized text be placed at the end of the ad and would not make the advertisement any more complicated.”
There’s nothing simple about changing a well-constructed multimillion-dollar pharmaceutical DTC marketing plan.
Ad agencies are modifying creative for TV ads, and performing miraculous feats of copywriting to explain that the “cost” of the drug can be far less due to insurance coverage, patient assistance programs, and other discounts. And the campaign landing pages for consumers to learn more, plus brands’ main websites, all need content modifications.
As for specific design requirements, the only guiding statement was made by HHS’ senior adviser on drug pricing, John O’Brien: “We left it to the people designing ads that this needs to be in a font size and color that is legible.” Another reflection of the notion that there’s little to do.
The concept of a drug’s cost will require new scripting and training for call centers. Across brands’ social media platforms, there will be new traffic to monitor, content to republish and hundreds of questions to answer in real time.
Internal approvals of all consumer advertising and communications alone can take 60 days, especially for the major manufacturers. Brand marketers have little time to update and test new execution, let alone to accelerate legal, compliance and other internal reviews.
Some manufacturers preemptively addressed the announcement, including J&J pharma company Janssen Pharmaceuticals’ STELARA® and XARELTO®, whose sites direct consumers to a website for its 2018 US Transparency Report.
Most D2C advertisers will complete the executional alterations by the July 9 deadline. Still others will bet on rule implementation being delayed by newly filed legal challenges. In the meantime, consumers will be looking for more clarity. They’ll be searching online, calling their insurance company, asking their doctor, or all of the above. None of this will seem “simple” when we’re bombarded with inquiries and complaints and aren’t ready.
And now it’s hospitals’ turn. On June 25, President Trump signed an executive order giving HHS only 60 days to write rules requiring hospitals to publish “standard charges.” Get ready.