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John Mack answers questions from investors interested in buying stocks of online health sites. These questions were submitted by an Internet research team at a major regional brokerage and investment banking firm that provides investment advisory services to individual investors and professional money managers. A conference call with the investors will follow and this presentation will be updated afterward.
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FDA,SocialMedia,&OnlinePharmaAdver7sing
John MackPublisher, Pharma marketing News &Pharma Marketing Blog@pharmaguy on [email protected]
AnswerstoQues7onsfromInvestors
Introduc7on
InvestorswhoownstocksorwhoarethinkingofbuyingstocksofmajoronlineHealthsitesareworried.Theyhavelotsofques7onsaboutFDA'splansforregula7ngdrugpromo7onontheInternet.
Asweknow,whenFDAregulates,marketsreact.WhenFDAsentoutthose14NOVleOers,forexample,brandedpaidsearchenginemarke7ngbypharmaexperienceda"Prompt,Precipitous,&Prolonged"Plummet(seehere).Thatcouldhavebeenjustacoincidence;IhaveheardthatGoogleisworriedaboutanoveralldeclineinpaidsearchengineadver7sing.
Anyway,anInternetresearchteamatamajorregionalbrokerageandinvestmentbankingfirmthatprovidesinvestmentadvisoryservicestoindividualinvestorsandprofessionalmoneymanagersinvitedmetospeaktosomeoftheirclientsviaconferencecallabouttherecentFDApublichearingontheInternetanditsrepercussions.
Thefollowingarethefirstroundofques7onstheyhaveaskedpriortothecallandmyanswers.
3
AreasofInterest/Ques7ons
FDAHearingsBackground− WhydidtheFDAholdpublichearings?− WhatistheFDAtryingtoaccomplish?− Whatisthe7melineforFDAac7on?− IstheFDAtrea7ngtheInternetasjustanothermedialikeprintorTVoraretheytrea7ngtheInternetasanewmedium?
KeyTakeawaysfollowingtheFDApublichearings– Whatarekeytakeawaysfromthehearings?– Dothepharmacompanieswantregula7onregardingonlineadver7singandifsowhy?
– Arepharmacompanieswai7ngforregula7onbeforeintroducingonlinemarke7ngcampaigns?
4
AreasofInterest/Ques7ons(cont’d)
FutureRegula7on− HowwilltheFDAdefinewhatpla^ormsandpar7cipantswillbegovernedbyFDAregula7on?
− Followingthehearings,arepharmacompaniesaremoreinclinedtoadver7seonlinenoworwaitforFDAguidelines?
EmergingOnlineAdver7singFormats– Areanyofthenewformsofsearchadseffec7veandlikelytoreceiveFDAapproval?
– Doyouexpectpharmaadver7serstoreturntopaidsearch?– Whatonlineadver7singtrendsyou’veseenfrompharmacompaniesinrecentmonths?
– Whatnewtrendstoyouexpectinonlineadver7singandsocialmediainthefuture?
BackgroundWhydidFDAholdpublichearings?InApril,2009,FDAsentout14NOVle:ersregardingsearchengineadverAsing.Thesele:ersshotdowntheso‐called“one‐clickrule,”whichpharmamarketerswereapplyingtopaidsearchads.ThatrulestateditwasOKtomenAonabrandnamedruganditsindicaAonwithoutmenAoninganysideeffectsaslongasthefullprescribinginformaAon(PI)wasoneclickaway.BecauseofthatacAonFDAreceivedalotofcomplaints.SoonaTerthat,Icalledforapublichearingonmyblog.Therestishistory!Whataretheytryingtoaccomplish?FDAtypicallyholdsPart15hearingsaspartofitsprocesstodeterminewhetherornotnewguidanceshouldbeissuedand/orwhatresearchmayneedtobedoneinordertofulfilltheirmission.Thatbeingsaid,thereisnoguaranteethathavingapublicmeeAngwillleadtonewguidance.MyviewisthatFDAalreadyhaddecidedthatnewguidanceisrequiredandthattheyneedtostartthecommentprocess,whichwasveryhasAlyputtogether.Itwaswell‐organizedwithregardtologisAcs,butpoorlyadverAsedandorganizedintermsofensuringthatallstakeholdershadavoice.
Doyouhavedifferentanswersorcommentstoadd?SeehOp://bit.ly/8z8JZM
Background(cont’d)NextSteps/Timeline?UnofficialcommentsfromFDApersonnelplusthehastyconveningofthepublichearingsuggestthatDRAFTguidancewillbereleasedbytheendof2010.ATerthattherewillbeanothercommentperiodbeforeFINALguidancewillbereleased.Iexpectthattheprocesswillbefasterthaninthepast,unlessFDAdecidestobiteoffmorethanitcanchew.Inthatcase,itwilltakealongAmetoissueanyguidanceanditwillbeoutofdateassoonasitispublished.Amuchbe:erapproach,IMHO,wouldbetotackleafewissuesataAme.FDAcould,forexample,issueguidanceregardingspacelimitaAonsimposedbycertaintoolssuchasTwi:er(andotherSMS,text‐basedapps)andservicessuchassearchengineads.FDAcouldofficiallysancAonthe"one‐clickrule"inthesecasesaslongascertaincriteriaweremet,suchasproposedbyGoogleandPhRMA.
THISISNOTYOURFATHER’SFDA:
Expectfasterresponse,moretransparency.
FDAmayaccepthelpwithresearchandfromworkinggroupstohelpdecidewhatissuestofocusonfirst,etc.
Doyouhavedifferentanswersorcommentstoadd?SeehOp://bit.ly/8z8JZM
Background(Cont’d)WillFDAremain“mediaagnos7c”ortreattheInternetasanewmedium?ManypresentersatthehearingmadethepointthattheInternetandsocialmediaaredifferentandIMPORTANTtothepublichealth.TheInternet,forexample,isaccessedfirstbyconsumersseekinghealthinformaAon‐‐beforeaskingtheirdoctorseven.Inhisclosingremarks,TomAbrams,DirectorofFDA'sDivisionofDrugMarkeAng,AdverAsing,andCommunicaAons(DDMAC),said"whatwehaveheardis[theInternetis]adifferentmedium.”AsfarasIknow,thisisthefirstAmethatanyoneattheFDAhassaidthat.Usually,theFDAsaysit's"media‐agnosAc."Inotherwords,FDAregulaAonsapplytoallmediaanddonothavetobemodifiedforanyparAcularmedium.Thatthinking,however,wasappliedonlytotheInternet.Thereisprecedentforissuingmedia‐specificguidance:the1997“adequateprovision”guidelineforbroadcastTVads;ie,abriefstatementaboutmajorriskscantaketheplaceofenArePIaslongas“adequate provision” was made to reference a toll-free phone number, a Web site, ora current issue of a magazine that contains a print ad where the full safetyinformation could be found.
Doyouhavedifferentanswersorcommentstoadd?SeehOp://bit.ly/8z8JZM
KeyTakeawaysTheFDAisawarethattheInternetandsocialmediacanhaveanimpact‐‐posiAveornegaAve‐‐onpublichealthanditsregulaAonsmayplayamajorroleAppingthescalesonewayortheother.
ThedrugindustryismoreafraidofbeingleToutoftheconversaAonthanitisofFDAissuingguidelinesthatrestricthowitcanengageintheconversaAon.Anyguidanceisbe:erthannoneatall.
Theindustryneedsandwantsthe“one‐clickrule,”especiallyforsearchenginemarkeAng(SEM),whichworksbestwithbrandedads.
SomegoodideaswerepresentedatthehearingssuchasGoogle’snewstandardsforproductclaimpaidsearchads,whichwilllikelybeapprovedbytheFDA.Bayer/YAZisalreadyusingthenewGoogleformat,whichisinbetatest.Otherpharmacompaniesmayfollowthatlead.
Doyouhavedifferentanswersorcommentstoadd?SeehOp://bit.ly/8z8JZM
FutureRegula7onFollowingthehearings,arepharmacompaniesaremoreinclinedtoadver7seonlinenoworwaitforFDAguidelines?Mostcompaniesarelikelytowaitandseewhat,ifany,guidelinestheFDAissuesbeforeiniAaAnganyriskyonlinecampaigns;ie,brandedsearchadsusingGoogle’sstandards,brandedTweets,andopenlyengaginginconversaAonswithconsumersonsocialmediasites.ItappearsthatpharmacompaniesareincreasingtheamounttheyarespendingononlinedisplayadverAsingaccordingtothelatestTNSMIdata;ie,thisspendingmorethantripledto$221millioninQ1throughQ3,2009vsthesameperiodin2008,accordingtoDTCPerspecAves.ThistypeofadverAsingisnotlikelytobethesubjectoffutureFDAguidelinesanditisasimplema:ertoensuretheycomplywithexisAngregulaAons.Theremaybemoreadvancedandexpensivetypesofadsthatemployrolloversandothertechniquesthathelppresentmorebenefitsaswellasfairbalanceasrequired.
Doyouhavedifferentanswersorcommentstoadd?SeehOp://bit.ly/8z8JZM
