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Non-Rx Drug Access - ACNU, a Conversation with Paul Wardle
61 Plays1 year ago
Paul Wardle led switches at HRA Pharma and Pfizer and worked on iconic switch brands such as Viagra, Advil, Lipitor and TUMS. Following up on our last episode on Rx-to-OTC Switches, Paul sheds lights on ACNU - the FDA's proposed rule on non-prescription drug products with additional conditions for non-prescriptive use. This is the FDA's 12-year effort in the works, aiming to empower consumers, foster stakeholder collaboration, and redefine access based on individual characteristics.
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Transcript
Introduction to 'Crossroads' and Focus on Healthcare
00:00:05
Speaker
Good morning. This is Rusty Ray with Elantra. I head up the US Healthcare Investment Banking team here in New York, and you are listening to Crossroads by Elantra, our podcast that focuses on healthcare segment. And today we are going to talk about access to care, specifically access to medication.
New Regulatory Pathway and FDA's ACNU Rule
00:00:20
Speaker
In a recent podcast on Rx2OTC switched, we delved into the regulatory shift from prescription to OTC. Today, we're steering towards a different topic, an emerging regulatory pathway in which pharmaceuticals that focus on direct-to-consumer engagement and access act new.
00:00:36
Speaker
ACNU, the FDA's proposed rule on non-prescription drug products with additional conditions for non-prescriptive use. It's quite an acronym, but the FDA recognizes the advantage of providing patients with access to a wider range of non-prescription drugs, some of which are prescription only. In this episode, we will explore active's impact on drug access, individual medical needs, pair complexities, and public benefits. Welcome back, Paul. Let's get
Intent and Impact of ACNU on Medication Access
00:01:04
Speaker
started. What is active?
00:01:05
Speaker
Break down this acronym for us and give us the lowdown on what it is and how it works. Thank you, Rusty. Thank you for having me back. Always good to chat. A great question, what is acne? In some ways, I almost want to put the term acne aside and actually talk about what its intent is because the term itself may be limiting in terms of perspectives. But I think where the FDA appear to be trying to go is there's a recognition that our current ways of getting to medicines
00:01:33
Speaker
are somewhat limited because we only have two classes of drug. We have prescription or non-prescription. There are large unmet needs. So although we have products that are approved and available, they're not getting into the hands of consumers. So the intent of Acneu is to find new ways to get medicines into the hands of the people that need it. And in recognition, and as individuals, we're not all the same,
00:01:59
Speaker
It's also filtered based on medical history and medical needs. So it is a very different type of solution. It's a new NDA, so a new drug application, which allows a new channel of communicating and engaging with a patient or a consumer directly so they can acquire that medicine in some cases without ever having to see the doctor. In other cases, they will actually be guided back into the doctor's office because their medical history actually requires it.
Reasons Behind FDA's Timing for Rule Change
00:02:29
Speaker
So it's non-prescription because not everyone has to go to the doctor in order to get the medication. And I guess, as with any regulatory chains, there's probably an impetus for this. Maybe it has something to do with COVID. Maybe it's the fact that consumers of patients are becoming smarter and more engaged in their own care. Why now? Why is the FDA taking on this kind of rule change now?
00:02:52
Speaker
which sounds on the surface like a very complex implementation. Who gets drugs when and how, what will the criteria be, and who's going to monitor that? Does the FDA feel comfortable that now is the right time for this sort of change? In terms of now, I think now's are relative terms when you're writing regulations. They can take quite some years. And in fact, the FDA has been looking at this proposed rule for about 12 years. Some of the factors that have gone into consideration for it are
00:03:20
Speaker
the increase in numbers of people actually having insurance as a result of the ACA, the incredible gaps in chronic health conditions. So roughly one in two of us, so 50% of us actually have a chronic health condition and actually around a quarter have multiple.
Consumer Engagement in Healthcare
00:03:35
Speaker
but when you look across therapeutic areas many of us aren't receiving treatment and because we don't have the providers even if they wanted to go there we wouldn't be able to meet the needs the fba is trying to figure out a different way that some people may be able to engage there are a number of factors with it behavioral financial geographical physical so.
00:03:53
Speaker
The FDA is trying to create a mechanism for innovation that allow more people to gain access to the product, responsible access, in different ways. And the condition is really undefined of what it needs to be in order to enable that innovation for how we could access medications.
00:04:10
Speaker
And the flip side of that is obviously the patient. Does that mean that we, as patients, as consumers, we're smarter, we're more savvy? It's been often said that people are much more willing to take more charge of their own healthcare outcomes and self-medicate in various ways.
Flexibility in Self-Medication under ACNU
00:04:28
Speaker
via OTC or other mechanisms. But I guess I'm just kind of curious because behind this regulatory scheme, you're relying on an individual to somewhat be smart about their diagnosis, be smart about the management of a chronic condition, and really take ownership of some of these things where maybe in the past, we often just follow doctor's orders. So I'm just kind of curious, do you see that there's been a fundamental shift in the consumer and patients that allow this kind of regulatory framework to flourish
00:04:58
Speaker
Yeah i think you're right in some ways i wish we were all smarter but i think as you look in the last twenty thirty years and particularly with the advent of the internet access to information has changed dramatically almost since the beginning internet health care has been one of the most searched.
00:05:14
Speaker
terms people are interested in themselves and i think that tells you something that they are interested in in looking for some cells before they go to the doctor to find a solution some research actually was involved in with consulting last year we found that around a third of the population would rather do all of their health care on the right around forty percent would rather always go to the doctor.
00:05:35
Speaker
And yet, the regulatory framework today, as set up by the Durham Humphrey Act, means we only have two solutions, prescription or non-prescription. And that means, sorry, every medicine today is regulated based on the characteristics of the drug. But actually, as individuals, we have different preferences of how we want to engage in our own healthcare.
00:05:54
Speaker
So education has been one of it as we think about director consumer advertising that's been around on medication since about the late nineties and you see now the way that works is a consumer may figure out i may have this condition that go to the doctor.
Potential of Self-Medication Pathways
00:06:10
Speaker
But if some of them could actually engage in that process on their own, would we relieve some of the burden for healthcare practitioners? Some of us are relatively simple in terms of our healthcare needs. So the pathway to choose the right medicine may be easier. Others, I'll say heart disease. Let's say you've had a triple bypass, you have diabetes, you've got a higher burden of need. You may need to go to the doctor. So the acne rule actually allows us to treat
00:06:36
Speaker
Medication by the characteristics of the individual so those who can self medicate self-treat. Could get it themselves those who really need the assistance of the position would actually be guided to the position so fundamentally i think your question are we smarter yes we're more educated,
00:06:56
Speaker
There's a greater desire to be engaged. We recognize we're looking for simpler solutions for needs that we can do ourselves. But we're also responsible that we know when we're out of our depth in terms of our health care needs. And that is in every situation. So we can triage people differently.
00:07:14
Speaker
You mentioned a few moments ago various conditions. You said chronic heart disease or others. That leads me to believe, obviously, this kind of regulatory framework is not going to be appropriate for everything. You could think of chemotherapeutics or things like that where you still need to go to an office to get an infusion, but for chronic type conditions, whether that's high blood pressure or
00:07:36
Speaker
other types of chronic illnesses. Do those lend themselves to this regulatory framework a little bit better or do you see this regulatory framework is sort of opening the door to things where we thought, oh gosh, you must go to the doctor to do that.
Suitability of Regulatory Framework for Various Conditions
00:07:52
Speaker
Can we start to take back some of the control within our hands of the consumer of things that were thought of as specialist only?
00:07:59
Speaker
Yeah, I think that's a great question and I'm going to break it down into a couple of ways. Firstly, there is a difference for individuals when you're first diagnosed with something versus have you had a condition for a number of years. So there's an element of the rule which actually says an ACM you can apply to either the diagnosis or for the ongoing use or for both of them. Let's say a hypertensive medication for a number of years. How could you get easier access to refills?
00:08:26
Speaker
there may be a diagnostic that you have to monitor to ensure that you're still appropriate for the medication. And so the act may be around some diagnostic measure. I find it interesting when you said in the oncology space, I was thinking about that myself. Would we ever think of this for oncology? And there are certain tests which an individual may not be able to do themselves. But I could get to the place of palliative care. Is there a place where making it easier for an individual to get medication would make sense?
00:08:56
Speaker
I'm not suggesting that is the solution that everyone should be going after, but I think the FDA in creating this rule has tried to leave it open to the innovation of sponsors. They're not trying to replace the healthcare practitioner, but they're trying to enable companies to find solutions that make the journey easier.
00:09:15
Speaker
And we all know in healthcare, adherence across many therapeutic categories is one of the biggest challenges. There's a burden of having to keep going back to get a refill. You may get a different generic each time, raising questions of what it is. And so I think it does open up the doors.
Innovation in Enhancing Patient Access
00:09:31
Speaker
The other piece that has changed in recent history, we now actually have access to our own test results. Many of us, it's through kind of my chart through our health provider, but historically that information had to go to the doctor first before us as a consumer could have it. And I think that's a good place that individuals are more engaged in their treatment options rather than less engaged.
00:09:54
Speaker
You mentioned something that I wanted to press on, but you've maybe slightly changed my thinking around this, and that is the sponsor, so the manufacturer, the marketeer. How does a program like this get administered? Is it the manufacturer? Is it a third-party, say, medical adherence-type company that's dealing with payers and medication management for lots of patients already? Are they sort of
00:10:21
Speaker
implementing this as a next level type of care for those patients that meet the criteria? Or do you think that the sponsors, the manufacturers, the pharmaceutical companies want to maintain control of this and develop their own sort of different style of marketing, DTC, if you will, to find and identify the patient that could be appropriate for this and go to them direct?
00:10:43
Speaker
How does the patient actually get hold of the medication and who
Patient Journey and Marketing Strategies
00:10:47
Speaker
does that? Another great question. Wow. I think I'm going to start with the patient journey. I think on many, many occasions we're used to creating a patient journey to understand where are the barriers? What are the marketing efforts as a manufacturer of how to reach those patients? And some of them, if they're not getting to the doctor's office, they're outside our audience. So one reason to think about this is how do we increase the reach of our medication in new populations?
00:11:11
Speaker
I can see advocacy groups, I can see manufacturers, I can see third parties very interested in, hey, there's a mechanism that could increase access for a solution. That, I don't think necessarily belongs with any individual organization. The interest here is how do you increase public health? So looking at it from different ways. I think for a manufacturer,
Direct-to-Consumer Engagement Benefits
00:11:32
Speaker
there's a number of reasons to think about this.
00:11:34
Speaker
Certainly, while the life of the brand is patented, if this is a channel which it can be, because it can be executed in parallel to the existing prescription NDA, you could be reaching more consumers sooner and increasing the value of that brand of medication far earlier in the life cycle of the medication.
00:11:54
Speaker
So there is a reason to actually think about it as a manufacturer kind of as you're thinking about phase two and phase three trials. Hey, can we expand the audience for this medication by having a segment of the population that can access it directly? Historically, people have often and we talked about our XOTC switch last time.
00:12:12
Speaker
They've only thought about that towards the end of the lifecycle over medication. Hey, it's going off patent. Hey, can we extend the reach? That's still a possible reason for thinking about it. But when I look at the US today, most of the medications that are available from prescribers are actually generic.
00:12:30
Speaker
So there are lots of medications where the category itself is generic, and yet there's still unmet need because bringing the price down hasn't changed the access. I'll take heart disease, for example, whether in cholesterol or hypertension, the number of untreated individuals is like 30 or 40%. We have the medications, the products are available. So it could be a mechanism to increase access on products that are generic today.
00:12:55
Speaker
having a different way of engaging, which is directly with the consumer. And it doesn't replace the existing RX license. It's actually an additional license which can be co-marketed at the same time as those other licenses. So it really does open up a door in a different way for access.
Comparison with Telehealth Models
00:13:12
Speaker
Consumer health care companies, I think they're going to continue to look at this space. Is it a way to expand usage over the last, I don't know, 20, 30 years? I think there's over 700 medications that were previously prescription that are now non-prescription. It has been a growth driver for consumer health care companies. But I think Acne actually has a far broader audience than typical consumer health care. I think it can apply in many other places.
00:13:37
Speaker
And how do you see some of the companies that have been around for, let's say, five to seven years call it, I don't know, not trying to be flip about this, but they're effectively mail order pharmacies, they advertise on TV, a lot of them teams seem to be geared towards erectile dysfunction or lifestyle type.
00:13:55
Speaker
pharmaceutical products and the like. You still have to qualify, talk to one of their doctors, and you get verified that you are worthy of prescription. I'd be curious to know how many people they turned out. But then you receive in the mail a discreet brown package with your Viagra or Cialis generic product.
00:14:16
Speaker
Is that pathway that sort of is a commercial pathway that people might look to and say, OK, that's how they did it. We might follow suit. Or do you think that is sort of something that was a bit of an interim step to kind of the true ACK new framework?
00:14:34
Speaker
It's a method of access that has been growing for over 10 years now, certainly accelerated during covid when we couldn't get to the doctor and it does two things. One, it actually says there is consumer interest in this mechanism. Interestingly, that is actually not all governed by the FDA. It's the practice of medicine.
00:14:54
Speaker
So the physician that is actually authorizing that prescription is responsible for it. Those systems evaluated by the FDA in the same way that an ACME would be. But there are some key differences. With a prescription product, there are some key differences here from one of these asynchronous telehealth models versus an ACME.
00:15:15
Speaker
With a prescription product, the manufacturer can't write the prescription. So what you see with those models is they largely supply generic products. And from an industry standpoint, the platforms we're dispensing them have become brands. And so there's a number depending on the therapeutic category.
00:15:33
Speaker
With Enacnew, the sponsor, because the practitioner, the healthcare practitioner doesn't have to write a prescription for these cases, the manufacturer can actually own the communication to the end consumer. So you can actually see the value of this from a manufacturing standpoint is very different versus those telehealth models. And when I look at the value of companies from a profit or sales perspective, direct consumer health companies are valued far greater than either branded pharmaceutical or generic companies.
00:16:02
Speaker
So it is a way of increasing value for a manufacturer by having a direct communication. And there's also a value that when you have that communication, you retain that consumer for longer, you create a relationship. But the relationship actually comes with a burden. It's communication. That's an interesting comparison.
Payer Perspectives on ACNU
00:16:19
Speaker
I guess my last question for you today is kind of more along the cost and payer perspective. And I'm just kind of curious what your thoughts are on the payer reaction to Agnew.
00:16:29
Speaker
In the sense that there's been lots of ink spilled on drug pricing, Medicare's ability to negotiate with manufacturers has been heavily in the news in the recent months. Obviously, we'll see where that lands based on probably the upcoming lawsuits around that. As you think about acne, especially with a chronic condition, that's an expensive proposition potentially over the lifetime of a patient, maybe getting a branded product as opposed to a generic or something that's more in the
00:16:58
Speaker
payer or PBM's formulary where they're pushing something that benefits them. So how do payers and the PBM sort of respond to this kind of legislation or regulatory change and are they seeing it as a good thing or do they see it as a threat?
00:17:13
Speaker
That's a complex question and I'll try and break it down in a couple of ways. I think pricing for a prescription product today is quite complex. It is a cost-benefit analysis. So there is the cost of the product at what level
00:17:28
Speaker
Is it reimbursed? What level does the insurance company, are they willing to pay for it? And you see many situations, I think for A&DAs, less than half of A&DAs that are actually approved ever getting launched because, hey, the commercial valuation wasn't there. There may have been a good consumer reason, but there's not a value seen for actually reimbursing it. In the same way for an Acne, and there was actually a public hearing, I want to say around 2013-14, where insurers were actually
00:17:55
Speaker
Ask to be a part of this process now the FDA does not regulate the pricing but i think the perspective is actually very similar to thinking about pricing on the prescription side will have to do a complex analysis. What is the benefit of covering it for an insurer and the benefit is more complex if you can ever sequally from that condition.
00:18:16
Speaker
Let's say you have somebody on a cholesterol medication and they don't have a heart attack. They don't have a stroke. You're averting other costs in the health care system. There are cost savings in the system. So you can do an economic health economic analysis to say what is the benefit for the insurance company to cover a particular medication within an acne versus not. And one of the requests that they did have in that prior public hearing was, hey, call this something different. So we can actually make that an evaluation of whether or not to cover it.
00:18:45
Speaker
So I think what we'll see is, depending on the condition, depending on the product, we may actually see a number of products actually being covered. And I think this goes back to the unmet need.
00:18:56
Speaker
If in heart disease, which is the leading cause of death in the US, 34 people dying every second, would it benefit for more people to get the appropriate medication? Yes, I think it would. Would it reduce overall healthcare costs? Actually, there's a number of studies that have actually indicated that. There is a cost benefit for that equation, and actually having direct access reduces a lot of costs in the system.
00:19:17
Speaker
It doesn't replace the doctor for those that need it, but for some individuals, it may be a more efficient way of getting them coverage. I think one of the things insurers are going to want to do is know that it's not being diverted for inappropriate reasons. They're actually covering the individual that is covered. So some mechanism that reinforces that. Historically, that's been a prescription in order to get non-prescription coverage. But actually, we may see now with the advent of technology and solutions other ways for that to get incorporated as a covered benefit.
00:19:46
Speaker
So I think it is something that will evolve, but it will always be a product and situation by situation evaluation. But as a result, I think it actually behooves an organization to think about this early in the development, because if it's covered and it's still patent protected, there could be incredible value for increasing the population. And the insurance coverage may not be the issue that we think about historically for non-prescription products.
00:20:13
Speaker
How is this different from what we have today? How is this different from what we have today?
ACNU vs Traditional Regulations
00:20:18
Speaker
The regulations that govern prescription non-product and non-prescription products today were governed by the Donald Humphrey Act in 1951. Essentially, a product should be non-prescription unless the characteristics of the product mean that a physician's intervention is necessary.
00:20:36
Speaker
In reality, almost all but a handful of products have actually gone prescription before they've ever got to non-prescription. But what that means is access for a medication is defined for everyone by the drug characteristics. So if there is a particular population that may have a serocyte effect or may be contraindicated, it may end up being prescription for everyone versus not.
00:20:59
Speaker
What essentially the acne does is start looking at access to medication by the individual. What are the characteristics of the individual that create a positive benefit-risk argument such that a subset of individuals may be able to get access without talking to a doctor?
00:21:19
Speaker
Whereas others whose burden of disease, comorbidities, actually suggest, yeah, they really should be in a doctor's office. So access to an acne means that you can get access to that modification defined based on your own individual characteristics.
00:21:33
Speaker
Now, obviously, the condition is intended to ensure that there's appropriate access, and a sponsor must actually demonstrate that through appropriate behavioral studies, and the acne must be necessary. So if it can be fully OTC, they actually aren't going to approve it with an acne. But there's also some very interesting things about this rule, which are very different from typical OTCs or non-prescription. One of them is that the acne can coexist
00:21:59
Speaker
with that prescription NDA, whereas with an RX OTC switch, the RX product is removed when the OTC becomes available. Here, it's actually increasing a channel of access in a different way. The FDA has also indicated that companies can consider this mechanism at any point in the lifecycle.
00:22:18
Speaker
It could be at the very initiation of a program. It could be while you're thinking about phase two and phase three programs that, hey, this is an additional way to reach more consumers. And I think it actually could add significant value to the pipeline of our products when you consider it in that way that this isn't an end of life strategy. It's a end of lifecycle strategy. It's actually a potentially a patented lifecycle component of drug development. How does this benefit the public from the FDA's perspective? How would they look at it?
Public Benefits of ACNU
00:22:48
Speaker
I think when we look at non-prescription access historically, and you can look at a whole number of case studies, when you reduce barriers for patients or consumers to access, the category utilization on average goes up by about 30%. Because we have behavioral barriers why we don't go to the doctor.
00:23:05
Speaker
because we have geographical or physical reasons why we don't get there. When you remove some of those barriers and make it more convenient to get access, the utilization goes up. And that's particularly relevant in chronic conditions where these happen over many years and adherence is poor. So the benefit from a healthcare perspective is getting more people onto the appropriate medication
00:23:29
Speaker
and actually having higher adherence to those medications overtime which is a net result and improves the cost benefit for an insurance company for an individual and for the population at large.
Conclusion and Transformative Potential of ACNU
00:23:40
Speaker
This wraps up our insightful conversation with Paul delving into the transformative potential of acne and reshaping drug access models.
00:23:47
Speaker
From recognizing diverse medical needs to navigating the complex landscape of peer responses, we've explored this multifaceted regulatory shift. The unique control it grants manufacturers of our prescription and dispensing opens up avenues for enhanced value and communication.
00:24:03
Speaker
As we conclude, we've uncovered the distinctive features of this regulatory framework, paving the way for more individualized approach to medical and medication access. Thank you again, Paul. And should anyone like to learn more, please visit us at Elantra.com.