Derek Lowe, a biomedical researcher at Novartis, is talking “A bit about biopharma investing” today on his blog.
It’s all about the problems inherent in making decisions based on drug company news releases.
His comments are targeted at investors, who in turn are the main targets of these drug company announcements. But his logic could just as easily apply to journalists, patients, and consumers — all of whom are routinely snookered by the optimistic projections and misleading interpretations often found in these documents.
Lowe’s post was sparked by Merck’s announcement yesterday that the company is not going to seek FDA approval for an experimental cholesterol drug, anacetrapib. That’s despite announcing in June that the drug “met its primary endpoint, significantly reducing major coronary events” in a large phase 3 study.
Apparently some investors took that June announcement to mean that the company would be forging ahead with the drug and likely reaping hefty profits from its sale. Those hopes were dashed yesterday when Merck decided to pull the plug. The “significant” benefits observed in the study were not meaningful enough to patients to justify proceeding.
Lowe notes that Merck’s announcement back in June wasn’t particularly frothy, and that the company “is a big, respectable, well-run drug company that does not go around trying to fool people.”
Merck’s history certainly would challenge that statement, but Lowe’s point is worth taking: There are a lot of other players in the market who are much less cautious than Merck.
Here’s his insightful take on why that’s a big problem:
Merck certainly did not try to deceive anyone with their announcement earlier this summer about anacetrapib, but remember, mundus vult decipi: people want to deceive themselves, and they will line up and pay money to be told the stories that they want to hear. That works out pretty well at the movies or at the bookstore, but not so great in the stock market. To lapse into Latin some more, when you read the public statements made about a drug discovery project, you will encounter at times both suppressio veri, where the truth is incompletely revealed, and suggestio falsi, where things that aren’t true are made to sound as if they are. Blatant examples of either one can land people in trouble, of course, but that’s the tricky part about biopharma investing: they don’t have to look so blatant to be effective. Touting positive results in a trial that’s so underpowered that they don’t mean much, sliding over the fact that this was an open-label study rather than a double-blinded one, not going into the previous times this compound or therapy has been in the clinic, not placing the results in a context with clinical or regulatory relevance – there are a lot of ways to accomplish the same goal, and if you stick with the field you’ll see them all. Again, and again, and again.
Everything that Lowe says about investors can also be applied to patients — many of whom have a lot more riding on these promotional announcements than any investor will ever have.
That’s why we review health care news releases and even make a standing offer to help improve these announcements before they are issued to the public.
We’re also continually working to provide the tools people need to become smarter health care consumers. We hope you’ll take a look at these resources and share them widely.