Mr. LERNER. First of all, I have already indicated my views on what transpired this morning from the witness you heard in terms of my ability to comment on it. We have what we call performance goals and we have performance standards.

Mr. NELLIS. Are these quotas?

Mr. LERNER. We prefer "performance goals."
Mr. NELLIS. But are they quotas?

Mr. LERNER. These are goals toward which we have our salespeople working. It is not always possible to establish those for products. You take a city like Washington, D.C. where you may have five or eight people working in the area. It is very difficult to track dollar sales to an individual's efforts. Prescriptions may be written here in Washington by a specialist in psychiatry and filled somewhere in Maryland or Virginia. There is no way to track that kind of relationship. Where dollar sales goals can feasibly and reasonably be established, they are established between division sales manager and salesperson. Where they cannot be, they are not, So I can't give a general answer to your comment on quotas.

Mr. NELLIS. Mr. Lerner, what I am getting at is this

Mr. GILMAN. Would you object if the gentleman from California is given 2 additional minutes?

Mr. NELLIS. Not at all.

Mr. DORNAN. Will the gentleman yield?

Mr. NELLIS. Yes.

Mr. DORNAN. Mr. Lerner, it says in this two-page Valium advertisement that only Valium, diazepam, can do all of this, where I am pointing on this chart. One of the things it says Valium can do is amazing. Since you are fond of quoting French philosophers I'd like to quote an English writer named Bill Shakespeare out of the mouth of his wise old character, Polonius, "To thine own self be true."

Will you answer truthfully this one claim of Valium, "The only drug that can relieve anxiety prior to surgery." Do you really believe it is the only drug that can do this?

Mr. NELLIS. That's what is says all right.

Mr. DORNAN. It mentions anxiety in all seven of these symptoms listed here.

Mr. LERNER. You are taking the anxiety claim out of context. It says only Valium can do all these things. And if you look at the approved prescribing information, the package insert that accompanies the product and the brief summary of information that is on another page in this ad, you will see this is a true and accurate statement. Mr. DORNAN. If you take all seven together?

Mr. LERNER. That is what the headline refers to. It is the only one that has all of these attributes, whether it's the oral or intramuscular form. It is used quite frequently to relieve presurgery apprehension and dejection.

Mr. DORNAN. Then you have achieved a breakthrough in advertising [laughter], because any product on the market then could take one claim that only it can do, for example, "Only the Lockheed SR-71 aircraft can fly three times the speed of sound," and if it included that one claim that is true with seven other claims for instance, "It is equal

to sex," then if someone challenged it as being equal in sexual compatibility as a woman, Lockheed could say, "Yes, but we were only talking about its going mach 3."

Mr. LERNER. All these things are true taken in totality. Valium happens to be the only product with an injectable form that can be administered the way it is for this particular usage.

Mr. DORNAN. So now you are getting into mechanics.
Mr. LERNER. It says there, "I.M. route recommended."
Mr. DORNAN. Where is it in small type.

Mr. LERNER. Well, it's just as large a typeface as the statement itself.
Mr. DORNAN. That is nitpicking.

Mr. LERNER. That's nitpicking?

Mr. DORNAN. It is.

Mr. NELLIS. We are talking about sales quotas, and I want to know your policy on discharging saies managers who don't meet their quotas. Do you discharge them? Do you terminate them?

Mr. LERNER. Mr. Nellis, I am not aware of any situation wherein a salesperson for Roche Laboratories was discharged purely and simply as a result of having failed to meet a performance goal.

Mr. NELLIS. There are other factors in terminations?

Mr. LERNER. There generally are.

Mr. NELLIS. And in your 10-percent turnover that you referred to earlier, you were referring to other factors besides failure to meet goals?

Mr. LERNER. I don't think I depicted any of the factors involved in turnover. I was simply quoting a statistic in terms of the level of turnover at Roche Laboratories by contrast with other pharmaceutical companies.

Mr. NELLIS. The reason for the discharge, you say, is never solely the failure to meet sales quotas.

Mr. LERNER. That is correct.

Mr. NELLIS. I want to ask you another question in the time that I have left. How often do you review or revise the indications for use of Valium?

Mr. LERNER. Well, that is a long process that takes place between ourselves and the Food and Drug Administration. The indications are not revised very often. When there is sufficient experimental and clinical data to support an expanded claim, all these data are furnished to the Food and Drug Administration which approves them. And there isn't any periodic time when these things happen. It happens when it happens.

Mr. GILMAN. The gentleman's time has expired.

Mr. Lerner, we want to thank you for your testimony and, counsel, if you have some additional questions, I suggest you submit them to Mr. Lerner and he will respond and they will be made part of the record at this point.

[The information referred to is included in the letter on p. 177.] Mr. GILMAN. We now call as our next panel Ms. Sue Boe, assistant vice president, consumer affairs, of the Pharmaceutical Manufacturers Association, and Dr. Robert Maronde, professor of medicine, section of chemical pharmacology, University of Southern California.

We welcome our panelists, and if you would please remain standing we will swear you in before you begin.

[Whereupon Ms. Sue Boe and Dr. Robert Maronde were sworn.] Mr. GILMAN. We welcome our panelists and ask Ms. Boe, if she is prepared to proceed, will she please proceed.

TESTIMONY OF MS. SUE BOE, ASSISTANT VICE PRESIDENT, CONSUMER AFFAIRS OF THE PHARMACEUTICAL MANUFACTURERS ASSOCIATION, ACCOMPANIED BY BRUCE J. BRENNAN, VICE PRESIDENT AND GENERAL COUNSEL

Ms. BOE. Mr. Chairman and members of the committee. I am Sue Boe, assistant vice president, consumer affairs of the Pharmaceutical Manufacturers Association, on whose behelf I am appearing today. With me is Bruce J. Brennan, PMA vice president and general counsel. PMA is a nonprofit trade association whose 127 members are engaged in the discovery, development, and manufacture of prescription and ethically promoted drugs, medical devices, and diagnostic products.

We appreciate the opportunity to present our views on the effects of certain promotional practices on the use of psychotropic substances. I will make a brief statement, but I'd like to request that the expanded version of my remarks which was submitted to you be included in the hearing record.

Mr. GILMAN. Without objection it will be included in the hearing record. We welcome your summarizing your remarks.

[Ms. Boe's prepared statement appears on p. 237.]

Ms. BoE. It is frequently noted that retail prescriptions for antianxiety agents have more than doubled since 1964 to over 100 million annually. This growth has caused some to conclude that these drugs are overprescribed to treat conditions for which their use is unwarranted. Yet, these statistics do not necessarily indicate an increase in per capita usage since they are not explicit as to whether the additional prescriptions were given to the same persons or to new patients. Simple numbers of new prescriptions may indeed reflect (1) the expansion of publicly funded programs now enabling the medically indigent to receive needed medical attention, (2) an increase in the numbers of persons in the age groups more frequently presenting symptoms that are treatable by these medications, (3) changes from inpatient to outpatient care, or simply (4) new prescriptions required to comply with Federal regulations that limit the span of time during which patients may secure refills.

Actually, the numbers of prescriptions written for such products in 1977 showed a decline of 7 percent from the previous year. Prescriptions for all psychotropics also showed a 7-percent decline in 1977. Since the total number of new prescriptions for all medicines showed a decline of just 2 percent last year, the decrease in the use of psychotropics is significant. Of course, the steady decline in prescriptions for barbiturates and amphetamines was a noticeable trend even long before the Comprehensive Drug Abuse and Control Act of 1970 went into effect.

This decline in prescriptions for psychotropic medicines is confirmed by another statistic that even further substantiates our belief that physicians are quite conservative in their prescribing practices.

According to the National Center for Health Statistics' national ambulatory medical care survey, for patients with a diagnosis of mental disorder, about 50 percent of doctor visits resulted in drug therapy in 1973, and by 1975, only 40 percent.

Surveys conducted by the National Institute of Mental Health sought to determine whether the symptoms of mental disorders treated with antianxiety agents were severe enough to justify their use. It was found that of the persons for whom antianxiety drugs had recently been prescribed, over two-thirds showed high levels of psychic distress or life crisis, or both, comparable to those observed in psychiatric outpatients. Even more striking was the finding that, of all persons studied who showed a high degree of both psychic distress and life crisis, 65 percent of the women and 70 percent of the men did not take medically prescribed antianxiety drugs in the preceding year. As the authors of the study commented:

The data argue that Americans are not prone to rush into treatment for minor ills and with minor provocation, at least where the antianxiety agents are concerned. The data also argue that the body of illness in the community is greater by a substantial margin than that observed in the health care system.

It must be recognized, nevertheless, that really comprehensive drug utilization data do not exist. This is one of the reasons PMA joined in the formation of the Joint Commission on Prescription Drug Use, and has provided the major funding for its operation. It is hoped whatever system of data gathering the commission recommends will provide the Congress and the scientific community with more facts on all drug utilization, not just psychotropics.

With respect to pharmaceutical advertisements, it has been alleged by some that specific ads illustrate a condescending and belittling attitude toward women, and attempt to expand the symptoms for which a prescription would be appropriate. To our knowledge, this is simply not so.

Illustrations in medical ads, as in all ads, are designed to attract the attention of the reader. They typically depict individuals whom the physician will relate to his own practice people like those he's seen in his own office. There are many women and men who show up in physicians' offices who look just like those depicted in pharmaceutical ads. They don't portray secure, content, well-adjusted healthy people because those people are not having difficulties coping with their conditions of life. The vast majority aren't going to physicians without reason. It's when a person's reaction to his or her traumas or anxieties becomes abnormal, and results in symptoms the person feels unable to eliminate, that he or she goes to a physician. If you look beyond the illustrations, you'll find that today's journal ads make this distinction quite explicit.

An example and I have brought with me the ad from which this is a quote: "Everybody experiences psychic tension. Most people can handle this tension. Some people develop excessive psychic tension and need your counseling, and a few"-five people of this whole group"may need counsleing and the psychotropic action of a particular drug."

Mr. GILMAN. Are you making that a part of your testimony?
Ms. BOE. I will be happy to leave it with you; yes.

[The information referred to follows:]

In truth, advertisements for prescription medicines are more controlled by Federal regulations than the ads for any other type of product. Since the law empowers FDA to seize drug products if their promotion does not comply with FDA's regulations, there obviously are practical reasons why manufacturers make every effort to develop copy that fully complies with all regulations. How well they succeed is apparent from the FDA's own statistics. In the fiscal year 1977, FDA reviewed 26,843 advertising and promotional labeling items. This figure represents some double counting of identical advertisements appearing in different magazines or editions due to the nature of FDA's reporting system. Out of the total, orly 97 promotional pieces were the subject if FDA action in the form of regulatory letters or notices of violations, and in the entire year of 1977 no remedial advertising campaigns were required by FDA.

Dr. Richard Crout, head of FDA's Bureau of Drugs, has said he does not believe that pharmaceutical advertisements have an undue influence on physicians. In a January 1974 speech before the Pharmaceutical Advertising Club in New York, he stated:

"Physicians are not pawns of the advertising industry. I have spent too many hours of searching discussion with medical students, residents, and practicing physicians to believe that doctors are led around by journal advertising or detailmer. Physicians are, as you well know, proud of their independence, firm in their likes and dislikes, and quite capable of recognizing drug product advertising for what it is.

"If a physician continues to prescribe a drug over a long period of time, this reflects his satisfactory personal experience as a professional."

That is the end of that quote.

It is the recognition of the physician's critical measurement of performance against claims that guides promotional efforts, including detailing. There are sound business as well as ethical and legal reasons why company representatives provide full and accurate information to physicians. Companies know that when physicians receive such information, and when their questions are answered fully, confidence in the representatives and their companies is enhanced. Only by earning such trust can companies expect to obtain a fair share of the medical market for their products. Failure to inform physicians fully and accurately is an invitation to loss of confidence and loss of business.

The basic guide for pharmaceutical sales representatives—indeed, the basic source for all information about the product-is the labeling that has been approved by the FDA. Representatives cannot make claims that are not consonant with this information; they must warn physicians of product limitations as well as of benefits. It is becoming a standard practice for representatives to give the physician a copy of the official package insert every time one of the company's products is discussed

Moreover, for many years the pharmaceutical industry has publicized specific recommendations for the conduct of company promotion. The PMA Code of Fair Practices in the Promotion of Drug Products adopted by the Association's board of directors in 1967 was a revision of a 1958 Statement of Principles on the same subject.

Mr. GILMAN. Ms. Boe, I will have to interrupt your testimony and ask if you would not mind recessing. We will put the committee in recess for a 15-minute period until the rollcall is completed, and then we will proceed with your testimony after the recess.

The committee stands in recess.

[Recess.]

Mr. EVANS. Would you like to proceed at this time.

Ms. BOE. In 1974, PMA's board of directors adopted an affirmative set of policies delineating legislative proposals for controlling promotional practices deemed unacceptable by the industry. PMA supports Federal legislation to prohibit the use of prizes or items of value as incentives or rewards for prescribing or dispensing medical products, a ban on inspection of prescription files by company