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RED BOOK PRICE DATA EXCLUDED FROM ADVERTISING SOLICITATION

Executive Summary

RED BOOK PRICE DATA EXCLUDED FROM ADVERTISING SOLICITATION, William Reynolds, publisher of Drug Topics Red Book asserted in Nov. 11 letters to the American Society of Hospital Pharmacists (ASHP) and the National Wholesale Druggists' Association (NWDA). Reynolds maintained that, although "ads are placed in the publication," the Red Book collects price information "on its own, from manufacturers, wholesalers and other suppliers." Reynolds wrote ASHP Executive VP Joseph Oddis and NWDA President Charles Trefrey to clarify statements the associations made about Red Book listings in their comments to the Health Care Financing Administration (HCFA) on Medicaid Rx drug reimbursement reform ("The Pink Sheet" Nov. 3, p. 7). ASHP stated in Oct. 20 comments to HCFA that "manufacturers pay the publishers to advertise their products in Red Book/Blue Book, which makes it suspect as an objective source." In the context of its objections that Red Book listings may imply, but do not assure, adequate inventory, NWDA referred to "firm advertising" in the publications. Reynolds protested that such statements "convey the misinformation that the price listings in Red Book are paid for by advertisers." Price information is included in Red Book "at no charge to the manufacturer" and is independent of any product advertisements the manufacturer may choose to run in the publication. According to Laszlo Schaffer, general manager of Red Book's data base services, the company solicits price and product information on an "ongoing basis" by written, telephone and electronic communication. Annually, in the latter part of the summer, Red Book sends out "product listing verification sheets" to drug firms. Once information is received, Red Book checks the accuracy against "barometers of reality" developed from various industry sources, including wholesaler surveys. In addition to the annual Red Book reference, which includes more than 175,000 product listings, for the past several years Red Book has produced monthly update publications and electronic tapes. The Red Book Update provides specifics on the 2,500 leading Rx products, 1,500 OTCs and new products. Data is entered daily, or when received, on the electronic tapes, which are available to various third-party payors, insurance companies and health and welfare programs. Schaffer added that this year the Red Book data base services division is in the "midst of an aggressive systems enhancement on the electronic side." The project, he said, "will create the ability to do some in-depth research and analysis and comparative analysis," adding: "It will give us alot more tools to work with to ascertain drug quality therapeutic information, generic information and more detailed ways of quickly retrieving data and making it available to the general public and to our electronic users."
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