How Pharma Can Cope with Consumerism
Executive Summary
Consumer-directed health plans have been less a boon for the drug industry than pharma executives expected because consumers, responsible for more of their own costs, are buying generics when they can and skimping on therapeutic regimens. Drug companies will have no choice but to reduce prices to patients in these plans--but should provide the discounts in return for greater adherence, which could to a large degree offset the revenue losses.
You may also be interested in...
Competing in a Retail Health Consumer Marketplace
A new Booz Allen survey shows that as more consumers take on much bigger shares of the health costs, they've started to focus on price, including the price of drugs--often rejecting their doctors' recommendations. To counteract even greater price pressures, drug firms need to provide physicians a different set of information and services, designed to meet the new demands of these new cost-conscious patients.
Leveraging Patient-Centric Information for Market Success
Traditional databases marketed by IMS and NDCHealth are not patient-centric and therefore can only describe what happens to a prescription, not a patient. But managed care, driven by the Medicare Modernization Act, will force drug companies to focus on a new view of customers-and in particular, keeping them longer. But drug companies aren't by and large using the new patient-centric data available in a variety of forms from a variety of vendors. The problem is as much habit as awareness.
Redefining Marketing and Development Innovation: GSK's Success with Advair
Before its launch, GSK's Advair, which combines the active ingredients of what were its own two most popular asthma drugs, faced a skeptical managed care audience which believed the company wanted to simply charge more for what appeared to them a mere increase in patient convenience. The pre-merger Glaxo thus created a two-pronged positioning strategy. To create unrestricted access on managed care formularies, Glaxo launched a risky outcomes-based study to prove the value of dual therapy based on experience with the precursor products, not with the still-unapproved Advair. Then, to position the new dual therapy for the broadest asthma market, rather than restricting it for moderate and severe disease, Glaxo crafted a pricing strategy which discounted Advair to the combination of precursor products but priced at a premium, reflecting its advantages, to its main single-agent competition, Merck's Singulair. The two key lessons for the industry: first, the value of effective and timely life-cycle management as the basis for the creation of a new product; and second, the combination of preclinical and clinical data on the new product, plus "directional" data from the older one, can create arguments that managed care groups will find almost impossible to ignore.