Coffee over co-pay: How did it come to this?

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Michael McLinden
Michael McLinden

Remember when it felt really good to say that you worked in the pharmaceutical business?  One of my clients reminded me of this the other day when he recalled how “working for a pharma company meant you worked with really smart people who were doing very special things because they were committed to making the world a better place."

Today, barely a day goes by without someone vilifying our industry. A survey published by Harris Interactive places pharma firms just below airlines and just above phone companies in “trustworthiness,” with all three lagging by double digits behind those bulwarks of public trust, supermarkets and hospitals. In that same survey, pharmas were second only to oil companies, and ahead of tobacco companies and banks, in terms of “industries that should be more regulated.”

The odd thing is that the period between those golden days recalled by my client and the time of the Harris survey was among the most productive in the 5,000-year history of medicine. Just ask someone with rheumatoid arthritis, Crohn's disease, HIV, MS, ulcers, diabetes, depression, cancer, cardiovascular disease, migraines or high cholesterol. 

The expectations for everything, from symptomatic relief to disease modification, are a world away from what was available just 30 years ago, as are differences in objective measures like reductions in urgent-care utilization for chronic illnesses, shorter hospital stays and longer life expectancies.

Yet, despite these advances, the general public is less and less likely to see the value in the “special things” we provide.  In a world where a $5 coffee is common, research shows that patients balk at co-pays of $25 or $30 a month for the prescription therapies that make that daily routine possible.

At the same time, an anti-pharmaceutical culture has lent legitimacy to alternative medicines that were once on the fringes of medicine. In market research, we routinely talk with patients who spend hundreds of dollars a month on vitamins and supplements based on scant clinical evidence, yet still complain about the costs of their prescriptions for FDA-approved drugs.

The diagnosis is clear to any trained marketer: we have a value problem. True, our industry has created tremendous value for the American people over the past quarter century, but value creation is only one part of the value equation.

For a business or industry to thrive, it needs to not only create value, but also to have that value recognized by the people it's intended to benefit—and to be compensated fairly, relative to the benefit conferred. I would argue that pharma companies have become so successful at creating value and securing compensation that we've ignored the critical middle step: getting the people who benefit from our products to recognize and articulate the value they receive.

While there are many wonderful pharma-sponsored patient, family and HCP programs out there, the majority of Americans still get their perceptions of the pharma industry in two places: watching DTC ads on television and collecting their prescriptions at the pharmacy.  On TV, we're the people “selling disease” with vague terms that confuse as much as they inform.

In my informal research, the most-recalled message from any of these ads is from the Brief Statement, the only plain language in the spot. When you're promoting dizziness, sudden vision loss, rectal discharges, and erections lasting more than four hours, it's virtually impossible to be thought of as “the really smart people who do special things.”

It doesn't get much better in the pharmacy. There, we hit them up for the cost of a decent meal and, in return, give them a sterile white package containing something they don't really understand for a problem they wish they didn't have. To the extent that they get any information about our product, it's generally a few pages of fine print explaining the potential dangers and drawbacks. Sometimes the pharmacist will add to this his or her own personal warnings about our product and possibly a cross-sell to a generic formulation.

All of this suggests that it's time to take back control of our narrative and refill that middle step in the value equation.

One place we should look is our payer relationships, as few areas of our business have done more to distort value perceptions among our audience. For years, we've complained about the power of insurance companies and PBMs while simultaneously conniving with them to keep our costs invisible to patients and physicians.

Along the way, we've trained several generations of Americans that their meds should be free, or close to it. This calls to mind the words of the Roman philosopher Publilius Syrus: “Everything is worth what its purchaser will pay for it.”

Do we have what it takes to put our products on the table and ask patients and physicians to pay fair value for the benefit they receive? We've become so preoccupied with negotiating rebates and buying down co-pays that we've lost this notion of trading a real benefit for fair compensation.

This is not just a mental exercise. I think there are more than a few mature brands in formulary purgatory who could benefit by going directly to patients and saying, “Here is a therapeutic solution that will make a significant improvement in your life for about the cost of your monthly dye-and-cut at the salon.”

By the time the brand manager accounts for rebates, costs for voucher redemption and administration, and the internal cost of access programs and promotion, they're likely to come out ahead. And more importantly, they'll be back on the offense, selling the value of their products to patients who can benefit.

If this is too radical for you, maybe start with the not-so-simple challenge of understanding what patients really want from a pharmacological therapy. One thing that's clear is that they're not interested in the abstract primary endpoints from most of our pivotal clinical trials.

We all know this because when we talk to patients, we hear them say very specific things: “I don't want my symptoms to scare my grandchildren” (Parkinson's disease).  “I don't want to feel isolated from my friends” (IBS). “I want to grow old with dignity and self-respect” (Alzheimer's).

Under the current system, when we try to respond to these patient needs, we're hamstrung by a language of look-alike charts and changes in UPDRS scores, sigmoidoscopic indices, or the Montreal Cognitive Assessment, if we even get that specific.  More often, we end up dishing out vague generalities designed more for the MedReg review panel than a real patient—all except for the important safety information (ISI), which again is highly specific about the dangers and drawbacks of our products.

The irony is that many patients would really like to know more about what we know and have a voice in what we're doing. A recent study showed that the average American sees a physician three times a year—but spends 52 hours on the internet looking for health information.

I would argue that many of these searchers are doing more than just looking for “information”; they're looking for connections to make their unique healthcare journey a little less lonely, a little more comprehensible, and a little more within their control.

Our “smart guys doing special things” are just the type of people with whom they'd like to connect, and not just to answer questions. To paraphrase one patient posting I read recently, “I am tired of a relationship with the medical community based on them doing things to me.  I think we would all be in a better place if they started doing things with me.

Seen from this perspective, in almost any disease state we have thousands, if not millions, of firsthand experts with specific, real-life knowledge of what really matters. They are looking for ways to help us harness the value of that resource. By comparison, Converse lets them tailor their basketball shoes. Apple lets them design their iPods. Coke gives them an infinite amount of options at the soda fountain. Surely we can find better ways to work with them to bring their healing experience more in line with their needs and values.

Finally, we need to look beyond simply putting drugs in boxes and then pushing physicians to prescribe them. There's a wave of new clinical research that sees the diseases we target as more than a checklist of cardinal symptoms and considers medical care as more than a shot or a pill.  It's hard to find a condition that we treat where we don't have new data touting the benefits of exercise, diet, dance, art, and physical or occupational therapy. Pharma companies have the opportunity to take the lead in this trend—or risk getting left behind as this new generation of care emerges.

Should we find ways to work with dance teachers or OTs?  Do we need to provide better guidance about the impact of dietary changes or improved sleep hygiene on the patients our drugs treat? What if exercise or puzzle-solving actually helped improve outcomes in people using our products? This is the new 360-degree world of healthcare in which our patients live and where we have to make our value real.

The bottom line is that few industries have done more to improve the human condition over the past century. Our commitment to innovation and exploration and our willingness to take on high costs and long odds to look for new answers has transformed the way the world thinks about healthcare.

But along the way, changes in the regulatory and payer environment and the culture around healthcare delivery have divorced the reality of the value we create from the perceptions of the value we deliver. Rewriting this paradigm is critical to our survival as an industry and goes far beyond anything we're going to put on a pharmacy shelf or write in a detail aid (digital or paper). 

It's time to get back to some of the fundamental questions of what we do, for whom, and why—and make sure that we're delivering on that vision in a way that the American public values and that allows us to stand tall again as the smart people doing special things to make the world a better place.


Michael McLinden is partner and chief strategy officer, Mc|K Healthcare.
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