Payers render traditional marketing outmoded, says study

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The drug industry has suffered a season of painful pipeline flops, including the still-unspooling story of Lilly's Alzhemier's medication solanezumab and Pfizer's dead-by-rights Alzheimer's effort bapineuzumab. But companies can improve their performance by blending hard numbers, like outcomes and cost savings, with softer messaging that centers on payer and patient relationships, a PricewaterhouseCoopers report argues.

Outcomes and savings seem like familiar ground, particularly for players who have already started to modify their sales approaches to better appeal to Accountable Care Organizations. PwC's researchers anticipate that this value messaging is going to soar in importance. Among the reasons: marketing “has become less effective now that payers and providers scrutinize outcomes so carefully.”

Researchers note that the traditional marketing approach is so ineffective at this point that it no longer really qualifies as a valuable pharma lever for promoting sales, and wrote “no matter how many sales reps a company fields or how many samples it hands out, if a new treatment doesn't offer more value than competing therapies, healthcare payers in the mature markets simply won't buy it.”

PwC's researchers noted that if companies can't offer more at a lower cost, the marketing success of new, costly drugs will require companies to prove that taking on a high cost upfront will lower costs somewhere else in the healthcare system. Polling of US health insurers showed that four-fifths of insurers require “clear evidence of cost savings or a clear clinical benefit to include new products on their formularies.” Also: 16% of the insurance companies have outcomes-based contracts, and an additional 33% expect to by 2015.

Those tensions were evident in the recent victory by several Memorial Sloan Kettering physicians over what they saw as unreasonable pricing. The docs penned a New York Times Op-Ed piece arguing that the Sanofi/Regeneron colorectal cancer drug Zaltrap wasn't going to make it into their patients' roster of treatments. The doctors said the new drug was no better than what was currently on the market, but a month of treatment was more than twice as expensive as old-school Avastin. The drug maker offered a discount one month later.

These changes alone are significant for sales and marketing professionals, and will force them to “grapple with rigorous scientific data and complex economic studies, as well as developing the skills to negotiate with healthcare payers.”

The authors also noted that reviving marketing's value also requires redefining it and its potential use. As an example, they used Incyte's myelofibroris drug Jakafi, which sells for about $84,000 in the US. PwC's researchers noted that the FDA itself said clinical trial results weren't what won the drug approval, but rather the patient-reported outcomes which were part of the review submission. The agency said the patient experiences were “a vital element in the decision to approve Jakafi.” Furthermore, the regulator approved the patient information for Jakafi's packaging, extending the value of trial-gathered data from testing into a marketing tool at the drugstore.
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