The conventional wisdom is that uncertainty about the 2008 elections makes healthcare strategic planning difficult. Or, maybe not.
Whether Sen. Clinton, Obama or McCain is elected president, his or her inaugural address will grapple with economic concerns, budget deficits as far as the eye can see and healthcare reform, where the focus will be on cutting Rx drug costs, notwithstanding the fact that drug spending accounts for just 10 cents of every dollar a person in America spends on healthcare.
So, when pharmaceutical manufacturers ask me where is healthcare going, my answer is: in search of value.
It's no longer enough to produce medicines that are safe and effective. In the US, the FDA appears to be applying a higher standard that new drugs actually be shown to be better than already marketed drugs. In Europe, regulators are beginning to embrace “value-based” pricing which links drug reimbursements to patient outcomes and just this month, the Japanese government ordered a 5% cut in drug prices. Some developing nations have decided to introduce generic medicines into their marketplace as a way to drive down name brand prices, even when doing so would violate patent protections awarded to the manufacturers.
The key to surviving these challenging times is for manufacturers to add value to the healthcare delivery system —by investing in compliance programs and medication therapy management, safety monitoring, disease management, and innovative drug discovery. By putting the needs of the patients first, the industry will be able to survive these challenging economic times and, with a little luck, convert some of their governmental critics.
This is more than political reality—it is an economic reality and one that can and should be addressed now.
Craig Fuller is executive vice president of APCO Worldwide