When MM&M started the Healthcare Marketers Trend Report back in 2013, we set out to provide a glimpse into the mind of the medical marketer navigating tumultuous times. Those in the healthcare industry had lived through some major shifts over the previous decade, from patent expirations and strained pipelines to the rise of clinical development outsourcing and healthcare reform.

Based on responses, the industry’s two-headed bogeyman at the time was the FDA and managed care. Its most important audience was not payers but — wait for it — physicians/specialists. And companies’ biggest commercial expense involved keeping the lights on in the sales department.

Fast forward seven years and, well, at first glance some things may not seem to have changed all that much. But as we learned from that first survey, just because everything appears calm doesn’t mean there aren’t significant shifts occurring under the surface (or, in this case, over a longer period of time). 

The first point to note about budgets is one of methodology. Each time the survey is fielded, pharmaceutical, biotech and med-device marketers are asked to share their previous year’s marketing budget, along with that of the current fiscal year. 

This method first adjusts for variability in companies’ end-of-year fiscal close. For example, when the 2020 survey was sent, not all respondents (such as those whose fiscal year doesn’t end until March 2020) had closed the book on 2019 and thus may have had to give their best estimate of 2019’s numbers.

Second, because the survey cohort itself varies year to year, looking at year-on-year percentage shifts may give a more reliable read than focusing on the real dollar value. For instance, 2018 saw a spike in the number of respondents from pharma companies, potentially inflating the mean budget that year.

From 2017 to 2019, both the “how much was your prior-year” and “how much was your current-year” budget questions confirm a steady climb in the mean. The dollar increase ranges from under $1 million to over $2 million per year and, on a percentage basis, 5% to 30%. If the rise weren’t for real, one would not see this pattern reflected in both the prior-year and current-year budget data, regardless of cohort.

The takeaway here is budget stability, even unsinkability, in the face of threats. Back in 2017, there were fears that newly elected President Donald Trump would push through Medicare price negotiation and/or repeal the Affordable Care Act. Neither came to pass, of course. This editor had even warned of a coming budget reckoning — did he really use the term “pharmageddon”? — reminiscent of the perfect storm years prior, when the patent cliff on blockbuster brands collided with thinner drug pipelines and what (at the time) had been perceived as a stodgy FDA.

Yet healthcare marketing outlays have shown themselves to be largely impervious to these external market forces. The gradual rise demonstrates a comfort level with the perpetual uncertainty in Washington.

Conditions seem ripe for the good times to continue. The last three years have seen historically high numbers of drug approvals. Although competition from biosimilars have started to hit some big brand-name biologics in 2020, over the next five years the IQVIA Institute is predicting drug-spending growth in the low single digits, its executive director told MM&M recently. The institute foresees a “historically large number” of new drug launches, many of which will be orphan drugs, particularly in oncology (the largest therapy area in the pipeline). 

Which audiences have drawn the most attention from marketers? Look to where the increases are happening. Over the last three years, more than 50% of respondents have increased their physician (58.1%) and patient (57.6%) budgets. More budgetary increases have been directed toward doctors and consumers than for NPs/PAs (38.7%), pharmacists (31.8%) and all other stakeholder groups. Only 26% of respondents spent more targeting caregivers. 

Healthcare marketing outlays have shown themselves to be largely impervious to these external market forces.

And what of payers? The stakeholder that topped the list of concerns back in 2013 — and perennially finds itself at or near the top — continues to get relatively short shrift from biopharma and device marketers. Less than 45% said they have upped their allocation to reach payers/managed care the last three years. The exception was 2018, in which the figure was 57.1% (possibly attributable to the aforementioned spike in pharma respondents that year).

In terms of tactical allocation, the retrospective data show more respondents using digital than traditional advertising across the HCP and consumer channels. From 2017 to 2019, prior-year and current-year use of digital net climbed to near saturation levels, from 88.7% to 92.4%. Meanwhile, sales reps, meetings/conferences and sales materials — the next-biggest block of tactics in the HCP mix — also rose, but to a lesser extent. 

On the patient front, the three-year totals gauging use of digital net also rose between the prior-year and the current-year questions: From 82.3% to 84.6%, respectively, versus a rise of 63.6% to 64.4% for paid traditional advertising. Again, the prior-year figure is thought to be a bit less speculative than the current-year question. 

Among tactics used to reach managed care, more than half of respondents employed market research/advisory engagements and discounts/rebates to engage the payer audience. And judging from the results, more respondents plan to use value communications, including publications, economic tools, calculators and contracting efforts. Usage jumped to 49.5% on the current-year total versus 38.1% on the prior-year total. On the other end of the spectrum, far fewer used disease management; it was the least-used program by about a third.  

Finally, payers/managed care manifested as the biggest concern for respondents over the last three years at a total of 72.2%. The threat level actually grew to 82.4% in 2018 before cooling off to 65.1% in 2019. At 67.7%, clinical development/time to market topped a lot of peoples’ radar since 2017 as well. Following are a cluster of concerns — customer behavior change (63.1%), smaller launch budgets (61.4%) and pipelines (59.9%) — whose threat levels are almost indistinguishable from one another.

Looking at the biggest opportunities in marketers’ eyes since 2017, big data sits in pole position at 62.6%, followed by social media (62.3%) and customer behavior change (60.8%). Given big data’s relatively low ranking (55.0%) on the list of challenges, it’s no surprise that harnessing analytics along the life cycle is viewed as a low-risk/high-reward endeavor for many life science companies in the years ahead.

Take a look at the complete 2020 MM&M/Elevate Healthcare Marketers Trend Report here.