managed markets advertising: addressing the value challenge in the evolving pharma marketplace
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Managed Markets Advertising Addressing the Value Challenge in the Evolving Pharma Marketplace
Jim Mittler, PhD; Medical Director
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The Value Challenge report from Economist Intelligence Unit
• Released February 6, 2012• Second in a series of 4 pharma
reports• Global survey of 399 industry
executives to better understand the nature of the “value challenge” in pharma
http://www.managementthinking.eiu.com/value-challenge.html
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The “value challenge” in pharma
• No longer enough to bring safe and effective drugs to market; new products must provide superior outcomes to existing medications
• Companies must demonstrate added value if a higher cost are to be garnered for new therapies
• Range of stakeholders with different perceptions of value– Pharma company
– Physicians
– Patients
– Commercial payers
– Government payers
– Regulatory agencies
http://www.managementthinking.eiu.com/value-challenge.html
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Managed markets expertise is increasingly important
• The value challenge is a long-term issue and a leading concern for the drug industry
• Pharma companies lack confidence in the ability to respond to the value challenge
• There’s a shift of power in market influence from pharma to payers
http://www.managementthinking.eiu.com/value-challenge.html
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Divergent perceptions on the value of a new drug
• A significant gap in the definition of value exists between payers and industry, which will continue in the future
• Fundamentally different business objectives drive this; however, payers are becoming increasing more influential and pharma needs to adjust
http://www.managementthinking.eiu.com/value-challenge.html
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Lack of clear definition of value is significant challenge
• Understanding of value differs the most according to stakeholder, type of medical condition, and geography
http://www.managementthinking.eiu.com/value-challenge.html
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The balance of power is shifting to payers
• Traditional pharma companies see themselves as losing influence over the market to commercial and government payers
http://www.managementthinking.eiu.com/value-challenge.html
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Managed markets strategy can better meet the value challenge
• Traditional sales channels are giving way to health economic information targeted to the payer audience
http://www.managementthinking.eiu.com/value-challenge.html
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Three-part aim: What looks good to payers in the evolving marketplace
Value proposition
Better health outcomes for patients
Better health of populations
Lower costs through healthcare quality improvement
“A general concept that translates across all conditions and care settings.”Dr. Shari Ling, MDDeputy Chief Medical OfficerCenters for Medicare and Medicaid Serviceshttp://www.managementthinking.eiu.com/value-challenge.html
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Palio Managed Markets group: Why we’re here
Majority of industry execs see payers trying to control costs
more than enhancing clinical care
Cost is only 1 attribute of the value proposition. When done
right, managed markets advertising addresses both clinical and economic value (3-part aim)
45% of industry execs indicate the industry is not effectively adjusting
to the value challengeThey need our expertise!