S&R Blog


Why Pharma Is Pushing Its Drug Pushers Out

New day. Same story.

Source:Minyanville

The pharmaceutical industry is going through a transformation — not only has it been consolidating with mega-mergers like the one between Merck (MRK) and Schering-Plough, but it’s facing a major patent cliff as the revenues from the blockbuster drugs of the 1990s fall prey to generic competition.

Yet, these larger changes have led to shifts in other parts of the industry, too. Since Big Pharma can no longer rely on new blockbuster drugs to pad their top line, these companies now have to transform how they do business to include the biotech model of finding drugs for diseases with smaller patient populations. This also means a major overhaul of how the industry sells its product to the masses.

Pharmaceutical sales reps will be the first to tell you that the industry is scaling down. Once plentiful — there were more than 100,000 reps in 2005 — the drug sales rep is quickly becoming part of the past. A recent report by Deloitte proclaimed to the industry to change its sales models or bust.

An article in the Indianapolis Star this week shows just how much sales rep are despised by the very doctors they’re supposed to woo. Doctors have been pushing for sales reps to make appointments and cut down their pitch time. In some cases, doctors are asking to ban their presence altogether (one in four doctors now refuses to meet with reps, according to the Deloitte report).

But doctors’ dislike of this incredibly aggressive and confident class of individuals isn’t the only reason that the sales rep is becoming extinct. Doctors are no longer the key decision makers when it comes to what drugs are being prescribed. That decision now rests heavily with consumers (who are highly affected by direct-to-consumer advertising), and even more so with insurers who are the primary payers for the often over-priced drugs being pushed by the pharma companies.

Pharmaceutical companies aren’t blind to the problem. The past year has been a bloodbath for pharmaceutical peddlers. AstraZeneca (AZN) said in 2007 that it would cut 7,600 people by 2013; it later upped that number to 15,000. The company didn’t say where those jobs would come from, but the sales force was offered the buyout first. Sepracor, wholly-owned subsidiary of Japan’s Dainippon Sumitomo Pharma, reduced its number by 530 in 2009, bringing its sales force to 1,325 people. King Pharmaceuticals (KG) eliminated 380 field sales positions last year, bringing its total number of reps down to 720 and Sanofi-Aventis (SNY) cut 750 people from its sales roster.

Jump to 2010: Pfizer (PFE) cut 556 sales reps as part of its broader layoffs due to its merger with Wyeth last year. Earlier in the month, Merck eliminated 400 positions from the Schering-Plough headquarters in New Jersey with a majority coming from the sales team. This is on top of the 1,000 sales reps that Schering laid off in 2008 before its merge.

So how will the new pharmaceutical sales landscape look?

It’s likely that insurance companies are going to be playing an even bigger role in which prescriptions become the drugs of choice. Meanwhile, Big Pharma will likely look to outsourced sales rep to educate those same insurance companies. As a plus for doctors, their knowledge will likely have to come more from medical journals and other non-biased sources.

“Pharma’s challenges require a detailed understanding of each stakeholder’s role and contribution to value,” says W. Scott Evangelista, principal at Deloitte. “By better understanding every stakeholder’s unique needs and motivators, a pharma company would be better equipped to improve its internal capabilities — e.g., knowledge, skills, tools — to interact more effectively with each constituent.”

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The top 10 health stories of 2009 (according to Harvard)

Via: Healthcare IT News

Swine flu, health reform and restrictions on industry gifts to doctors are among the top 10 health stories identified by the Harvard Health Letter in its annual list.

The Harvard University publication develops a top 10 list each year with help from doctors on its editorial board.

Among the top stories of 2009 is the national effort to curb healthcare costs via reform legislation, mandated coverage and tighter regulation of health insurers. “Chances are that legislation, if it does become law, won’t do nearly enough to control costs,” the list’s authors said.

Healthcare organizations faced additional challenges this year as a result of the H1N1 flu pandemic. “Measured public health response” and “plenty of information” helped keep the pandemic in perspective, the editors said, and despite the oncoming flu season, they expect that H1N1 will likely remain manageable.

The Harvard Health Letter‘s full list of top 2009 health stories is as follows:

  • H1N1 flu
  • Healthcare reform
  • Screening tests
  • An alternative to warfarin?
  • New findings about “good” and “bad” body fat
  • Restrictions on industry gifts to doctors (TRANSPARENCY)
  • MicroRNA-based treatment
  • Changes in blood sugar goals for patients in intensive care
  • Testing for C-reactive protein
  • Social networks as conduits for health and disease

What about Pfizer? They must be on the ‘pharma’ list.

Check out the Wall Street Journal’s top 10 here.



More transparency issues with Big Pharma

The internet was blazing hot yesterday and today about the latest, in now an ever-growing list of transparency issues with Big Pharma and blockbuster drugs. The latest victim – Roche’s Tamiflu. According to a recent analysis published by the British Medical Journal, it was concluded that Tamiflu had  “modest effectiveness” against the symptoms of the flu in otherwise healthy adults — cutting symptoms by about a day.

The report, an update of a 2005 analysis by Cochrane Collaboration, excluded eight studies funded by Roche that haven’t been published and whose full data wasn’t given to the researchers. The exclusion reversed the group’s earlier finding that Tamiflu protects against complications.

The report raises questions about how drugs are reviewed, approved and distributed, Fiona Godlee, the British journal’s editor in chief, wrote in an editorial. The studies originally used to establish the benefits of Tamiflu were written by Roche employees and paid consultants, under-reported serious side effects and failed to clearly identify all the authors, she wrote. In at least one case, a study was attributed to a researcher who disavowed any involvement to the journal, Godlee wrote.

Follow the story here:

Bloomberg

Gaurdian

Financial Times

Reuters



Who will lead pharma back to a constructive, trusting, and value-based industry?

The “conspirators” have been revealed—the  Pharmageddon2012 “conspirators” that is.  This past week, the November issue of MedAd News broke a story on Pharmageddon2012 and the people behind the scene—S+R Medical Communications (SRMC) and Friday Morning.

For those of you who have not taken the time to check out Pharmageddon2012, this multifaceted website uses a variety of social media outlets to carefully and anonymously describe what we believe is the pharma industry’s greatest problem—the breakdown of communication and trust between physicians and the industry.

The site, describes the issues and problems that exist but what it doesn’t address is the passion, belief, and attitude of those people at SRMC and Friday Morning who have to live and deal with the implications of what Pharmageddon2012 represents. You must admit a campaign like Pharmageddon2012 could be risky for a business that that has spent over 18 years enabling and helping our pharma clients devise the very same communication pieces and strategies that we believe contributed to the demise of physician trust.

However, we also believe that someone needs to lead the charge for change and why shouldn’t it be SRMC and Friday Morning? We spent the last 10 years closely watching, listening, and seeing firsthand the strategies and tactics that led to the mistrust problems. We were frustrated and angry about the situation, and we struggled to understand what new strategies and solutions we might incorporate into our business model. The end objective is to help us build our success—and, equally as important, that of our clients.
To that end, we must help clients find ways to restore physician confidence AND improve patient outcomes.

So while we are willing put our collective necks on the line, the real question is which pharma companies will be the first to understand and see the need for communicating with physicians in a different way? Which companies will choose to use educational programming that is needs-based? Are you, as a pharma marketer, willing to use total transparency and clarity as you describe ALL of the important aspects of how your brand is best used? When a physician asks, “Which of my patients are specifically and best suited for what your product does?” what will your sales force say? How will you provide educational and promotional programs that allow your sales force to bring value and relationship building to every sales call?

Is YOUR pharma company willing be a leader and change the pharma/physician communication model back to a constructive, trusting, value-based relationship? Do you believe that you can participate in this change process and at the same time positively impact your brand’s financial achievements? It’s tough to be a leader and to stand out from the crowd. But in fact, that is the opportunity that is before us right now.

If you have the same passion and spirit for this issue as we do, if your brain and heart tell you it is time to do it differently, please contact me. I can show you how we can work together to put our industry, your company, and your products back on a more productive, positive path.

Sincerely,
Dave Recht
CEO, North State Resources, Inc.
davidr@northstateresouces.com



Trust: No longer just a physician and Big Pharma problem

Trust has been a big topic on this blog of late and for good reason. The pharmaceutical community has a growing divide between physicians and drug companies and unless it’s addressed, a cataclysmic  event could be on the horizon. But according to a report in the Washington Post, there is an even bigger trust issue growing between patients and physicians.

The Post reported that 68 percent of respondents to a Pew Prescription Project survey  supported legislation that would require public disclosure of financial relationships between physicians and industry. In fact, 78 percent believed that accepting gifts from the pharmaceutical industry influences their doctors’ prescribing habits, but only 34 percent said they would be likely to ask their doctors about potentially troubling financial ties.

So what’s the solution? Transparency? Conversation? Regulation? Find out what the Washington Post recommends here.