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Rebuilding Pharma Image: A Laudable Mindset – Lacking In Many

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The fierce debate on ethics and compliance related issues in the pharma marketing practices still reverberates, across the globe. One of its key fallout has been ever-increasing negative consumer perception about this sector, sparing a very few companies, if at all. As a result, many key communications of the individual players, including the industry associations specifically targeted to them, are becoming less and less credible, if not ineffective.

Which is why, though pharma as an industry is innovative in offering new medicines, consumers don’t perceive it so. Despite several drug players’ taking important steps towards stakeholder engagement, consumers don’t perceive so. The list goes on and on. I discussed on such consumer perception in my article of June 26, 2017. Hence, won’t further go into that subject, here.

General allegation on the pharma industry continues to remain unchanged, such as the drug industry tries to influence the medical profession, irrespective of whether they write prescription drugs for patients or are engaged in regulatory trial related activities aimed at product marketing.

Let me give an example to illustrate the later part of it, and in the Indian context. On April 26, 2017, it was reported that responding to a joint complaint filed by Mylan and Biocon in 2016, alleging that the Roche Group indulged in “abusive conduct”, the Competition Commission of India (CCI) gave directions for carrying out a detailed investigation on the subject. This probe was initiated to ascertain, whether Roche used its dominant position to maintain its monopoly over the breast cancer drug Trastuzumab, adversely impacting its access to many patients.

Such a scenario, though, undoubtedly disturbing, is very much avoidable. Thus, winning back the fading trust of the consumers in the industry, should be ticked as a top priority by the concerned parties.

In this article, I shall mostly focus on some recent developments related to ethics and compliance issues, mainly in pharma marketing, and with a small overlap on the regulatory and other areas, as and when required to drive home a point.

It shakes the trust base on the medical profession too:

This menace, as it were, though, more intense in India, is neither confined to its shores alone, nor just to the pharma industry, notwithstanding several constituents of big pharma have been implicated in mega bribery scandals in different countries. There doesn’t seem to be much doubt, either, that its impact has apparently shaken the very base of trust even on the medical profession, in general.

Not very long ago, Dr. Samiran Nundy, while holding the positions of Chairman, Department of Surgical Gastroenterology and Organ Transplantation at Sir Ganga Ram Hospital and Editor-in-Chief of the Journal of Current Medicine Research and Practice, reportedly exposed the widespread malpractices of the doctors in India who are taking cuts for referrals and prescribing unnecessary drugs, investigations and procedures for profit.

This practice continues even today, unabated. On June 18, 2017, it was widely reported in India that Maharashtra Government has decided to form a 3-member committee for suggesting effective ways to check the ‘cut practice’ of doctors. This decision followed a public awareness campaign on this subject, initiated by well-reputed late heart surgeon – Dr. Ramakanta Panda’s Asian Heart Institute, located in Mumbai. The hospital had put up a hoarding saying: ‘No commission. Only honest medical opinion’. The Indian Medical Association opposed the hoarding. But the hospital wrote to Maharashtra medical education minister seeking a legislation to fight this malpractice.

To contain this malady across India, for the sake of patients, Dr. Nundy had then suggested that to begin with, “The Medical Council of India (MCI), currently an exclusive club of doctors, has to be reconstituted. Half the members must be lay people like teachers, social workers and patient groups like the General Medical Council in Britain, where, if a doctor is found to be corrupt, he is booted out by the council.”

This subject continues to remain an open secret, just as pharma marketing malpractices, and remains mostly confined to the formation of various committees.

“Corruption ruins the doctor-patient relationship in India” – a reconfirmation:

“Corruption ruins the doctor-patient relationship in India” - highlighted an article published in the British Medical Journal (BMJ) on 08 May 2014. Its author – David Berger wrote, “Kickbacks and bribes oil every part of the country’s health care machinery and if India’s authorities cannot make improvements, international agencies should act.”

He reiterated, it’s a common complaint, both of the poor and the middle class, that they don’t trust their doctors from the core of hearts. They don’t consider them honest, and live in fear of having no other choice but to consult them, which results in high levels of doctor shopping. David Berger also deliberated on the widespread corruption in the pharmaceutical industry, with doctors bribed to make them prescribe specified drugs.

The article does not fail to mention that many Indian doctors do have huge expertise, are honorable and treat their patients well. However, as a group, doctors generally have a poor reputation.

Until the medical profession together with the pharma industry is prepared to tackle this malady head-on and acknowledge the corrosive effects of medical corruption, the doctor-patient relationship will continue to lie in tatters, the paper says.

Uniform code of ethical pharma marketing practices:

This brings us to the need of a uniform code of ethical pharma marketing practices. Such codes, regardless of whether voluntary or mandatory, are developed to ensure that pharma companies, either individually or collectively, indulge in ethical marketing practices, comply with all related rules and regulations, avoid predominantly self-serving goals and conflict interest with the medical profession, having an adverse impact on patients’ health interest.

This need was felt long ago. Accordingly, various pharma companies, including their trade associations, came up with their own versions of the same, for voluntary practice. As I wrote before, such codes of voluntary practice, mostly are not working. That hefty fines are being levied by the government agencies in various countries, that include who’s who of the drug industry around the world, with India being a major exception in this area, would vindicate the point.

Amid all these, probably a solitary global example of demonstrable success with the implementation of voluntary codes of ethical pharma marketing practices, framed by a trade association in a major western country of the world, now stands head and shoulders above others.

Standing head and shoulders above others:

On June 23, 2017, the international business daily – ‘Financial Times’ (FT), reported: “Drug maker Astellas sanctioned for ‘shocking’ patient safety failures”

Following ‘a series of shocking breaches of guidelines’ framed by ‘The Prescription Medicines Code of Practice Authority (PMCPA)’ – an integral part of the ‘Association of the British Pharmaceutical Industry (ABPI)’, publicly threatened the Japanese drug major – Astellas, for a permanent expulsion from the membership of the Association. However, PMCPA ultimately decided to limit the punishment to a 12-month suspension, after the company accepted its rulings and pledged to make the necessary changes. Nevertheless, Astellas could still be expelled, if PMCPA re-audit in October do not show any “significant progress” in the flagged areas – the report clarified.

Interestingly, just in June last year, ABPI had suspended Astellas for 12 months ‘because of breaches related to an advisory board meeting and deception, including providing false information to PMCPA’. The company had also failed to provide complete prescribing information for several medicines, as required by the code – another report highlights.

Astellas is one of the world’s top 20 pharmaceutical companies by revenue with a market capitalization of more than £20bn. In 2016 its operations in Europe, the Middle East and Africa generated revenues of €2.5bn –reports the FT.

What is PMCPA?

One may be interested to fathom how seriously the implementation of the uniform code of pharmaceutical marketing practice is taken in the United Kingdom (UK), and how transparent the system is.

The Prescription Medicines Code of Practice Authority (PMCPA) is the self-regulatory body which administers the Association of the British Pharmaceutical Industry’s (ABPI) Code of Practice for the Pharmaceutical Industry, independent of the ABPI. It is a not-for-profit body, which was established by the ABPI on 1 January 1993. In other words, the PMCPA is a division of the British pharma trade association – ABPI.

According to PMCPA website, it:

  • Operates the complaints procedure under which the materials and activities of pharmaceutical companies are considered in relation to the requirements of the Code.
  • Provides advice and guidance on the Code.
  • Provides training on the Code.
  • Arranges conciliation between pharmaceutical companies when requested to do so.
  • Scrutinizes samples of advertisements and meetings to check their compliance with the Code.

As I often quote: ‘proof of the pudding is in eating’, it may not be very difficult to ascertain, how a constructive collective mindset of those who are on the governing board of a pharma trade association, can help re-creating the right image for the pharma industry, in a meaningful way.

Advertisements and public reprimands for code violations:

The PMCPA apparently follows a system to advertise in the medical and pharmaceutical press brief details of all cases where companies are ruled in breach of the Code. The concerned companies are required to issue a corrective statement or are the subject of a public reprimand.

For the current year, the PMCPA website has featured the details of three ABPI members as on May 2017, namely, Gedeon Richter, Astellas, and Gedeon Richter, for breaching the ethical code of practices.

However, in 2016, as many as 15 ABPI members featured in this list of similar violations. These are:  Vifor Pharma, Celgene, Takeda, Pierre Fabre, Grünenthal Ltd, Boehringer Ingelheim Limited, Eli Lilly, AstraZeneca, Janssen-Cilag, Astellas, Stirling Anglian, Guerbet, Napp, Hospira, Genzyme, Bausch & Lomb and Merck Serono. It is worth noting that the names of some these major companies had appeared more than once, during that year.

I am quoting the names of those companies breaching the ABPI code, just to illustrate the level of transparency in this process. The details of previous years are available at the same website. As I said, this is probably a solitary example of demonstrable success with the implementation of voluntary practices of ethical pharma marketing codes, framed by any pharma trade association.

In conclusion:

Many international pharmaceutical trade associations, which are primarily the lobbying outfits, are known as the strong votaries of self-regulations of the uniform code of ethical pharma marketing practices, including in India. Some of them are also displaying these codes in their respective websites. However, regardless of all this, the ground reality is, the much-charted path of the well-hyped self-regulation by the industry to stop this malaise, is not working. ABPI’s case, I reckon, though laudable, may well be treated as an exception. 

In India, even the Government in power today knows it and publicly admitted the same. None other than the secretary of the Department of pharmaceuticals reportedly accepted this fact with the following words: “A voluntary code has been in place for the last few months. However, we found it very difficult to enforce it as a voluntary code. Hence, the government is planning to make it compulsory.”

Following this, as reported on March 15, 2016, in a written reply to the Lok Sabha, the Minister of State for Chemicals and Fertilizers, categorically said that the Government has decided to make the Uniform Code of Pharmaceutical Marketing Practice (UCPMP) mandatory to control unethical practices in the pharma industry.

The mindset that ABPI has demonstrated on voluntary implementation of their own version of UCPMP, is apparently lacking in India. Thus, to rebuild the pharma industry image in the country and winning back the trust of the society, the mandatory UCPMP with a robust enforcement machinery, I reckon, is necessary – without any further delay.

However, the sequence of events in the past on the same, trigger a critical doubt: Has the mandatory UCPMP slipped through the crack created by the self-serving interest of pharma lobbyists, including all those peripheral players whose business interests revolve round the current pharma marketing practices. Who knows?

Nonetheless, the bottom line remains: the mandatory UCPMP is yet to be enforced in India… if at all!

By: Tapan J. Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

Managing Pharma Investors’ Expectations When The Chips Are Down

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Triggered by several critical factors, over a relatively short period of time, a downward spiral is visible with most Indian Pharma stocks, with a significant erosion in market capitalization of many large players in the country.

A set of important factors has been fueling this current downturn since around the last four years. These include, issues related to serious regulatory non-compliance with US-FDA and other foreign drug regulators, pricing pressure both in the domestic and the overseas markets, including the United States, delayed approval of several new generic drugs in the number-one pharma market of the world, for various reasons. Initial rollout period of GST expected to commence on July 1, 2017, may also prompt some major readjustments in the distribution setting of many pharma organizations. This has been further compounded with the wholesalers’ and retailers’ demand for compensation for any losses on input credit arising out of this critical reform.

As eroding market cap generally leads to commensurately lower market valuation of a company, it adversely impacts company’s many business growth related activities, which encompasses attracting low cost – high value investments, and M&A related activities, besides many others. Consequently, this negative swing has alarmed many investors, making them more demanding on company performance – uninterrupted, almost at any cost, as it were.

Not much headroom for necessary course correction:

Unrelenting expectations of this nature from the investors, inclusive of activist shareholders, to continue driving the business growth engine up the steep slope of ever increasing return on investment, is not expected to die down, anytime soon.

They may not be willing to leave enough headroom for the respective pharma management teams to realign their growth path with the changing and challenging needs of time, if it adversely impacts business even in the short-term. Nonetheless, if it is not allowed, the tailspin is likely to continue, as has been happening since, at least, the last couple of years, pushing the business at a dangerous level of sustainability.

Such demand of the investors and shareholders, irrespective of the gravity of the situation where their respective companies are in, may not be too uncommon, even in the global arena. However, many experts are now raising a key question in this area. In this article, I shall try to look at this issue, not just from the investors’ perspective, but also from what the concerned pharma players can and should do in this area, sooner the better.

A pertinent question needs to be addressed:

This important and relevant question is: what is the accountability of the investors, if their pressure for performance when the company is at a crossroad of this nature, causes a long-term irreparable damage to the business?

The very issue has been discussed immaculately in an article titled, “The Error at The Heart of Corporate Leadership”, published in the May-June 2017 issue of the Harvard Business Review.

The paper reiterates that attributing ownership of the corporation to its investors involves a challenging problem of accountability. This is because, ‘shareholders or private investors have no legal duty to protect or serve the companies whose shares they own and are shielded by the doctrine of limited liability from legal responsibility for those companies’ debts and misdeeds.’ Moreover, they are both physically and psychologically distant from the activities of the companies they invest in, and may generally buy and sell these shares without restrictions.

Nevertheless, such strong and ever increasing demands put the top pharma managers under increasing pressure to deliver faster and more predictable returns, regardless of the headwind that the business is facing. The issue becomes more complex when temporary-holders of large blocks of shares intervene to reconstitute a company’s board, change its management, or restructure its finances to drive up the share price, only to sell out and move on to another target, without ever having to answer for their intervention’s impact on the company or other parties, the article highlights.

Export business – the pain points:

“Pharma stocks take a beating on renewed US FDA scrutiny” – flashed the headline of a recent media report of June 12, 2017. As I see it, in the export business, especially in the top pharma market in the world, there appears to be a strong possibility of further worsening the business environment, especially for the Indian drug exporters.

Wave after wave of US-FDA import bans involving many India made drug formulations and Active Pharmaceutical Ingredients (API), since over last four years, have significantly affected the short-term export sales of the domestic pharma exporters. Alongside, these have seriously dented the image of the Indian pharma players, collectively, which encompasses the critical area of regulatory compliance – to offer well-documented safe and effective drugs, as required by the regulator, for the patients in the United States.

The situation gets messier with media headlines, such as, one from Bloomberg’s on January 24, 2017, conveying to the world community – “Document Shredding at Night Raises FDA Eyebrows During India Visit.”

Besides current drug pricing pressure, President Donald Trump’s election pledge for local manufacturing of products consumed in the United States, for more job creation in the country, sends another possible storm signal in this area. This is serious too, as Indian generic drug producers cater to around 40 percent of the total generic drug consumption in America.

Overcoming the odds in export business:

While taking corrective and effective measures for a sustainable long-term business performance, doing the same things more intensely that precipitated the current crisis, would be counterproductive.

Improving the situation, would also call for a strong preparedness for launching new generic products at a regular interval. However, in tandem, there is a crying need for the concerned pharma companies to take a pause, and conclude, a well-structured and expert-guided corporate introspection and brainstorming process, on priority. This will help them to arrive at a set of actionable strategic plans to effectively address each of the pain points, in a meticulous and time-bound manner.

Investors must necessarily be taken on board by opening appropriate communication channels, accordingly. This is to enable them to understand and accept the reasons for a short-term pain for a sustainable long-term gain. The tangible results of corrective measures should subsequently unfold to all concerned, with minor course corrections on-the-run, wherever necessary.

Domestic business – the pain points:

This is again another complex issue, which is often manifested through pressure on drug prices. The blame for such a situation, though originates from somewhere else, generally falls on the Government and the drug price regulator, for obvious reasons. It has a palpable boomerang effect, that is brought out by various research studies, and captured in consumers and the expert opinion, such as one that was published by the Washington Post on June 14, 2017 with the title, “The pharmaceutical industry puts profits above people.”

In the United States, where the drug pricing pressure is widely believed to have primarily originated from the escalating cost containment pressure of the Government and the key health care providers – triggered by a dangerous drug-pricing trend. Whereas in India, in addition to the latter that is related to non-schedule branded generic drugs, it is mostly related high out of pocket expenses on drugs, attempts to dodge various drug price regulations, and ignoring several ethical marketing practices related issues. The net outcome of all this is growing trust deficit on the pharma industry, in general.

Let me illustrate this point with a very contemporary example.  On May 18, 2017, Reuters reported, “India’s drug pricing regulator has demanded explanations from 65 domestic and global drug makers for selling new forms of essential diabetes and antibiotic drugs without its approval.” Interestingly, these companies reportedly include many big names, such as, Abbott Laboratories, Sanofi, Novartis and Indian firms such as Sun Pharmaceutical Industries and Lupin.

According to a circular of the National Pharmaceutical Pricing Authority (NPPA) of May 17, 2017, the above companies have allegedly launched formulations by altering an essential drug formulation with strength/dosage other than as specified in the Drug Price Control Order (DPCO) 2013 or combination with another drug not under price control, without even applying for price approval from NPPA as required. NPPA also doesn’t seem to be sure, whether such Fixed Dose Combinations (FDC) are rational or irrational and have the approval of the Central Drug Standard Control Organization (CDSCO).

If so, it’s indeed a sad development and a sorry state of affair, especially for those companies, which do some chest-thumping on ethics and compliance, often browbeating many Indian players, especially on USFDA related issues, besides pharma marketing practices.

As on date, Union Ministry of Health has banned several hundreds of such FDCs – on the ground of being irrational, launched without proper regulatory approval, lacking in therapeutic efficacy and safety profile, which may even cause harm to patients. March 11, 2016 notification of CDSCO banned 296 irrational FDCs.

However, many pharma players have succeeded in obtaining stay orders against almost all such regulatory bans from various High Courts. Nevertheless, the good news is, from July 2017, the Supreme Court is expected to hear all these cases, collectively. There could be another possible downturn in the market, if the Government wins the case.

Overcoming the odds in domestic business:

In these specific areas, there doesn’t seem to be any other option left to satisfy the long-term interest of the investors, other than addressing the ethics, values and compliance issues of the company on the ground, head on. It doesn’t really matter, what is displayed on the subject in their respective websites. Thus, in this area too, there is a crying need for a well-structured and expert-guided corporate introspection and brainstorming process to disrupt the status quo from its very root.

The above process would help the pharma players to arrive at a set of actionable strategic plans to effectively address the ethics and compliance issues in all the pain points – regulatory, marketing or financial, in a meticulous and time-bound manner. Alongside, all the stakeholders, including the investors, to be taken on board through customized content and the engagement platforms, to put the companies back into the long-term growth trajectory.

In conclusion:

Investors are very important, but if they aren’t an integral part of the corporate management team, should not try to overwhelm the business management process, especially for any short term financial gain. Attributing such authority to investors, involves a challenging problem of accountability for action, as they can get in or out of their investments at any time they choose to do so.

However, it’s also one of the key responsibilities of the management to listen to them, seriously. Take them on board by appropriately explaining to them in every critical situation, the broad strategic direction that the company would follow in pursuit of excellence. Thereafter, demonstrable outcome of all management action against the top operational goals, should be placed before them at a periodic interval, on an ongoing basis.

This process, if carried out with absolute transparency, integrity and seriousness, could help the Indian pharma players getting enough breathing space from the investors, for making the right operational interventions, before it’s too late.

Earlier this year, stepping down of former CEO of GSK – Andrew Witty, was reported to be due to pressure from investors for below par sales and profit in the past three years, besides a few other reasons. Another recent report of June 15, 2017 on “rebel investors looking to remake the board of Mylan” would possibly reinforce this point, further.

Outside the pharma industry, such a situation is not uncommon now, even in India. Besides, what happened recently in Tata Sons,  the June 14, 2017 media headline highlighting “Infosys flags ‘activist shareholder’ as risk factor”, vindicates the same point, yet again.

Thus, managing pharma investors’ expectations through a process of continuous engagement with them, effectively, especially when the chips are down, as it is today, is so critical for the long-term success and sustainability of pharma business.  Maintaining the status quo any further, would possibly make a high-flying pharma player to experience the strong gravitational pull, uncontrolled, with its its serious but avoidable consequences.

By: Tapan J. Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

The Relevance of Content Marketing In Pharma

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“Nearly half of pharma industry may come under price control” – was the headline of a media report of June 7, 2017. Although, National Pharmaceutical Pricing Authority (NPPA) has apparently denied any such move, the fact is that the number of drugs coming under price control is steadily creeping up, ever since the Drugs Price Control Order 2013 came into force. If this trend continues, the gross profit margin of most of the branded generic manufacturers will also keep getting significantly squeezed, with a varying degree, though.

Coupled with drug pricing pressure in the United States, USFDA import bans from several manufacturing plants in India and dwindling number of new generic drugs ready for US launch, the market capitalization of many publicly listed pharma companies, may go further south. An important example of this situation was cited by Bloomberg, with reasons, in its report of June 07, 2017 carrying a headline “Pharma Woes Axe $14 Billion From Wealth of Once-Richest Indian.”

However, the overall setting is not so distressing for all Indian drug manufacturers, for different reasons. The June 08, 2017 headline of another  business news daily stating – “Cadila Healthcare overtakes Lupin as second most valuable pharma company in India,” vindicates the point. The promoter of this company reportedly said, ‘the company expects to receive 40 product approvals in the US in the current financial year.’

Be that as it may, added to these pain points of many pharma players in the country, Prime Minster Narendra Modi’s recent hint on framing rules for doctors to prescribe generic drugs, invites yet another wave of worries for the branded generic drugs players in India, regardless of a solid socioeconomic reason for the same.

Keeping these developments in perspective, collectively, the headwind faced by the Indian pharma industry, regardless of the underlying reasons, is indeed a tough one to navigate through, unscathed. Consequently, the stellar aggregate net profit growth of 41.3 percent in 2016 over 2015, as reported by the 2016 Dun & Bradstreet publication titled, “India’s Leading Pharmaceutical Companies 2016”, could possibly be rather challenging to maintain. Let me hasten to add that a much slower rise in the sector’s largest expense head – ‘raw material expenses’, also helped to achieve this enviable profit growth in 2016, as the report elaborated.

In this article, I shall try to fathom the depth this issue, and the possible way forward.

Areas of laudable contribution by the pharma industry:

For several decades, the pharmaceutical industry has been playing a leading role, not just in offering new innovative drugs, but their cheaper generic equivalents also, as those go off-patent, incessantly, to save and improve the quality millions of lives, across the world. The success of the drug industry is fundamentally driven by innovation – both in the discovery of new molecules and treatments, as well as in coming out with new cost efficient processes to significantly improve patients’ access to innovative drugs, post patent expiry.

Two areas requiring greater focus:

In tandem with these laudable initiatives, two disturbing trends are gathering momentum. One such trend is inadequate understanding of the grave fall out of not meeting with important stakeholders’ expectation on product pricing. As a result, various Governments and other health care payers are coming down heavily on pharma players to make drug prices affordable for the patients.

And the second one is, an intriguing apathy to be innovative in engaging with each stakeholder to take them on board. This can be done by communicating transparently, an easy-to-understand way and a customized way, the major benefits the individual players have been providing to facilitate various public health care initiatives. An apparent disinterest in this area continues, despite the snowballing effect of adverse public perception, and increasing trust deficit.

The core factors driving the trends:

These two trends are generally driven by two core factors – one is external, and the other internal. The external one is related to the general socioeconomic environment, and the internal one is intimately related to strategic business game plans of individual pharma companies.

The discussion will get more complex, if one wants to know whether the traditional pharma business models have a catalytic effect on the seemingly hostile business environment. As I have discussed several times in this blog, what the pharma players can possibly do in the pricing area, I shall not go into that subject yet again.

Nevertheless, what the pharma companies can do in the second area, to achieve their key strategic business goals, is quite different from what most of them are doing or not doing, till date. As we see around, many pharma players, especially the Indian branded generic companies remain engaged predominantly with the doctors, in the form of product detailing, or through Continuing Medical Education (CME) events, or the likes of these.

Today’s newer kind of strategic intervention calls for expert inputs. This is essential to create credible-research-based innovative content, and deliver the same with absolute precision through tailor-made platforms, for effective engagement with each stakeholder. It goes without saying, this should be done in a way that ordinary citizens or netizens can easily relate to.

Relevance of ‘Content Marketing’:

As the traditional pharma marketing is becoming progressively less and less effective, the need for a comprehensive content marketing model is becoming critical for the Indian pharma industry, more than ever before. In this model, useful content will be at the core of pharma marketing

According to the Content Marketing Institute (CMI): ‘Content Marketing is a strategic marketing approach focused on creating and distributing valuable, relevant, and consistent content to attract and retain a clearly defined audience – and, ultimately, to drive profitable customer action.’

It is possible to make the demand of a medical product, or a caring corporate image, more sustainable through content marketing, as compared to the traditional ones where individual product detailing and CMEs become the centerpieces of marketing strategy.

Why is it so important for pharma now?

According to a Pew Research Study, “One in three American adults have gone online to figure out a medical condition.”

Similarly, PwC Health Research Institute’s consumer survey of 1,060 US adults highlights, about one-third of consumers are using the social space as a natural habitat for discussions on health. More than 80 percent of individuals aged between18 and 24 would likely to share health-related information through social media, while nearly 90 percent of individuals would engage in health-related activities, or trust information found via social media. Around 45 percent of consumers said information from social media would affect their decisions to seek a second opinion.

In India too, increasing number of doctors and patient populations are ferreting information that they require from cyberspace, including different expert websites, online, and immediately when they require those.

Doctors are searching for detail information on different drugs, about their manufacturers, new treatment processes, and required data on clinical trials. Similarly, patients are searching for information in various other areas, such as, different aspects of the diseases that they or their near or dear ones are suffering from, and their effective modes of treatment with cost data, by getting connected online with related patient groups or communities. Even when engaging with the doctors, they often want to cross verify the outcome of discussion with the information available on the Internet. So do the doctors with the information provided by the pharma companies in person.

For example, one such popular website, among many others, is The Mayo Clinic’s Sharing blog designed for the Mayo Clinic community, and includes the following area:

  • Sharing experience of patient communities
  • Specialist doctors discussing new treatments, contemporary innovation in the health care space and patient care
  • Medical researchers and specialist doctors sharing their research experiences
  • Discussion on future health care and wellness by the professionals at Mayo Clinic
  • Students sharing their experience and perspectives in various areas

Driven by the current digital wave, and the word of mouth publicity to the benefits derived by the doctors and patients through such process, an ever-increasing number of the population is expected to do the same, in the years ahead.

Thus, a huge marketing opportunity in this much unexplored area awaits the Indian pharma players to establish an emotional connect with the stakeholders, including the doctors and patients, by providing all relevant information that they are web-searching for.

Needs specialization:

Unlike traditional pharma marketing, content marketing is a highly-specialized area – especially for the generation of requisite meaningful and quality data, getting the relevant insight through analytics for innovative message creation.

Moreover, as the current public image of pharma players, in general, is not very encouraging, it may be a good idea to work on various trust building activities. These may include videos on patients narrating their stories or a research experience, and infographics. Thereafter, its delivery through best suited communication platforms, across the marketing channels, followed by constant evaluation of the quality impact generated, will be critical.

Content marketing initiative in pharma should ideally start on a pilot scale and curated to enhance stakeholder engagement level, as necessary, before scaling it up to a national or a global level, as the situation would call for.

A few examples:

Some global pharma players have initiated great work in the space of content marketing. These are aimed at mostly to increase the awareness level and educate patients, doctors, and caregivers in some important and carefully crafted areas. A few examples are as follows:

  • Actually She Can (Allergan): on contraception options
  • Set Your Sights (Novartis): on vision conditions that a person may not have been previously aware of
  • Living Like You (Novartis): on coping with Multiple Sclerosis at its different stages
  • Arthritis.com (Pfizer): provides information about rheumatoid arthritis and osteoarthritis
  • Quitter’s Circle (Pfizer and American Lung Association): provides resource for those who want to quit smoking and their supporters.

Conclusion:

The most predictable part in the pharma business environment is its unpredictability. What is happening today with various large and seemingly invincible players of the recent past, is indeed jaw dropping. Some experts had predicted that the ultimate outcome of getting fixated into mostly traditional business practices in a rapidly changing socioeconomic setting and technology focused environment, could seriously challenge the long-term sustainability of a business.

The major adverse impact on the Indian pharma sector’s overall business performance is primarily driven primarily by the product pricing pressure and USFDA import bans on product quality parameters. Many believe, both these are intimately related to the current business practices of the industry, in general, leading to increasing trust deficits between the pharma companies and the Government, including the public.

The growth engine of the pharma industry is innovation, which would always remain so. Interestingly, in marketing areas no much innovation is noticed. Continuous and effective engagement with all stakeholders is critical now, not just for brand promotion, but also on corporate mission, vision and values, giving solid examples of how the company is making steady progress in those areas. This would help establish credibility in their eyes and take them on board to create a powerful and trustworthy voice for effective brand engagements, as well. It will also encourage the pharma players to ‘walk the talk’, in the real world, always.

The opportunities that a comprehensive content marketing strategy could offer to pharma companies to move in this direction, are phenomenal. It helps to get emotionally connected with all stakeholders, by providing relevant information, including those they are web-searching for, in a more innovative and informative format.

By: Tapan J. Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

Rebalancing Skill Sets In Pharma Sales And Marketing

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A disturbing trend against much needed more job creation across the world, has been well captured in a May 2016 MIT article. It concluded through several complex mathematical models that: “As more tasks performed by labor are being automated, concerns that these new technologies will make labor redundant have intensified.”

However, despite well-hyped concerns in this area, ongoing rapid advancement of technology and other related innovation haven’t yet caused any alarming level of unemployment anywhere in the world, nor it possibly will. Several instances of gradual reduction in the number of routine and traditional jobs due to such automation, are generally related to a lesser level of hard skill sets. As we shall see below, many industries require doing so in the modern times, for long term sustainability of business.

In tandem, promising high tech jobs requiring state or the art hard skill sets are getting created too, though are fewer in number. Nevertheless, the number of brilliant startups has increased by manifolds, during the same period. This change is inevitable, mostly in any science and technology driven industry, e.g., banking sector, where most of human operated bank tellers have made way to ATM machines.

A recent vindication:

Vindicating this point, as it were, on May 18, 2017, Reuters reported that Swiss pharma major Novartis, as a part of its “ongoing global transformation” initiative launched last year to create a unified operating model, will cut around 500 traditional and routine jobs in Switzerland, and add 350 in high-tech areas. Immediately thereafter, for similar reasons, the company announced the elimination of another 250 jobs in the United States.

Jobs are important to all for a living. Any job loss, irrespective of the nature of business compulsion, is indeed unfortunate. That said, whether we like it or not, such evolving trends are the stark realities, and expected to continue or even accelerate in the years ahead for higher growth in productivity, especially involving the routine and traditional tasks.

Pharma industry, though a science-based one, loss of routine and traditional jobs due to technological advancement is fortunately still much less as compared to other similar industries. This is primarily due to the continuation of the traditional business models in the pharma sector, requiring a huge number of human intervention, which call for a different balance of soft and hard skill sets.

However, crystal gazing the future, it appears quite likely that there will be a strong need to rebalancing the required soft and hard skills in the drug industry. The contour of my discussion in this article will be on pharma sales and marketing. 

Skill – the ability to do something well:

The Oxford dictionary defines ‘skill’ as ‘the ability to do something well’. Similarly, the term ‘ability’ has been defined by it as ‘possession of the means’. Thus, ‘skill’ means ‘possession of the means to do something well’. It is an absolute must in all professions, including pharma sales and marketing.

Skills broadly fall into two categories – hard and soft skills. Hard skills involve specific knowledge and teachable abilities that can be defined and measured and are usually quantifiable.

Hard skills are individual proficiency in various scientific, technical, mathematical and even some artistic areas of creation, besides other related ones. In pharma sales and marketing arena of the near future, these include, among others, robust scientific knowledge-base to understand various aspects of drug molecules, content creation with astute market understanding, data generation and analysis through state of art analytics and research, software programing, digital savviness and social media expertise. Many of these skills are related to the Intelligent Quotient of an individual.

Soft skills, on the other hand, are less tangible and quantifiable, such as etiquette or personality development; work ethics, getting along with people, ability to listen patiently, overcoming objections, persuading others and a deep sense of accountability. Many of these skills are usually related to emotional intelligence of an individual.

Which one is more important?

Both hard or soft skills are useful, valuable and important. However, the mix of these two skills for high performance of any individual professional will generally depend on success requirements of a job in a specific macro business environment.

That said, it is important to note that most of the hard skills are taught and learnt mostly before a person’s entry into science, technology or various other craft or design based jobs. The related hard skills are essential for getting selected for specialized jobs. Whereas, softer skills are usually learned on the job, and through experience by all those who want to grow in the profession.

In this context, it may not be a bad idea for all pharma sales and marketing professionals to take a hard look at our own current soft and hard skill sets again, against rapidly changing demands of the business environment. Regardless of where we are now, it will be worth writing down on a piece of paper the type of each of these two skills, in order of their strengths, that we individually possess, which are good enough for achieving sustainable excellence in business performance and personal career progression. It may provide a broad sketch of where we stand today in the VUCA world.

The years ahead for pharma won’t be quite the same:

A strong wind of change has already started signaling that the years ahead for the pharma industry, won’t be quite the same as the bygone years nor like what it is today. Some, industry professionals have picked up this cue, while many are still in pursuit of replicating the traditional past with some digital tweaking here and there, whatever may be the reasons.

The current mix of skill sets of the sales and marketing professionals, quite perceptibly, tilts more towards sharpening the softer skills of the employees, as the traditional pharma business models prompt so.

Future need – rebalancing the skill sets:

To be a successful in the days ahead, pharma companies would need to dive deep into the cyberspace – just to be on the same wavelength with its important stakeholders, including, the Government.

Looking around, one witnesses many patients going digital at a faster pace than ever before. They enjoy the cyberspace while embracing the new ways of living life, such as – communicating digitally, chatting in WhatsApp sharing patient’s experience, interacting with online patient communities, and preferring data mining to know more about anything of interest. These activities also get them a sense of the differential advantages of various health care products, services and their cost, before or while consulting doctors and deciding what they can afford.

Similarly, many medical professionals are also not depending solely on the company representatives now to get relevant details on any medicinal product, device or services. Besides frequent interaction with their peer groups, they get such detail information from various websites run by independent, and credible expert groups.

Thus, one of the common arena for pharma stakeholder engagement and interaction would soon be the enigmatic Cyberspace. As the changing days come nearer, there is likely to be greater emphasis on the acquisition of talent having specialized hard skills in this area of sales and marketing.

This emerging scenario prompts rebalancing the mix of soft and hard skill sets with much greater care, and hire young sales and marketing professionals, accordingly to give shape to it. This process should commence now, as the present makes way for the future. This is so important because, the current trend of tweaking with many digital tools and devices mostly as interfaces, or for complementing in-person product detailing or for better field management, or even to draw up marketing and sales plans, may not yield the desired business results any longer, even for survival, as we move on.

Becoming digital natives?

According to the 2015 A.T. Kearney Report titled, “Time for Pharma to Dive into Digital”, pharma sales and marketing professionals must also become digital natives, providing content that is both up-to- date and appropriate for multiple digital channels. Moreover, they will have to be familiar with advanced analytics to monitor and measure actual consumption pattern, besides capturing in real time a huge sample of relevant data for deeper customer insights.

The new normal:

One of the biggest challenges would be in the approach to content development and management. Creating an interactive detailing toolbox for truly responsive customer engagement, requires a good deal of thought and quite complex coding. This would necessitate centralization of marketing content production, which is traditionally decentralized in many sales and marketing organizations. Similarly, the major focus of the sales force will shift from maximizing physician-call rates, to becoming a team of digital communication specialists, and coordinators who would ensure that the right channels are used at the right time.

As the November 2016 Accenture Report titled, ‘The Rebirth of The Pharmaceutical Sales Force’ underscores, the most successful pharmaceutical sales teams in the future will be those willing to define and servicing customers in new ways… and will use digital advances to change the conversation, and position themselves as committed to helping physicians improve health outcomes.

This expected change, I reckon, will put in place a new normal for pharma sales and marketing success in the years ahead.

In conclusion:

Young aspirants wanting to make a career in the pharma industry, may wish to take note of this evolving trend of inevitable changes. They may wish to get well-considered views on the same of a couple of experts’ having no conflict of interest, for a careful and independent personal assessment. These budding strivers should realize that the final actionable decision on developing requisite hard and soft skill sets for a successful take off in their respective working lives, should preferably be taken only by themselves, and none else.

An August 2015 article of McKinsey & Company titled, “The road to digital success in pharma” articulates that the pharma companies, though can play a central role in the digital revolution of healthcare, are running hard to keep pace with changes brought about by digital technology. But soon there may not be any other option left for achieving business excellence.

While the nation is taking strides to transform itself into ‘Digital India’, the pharma companies operating in the country can’t possibly afford to remain far behind. Willy-nilly, they will soon need to realign their business processes accordingly, as there may not be any further scope for individual pharma players to operate within the same old cocoon of tradition bound activities, and still survive.

To meet the new and tougher demands for excellence in pharma sales and marketing, the urgent need of the changing time lies squarely outside the box. To usher in a requisite transformation in the current business model, it calls for a series of well-calibrated, much researched, and bold steps – skillfully rebalancing the crucial soft and hard skill sets, achievable within a realistic and self-determined timeframe.

By: Tapan J. Ray   

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

Is The Department of Pharmaceuticals On The Same Page As The Prime Minister?

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“The open secret is that pharmaceutical companies throw all manners of inducements on doctors to prescribe their medicines. The victim of their misdemeanors is the unsuspecting patient. Mr. Modi clearly wants to break this self-serving chain” – highlighted a media report on April 20, 2017.

“Prime Minister Modi wants to end the unholy doctor-drug industry nexus” – echoed another media headline on the same day.

In a step towards this direction for the benefits of patients, the PM hinted at making prescriptions in generic names of drugs mandatory through a legal framework. There could be many challenges ahead to achieve this objective, but the fact remains just the same. A study published in a well-acclaimed medical journal, even after the PM’s much talked about pledge, re-establishes the adverse impact of this alleged nexus through a bioequivalarge research study.

In this article, I shall not go into the details of what the PM had said in this regard and the impact of the same on patients, pharma companies, different types of service providers to the branded-generic business, and the Indian Pharma Market (IPM), as I have already done that. Neither shall I focus here on the action expected from the Union Ministry of Health, as they have, at least, amended the statute making the bioequivalence studies mandatory, though several other action steps need to follow. Today, I shall deliberate only on one question: Is the department of pharma on the same page with the PM on effectively addressing the alleged ‘doctor-drug industry nexus’?

A recent study:

The following very recent study elegantly highlighted the criticality of snapping this unholy link, as many believe, for the patients’ sake.

The May 2, 2017 JAMA editorial titled, “Reconsidering Physician – Pharmaceutical Industry Relationships” articulated, physicians need to balance the risk and benefits of treatments, especially when inputs come from companies whose interests may conflict directly with those of patients. Drug costs, though revenue to their respective manufacturers, are high out of pocket expenditure to patients, many of whom seriously struggle to afford their medical treatment.

The above editorial comment was based on an ‘Original Investigation’ study titled, “Association Between Academic Medical Center Pharmaceutical Detailing Policies and Physician Prescribing”, published on the same day in the same esteemed journal.

This large study was aimed at measuring the outcome of an effort by some Academic Medical Centers (AMCs) in the United States to regulate physicians’ conflict of interest in this area. These AMCs enacted policies restricting pharmaceutical representatives’ visits to physicians for product detailing, between 2006 and 2012. Accordingly, the paper analyzed the association between detailing policies enacted at these AMCs and the physicians’ prescribing of actively detailed and not detailed drugs. This study included 16,121, 483 prescriptions, written between January 2006 and June 2012, by 2126 attending physicians, at the 19 intervention group AMCs, and by 24, 593 matched control group physicians.

The authors concluded with a fresh reaffirmation that the implementation of policies at AMCs, which restricted product detailing by the respective company medial representatives, between 2006 and 2012, was associated with a modest but statistically significant reduction in prescribing of detailed drugs across 6 of 8 major drug classes.

Significant cost reduction, with important economic implications:

It’s worth noting, the patients did not suffer at all, in any way, with such restrictions, on the contrary were probably benefitted with this policy, though individual pharma player’s sales revenue might have been adversely impacted.

Quoting the researchers, a Public Release of May 2, 2017 titled, “Restricting sales visits from pharmaceutical reps associated with changes in physician prescribing” also reiterates: The reduction in the prescribing of detailed drugs and the increase in the prescribing of non-detailed drugs potentially represent a large reduction in costs, with important economic implications.

Why aren’t the erring players brought to justice in India?

Instances of serious marketing malpractices of several pharma companies in India are also being widely reported from time to time, both by the international and national media, including expressions of serious concern in the Parliament, and a reported Public Interest Litigation (PIL) pending in the Supreme Court.

Any instances of levying massive fines, or other punitive measures taken by any competent Indian authority for such delinquency by many pharma companies operating in the country, have not been reported, just yet, in my view. This is because, India doesn’t have in place any specific regulatory mechanism with built-in legal teeth that would deter, detect, investigate and take exemplary punitive actions against the erring players, wherever justifiable.

Is the department of pharma on the same page as the PM?

Much before this recent development, the Department Related Parliamentary Standing Committee on Health and Family Welfare in its 58th Report, placed before the Parliament on May 08, 2012, strongly indicted the Department of Pharmaceuticals (DoP) for not taking any tangible action in this regard. The committee observed that the DoP should take immediate action in making the ‘Uniform Code of Pharmaceutical Marketing Practices (UCPMP)’ mandatory to contain ‘huge promotional costs and the resultant add-on impact on medicine prices’.

It has just been reported, soon after the Prime Minister’s hint for a legal framework mandating doctors to prescribe in generic names, 73 percent doctors surveyed across the country opposed the PM’s initiative, raising concerns about the quality of all non-branded generic drugs. The report further stokes the apprehension of a concerted effort by this alleged nexus to further strengthen the make-believe perception, sans requisite credible favorable evidence, that branded-generics as a category is superior in quality to non-branded generics, which is not the fact.

Unfortunately, nothing substantive has yet happened on the ground regarding this issue, except the announcement of voluntary implementation of the DoP’s ‘Uniform Code of Pharmaceutical Marketing Practices (UCPMP)’, effective January 1, 2015 for six months for its assessment. Thereafter, the date extension process on the voluntary implementation of the UCPMP has become a routine exercise for the DoP on various pretexts, such as continuing discussion with the pharma trade associations and other stakeholders or to give legal teeth into it with penal provisions.

This situation prompts an important question: Is the DoP on the same page with the PM to contain, if not eliminate, the alleged unholy doctor-drug industry nexus?

Scope of mandatory UCPMP goes beyond prescriptions with generic names:

The scope of several intricate types of marketing malpractices, goes well-beyond influencing prescriptions for brand name drugs, due to various reasons. Hence, what Prime Minister Modi recently hinted at is not an alternative or a replacement for UCPMP, which will fall within a legal framework and be applicable to all the concerned players. Although, there could possibly be some degree of overlap with the prescriptions in generic names, mainly from the perspective of protecting patients’ health interest, the scope of both these initiatives is mutually exclusive, in many respects.

This would also encourage, especially the millennial generation, for innovative strategic thinking to work out cutting edge pharma marketing game plans with active patient engagement, while charting the uncharted frontiers, despite prescriptions in generic names, as and when it comes, if at all. As a result, new warhorses with proven cerebral power and agility would get newer opportunities to hold the leash and occupy the center stage in the pharma marketing warfare.

But…the indefinite wait continues:

Although the DoP apparently maintains a radio-silence on this important issue, a media report of February 26, 2017 indicates that the department will ‘soon’ issue an order making UCPMP mandatory for the drug manufacturing industry, bringing all doctors, chemists, hospitals and states in its ambit, and a blanket ban on expensive freebies such as cruise or vacation tickets. Intriguingly, no one seems to know how ‘soon’ would this ‘soon’ be – hence, the agony of an indefinite wait for justice continues.

Conclusion:

For the last three and a half decades, ‘Code of Pharmaceutical Marketing Practices’, prepared by various global pharma trade associations and many large global pharma companies individually, has come into existence for ‘strictest’ voluntary adherence. These are being relentlessly propagated by them as a panacea for all marketing malpractices in the drug industry.

Squeaky clean ‘pharma marketing codes for voluntary practices’ can be seen well placed in the websites of almost all large global pharma players and their trade associations. Although, its concept and intent are both commendable, a regular flow of media reports on such malpractices raises a relevant question: Do the votaries, sponsors and creators of these codes “walk the talk”?

If yes, why then mind boggling sums in billions of dollars are being paid as settlement fees by a large number of global pharma companies for alleged colossal marketing malpractices in different countries of the world.

This scenario prompts many stakeholders believe, though over-hyped by the global pharma industry, ‘Voluntary Practices’ alone of Pharma Marketing Code’, has never worked anywhere in the world. Thus, India needs a legally binding UCPMP for all concerned.

Prime Minister Modi has hinted at an effective pathway to mitigate this malevolent nexus for the benefit of patients. Understandably, that way can’t be construed as an exhaustive one, nor a cure-all. A slew of other effective steps should follow from different Government authorities, in tandem. The Union Ministry of Health has, at least, taken a related measure falling in their space. Nevertheless, an intriguing apathy of the DoP, as it were, in this area would encourage many to ponder: Is this important Government department on the same page as the PM in containing the alleged ‘doctor – pharma industry nexus?’

By: Tapan J. Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

 

Prescriptions in Generic Names Be Made A Must in India?

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Would prescriptions in generic names be made a must in India?

Yes, that’s what Prime Minister Modi distinctly hinted at on April 17, 2017, during the inauguration function of a charitable hospital in Surat. To facilitate this process, his government may bring in a legal framework under which doctors will have to prescribe generic medicines, the PM assured without any ambiguity whatsoever.

“In our country doctors are less, hospitals are less and medicines are expensive. If one person falls ill in a middle-class family, then the financial health of the family gets wrecked. He cannot buy a house, cannot conduct the marriage of a daughter,” he reiterated.

“It is the government’s responsibility that everybody should get health services at a minimal price,” the Prime Minister further reinforced, as he referred to the National Health Policy 2017. His clear assurance on this much-debated issue is indeed music to many ears.

Some eyebrows have already been raised on this decision of the Prime Minister, which primarily include the pharma industry, and its traditional torch bearers. Understandably, a distinct echo of the same one can also be sensed in some English business dailies. Keeping aside these expected naysayers, in this article, after giving a brief backdrop on the subject, I shall argue for the relevance of this critical issue, in today’s perspective.

Anything wrong with generic drugs sans brand names?

At the very outset, let me submit, there aren’t enough credible data to claim so. On the contrary, there are enough reports vindicating that generic drugs without brand names are generally as good as their branded equivalents. For example, a 2017 study on this subject and also in the Indian context reported, ‘93 percent of generic and 87 percent branded drug users believed that their drugs were effective in controlling their ailments.’

Thus, in my view, all generic medicines without any brand names, approved by the drug regulatory authorities can’t be inferred as inferior to equivalent branded generics – formulated with the same molecules, in the same strength and in the same dosage form; and vice versa. Both these varieties have undergone similar efficacy, safety and quality checks, if either of these are not spurious. There isn’t enough evidence either that more of generic drugs sans brand names are spurious.

However, turning the point that generic drugs without brand name cost much less to patients than their branded generic equivalents on its head, an ongoing concerted effort of vested interests is systematically trying to malign the minds of many, projecting that those cheaper drugs are inferior in quality. Many medical practitioners are also not excluded from nurturing this possible spoon-fed and make-believe perception, including a section of the media. This reminds me of the famous quote of Joseph Goebbels – the German politician and Minister of Propaganda of Nazi Germany till 1945: “If you tell a lie big enough and keep repeating it, people will eventually come to believe it.”

The lower prices of generic drugs without brand names are primarily because their manufacturers don’t need to incur huge expenditure towards marketing and sales promotion, including contentious activities, such as, so called ‘Continuing Medical Education (CME)’ for the doctors in exotic locales, and several others of its ilk.

Thus, Prime Minister Modi’s concern, I reckon, is genuine to the core. If any doctor prescribes an expensive branded generic medicine, the concerned patient should have the legal option available to ask the retailer for its substitution with a less expensive generic or even any other branded generic equivalent, which is supposed to work just as well as the prescribed branded generic. For this drug prescriptions in INN is critical.

Provide Unique Identification Code to all drug manufacturers:

When in India, we can have a digitally coded unique identification number, issued by the Government for every individual resident, in the form of ‘Aadhaar’, why can’t each drug manufacturer be also provided with a similar digitally coded number for their easy traceability and also to decipher the trail of manufacturing and sales transactions. If it’s not possible, any other effective digital ‘track and trace’ mechanism for all drugs would help bringing the wrongdoers, including those manufacturing and selling spurious and substandard drugs to justice, sooner. In case a GST system can help ferret out these details, then nothing else in this regard may probably be necessary.

Past initiatives:

In India, ‘Out of Pocket (OoP) expenditure’ as a percentage of total health care expenses being around 70 percent, is one of the highest in the world. A study by the World Bank conducted in May 2001 titled, “India – Raising the Sights: Better Health Systems for India’s Poor” indicates that out-of-pocket medical costs alone may push 2.2 percent of the population below the poverty line in one year. This situation hasn’t improved much even today, as the Prime Minister said.

Although, ‘prescribe drugs by generic names’ initiative was reported in July 2015, in the current context, I shall focus only on the recent past. Just in the last year, several initiatives were taken by the current Government to help patients reduce the OoP expenses on medicines, which constitute over 60 percent of around 70 percent of the total treatment cost. Regrettably, none of these steps have been working effectively. I shall cite hereunder, just three examples:

  • On February 29, 2016, during the Union Budget presentation for the financial year 2016-17 before the Parliament, the Finance Minister announced the launch of ‘Pradhan Mantri Jan-Aushadhi Yojana (PMJAY)’ to open 3,000 Stores under PMJAY during 2016-17.
  • On August 04, 2016, it was widely reported that a new digital initiative of the National Pharmaceutical Pricing Authority (NPPA), named, “Search Medicine Price”, would be launched on August 29, 2016. According to NPPA, “Consumers can use the app before paying for a medicine to ensure that they get the right price.”
  • In October 2016, a circular of the Medical Council of India (MCI), clearly directed the medical practitioners that: “Every physician should prescribe drugs with generic names legibly and preferably in capital letters and he/she shall ensure that there is a rational prescription and use of drugs”

A critical hurdle to overcome:

Besides, stark inefficiency of the MCI to implement its own directive for generic prescriptions, there is a key legal hurdle too, as I see it.

For example, in the current situation, the only way the JAS can sell more of essential generic drugs for greater patient access, is by allowing the store pharmacists substituting high price branded generics with their exact generic equivalents available in the JAS. However, such substitution would be grossly illegal in India, because the section 65 (11) (c) in the Drugs and Cosmetics Rules, 1945 states as follows:

“At the time of dispensing there must be noted on the prescription above the signature of the prescriber the name and address of the seller and the date on which the prescription is dispensed. 20 [(11A) No person dispensing a prescription containing substances specified in 21 [Schedule H or X] may supply any other preparation, whether containing the same substances or not in lieu thereof.]”

A move that faltered:

To address this legal issue, the Ministry of Health reportedly had submitted a proposal to the Drug Technical Advisory Board (DTAB) to the Drug Controller General of India (DCGI), for consideration. In the proposal, the Health Ministry reportedly suggested an amendment of Rule 65 of the Drugs and Cosmetics Rules, 1945 to enable the retail chemists substituting a branded drug formulation with its cheaper equivalent, containing the same generic ingredient, in the same strength and the dosage form, with or without a brand name.

However, in the 71st meeting of the DTAB held on May 13, 2016, its members reportedly turned down that proposal of the ministry. DTAB apparently felt that given the structure of the Indian retail pharmaceutical market, the practical impact of this recommendation may be limited.

The focus should now move beyond affordability:

In my view, the Government focus now should move beyond just drug affordability, because affordability is a highly relative yardstick. What is affordable to an average middle class population may not be affordable to the rest of the population above the poverty line. Similarly, below the poverty line population may not be able to afford perhaps any cost towards medicines or health care, in general.

Moreover, affordability will have no meaning, if one does not have even easy access to medicines. Thus, in my view, there are five key factors, which could ensure smooth access to medicines to the common man, across the country; affordable price being one of these factors:

1. A robust healthcare infrastructure
2. Affordable health care costs, including, doctors’ fees, drugs and diagnostics
3. Rational selection and usage of drugs by all concerned
4. Availability of health care financing system like, health insurance
5. Efficient logistics and supply chain support throughout the country

In this scenario, just putting in place a legal framework for drug prescription in generic names, as the Prime Minister has articulated, may bring some temporary relief, but won’t be a long-term solution for public health care needs. There arises a crying need to put in place an appropriate Universal Health Care (UHC) model in India, soon, as detailed in the National Health Policy 2017.

Brand names aren’t going to disappear:

Prime Minister Modi’s assertion to bring in a legal framework under which doctors will have to prescribe generic medicines, probably will also legally empower the retailers for substitution of high priced branded generics with low priced generic or branded generic equivalents.

This promise of the Prime Minister, when fulfilled, will facilitate making a larger quantum of lower price and high quality generic drugs available to patients, improving overall access to essential medicines. Hopefully, similar substitution will be authorized not just for the JAS outlets, but by all retail drug stores, as well.

Brand names for generic drugs will continue to exist, but with much lesser relevance. the Drugs & Cosmetic Rules of India has already made it mandatory to mention the ‘generic names or INN’ of Drugs on all packing labels in a more conspicuous manner than the trade (brand) name, if any. Hence, if a doctor prescribes in generic names, it will be easier for all retail pharmacists and even the patients, to choose cheaper alternatives from different available price-bands.

Possible changes in the sales and marketing strategies:

If it really happens, the strategic marketing focus should shift – from primarily product-brand marketing and stakeholders’ engagement for the same, to intensive corporate-brand marketing with more intense stakeholder engagement strategies, for better top of mind recall as a patient friendly and caring corporation.

Similarly, the sales promotion strategy for branded generics would possibly shift from – primarily the doctors to also the top retailers. It won’t be unlikely to know that the major retailers are participating in pharma company sponsored ‘Continuing Pharmacy Education (CPE)’ in similar or even more exotic places than the doctor!

There are many more.

International examples:

There are enough international examples on what Prime Minister Modi has since proposed in his speech on this issue. All these are working quite well. To illustrate the point with a few examples, I shall underscore that prescribing in generic name or in other words “International Nonproprietary Name (INN)’ is permitted in two-thirds of OECD countries like the United States, and is mandatory in several other nations, such as, France, Spain, Portugal and Estonia. Similarly, pharmacists can legally substitute brand-name drugs with generic equivalents in most OECD countries, while such substitution has been mandatory in countries, such as, Denmark, Finland, Spain, Sweden, Italy. Further, in several different countries, pharmacists have also the obligation to inform patients about the availability of a cheaper alternative.

However, the naysayers would continue saying: ‘But India is different.’

Impact on the pharma industry:

The March 2017 report of ‘India Brand Equity Foundation (IBEF)’ states that Indian pharmaceutical sector accounts for about 2.4 per cent of the global pharmaceutical industry in value terms, 10 per cent in volume terms and is expected to expand at a Compound Annual Growth Rate (CAGR) of 15.92 per cent to US$ 55 billion by 2020 from US$ 20 billion in 2015. With 70 per cent market share (in terms of value), generic drugs constitute its largest segment. Over the Counter (OTC) medicines and patented drugs constitute the balance 21 percent and 9 percent, respectively. Branded generics constitute around 90 percent of the generic market. In my view, if the above decision of the Prime Minister is implemented the way I deliberated here in this article, we are likely to witness perceptible changes in the market dynamics and individual company’s performance outlook. A few of my top of mind examples are as follows:

  • No long-term overall adverse market impact is envisaged, as ‘the prices of 700 essential medicines have already been capped by the National Pharmaceutical Pricing Authority (NPPA). However, some short-term market adjustments are possible, because of several other factors.
  • There could be a significant impact on the (brand) market shares of various companies. Some will have greater exposure and some lesser, depending on their current sales and marketing models and business outlook.
  • Valuation of those companies, which had acquired mega branded generics, such as Piramal brands by Abbott Healthcare, or Ranbaxy brands by Sun pharma, may undergo considerable changes, unless timely, innovative and proactive measures are taken forthwith, as I had deliberated before in this blog.
  • Together with much awaited implementation of the mandatory Uniform Code of Pharmaceutical Marketing Practices (UCPMP) sooner than later, the sales and marketing expenditure of the branded generic players could come down significantly, improving the bottom-line.
  • Pharma marketing ballgame in this segment would undergo a metamorphosis, with brighter creative minds scoring higher, aided by the cutting-edge strategies, and digital marketing playing a much greater role than what it does today.
  • A significant reduction in the number of field forces is also possible, as the sales promotion focus gets sharper on the retailers and digitally enabled patient engagement initiatives.

The above examples are just illustrative. I hasten to add that at this stage it should not be considered as any more than an educates guess. We all need to wait, and watch how these promises get translated into reality, of course, without underestimating the quiet lobbying power of the powerful pharma industry. That said, the long-term macro picture of the Indian pharma industry continues to remain as bright, if appropriate and timely strategic interventions are put well in place, as I see it.

In conclusion:

It is an irony that despite being the 4th largest producer of pharmaceuticals, and catering to the needs of 20 percent of the global requirements for generic medicines, India is still unable to ensure access to many modern medicines to a large section of its population.

Despite this situation in India, Prime Minister Modi’s encouraging words on this issue have reportedly attracted the wrath of some section of the pharma industry, which, incidentally, he is aware of it, as evident from his speech.

Some have expressed serious concern that it would shift the decision of choosing a specific generic formulation of the same molecule for the patients from doctors to chemists. My counter question is, so what? The drug regulator of the country ensures, and has also repeatedly affirmed that there is no difference in efficacy, safety and quality profile between any approved branded generic and its generic equivalents. Moreover, by implementing an effective track and trace system for all drugs, such misgiving on spurious generic medicines, both with or without brand names, can be more effectively addressed, if not eliminated. Incidentally, reported incidences of USFDA import bans on drug quality parameters and breach of data integrity, include many large Indian branded generic manufacturers. Thus, can anyone really vouch for high drug quality even from the branded generics in India?

Further, the expensive branding exercise of essential medicines, just for commercial gain, and adversely impacting patients’ access to these drugs, has now been questioned without any ambiguity, none else than the Prime Minster of India. The generic drug manufacturers will need to quickly adapt to ‘low margin – high volume’ business models, leveraging economies of scale, and accepting the stark reality, as was expressed in an article published in Forbes – ‘the age of commodity medicines approaches’. Even otherwise, what’s wrong in the term commodity, either, especially when generic medicines have been officially and legally classified as essential commodities in India?

Overall, the clear signal from Prime Minister Modi that ‘prescriptions in generic names be made a must in India ‘, well supported by appropriate legal and regulatory mechanisms – is indeed a good beginning, while paving the way for a new era of Universal Health Care in India. God willing!

By: Tapan J. Ray 

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

Digital Divide And Indian Pharma Industry

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Over the last one and half decades of this new millennium, despite making significant headway in digital literacy, fueled by consistent progress in the penetration of broadband Internet and availability of more affordable smartphones, a large section of Indian population is still not digitally literate, not even in its importance and awareness, creating a sharp digital divide in the country.

This populace with inadequate or no digital literacy spans across a large section of our society, such as those who are generally poor, many living in rural areas, or lacking in adequate digital awareness, or exhibiting strong preferences in adhering to traditional approaches of doing things, or differently abled individuals, and many elderly persons.

In the health care arena, this citizenry constitutes one of the most vulnerable segments of the society often posing serious health risks, and mostly unable to make use of various digital tools while availing several social sector benefits of the government, as and when required.

However, more concerning is the fact that this gap is not just quite significant, there does not seem to be any near-term possibility of bridging it, either, as all accompanying responsibilities now lying on the government alone. Effective measures to bridging this gap do not depend on just technology, as the issue is multidimensional in nature, necessitating participation of all the stakeholders, pharma included – for a quantum leap in the business growth too.

This should not go unnoticed and unappreciated. Addressing this scenario effectively would call for a different strategic approach – not the usual run of the mill type ad hoc measures, both by the government, and in healthcare, also by the pharma marketers. In this article, I shall dwell in this area.

What it means?

In the modern era, the term ‘digital divide’ broadly refers to the gap between demographics and regions that have access to modern Information and Communications Technology (ICT), and those who don’t or have restricted access to it. Post late 1990s, this terminology is primarily used to describe the split between those with and without Internet access, particularly broadband.

In the global perspective, according to ‘Tech Target’ – the global network of technology-specific websites, the ‘digital divide’ typically exists between those in cities and those in rural areas; between the educated and the uneducated; between socioeconomic groups; and between the more and less industrially developed nations. Even among populations with some access to technology, the digital divide can be evident in the form of lower-performance computers, lower speed wireless connections, lower-priced connections, such as dial-up, and limited access to subscription-based content. The report also points out, while adoption of smartphones is growing, even among relatively lower-income groups, the cost of various data plans and the difficulty of performing tasks and transactions on smartphones continue to inhibit the closing of the gap.

To a large extent, this is applicable to India, as well.

It’s not just a technological issue:

Bridging the ‘digital divide’ in health care is not just a technological issue. It’s rather a complex one with many dimensions. It also depends on the health literacy of individuals, or a society, or the location where they live in. The World Health Organization (WHO) defines health literacy as: ‘The cognitive and social skills which determine the motivation and ability of individuals to gain access to, understand, and use information in ways which promote and maintain good health.’

This is not just the ability of a person to understand the health messages, it also involves the individual’s ability to look for the required information, and taking further action accordingly. As a December 2016 study of Michigan State University Extension concludes, those who are more likely to experience low health literacy are, older adults, racial and ethnic minorities, people with less than a high school diploma, people with low income levels, facing language issue for communication and those with compromised health status, such as chronic health conditions. Culture and access to resources also affect people’s health literacy. Another October 2016 study published in the Journal of Medical Internet Research, establishes the connection between low health literacy and the skepticism on health technologies.

Effectively bridging ‘digital divide’ alone, may not resolve the issue of health literacy. Neither, just addressing the health literacy can bridge the gap of ‘digital divide’, effectively. Thus, there isn’t any ‘one size fits all’ type of solution, to address both these issues, for a synergistic outcome in improving affordable access to quality health care for all.

Bridging the ‘Digital Divide’:

That said, bridging the digital divide, especially in the healthcare segment, has immense relevance in the modern days. As PwC’s Global Digital IQ Survey report of May 2016 observes, health care is arguably one of the world’s most information-intensive sectors, and the opportunities to improve quality, encourage affordability and enhance the consumer experience are vast. Wider application of digital technology can help this sector tackle many of these pressing challenges, effectively. However, the sector is currently behind the curve, the report highlights.

According to another 2016 report by PwC on Indian healthcare, the digital connectivity of the country is expected to grow from 15 percent access in 2014 to 80 percent access in 2034, with rural Internet users increasing by 58 percent annually, which presents a great potential for telemedicine and remote diagnosis in the country. This is indeed encouraging.

Can pharma industry hasten the process?

As I said before, bridging the ‘digital divide’ and improving health literacy, may be construed by many as a primary responsibility of the Indian government, through various robust initiatives backed by allocated budgetary provisions. Nonetheless, in the realm of healthcare, I reckon, pharmaceutical and other related industries can significantly help hastening the process, not just as a social responsibility, but for significant growth in businesses, simultaneously creating a win-win situation for all.

Just to cite an example out of many, various pharma companies can set up ‘digital health information kiosks’ especially in those areas where awareness and participation of the local population related to healthcare issues are poor or suboptimal. These ‘digital health information kiosks’, providing various diseases or treatment related information that a pharma company may be interested in, can be set up at convenient locations, of course, with the approval of local authorities. Such information, should encourage people to seek more and more health information digitally, explaining the whole process, and at the same time persuading them to take available disease prevention measures. and advising them to visit doctors, to initiate early treatment, wherever necessary.

I repeat, this is just an illustration, there could several other ways of achieving the same result.

Increasing relevance:

For healthcare, the above trend would mean empowering most of the population to have unfettered access to knowledge in various health related fields, especially in prevention, management and available treatment options, for various diseases, encompassing both acute and chronic conditions. Thus, this process has the potential to create a significant snowballing effect, not just on

deeper penetration of telemedicine, but also on remote diagnosis in India. In tandem, leveraging this trend early enough and in innovative ways, is likely to enable the pharma players to provide a much-needed boost to their respective business ventures.

Advantage pharma:

Rapid transformation in the complex market dynamics, coupled with increasing challenges in making productive face to face interaction with important doctors for prescription generation and consequent fast decline in the economic outcome of traditional product detailing, is likely to hasten this metamorphosis. On the other hand, this change also brings a blessing in disguise for the pharma players, by opening many new doors of opportunity based on digital platforms, and thereby paving the way for reaping a rich harvest, for all those who will choose to be early adopters.

In the above context, intimate business involvement with the digital world in many areas, such as ‘digital sales and marketing’ assumes a high priority for Indian pharma players, just as it’s being imbibed by some global players, including many in other industries. The speed of its becoming the centerpiece in pharma sales and marketing strategy formulation process ought to be directly linked to the increasing speed of broadband Internet penetration, smart phone and other digital platform usages by people of all ages with enquiring mindsets. Thus, the destiny’s call is clearly ‘Advantage Pharma’.

Key benefits:

According to a paper of April 16, 2014, published by Salford Business School, Manchester, UK, the major benefits of ‘Digital Marketing’ are as follows:

  • It helps businesses to develop a wider customer base as it does not rely on physical presence or interaction.
  • It encourages customers to interact directly with businesses.
  • It is not limited by conventional opening times – customers can interact at a time and place convenient for them

Calibrated increase in usage of digital platforms:

It is worth noting, traditional methods of sales and marketing, barring a few exceptions, are currently prevailing in the Indian pharma industry. In this scenario, each pharma player, must carefully evaluate its current and future product-mix, along with customer types and base, as they would decide, first to initiate, and then to scale up their sales and marketing operations in the digital space in a well-calibrated manner.

In this new ball game, the fresh entrants would need to consider only the credible research-based data, on the rapidly changing aspirational mindset of young Indians, including doctors and patients, with smart phones being a key enabler, on the one hand. While on the other, these should provide optimal digital penetration in different geographical regions or areas, together with the usage of platforms and related demographic configurations.

For example, if a region shows high smartphone usage for community or group chat within the general population, a pharma company may explore the possibility of creatively designing a smart phone based ‘digital patient chat group’ as a part of its patient engagement initiative. In this ‘digital patient chat group’, the members suffering from chronic or even acute ailments can discuss with each other the issues for which one is seeking a solution, where even the pharma companies can intervene, wherever they can add value and is legally permissible.

The effectiveness in working out a game changing crafty blend of both brand and patient-centric communication package with digital tools would separate the men from the boys. It would demand top quality cerebral inputs from the pharma marketers – a requirement that is not so easily available in the current space of pharmaceutical marketing, dominated by a wide variety of freebies.

In conclusion:

Humongous digital divide in India is a fall out, predominantly of disparate availability and access to ICT, not just between those living in rural and urban areas, but spans across several other areas such as, between educated and uneducated people, demographic and economic classes, to name a few. Nonetheless, especially, since the last one and a half decades, the country has made significant headway in gradually reducing this gap, though a lot more ground is yet to be covered in this direction.

Today in India, we witness even various political parties, which used to be very traditional in their approaches have started using a wide variety of digital marketing tools successfully by deploying astute domain experts, to achieve their goals.

For the healthcare sector, including the pharma industry, this progress throws open many doors of opportunities, both for the public, as well as for the industry. Notwithstanding this digital divide and general prevalence of an overarching traditional behavior and response patterns, displaying visible apathy or inability to embrace the promises of the emerging cyber era, several doctors and patients have already started reaping the benefits offered by various digital platforms, tools and media. The regulators governing this sector, are also not lagging far behind, with their presence visible in the digital space too, including social media.

This challenge of change should be effectively leveraged by all stakeholders in healthcare, reaping a rich harvest. Like many other constituents in this intricate, yet interesting ball game, pharma industry too needs to assume an active, pragmatic and proactive role in several innovative ways.

Flooring the gas pedal to move into the digital space of healthcare, would provide significant competitive and commercial advantages to the early movers, more than ever before. When political narratives can be made more productive by embracing the digital platforms, why not the business narratives of the pharma industry in India?

By: Tapan J. Ray 

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

Multi-channel Engagement: A New Normal In Pharma Marketing

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The 2015 Report of AffinityMonitor reconfirms that access to important doctors for pharma Medical Representatives (MRs) continues to decline. Now, fewer than half of all doctors are truly accessible to the MRs, down from nearly 80 percent in 2008. In other words, though MRs continue to be the best way to engage the average physician, this “best way” is steadily getting worse.

However, for physician engagement, all digital channels put together to rank the second highest. These include both digital “push”, such as, email or alerts sent to a physician’s smart phone – followed by telemarketing, direct mail; and digital “pull”, such as content that doctors can access on their own from the Internet, and peer interactions, like webinars.

With the new digital channels emerging, pharma companies will have a wider range of promotional and engagement channels to reach out to not just the doctors, but also other important stakeholders. Additionally, various non-personal marketing channels could also help pharma companies overcome the declining trend of restricted access to physicians for MR.

No single channel works for all physicians:

Although, no single channel works for all physicians, as each doctor has a unique preference for how he or she wants to receive information across various channels, most doctors will engage with pharma players in some way. The findings of this report are based on data compiled from more than 100 pharma brands, including engagements with 632,000 physicians across a wide range of specialty areas, and more than 123 million individual physician interactions.

The report suggests that by understanding those channels on a physician level, and targeting their marketing and promotion accordingly, pharma companies can hone the effectiveness of each physician engagement, and thereby improve sales and marketing productivity considerably, for excellence in business.

Similar trend in India with varying degree of difficulty:

Similar trend, though with varying degree of difficulty, can be noticed in India, as well. Over the past several years, many top pharma companies have been already experiencing the steadily declining quality of access of pharma MRs to many important doctors.

This is primarily due to the number of patients coming to these busy practitioners is fast increasing, and as the doctors are trying to see all these patients within the same limited time that was available to them, as in the earlier days. In tandem, their other obligations of various kinds, personal or otherwise, are also overcrowding the same highly squeezed time space.

Thus, an increasing number of MRs, which has more than doubled in the past decade, is now fiercely competing to get a share of lesser and lesser available time of the busy medical practitioners. Added to this, a gross mismatch between the inflow of doctors with similar prescription potential and ever increasing inflow of patients, is making the situation worse.

Reevaluating traditional marketing and sales communication models:

In this complex scenario, the key challenge before the pharma players is how to make sales communication with the busy medical practitioners more productive?

Consequently, many pharma companies, across the globe, have started reevaluating their traditional sales communication models, which are becoming increasingly expensive with diminishing returns from the MR calls.

As I discussed in some other article, a few drug companies have commenced using various interesting multi-channel digital platforms, though mostly fall under the traditional pharma sales communication process.

I shall now briefly glance over the trend of responses of the Indian pharma companies over a couple decades, to meet these challenges of change.

MR based Experimentations:

With a strong intent to squarely overcome this challenge, many Indian pharma players initially tried to experiment with several different MR based approaches, in various permutations and combinations. It was initially directed to make the prescription generation process more productive, by equipping the MR with a wide range of soft skills.

Some pharma players also tried to push up the overall sales productivity through additional rural market coverage to Tier IV cities and below. Quite a few of them succeeded in their endeavor to create profitable business models around the needs of hinterland and rural geographies.

These pharma players, though quickly realized that extra-urban geographies require different tactical approaches, broadly remained stuck to the traditional marketing and sales communication models. These approaches include, differentiated product portfolio, distribution-mix, pricing/packaging and promotional tools, considering most the doctors are not as busy as their counterparts in the metro cities and large towns.

Strategic marketing based experimentations:

Several changes were also made in the strategic marketing areas of pharma business, though most of these, if not all, were imbibed from the global marketing practices of that time. These were well captured in an IMS report of 2012. Some of these strategic marketing shifts were as follows:

  • Strategic Business Unit Structure (SBU): To bring more accountability, manage evolving business needs and use the equity of organization for reaching to the middle of the accessible pyramid.
  • Therapy Focus Promotion: Generally seen where a portfolio is specialized, therapy focused, and scripts are driven through chosen few doctors; generally, in chronic segment.
  • Channel Management: Mostly adopted in OTC /OTX business; mature products with wider portfolio width.
  • Hospital Task Force: Exclusively to manage the hospital business.
  • Specialty Driven Sales Model: Applicable in scenarios where portfolio is built around 2 or 3 specialties.
  • Special Task Force: Generally adopted for niche products in urban areas, such as fertility clinics or for new launches where the focus is on select top rung physicians only.
  • Outsourced Sales Force: Generally used for expansion in extra-urban geographies or with companies for whom medico marketing is secondary (such as OTC or Consumer Healthcare companies).

Pharma MNCs did more:

In addition, to increase sales revenue further, many pharma MNCs engaged themselves in co-promotion of their patented products with large local or global pharma companies operating in India, besides out-licensing. A few of them pushed further ahead by adopting newer innovative promotional models like, Patient Activation Teams, Therapy Specialists, or creating patient awareness through mass media.

Realizing quickly that patients are increasingly becoming important stakeholders in the business, some of the pharma MNCs started engaging them by extending disease management services, along with a clever mix of well-differentiated tangible and intangible product related value offerings, such as, Counseling, Starter kits, Diagnostic tests, Medical insurance, Emergency help, Physiotherapy sessions, and Call centers for chronic disease management, to name a few. Concerned doctors used to be reported about the status of the patients, who were not required to pay anything extra for availing these services from the MNC pharma companies.

Nevertheless, despite all these, declining productivity of the traditional pharma sales communication models continued, predominantly from the extremely busy and very high value medical practitioners/experts/specialists, as mentioned above.

The critical point that remained unaddressed:

At that time, pharma sales communication kept focusing on customer/market types and characteristics. Most companies missed the emerging order of unique customer preferences towards the medium of sales communication, and differentiated message requirements for each doctor. Not many pharma players could probably realize that MR’s quality of access to doctors for productive sales communication would emerge as one of the most critical issues, and become increasingly complex.

Leveraging technology for an effective response:

Amid all these experimentations with pharma sales and marketing models, a few companies did ponder over leveraging technology to chart a novel pathway for effectively addressing this emerging challenge. They tried to ascertain:

  • Whether the traditional sales approach would continue to be as relevant as opposed to digitally customized sales applications?
  • Whether MRs would continue to remain as relevant in all areas of pharma prescription generation process, in the years ahead?

First major venture in e-marketing:

Towards this direction, in 2013, Pfizer reportedly started using digital drug representatives to market medicines, leaving the decision in doctors’ hands as to whether they would want to see them.

Prior to that, in 2011, a paper published in the WSJ titled, “Drug Makers Replace Reps With Digital Tools” stated that pharmaceutical companies in the United States are downsizing their sales force with increasing usage of iPad applications and other digital tools for interacting with doctors.

Lot many other fascinating experimentations with pharma e-marketing have now commenced in several places of the world, many with considerable initial success. However, most of these efforts seem to be swinging from one end of ‘face-to-face’ sales communication with doctors, to the other end of ‘cyber space driven’ need-based product value sharing with customers through digital tool kits.

Blending the right communication-mix is critical:

Coming back to the AffinityMonitor 2015 Research Report, today pharmaceutical and biotech companies have at their disposal more than a dozen of promotional channels to include in their strategy, spanning across, from traditional methods to digital ones.

Some physicians still want to interact with MRs, others restrict MR detailing, as they prefer to get the required information from various credible websites, directly, and from their peers. One doctor may prefer to regularly use a mobile application for product information, while another similar physician may rarely wish to surf the Web for information to achieve the same purpose. Some others may simply not engage with any sales communication no matter what the channels are. Although overall accessibility to MRs is getting more restricted, some doctors are still more accessible than others, the report finds.

Segmenting doctors by their accessibility to personal promotion, such as, MRs and by non-personal promotion like other channels, including digital, allows pharma companies to identify potential gaps in their marketing approach.

For example, of the 54 percent of doctors who are less accessible to MRs, 15 percent show good accessibility to other channels. In other words, those doctors haven’t closed the door for good, just yet. Pharma companies can still reach them, provided they use the right approach, the report suggests. Drug companies would, therefore, require gathering specific information doctor-wise, and customizing both the medium and the message for effective brand value delivery, accordingly.

Sales and marketing avalanche too isn’t working:

This study revealed that a pharma company’s top 100 doctors receive as high as 423 contacts a year, and the top 10 doctors receive more than 600 each year. Given such volume, it’s easy to imagine how doctors can start to get buried under an avalanche of sales and marketing. It’s also easy to see how even the right message, in the right channel, to the right doctor, could get lost in all the noise, and may even create a bad customer experience for many physicians, the report concludes.

Conclusion:

The decline in pharma MR’s quality of access to physicians for brand communication is now well documented. Moreover, ‘one size fits all’ type of message, delivered even by the best of MRs, is unlikely to be productive in the changing macro environment.

Therefore, the right knowledge of whether a doctor would prefer to engage through traditional marketing and sales communication methods by meeting with an MR, or would just prefer to get his/her required information through any digital medium, is critical for success in the new ball game. This in turn will help generate the desired level of prescription support for any pharma brand.

Still, a majority the doctors’ choices in India would, possibly, involve MRs, while a good number of other important doctors’ choices may probably be independent of them. Nevertheless, from this emerging trend, it’s clear now that multi-channel engagement would be a new normal in pharma sales and marketing, sooner than later.

By: Tapan J. Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.