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Why MNC Pharma Still Moans Over Indian IP Ecosystem?

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Improving patient access to expensive drugs, paving the way for entry of their cheaper generic equivalents, post patent expiry, and avoiding evergreening, is assuming priority a priority focus area in many countries. The United States is no exception, in this area. The Keynote Address of Scott Gottlieb, Commissioner of Food and Drug at the 2018 Food and Drug Law Institute Annual Conference inWashington, DC by, on May 3, 2018, confirms this. Where, in sharp contrast with what the MNC Pharma players and their trade associations propagated, the US-FDA commissioner himself admitted by saying, “Let’s face it. Right now, we don’t have a truly free market when it comes to drug pricing, and in too many cases, that’s driving prices to unaffordable levels for some patients.”

Does US talk differently outside the country?

At least, it appears so to many. For example, in April 2018, the Office of the United States Trade Representative (USTR) released its 2018 Special 301 Report. In this exercise, the USPTO names the country’s trading partners for not adequately protecting and enforcing Intellectual Property (IP) rights or otherwise deny market access to U.S. innovators that rely on the protection of their IP rights.’ Accordingly, U.S. trading partners are asked to address IP-related challenges, with a special focus on the countries identified on the Watch List (WL) and Priority Watch List (PWL).

In 2018, just as the past years, India continues to feature, along with 11 other countries, on the PWL, for the so called longstanding challenges in its IP framework and lack of sufficient measurable improvements that have negatively affected U.S. right holders over the past year.

From Patient access to affordable drugs to Market access for Expensive Drugs: 

Curiously, the USTR Report highlights its concerns not just related to IP, but also on market access barriers for patented drugs and medical devices, irrespective of a country’s socioeconomic compulsion. Nevertheless, comparing it to what the US-FDA Commissioner articulated above, one gets an impression, while the US priority is improving patient access to affordable drugs for Americans, it changes to supporting MNC pharma to improve market access for expensive patented drugs, outside its shores.

Insisting others to improve global IP Index while the same for the US slides:

In the context of the 2018 report, the U.S. Trade Representative, reportedly said, “the ideas and creativity of American entrepreneurs’ fuel economic growth and employ millions of hardworking Americans.” However, on a closer look at the U.S. Chamber of Commerce’s annual Global IP Index for 2018, a contrasting fact surfaces, quite clearly. It shows, America, which once was at the very top of the overall IP Index score, is no longer so – in 2018, the world rank of the US in offering patent protection to innovators, dropped to 12thposition from its 10thglobal ranking in 2017. Does it mean, what the US is asking its trading partners to follow, it is unable to hold its own ground against similar parameters, any longer.

Should IP laws ignore country’s socioeconomic reality? 

MNC Pharma often articulated, it doesn’t generally fall within its areas of concern, and is the Government responsibility. However, an affirmative answer, echoes from many independent sources on this issue. No wonder, some astute and credible voices, such as an article titled “U.S. IP Policy Spins Out of Control in the 2018 Special 301 Report”, published by the Electronic Frontier Foundation on May 01, 2018, termed 2018 Special 301 Report – ‘A Tired, Repetitive Report.’ It reiterates in no ambiguous term: ‘The report maintains the line that there is only one adequate and effective level of IP protection and enforcement that every country should adhere to, regardless of its social and economic circumstances or its international legal obligations.

The ever-expanding MNC Pharma list of concerns on Indian IP laws:

The areas of MNC Pharma concern, related to Indian IP laws, continues to grow even in 2018. The letter dated February 8, 2018 of the Intellectual Property Owners Association, Washington, DC to the USTR, makes these areas rather clear. I shall quote below some major pharma related ones, from this ever-expanding list:

  • Additional Patentability Criteria – section 3 (d): The law makes it difficult for them to secure patent protection for certain types of pharma inventions.
  • TADF (Technology Acquisition and Development Fund)is empowered to request Compulsory Licensing (CL) from the Government:Section 4.4 of India’s National Manufacturing Policy discusses the use of CL to help domestic companies access the latest patented green technology.This helps in situations when a patent holder is unwilling to license, either at all or “at reasonable rates,” or when an invention is not being “worked” within India.
  • India’s National Competition Policyrequires IP owners to grant access to “essential facilities” on “agreed and nondiscriminatory terms” without reservation. They are not comfortable with it.
  • Regulatory Data Protection: The Indian Regulatory Authority relies on test data submitted by originators to another country when granting marketing approval to follow-on pharma products. It discourages them to develop new medicines that could meet unmet medical needs.
  • Requirement of local working of patents: The Controller of Patents is empowered to require patent holders and any licensees to provide details on how the invention is being worked in India. Statements of the Working, (Form 27),must be provided annually.Failure to provide the requested information is punishable by fine or imprisonment. It makes pharma patent holders facing the risk of CL, if they fail to “work” their inventions in India within three years of the respective patent grant.
  • Disclosure of Foreign Filings: Section 8 of India’s Patent Act requires disclosure and regular updates on foreign applications that are substantially “the same or substantially the same invention.” They feel it is irrelevant today.

Pharma MNCs’ self-serving tirade is insensitive to Indian patient interest:

Continuing its tirade against some developed and developing countries, such as India, the US drug manufacturers lobby group – Pharmaceutical Research and Manufacturers of America (PhRMA) has urged the office of the US Trade Representative (USTR) to take immediate action to address serious market access and intellectual property (IP) barriers in 19 overseas markets, including India, reports reported The Pharma Letter on February 28, 2018. It will be interesting to watch and note the level active and passive participation of India based stakeholders of this powerful US lobby group, as well.

Government of India holds its ground… but the saga continues:

India Government’s stand in this regard, including 2018 Special 301 Report, has been well articulated in its report released on January 24, 2018, titled “Intellectual Property Rights Regime in India – An Overview”, released by the Department of Industrial Policy and Promotion Ministry of Commerce and Industry (DIPP). The paper also includes asummary of some of the main recommendations, as captured in the September 2016 Report of the High-Level Panel on Access to Medicines, constituted by the Secretary-General Ban Ki-Moon of the United Nations in November 2015.  Some of these observations are as follows:

  • WTO members must make full use of the TRIPS flexibilities as confirmed by the Doha Declaration to promote access to health technologies when necessary.
  • WTO members should make full use of the policy space available in Article 27 of the TRIPS agreement by adopting and applying rigorous definitions of invention and patentability that are in the interests of public health of the country and its inhabitants. This includes amending laws to curtail the evergreening of patents and awarding patents only when genuine innovation has occurred.
  • Governments should adopt and implement legislation that facilitates the issuance of Compulsory Licenses (CL). The use of CL should be based on the provisions found in the Doha Declaration and the grounds for the issuance left to the discretion of the governments.
  • WTO members should revise the paragraph 6 decision in order to find a solution that enables a swift and expedient export of pharmaceutical products produced under compulsory license.
  • Governments and the private sector must refrain from explicit or implicit threats, tactics or strategies that undermine the right of WTO Members to use TRIPS flexibilities.
  • Governments engaged in bilateral and regional trade and investment treaties should ensure that these agreements do not include provisions that interfere with their obligations to fulfill the rights to health.

The DIPP report includes two important quotes, among several others, as follows:

Joseph Stiglitz, Nobel Prize for Economics (2001) – an American Citizen:

-       “If patent rights are too strong and maintained for too long, they prevent access to knowledge, the most important input in the innovation process. In the US, there is growing recognition that the balance has been too far tilted towards patent protection in general (not just in medicine).”

-       “Greater IP protection for medicines would, we fear, limit access to life-saving drugs and seriously undermine the very capable indigenous generics industry that has been critical for people’s well-being in not only India but other developing countries as well”.

Bernie Sanders, an American Citizen and Senior U.S. Senator:

-      “Access to health care is a human right, and that includes access to safe and affordable prescription drugs. It is time to enact prescription drug policies that work for everyone, not just the CEOs of the pharmaceutical industry.”

-      “Healthcare must be recognized as a right, not a privilege. Every man, woman and child in our country should be able to access the health care they need regardless of their income.”

Conclusion:

Why is then this orchestrated moaning and accompanying pressure for making Indian IP laws more stringent, which apparently continues under the façade of ‘innovation at risk’, which isn’t so – in any case. But, cleverly marketed high priced ‘me too’ drugs with molecular tweaking do impact patient access. So is the practice of delaying off-patent generic drugs entry, surreptitiously. Instead, why not encourage Voluntary Licensing (VL) of patented drugs against a mutually agreed fee, for achieving greater market access to the developing countries, like India?

Whatever intense advocacy is done by the vested interests to change Indian patent laws in favor of MNC pharma, the intense efforts so far, I reckon, have been akin to running on a treadmill – without moving an inch from where they were, since and even prior to 2005. The moaning of MNC Pharma on the Indian IP ecosystem, as I see it, will continue, as no Indian Government will wish to take any risk in this area. It appears irreversible and is likely to remain so, for a long time to come. The time demands from all concerned to be part of the solution, and not continue to be a part of the problem, especially by trying to tamper with the IP ecosystem of the country.

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.