According to Forbes ” The 31 pharmaceutical companies comprising its main trade group spent $48.5 billion on research and development last year. All told, the pharmaceutical sector has spent $550 billion on R&D since 2000. That half-trillion dollars of research has yielded more than 400 new medicines” But of 12 cancer drugs approved in 2012, 11 cost more than $100,000. As more drugs are offered at that level and their sponsors get away with it, it seems to set a floor that emboldens drug companies to push the envelope. They are badly misjudging the brewing anger.
Bernard Munos, in the Forbes article says “The industry’s standard defense has been to run warm-hearted stories about the wonders of biomedical innovation, and to point out that drugs represent only 10% of healthcare costs. Both arguments miss the point. Everyone loves biomedical innovation, but the industry’s annual output of 25 to 35 new drugs is a lousy return for its $135 billion R&D spending. And pointing out that there is a worst culprit on the block is no comfort to patients getting stuck with a $20,000 co-pay.” This is very true in a world of corporate accountability and transparency.
Then there were the stories this week of a drug company treating physicians to meals at Hooters of all places. There was quite a bit of buzz around that the question that keeps coming up is why and how could that happen? To answer that we have to answer a basic question; “is the pharmaceutical industry a business?”. The answer to that of course is “yes”. But what they are missing is that today’s consumers are angry at big business and demand more in terms of transparency and social responsibility.
This recession, and the media’s reporting of it, have left a lot of people very angry. They are angry at big government who seems to be in the pocket of special interests and they are angry that corporate profits are the highest they have ever been while employees are working more hours for less money and have to pay increased health insurance premiums. When a consumer reads that a drug costs over $100,000 for use while patients in other countries pay a fraction of that what are they supposed to think ? Does big pharma really believe that consumers are going to do a lot of research to get to the real reasons why drugs costs so much? Of course not. Today’s consumers don’t have time to research the costs of drugs they just want to jump on the band wagon and say “shame on you”.
The sad part of all this is that whenever the pharma industry tries to fight back another headline hits the internet with a story of a drug company paying a fine, laying people off or other illegal marketing. Add it all up and we have an industry that is leaking badly in consumer trust and every time they plug one leak another one pops open.
How can the industry improve its perception?
(1) Take Mr Merck’s quote to heart “we try never to forget that medicine is for the people it is not for profits, the profits follow. The better we have remembered it the larger they have been”. Thank you very much ! Today the CEO of Merck is bucking financial analysts and investing more in R&D while other companies are cutting R&D.
(2) Take action against employees who willfully put sales ahead of patients. Sorry, but whoever approved the dinners at Hooters should be shown the door and should not be allowed to work within the pharma industry again.
(3) All clinical trials should be available to the general public especially HCP’s. This includes products that are currently on the market as well as products in development.
(4) Respond to media coverage of health conditions or medications in real time via the internet (social media or product website). Don’t wait weeks for the buzz & perceptions to linger.
(5) Stop treating good employees like they are expendable. I mean what are people supposed to think when they read that Pfizer laid off one of the R&D people who worked on Lipitor?
(6) Pharma CEO’s should not be compensated in the tens of millions of dollars. The two highest ranking executives at Amgen shared $22 million in compensation the same time the company was laying off people. How do they think this makes the rank and file feel?
(7) At every meeting and presentation you should act like a patient is with you in the room and looking over your shoulder.
(8) Marketers need to look at their products in the eyes of consumers not as marketers pitching to segments.
(9) Stop putting sales people in consumer marketing positions. Consumer marketing is a specialty not something that can be learned overnight with a sales mentality.
(10) ROI is important, but so is Return to Image. Embrace social media and talk to people to address their questions and concerns. If you are afraid because the FDA has not issued guidelines you’re going to lose with consumers and patients.