KEY TAKEAWAY: Pharma companies have to use their PR departments to help patients who fall through the cracks of our health care system. It’s part of a strategy to clearly indicate that pharma company’s first obligation is to their patients.
A story on CNBC about families purchasing black market insulin largely went unnoticed. One example was a little girl who has type 1 diabetes. Although she has health insurance, she is allergic to the insurers Tier 1 treatments and as thus has to pay over $350 a month for an insulin that she can tolerate.
As the story indicates:
- Soaring insulin prices and inflexible insurance policies have forced many parents to take desperate measures to keep their kids alive.
- The price of one drug has risen 1,123 percent since 1996, even as more competitors have entered the market.
- Three million Americans with Type-1 diabetes rely on insulin to avoid life-threatening comas.
Now you would think that somewhere, somehow, someone within our industry would see this story and want to do something about it, but like with the possibility of 24 million Americans losing health care coverage and the attack on insuring those with preexisting conditions pharma executives have pretty much remained on the sidelines. This is unacceptable.
US drug price rises contributed 100% of industry EPS growth in 2016. Arguably, this is the most important issue for a Pharma investor today,” a recent report said. “Despite public scrutiny, we estimate US net price rises contributed $8.7 billion in 2016 to net income, 100% of sector EPS growth.” In other word pharma is keeping quiet to avoid scrutiny of price increases.
I know that this is not an industry wide problem. Some CEO’s are shouting that “we’re sinking” on board the pharma ship, but others don’t care because their compensation packages are tied to the performance of the stock and nothing says profit like price increases.
I could go into detail on the amount of time wasted in endless meetings or in paying salespeople who are becoming less and less effective but those of us working in the industry know all about this. A client of ours started 2017 with a 35% price increase from their agency which we said was outrageous. Procurement finally got involved and terminated their relationship upon which Senior VP came to their office to try and salvage the business.
So why can’t someone within an organization’s email the CNBC story of an executive to “help this family”? Probably because they are too busy in meetings debating the pro’s and con’s.