I was fortunate to attend the Cegedim meeting in Philadelphia, PA, September 13 – 14, 2012. The meeting was chock full of both industry evolution revelations and Cegedim capabilities. This is the first in a series of posts of original content from that meeting.
As I sat through the two-day meeting I was both exhilarated and saddened. I was exhilarated because my thinking was already right in line with theirs and all of their speakers. I was saddened due to the same reason – when is the industry going to wake up??? As a matter of fact both Carolyn Buck-Luce (Global Pharmaceutical Leader, Ernst & Young) and Todd Francis (VP, US Commercial Support and Enterprise Marketing, SANOFI) predicted the end of the industry as we know it within the next 3-5 years if we do not wake up. Companies not traditional to life sciences (Verizon, Google, Samsung to name a few) are eyeing this industry like a hawk due to our missed opportunities to capture margin and improve outcomes by doing what they do well – retain customers and work efficiently.
These are selected slides from Carolyn Buck-Luce’s presentation:
This slide illustrates the drivers of change in the industry such as the patent cliff and the rise in consumerism. These changes are forcing a change in business model from a focus on blockbusters/brands to a focus on outcomes. Then there is this incredibly huge influence on change – the shift from the provider controlling the prescription to one where that control is shared with the payer and the patient. Regarding this last shift, there is little change in how budget or people are utilized within pharma. One has to wonder what is taking so long for these budgets to shift.
All of these changes add up to a shift from Ernst & Young coined Pharma 2.0 to Pharma 3.0 – from an emphasis on brands to an emphasis on outcomes. This demands a change in behavior for marketers – adding skills to enhance listening, to understand the customer experience, and less emphasis on ROI to emphasis on health outcomes and other measures.
As we learn how to harness the digital opportunity slowly we are learning that digital is a tactic, not a strategy. However, this tactic is opening up a whole new world of health management. Patients, er, people do not spend their lives in the doctor’s office. We manage our health in our lives, within our communities, families, peers, etc. We must be reached here, not only in the doctor’s office or other health-related institution. Digital access helps get information and health management tools to us where we ARE.
If you have been on the Inspired Health Strategies, LLC site before this is not news – the biggest opportunity is in changing patient behavior. Both in impact on adherence and improved outcomes and in recouping lost revenues.
I am always being asked what is the ideal way to change behavior. This is the question that comes out of our traditional segmentation approach. To change behavior is more complex. But this slide clarifies very well the possibilities of impacting behavior by coming at the issue from two directions – information processing and resisting temptation. The slide also suggests paths to manage both.
Ernst & Young has developed five guiding principles for behavior change. Great idea on their part as this helps those unfamiliar with behavior change to digest the concept and see that this whole approach is really doable. The major principles are as follows:
- Communicate clearly
- Account for preferences
- Learn from behavioral economics
- Experiment and be flexible
- Extend your business model
I got so much out of this conference but I did not come away with hope for change in life sciences. As Samsung is building pharmaceutical manufacturing plants, Verizon is shifting healthcare management to the cloud, and other non-traditional players see the potential, if pharma is going to survive it either has to partner with these new players or be taken over by them. As said earlier, these new players understand the customer quite well and will apply their competencies to be sure that pharma’s customers are their own.
This is my opinion,