In December of 2013, Bristol-Myers Squibb made headlines when it returned the marketing rights to its diabetes portfolio to its partner AstraZeneca PLC. Industry analysts heralded the move as a sign of Big Pharma making difficult choices about focus—sending a message by choosing to divest commercial attention from large market segments where competitors had built multi-billion dollar franchises.
This strategy makes good commercial sense. Patients, physicians and payers want Big Pharma to bring forward new treatments that meaningfully improve outcomes for the most severely afflicted patients. Assuming pipelines continue to deliver, this sounds like a good problem. But to provide some context for how these new and effective treatments may be received on the market, consider the payer’s perspective. Though pharmacy benefit managers have projected a decline in overall pharmacy spend through 2015, driven mostly by small-molecule generic entrants, spending on specialty drugs has seen a steady double digit increase and is projected to rise.1
But it’s not just the number of new specialty drugs, or the increasing number of specialty therapies fast-tracked to market via the U.S. FDA’s Breakthrough Therapy designation creating anxiety in the minds of payers. Rather, it’s the fact that many new specialty therapies, including drugs for Hepatitis C, cystic fibrosis, hypercholesterolemia and many types of cancers, are expected to set new standards for treatment.1 In other words, specialty is here to stay.
Bristol’s decision was to invest and compete selectively in therapies that could set new treatment standards for diseases such as cancer, in which the unmet need could be pinpointed to tumor types and lines of therapy. A clear focus is an obvious benefit, but what does it mean for marketers? And why should the payer’s perspective feature so prominently in the marketing mix for manufacturers of specialty pharmaceuticals?
Changing Business, Changing Customer
A transformation like Bristol’s presents both challenges and opportunities for pharma marketers. The goal of such a transformation is to enable the company to reach more defined market segments, with more complex therapies, in an environment of pressured healthcare budgets.
Additionally, it’s not just the companies that are changing their model. With the shift from primary care to specialty, the approach to marketing must change as well. As these customers begin to have options for effective specialty drugs in previously underserved diseases, their choice of therapy will increasingly involve weighing their value against their cost.
For instance, the American Society for Clinical Oncology (ASCO) advised oncologists in 2009 that discussing the cost of care openly with patients is an important component of providing high-quality care.2
Since that time, ASCO has strengthened its position, now stating: “…oncologists have not only a role, but indeed a responsibility to help address and manage the issue of high drug costs on behalf of our patients.”3
Put simply, the specialty shift is an opportunity to learn from a related field that knows how to anticipate the needs of customers who make decisions based on benefits and costs. It’s an opportunity to take a cue from market access.
Preparing For The Specialty Shift: Insights From Market Access
For many marketing professionals, the traditional approach to dealing with a complex specialty customer mindset has focused on communicating the clinical value proposition in a promotional context. Market access colleagues were brought in prior to launch to make sure payers didn’t constrain therapy choice. Obtaining preferred access was sometimes discussed, but rarely achieved without making concessions on price.
However, as mentioned above with respect to ASCO’s cost guidance, there is clearly no longer such a thing as unconstrained prescriber choice. Today’s specialist doesn’t want to hear a clinical value proposition without first knowing that pharma can anticipate their payer challenges as well. Moving forward, a thoughtful approach might be to learn from market access colleagues and build their lessons into an integrated marketing plan.
Two insights from market access emphasize the importance for marketers to understand how to approach the customer for specialty pharmaceuticals.
1. Think Big Picture
Taking the payer view on a specialty opportunity can provide a deeper understanding of market segments and business opportunities. But it’s important not to make the common mistake of assuming that payers will be willing to remove barriers to prescribing for specialty therapies, simply because these therapies are not intended for use in large, primary care patient populations.
Think of it this way: When a physician makes a decision to prescribe a therapy, they are likely thinking of the patient in front of them. So while the choice of product may be driven by the expected benefits, risks and impact on the patient’s out-of-pocket cost, the physician’s immediate concern would not be the ability to treat more patients for that cost. Payers see things differently. The payer has to make decisions about reimbursing therapies for whole patient populations over time. And with specialty drugs, this proposition can quickly become very costly.
Take the example of sofosbuvir for Hepatitis C. Much has been made of the product’s price per tag at $1,000 per pill. However, when asking payers what gave them the most concern, it was the influx of patients who had been waiting for a new treatment standard other than interferon-based regimens. It wasn’t about the duration of therapy, since sofosbuvir claims a nearly 90% cure rate with no more than a few months of treatment. It was the temporary budget impact outside of annual rate-setting cycles for most insurers that caused the anxiety.
Marketers concerned about payers limiting use (for example, requiring prior authorization to reserve sofosbuvir for the most severe patients), might have thought a lower list price would make a difference and preserve the broadest possible access to therapy. As it turns out, companies marketing the latest Hepatitis C treatments have provided undisclosed discounts to pharmacy benefit managers to remove such restrictions. It’s more likely, however, that with simple advanced planning and communication with insurers and the expert clinicians, they could have helped pave the way to treatment for patients sooner and with fewer hurdles. Physician champions could provide clarity on the size of the expected treatment population, curative potential and duration of therapy.
2. Think Beyond the Trial
So how can pharma marketers create messages that provide that clarity? The answer involves another area in which market access professionals have blazed a trail: Communicating based on real-world evidence.
In this case, it is important to think beyond pivotal trial data to identify sources of data that payers and physicians trust will answer their questions. Specialty therapies tend to be used in key centers, by specific physicians who have gained comfort with complex biologics. Data from Phase III clinical trials won’t always match the experience of the patients in their offices. Market access professionals understand the importance of generating real-world data—or even analyzing payers’ own claims data—to address payer uncertainties: Will costly therapies spill over into other uses? Will outcomes outside of the trial setting match the data that informed the label claims?
In the new specialty landscape, marketers will need to get comfortable with real-world data to address physician uncertainties as well. In newly-formed Accountable Care Organizations (ACOs), where physicians may assume financial risk based on quality and cost of care, understanding whether a new biologic therapy for high cholesterol uncontrolled on a background of statin therapy can reduce the avoidable hospital readmission rate will be the type of question that won’t be answered adequately by a Phase III trial. Marketers will need to understand when their physician customers may want to think beyond the trial to understand the clinical and economic impact of their prescribing decisions. They’ll also need to clearly articulate drivers of their customers’ behavior to their health economics and outcomes research colleagues who are designing these studies.
Rising To The Challenge
Physicians recognize that the specialty shift within pharma may not be sustainable in the long term. They’re taking ownership and action as access gatekeepers for specialty drugs. Consider the oft-cited example of undifferentiated but more costly cancer drugs that have been excluded from major hospital formularies at the request of leading oncologists.
These are clear signals that today’s pharma marketer needs to know how to balance value and access realities when engaging with physicians and other stakeholders. The good news is that market access has been addressing these challenges for years. As the pharmaceutical industry focuses on the next wave of specialty therapies to meet the outstanding needs of patients, it’s time for the silos between professional marketing and market access to come down. The patient is waiting.
1. “CVS Caremark Insights 2013, Specialty Trend Management: Where to Go Next,” available at: http://www.cvshealth.com/sites/default/files/Insights%202013.pdf (accessed April 2015).
2. Meropol NJ, Schrag D, Smith TJ. “American Society of Clinical Oncology Guidance Statement: The Cost of Cancer Care.” J Clin Oncol. 27;27(3):3868-387, DOI: 10.1200/JCO.2009.23.1183.
3. American Society of Clinical Oncology. “ASCO in Action Brief: Value in Cancer Care.” (January 21, 2014), available at: http://www.asco.org/advocacy/asco-action-brief-value-cancer-care (accessed April 2015).