I have preached the gospel of value-based marketing for years and argue constantly that to be able to market appropriately you must first understand the value your product brings to the market. I’ve found that the answers to two simple questions can provide you with the main information you need to help you to understand your value and how to market your product:
1. What unique problem does your product solve?
2. Who owns the problem?
I’ve discussed these questions before (most recently in November 2013 “The Nurse Knows”), but I don’t believe I can talk about them enough. Think about it: Just what problem does your product solve that isn’t solved by dozens of other products? Why is it unique? What makes yours a better solution? If you can’t answer these simple questions—to the satisfaction of your customers—then you may have a problem.
What a Value Proposition Does Not Look Like
In a recent discussion with a client, someone said: “We have just finalized our value proposition for payers.” When I asked what it was, I was shown a slide that simply listed the clinical rationale for using the drug category (e.g., “Improved levels of X will lead to better outcomes in…”). There was nothing unique about their drug, and every bullet point could also be claimed by every competitor. When I pointed this out and asked how it could be a “value proposition” the entire team looked stunned—I may as well have been speaking in Swahili!
Think about it. There was nothing in that statement that could be used by a payer to help determine which, if any, drug they should cover—only that there was a clinical rationale for treatment of the disorder. Later we even determined that because of non-compliance you could not even build a true clinical rationale for the treatment because most patients stopped their meds. The sad truth was that in the big picture, this product had no real value to payers—even though it had substantial value for the patients who stick with it. Payers cover a lot of products that they don’t necessarily value. They cover them because they are approved and accepted in medical practice, not because they believe the treatments are important or even useful.
Patients Realize Value—Payers May Not
If you are in a similar situation, my advice is to stop trying to get payers to appreciate your drug—there isn’t a chance of that ever happening! Patients who stay on therapy do realize value—but that helps with the second question, “who owns the problem,” not the first question. There are a lot of problems that payers don’t “own” or truly care about (such as fatigue, dry eye, restless leg and countless others).
For these markets there is no such thing as a value proposition for payers. They may cover drugs for the category, even if they don’t like them. Trying to get payers to like statements with which they fundamentally disagree is really a fool’s errand—why even try? By the way, this client’s product has sales of over a billion dollars annually—it doesn’t matter if they like it as long as they pay for it!