Mals musings: Whats all the fuss about market access?
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By on Oct 18, 2010
Why pharma should not start a
new arms race based on market access.
Market access
crept up on the industry in the dark of night, and it has done little more than
increase the sophistication of the battle between payer and supplier.
I have
long argued that market access is a product-based approach to solving a problem.
A more
appropriate approach would require maturity, openness, and partnership.
Who will
blink first, payer or supplier?
Think
about it. After the power-broking countries in the world built up masses of
nuclear arms, they embarked on a proactive disarmament program as they came to
the realization that arms races achieve little more than increased costs.
We do
not have to look that far for examples in our own industry.
Consider
our recent history. Our arms race was sales-force based. Nonetheless, we
eventually came to the realization that if we all reduced sales forces by 25%
it actually had little impact on sales.
OK, a
market scenario that asked questions about ongoing return on investment
encouraged us.
The
underlying principle still applied. Are we embarking on a new arms race based
on market access capability?
Some
executives in the industry believe that market access is the new frontier.
I think
we should consider the bigger picture before we all rush into the next fad.
Recently,
Member of the European Parliament Peter Liese, spokesman for healthcare, alluded
to the desire to harmonize prices for pharmaceuticals in the EU.
A
harmonization could lead to significant savings for the healthcare systems, he
said.
Companies
would no longer suffer from dealing with 27 different reimbursement systems and
could shift their human resources capacities to research and development
activities. Also, the whole parallel trading machinery could become obsolete.
Nimble organizations
If ever
we needed an example of the fact that we are in for a period of sudden and
dramatic change, then this is one.
Until
the industry settles again, there will be these burst of changeswhich means
the infrastructure we are putting in place needs to be mobile and flexible.
So,
before we fall into traps of past, we should build nimble and easily adaptable
organizations.
More
importantly, we should ensure we understand the problem before we start
proposing solutions.
Efficiency
is focusing all stakeholder minds at the moment, as we realize that taking costs
out of doing business can deliver win-win scenarios for all.
The
authorities have signaled the direction of their thinking; they may act quicker
than we expect.
We can
fight it or we can embrace it and take the positives.
To be
fair, it is hard to argue how resources in market access will deliver more
value to patients than if those same resources were deployed in R&D.
The
future-minded ones are already thinking beyond market access and pricing, and
realizing this is the beginning of a period in which the industrys value chain
is being challenged.
Hold on
tight, stormy weather ahead. But those who avoid a superficial approach will
come out on top.