Market Access and what payers really want

Marcus Deans examines why market access depends on understanding the needs of payers.

By Marcus Deans on Mar 23, 2010

Marcus Deans examines why market access depends on understanding the needs of payers.



The boiling frog story is a widespread anecdote describing a frog slowly being boiled alive. The premise is that if a frog is placed in boiling water, it will jump out. But if it is placed in cold water that is slowly heated, it will not perceive the danger and will be cooked to death.


The story is often used as a metaphor for the inability of people to react to significant changes that occur gradually. The expression "boiling frog syndrome" is sometimes used as shorthand for the metaphor


To many, the above scenario is certainly indicative of the pharma industrys slow response to the change in challenges over the last decade.


The emergence of payers


The emergence of payers as a core customer over the last ten years has seen an increased focus on cost containment and, subsequently, government policies designed to balance the realities of supply and demand. As a result, an array of reimbursement mechanisms has emerged both in Europe and the US.


As opposed to quickly adapting to this change and working hand in hand with these customers, pharmas initial reaction was to portray them as out of touch and disconnected from the reality of pharmaceutical innovation. This would ultimately prove a crucial mistake.


This shift in the customer landscape has also coincided with a reduction in the number of innovative medicines coming to market due to the needs of most disease areas having already been met. As a result, the industry has now turned its attention to specialized medicines and orphan drugs.


Although the patient populations for these drugs tend to be small, pharma will continue to face challenges with market access unless they exact a mindset change quickly.


Slow response to change


The major problem with most change management strategies is failure to manage change successfully. Many people are resistant to change because they are familiar with the status quo and often fear the consequences of change.


A useful framework for analyzing the change process suggests that the change process consists of three interlinked elements: objectives and outcomes, planning, and the people involved. A closer look at each of these may provide some answers as to the slow response.


Objectives and outcomes


It is essential that objectives and outcomes are explicit and openly communicated by the most appropriate department, individual or team. Solutions, feedback and recommendations should also form part of this communication.


Within pharma, the commercial or marketing departments are the ones most likely to liaise with customers and should be identifying new customers and anticipating future trends. So has this happened?


Well, as a pharma marketer myself, I can say with some certainty that both my peers and I have been shouting from the rooftops about the need to address payer needs and requirements for some time. In this instance then, it seems that the problem may lie elsewhere.


Planning the Change


Okay, so lets look at some more of the evidence, which involves six interrelated activities:



  • Establish a change management team;

  • Management structures special structures may be necessary to facilitate the change process;

  • Activity planning constructing a schedule to the change program;

  • Commitment planning Identifying key people whose support is necessary for the successful implementation of change;

  • Audit and post audits monitor progress and whether objectives are being met;

  • Training providing staff with new skills they will need in the new environment.

 


A look at the above begins to identify some of the possible issues as to why the industry has been so slow to respond to the changing environment. Very few of us will be able to recognize the steps above, and even fewer will be able to testify that this has been rigidly applied in their respective organizations.


But make no mistake, it should be! As we now know the consequences of a payer-led environment, it is imperative that we respond and begin to implement the above steps if organizations are to be successful in the future.


The People


This is probably the most overlooked of any change process. For change programs to be successful, it is essential that all people affected are motivated and that their support is gained.


As we all know too well, the structure of most pharma organizations tends to be functional. Experts work within their designated departments, which results in limited sharing of knowledge across the organization.


As a result, this shift in the core customer from prescriber to payer has remained largely the concern of the commercial/marketing department and to some extent the medical department. R&D, clinical, and manufacturing have largely been left out of the loop.


The value born out of the R&D process, honed by the clinical department, communicated by the marketing department and, ultimately, manufactured in a cost-effective manner encompasses everybody. Hence, it is essential that all internal stakeholders become involved in the process if the industry is to successfully adapt.


While the water continues to warm up, it is not yet boiling. Therefore, before the inevitable happens and we are no longer able to respond, pharmas response to change must happen now! The clock is ticking