How To Fix Big Pharma

Sauropod dinosaurs

The pharmaceutical industry has clearly been under stress during the past decade. The 12 largest drug makers in the U.S. as a whole has lost nearly 20% of their net worth since 2004[i].

At first glance, the common culprits come into play: R&D pipelines are running dry, blockbuster drugs are losing their patent protection, the average cost of bringing a product to market rose by more than 25% (to more than $1billion since 2010), and lastly, the billions of dollars drug makers have spent on settlements ranging from patient lawsuits from pernicious drug side effects, to pricing fraud charges.

What is rarely mentioned however, is the negative reputation and the growing lack of trust amongst the medical community about the pharmaceutical industry today.

During 2012, the pharmaceutical industry spent over $27 billion on promoting drugs, of which $24 billion was on marketing directly to physicians, with the balance spent on consumers[ii]. It is these very promotional practices and rep ‘reward programs’ that have alienated healthcare professionals. Case in point, in 2013, 40% of doctors’ offices severely limited the number of reps they admit each day, and 25% of hospitals and health institutions have implemented a “no-see” policy for pharmaceutical sales reps.

Today, some would argue that the industry’s reputation is not much better than that of the financial sector or tobacco companies. Yet, it wasn’t long ago that the pharmaceutical industry was considered among the most respected industries in the United States.

Just imagine you’re a physician for a moment. You know your rep’s compensation is affected by how much of her product you prescribe. You know they refer to you as a ‘Tier 1’ targeted physician. You know her company has spent millions of dollars on determining what exact message will influence you the most. Based on all this, how much would you trust the rep?

While sales rep measurements and compensation plans should not be eliminated (my last client firmly stated to me: “if you can’t measure it, you can’t manage it”), there needs to be less micro-measuring of script volume, and more focus on how reps are cultivating long-term advisor relationships with their customers.

Some solutions I recommend on how the pharmaceutical industry should go about building long-term advisor relationships are:

  • Sales Representatives should focus more on treatment options and broader patient health issues, rather than on just prescribing habits with their customers.
  • More in-depth training for representatives in medical issues beyond those directly affecting the medication being sold.
  • Moving away from canned and scripted phrases & visual aids to a more consultative dialogue approach. Believe it or not, there are still some hap-hazard sales managers ‘dinging’ their reps (giving them “did not meet expectations” on evaluation forms) for not ‘closing’ the doctor or not reciting ‘all seven benefits’ of their superior medication.
  • Urging reps, within regulatory guidelines, to comment on competitor products when those products are better for a specific patient type / indication. What a great way to earn trust!
  • Conduct brainstorming sessions with cross-functional teams on how to build trusted relationships with the healthcare community. This may include a pause in influencing  – and a switch to just plain helping; and a pause in measuring – to just doing the right thing.

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