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Managed Markets Advertising: Addressing the Value Challenge in the Evolving Pharma Marketplace

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Summary of the January 2012 report from the Economist Intelligence Unit

Summary of the January 2012 report from the Economist Intelligence Unit

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  • 1. Managed Markets AdvertisingAddressing the Value Challenge in the EvolvingPharma MarketplaceJim Mittler, PhD; Medical Director
  • 2. The Value Challenge report from Economist Intelligence Unit • Released February 6, 2012 • Second in a series of 4 pharma reports • Global survey of 399 industry executives to better understand the nature of the “value challenge” in pharmahttp://www.managementthinking.eiu.com/value-challenge.html
  • 3. The “value challenge” in pharma• No longer enough to bring safe and effective drugs to market; new products must provide superior outcomes to existing medications• Companies must demonstrate added value if a higher cost are to be garnered for new therapies• Range of stakeholders with different perceptions of value – Pharma company – Physicians – Patients – Commercial payers – Government payers – Regulatory agencieshttp://www.managementthinking.eiu.com/value-challenge.html
  • 4. Managed markets expertise is increasingly important• The value challenge is a long-term issue and a leading concern for the drug industry• Pharma companies lack confidence in the ability to respond to the value challenge• There’s a shift of power in market influence from pharma to payershttp://www.managementthinking.eiu.com/value-challenge.html
  • 5. Divergent perceptions on the value of a new drug• A significant gap in the definition of value exists between payers and industry, which will continue in the future• Fundamentally different business objectives drive this; however, payers are becoming increasing more influential and pharma needs to adjusthttp://www.managementthinking.eiu.com/value-challenge.html
  • 6. Lack of clear definition of value is significant challenge• Understanding of value differs the most according to stakeholder, type of medical condition, and geographyhttp://www.managementthinking.eiu.com/value-challenge.html
  • 7. The balance of power is shifting to payers • Traditional pharma companies see themselves as losing influence over the market to commercial and government payershttp://www.managementthinking.eiu.com/value-challenge.html
  • 8. Managed markets strategy can better meet the valuechallenge • Traditional sales channels are giving way to health economic information targeted to the payer audiencehttp://www.managementthinking.eiu.com/value-challenge.html
  • 9. Three-part aim: What looks good to payers in the evolvingmarketplace Better health outcomes for patients Value Better health of proposition populations Lower costs through healthcare quality improvement“A general concept that translates across all conditions and care settings.” Dr. Shari Ling, MD Deputy Chief Medical Officerhttp://www.managementthinking.eiu.com/value-challenge.html Centers for Medicare and Medicaid Services
  • 10. Palio Managed Markets group: Why we’re here Cost is only 1 attribute of the Majority of industry execs see value proposition. When done payers trying to control costs right, managed markets more than enhancing clinical care advertising addresses both clinical and economic value (3-part aim) 45% of industry execs indicate the industry is not effectively adjusting They need our expertise! to the value challenge