Pharma Budgets Soaring, but Marketers Closely Watching Washington

According to the 2019 MM&M Deloitte Consulting Healthcare Marketers Trend Report, marketing budgets increased 26% when compared to the previous fiscal year. The mean budget jumped from $8.3 million to $10.5 million, and 92% of respondents reported a year-over-year increase! This growth has been fueled by a record number of approvals of new treatments, as well as the Trump Administration’s Laissez-faire approach to the industry. This recent growth, however, faces numerous challenges in the near-future. The political climate present when such issues are addressed will strongly influence their outcome, and experts have agreed political action is inevitable.

Joe Plevelich, a commercial operations executive for a pharmaceutical company commented:

“If you look at some of the leading potential contenders for the presidency and some of the platforms they are trying to establish, [many] are talking about better controls and transparencies around pharma pricing and profits. I think there are definitely changes afoot. Whoever is going to be in power is going to have an impact on pharma pricing and our recent ability to continue to raise pricing on a whim.”

As we embark upon an active and critical time in healthcare regulation, development, and modernization, both democrats and republicans agree pharma is an industry worthy of attention.

The following have been identified as key discussions to watch as we approach 2020:

  • A reduction or elimination of tax deductions for marketing expenses (expected this year)
  • Requiring list prices of drugs to be included on TV advertisements
  • Price caps on drugs (Congress has already opened hearing on rising drug prices)
  • Investigations into sales and marketing practices

Why It’s Hot

The outcomes of these and similar healthcare regulatory topics will strongly impact pharma marketing budgets, and will determine if they will remain as fruitful as they are today. Many are concerned an unfavorable decision in any of these issues, could lead to significant change. Pharma marketers should remained tuned into the latest developments in these and other healthcare related issues, as well as the 2020 presidential election.

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Why bedding brand Buffy isn’t playing by the direct-to-consumer rules

Buffy is part of a growing cohort of digitally native brands that are prioritizing longevity over fast growth out of the gates. It’s a sign that the category’s maturing: In the past, brands saddled with millions in VC-funding could squash competition by outspending them on flashy marketing campaigns and brand awareness. With customer acquisition becoming prohibitively expensive, young brands like Hims and Rothy’s, in addition to Buffy, are turning their attention to loyalty plays and long-term growth plans.

Additionally, Buffy isn’t afraid of Amazon like most brands in the direct to consumer category. Instead they see the ecomm giant as an ally to strengthen their brand awareness and complement their owned channels. Buffy’s goal is making sustainable bedding more readily available and affordable for their customers, so they’ve taken the unpopular route of selling through Amazon to quickly gain awareness and volume.

“What Amazon represents is a way to get the word out and get product into people’s hands. If you look at it just from a business standpoint, Amazon is the world’s marketplace and they do so much so well, and they represent a door into everyone’s home in a way,” said Shaked. “For us, I think recognizing those opportunities as non-threatening to our brand is important. It’s not something that gets in the way of people going to our site, so I don’t see it as a problem. It’s a way to leverage technology.”

Why it’s hot?

This shift among DTC brands signifies a new perspective on how brands in this category are focused on fulfilling their brand’s mission by leveraging competitive giants to their advantage and focusing on retention versus fast scale growth. This requires a shift from traditional acquisition strategies to retention and loyalty focused demand gen strategies.

The ROI of Patient Empathy

“I read some very interesting articles via my Apple News Feed on MS over the last week.  Having been involved in research with MS patients I am always interested to learn about the needs of MS patients.  The articles range from new potential treatments to living with MS and how it affects your daily life. Unfortunately, not one player in the MS market owns the space for MS news and information even though the research I was involved in clearly showed a strong need for this type of information.  Instead, most Biopharma company’s online presence revolves around the needs and wants of patients.  Instead, their websites contain the basics and sales copy.

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Now think for a moment if you were suddenly diagnosed with MS, God forbid.  What would you want to know and what emotional support would you want and need?  This is the way that DTC marketers need to think, but it usually involves weeks or months of meetings and Power Point presentations with some MBA wide ass asking “what’s the ROI?”. What is the ROI of helping patients live with chronic conditions and helping one another with insights and advice?

Novartis recently launched a DTC site around heart failure that has doctors crying foul, but can anyone honestly say that patients are going to run to their doctor to say “I have heart failure and want this drug”?  Today’s primary doctor visits are commonly scheduled at 15-minute intervals, and some physicians who work at hospitals are asked to see a new patient every 11 minutes, according to a 2014 article from Kaiser Health News. Even in that short time frame, doctors probably aren’t listening attentively to their patients. A 1999 study of family doctor practices found doctors let patients speak for only 23 seconds before redirecting them, and only 25% of patients got to finish their statement. Another study, this one out of the University of South Carolina in 2001, found primary care patients were interrupted after just 12 seconds, either by the health provider or a knock at the door. Obviously that’s not enough time to ask about health problems in depth.  The Novartis site aims to help patients and caregivers understand that being diagnosed with heart failure is not a death sentence.

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DTC, today, in an era when pharma is in the crosshairs of everyone on the Internet needs to go beyond “selling” .  It has to involve the whole patient experience from diagnosis to management.  It has to provide real answers on how to have a normal life and what to expect when on therapy.  It can’t be med talk it has to be a human conversation, not a used car sales pitch.

There is a reason why online ad blockers have surpassed more than 200 million users and why people are time shifting live TV.  They don’t have the time to be interrupted with advertising because ads today, for the most part, stink. They are irrelevant, boring and intrusive.  DTC can’t fall into this trap.  I know that most pharma people don’t get a cup of coffee without thinking about ROI, but today that’s not your job. Today your job is to convince management that we can enhance our brand and company by helping people not selling them.”

Why It’s Hot

As marketers in the health space continue to invest in advertising, they also have to keep in mind that throwing sales-speak at patients is not necessarily helping them.  Pharma needs to think beyond “marketing” and be more empathetic to patients who become lost in a world where healthcare is in transition.

Source: http://worldofdtcmarketing.com/the-roi-of-patient-empathy/contrarians-pov/

Do you “trust” Big Pharma? Do you care? Innovation.org bought to you by PhRMA lobbying group

Reputation plays a big role in many industries. For Big Pharma, each year brings a new corporate reputation survey that places the industry one notch above car salesmen and insurance companies. While there are many reasons for this – from the regulatory handcuffs of the FDA, to DTC-ads with their scary voice-overs, or frustration over drugs being too expensive to afford — there is a clear need to try and let the industry tell its story.

Thus, www.innovation.org. Here is the home of the industries “story.” HS Innovation.org h.page 8.27There is a ton of information, interactivity, mobile-friendly content. Just one of the top three tiles is an interactive guide to understanding clinical trials — one of the industries biggest issues due to poor patient recruitment and that they take so long and cost so much; next to that, articles and slideshow carousels on innovation and the future. Just from the home page, you can educate yourself with content that has never before been aggregated and delivered in such a consumer-friendly User Experience.

HS Innovation.org top 3 tiles

HS Clinical Eco-system 8.27

Why is this hot? Biopharma/Life Sciences is an enormous and incredibly complex and little understood industry. This content-rich Web site may seem like the industry is pulling back the curtain: but is it believable? At the very least, if you want to get an education on many aspects of the industry, this would be the place to do it.

This new site, www.innovation.org was created by the industry lobbying trade group, PhRMA. While their key audience may be politicians, policy-makers and such, this site was clearly created for patients and those in the public who relish information and any potential transparency that comes with it.

Oddly enough, while reputation can have a direct correlation to trusting a company’s product, it has little meaning or impact in Biopharma/Life Sciences. Most patients have no idea what company makes a drug; and most doctors, while aware, are driven by other more quantitative factors like clinical data.

So we have to ask the right questions: While it is very engaging and easy-to-navigate does it actually help the industry reputation? Or is it a self-serving content strategy served up with good UX? Or more realistically, will patients appreciate the content but cherry-pick what they believe, or not — this is an established behavior when searching for drug information…cull from a dozen sources, weigh the results and synthesize an opinion.

Perhaps the real strategy here was not to enhance reputation or gain consumer trust, but to just add one more source/voice to the conversation. In this world of too much information, they have decided that to join the discussion with credible, easy-to-understand content, thus they gain a share-of-Influence, while still striving to raise their credibility.