Guest Commentary: Biopharma's echo chamber
Guest Commentary: Why biopharmas should give payers true comparative value data
Of the many reasons for business failure, not listening to customers is the king. And too many biopharmas today are walking around wearing earplugs.
In the U.S., managers are dealing with a set of increasingly powerful customers, thanks in part to the 2003 Medicare Modernization Act and the 2009 Affordable Care Act - customers with a very different set of values than biopharma is used to.
And they won't allow biopharma companies simply to assert value as they have in the past. As has happened in every other industry, customers will learn, or hire intermediaries, to define and then impose standards of value. It's certainly happening elsewhere in healthcare: The Leapfrog Group, Castlight Health Inc. and Change Healthcare Corp. are all helping to define value for money in medicine for employers and consumers. Even CMS sponsors a website that compares hospitals and physicians on the basis of quality.
In short, either pharma helps its customers create the standards with which the value of drugs will be measured relative to their competitors - or they'll have it done for them. And you can bet customers will try the easiest standard first, which is price.
The belief that drug executives can themselves define their drugs' value, in part by "educating" the customer, is bred deep in the bone. Drug companies used to have essentially one commercial target - the physician - and communications were limited by the label, which was itself the product of a