Already, vendors and service providers make it easy to install them. Packages such as Ready-Script come with links to major
medical records systems. Web-based services such as Healinx make e-prescribing services available through web interfaces,
allowing doctor's offices to avoid the use of complex, locally installed software. They are also working with insurers to
gain reimbursement coverage for patient consultations delivered electronically.
Recent surveys show that about 11 percent of US physicians prescribe online occasionally and about 22 percent use some type
of electronic medical records system. That use will likely double within 18 months. In several countries outside the United
States, electronic systems have already become the norm. More than 50 percent of primary care physicians in the United Kingdom
and New Zealand use e-prescribing and EMR systems. US adoption has been slow because of the fragmentation of service payment
systems across federal and state governments as well as the many private insurers and large corporate self-insurers. Without
a central payer, such as the UK's National Health Service, to drive use and to set data and workflow standards, US adoption
has been limited to larger group practices and hospital-focused delivery communities. Consortia such as RxHub are now addressing
The Patient Safety Institute, a nonprofit launched in December 2001, plans to provide physicians and hospitals with real-time,
secure, patient centric medical records in five key areas: diagnoses, laboratory results, medications, allergies, and immunizations.
The availability of secure, open technology and new data standards, including the Health Insurance Portability and Ac-countability
Act (HIPAA), creates a technology and business environment in which it is possible to integrate and deploy large-scale, nationwide
prescribing and EMR systems.
Patient and Insurer Power
The interests of patients and insurers are also aligned in favor of integrated electronic systems. US consumers spend more
than $100 billion annually on prescription medications. Insurers and employers are shifting more and more of the out-of-pocket
burden to patients, particularly for newer, more expensive, brand name prescriptions. Multi-tier co-pays reaching $35 or more
are increasingly common. Asked for higher co-pays for brand name products, consumers will want to know if the product is three
times as valuable as the $5 or $10 choices.
Beyond the use of simple economics to encourage consumers to ask tough questions and push doctors to consider less expensive
options, insurers also continually attempt to influence physician prescribing behaviors through formularies and onerous processes
for requesting off-formulary coverage. E-prescribing tools, supported by patient-specific formulary information, plus up-to-date
information about clinical results and therapeutic indications, will benefit physicians and shape the set of prescribing options
they consider. E-prescribing studies show that 45 percent of participating doctors immediately increased compliance with formulary
guidelines, even though less than 10 percent identify compliance as a reason to implement those systems. More than 80 percent
say those systems improve delivery of care, and two-thirds say they help improve their personal efficiency.
Sales and Marketing Impact
Savvy sales and marketing organizations must rethink the allocation of assets to match the new balance of prescribing decision
making power. The US pharma industry spends more than $13 billion annually marketing to physicians, compared with about $2.5
billion for direct-to-consumer (DTC) efforts. Even small shifts in spending can produce a major strategic business shift.
It is time to consider whether physician-focused field sales, educational events, and promotional budgets-a combined average
of $8,000-$13,000 annually per physician-should continue to tower over DTC programs. Re-bates and discounts offered to big
insurers also influence the market as they drive formulary placement, but they are rarely considered part of the sales and
marketing budget. Pharma marketers must review the mix of traditional and electronic channels such as e-detailing and internet-based
educational services as part of an across-the-board resource allocation assessment.
Physician marketing programs must promote and enable a collaborative doctor–patient dialogue that features more quality of
care and compliance elements. Pharma sales and marketing teams will have to create both physician and patient programs that
provide a range of choice and control as to when, where, and how doctors and patients choose to interact with the pharma company.
Digital integration and delivery of information will be critical, as will a new approach to segmenting and targeting physician
and patient customer groups. Three areas need particular consideration:
- physician-consumer collaboration and informed consumer choice
- matching physician marketing investments to individual preferences about how and when the information is delivered
- competitive, evidence-based prescribing data to drive formulary choices and electronic prescribing service content.
No one expects to remove doctors from the prescribing process. Rather, their role will evolve from issuing prescribing edicts
to becoming more collaborative decision makers working with well-informed consumers who influence their own medication choices
at the point of care. Pharma marketers must find ways to make that dialogue more collaborative and extend it beyond high-income,
well-educated segments to a broader base of consumers-particularly the elderly and those with chronic conditions.
Specific investments will de-pend on each company's product portfolio, competitive position, and current market share and
brand leadership with physicians and patients. The options range from sponsorship of consumer-focused therapeutic online discussion
sites to diagnostic tools and physician education and training.
Postmarketing clinical trials designed to show product cost effectiveness as well as clearly improve therapeutic outcomes
will be needed to win preferred status among formularies and to motivate consumer loyalty even when the patients have to cover
out-of pocket charges. Those studies must clearly illustrate how a recently introduced-and expensive-brand name product beats
out the cheaper generic and over-the-counter offers. Rebates and discounts alone won't work. Insurers and patients must be
convinced that the economic, as well as the therapeutic, analysis is compelling. Pharma companies can work with e-prescribing
databases and insurers to see that data about cost-effectiveness is widely communicated to both physicians and patients to
help promote the collaborative prescribing decision making process.
The Right Priorities
Industry leaders now face flat revenue and frozen marketing budgets; thus prudent choices about where to reduce investments
are as critical as determining where to expand. To date, no large pharma company has been willing to reduce field force staffing
for fear of catastrophic losses in the trenches, even though some physicians are reducing rep access. That many doctors now
spend more time online than they do in real-time conversations with sales reps signals that the tide is turning. Although
the total number of field reps may not decline anytime soon, their per capita effectiveness must improve if pharma is to have
any hope of continued profit and margin growth.
For the most part, internet-based marketing efforts have operated separately from field activities. Companies have also executed
insurer rebate negotiations and DTC efforts but without integration with field rep activities. The question is, are pharma
sales and marketing organizations getting a decent return from that expensive and fragmented go-to-market strategy?