Rising government pharmaceutical expenditures have attracted the attention of federal prosecutors, and the scrutiny is expected to expand. With Congress spending billions to fight terrorism, federal investigators are looking closely at healthcare for opportunities to trim outlays and collect big penalties. During the past 15 years, the government has recovered nearly $8 billion from violators of the False Claims Act, almost half of that from health-related cases. The record $875 million fine recently paid by TAP Pharmaceuticals is encouraging both investigators and company whistleblowers to jump on anything that smacks of fraud. 

Questionable marketing practices subsided in the mid-'90s, observes James Sheehan, assistant US attorney in Philadelphia, after some government saber-rattling prompted medical associations and industry groups to adopt ethical marketing guidelines. At the October Fraud and Compliance Forum in Washington, however, he said he has seen a "creep up" in unethical programs in the last few years, as sales reps find it difficult to "take the high moral ground" in a highly competitive market.    

Sheehan is looking at a number of marketing practices and focusing on pharmacy benefit managers (PBMs). It may be all right for a PBM to ask a manufacturer for a fee to send out compliance letters to patients, but Sheehan wants to know the fair market value of that service. An overly generous payment could constitute a kickback to gain formulary listing. He is also examining industry repackaging deals with HMOs and other value-added programs, such as disease management and research grants, to see if marketers use them to avoid traditional discounts that must be included in best-price calculations for Medicaid rebates. 

The "net message," says attorney Harvey Sussman with Kleinfeld, Kaplan & Becker, is that the government is looking beyond the traditional price to determine if additional value should reduce the reported best price. Value-added programs are not "inherently wrong," but they must be constructed so the value is not targeted to just one HMO. Sheehan also remains troubled by gifts to doctors and says the test is whether the doctor would be comfortable telling his patients about the arrangement. 

The Office of the Inspector General (OIG) in the Department of Health and Human Services (HHS) is examining a long list of industry practices and government programs affecting pharma companies, as seen in its new Work Plan for fiscal year 2002. Among other questions, OIG wants to know   

if pharma companies are complying with limits on gifts to physicians

if FDA is tracking industry performance on postmarketing studies

how much it costs Medicare to cover patients in clinical trials

whether Medicare is paying appropriate rates for Epogen (epoetin alfa) and for nebulizer therapies. 

Another hot button for investigators is whether manufacturers comply fully with product tracking requirements set by the Prescription Drug Marketing Act (PDMA). The latest question to arise is the extent to which a company is responsible for detecting discrepancies between sales and retail reports. The issue emerged from a recent criminal case against a Kansas City pharmacist who diluted chemotherapy drugs. Patients have filed civil charges against Eli Lilly for failing to report the problem earlier than it did, even though a Lilly sales rep helped uncover the scheme by noting big discrepancies in sales numbers. 

Congress, meanwhile, is leading the charge to revise how manufacturers report prices to Medicare and Medicaid. A key allegation in the TAP case is that the company inflated its average wholesale price (AWP), then sold its prostate cancer therapy Lupron (leuprolide) to physicians at much lower rates, allowing doctors to make hefty profits on the spread between the two prices.     

At a hearing in late September, leaders of the House Energy and Commerce Committee were particularly vocal about reforming the system. Not only does the big spread on office-administered therapies boost Medicare expenditures by an estimated $1 billion a year, it also forces seniors to pay more out of pocket for treatments. 

Oncologists and home health agencies have opposed reform because they claim that they need to profit from drug price spreads to make up for the low reimbursement they receive for treating patients. Congress' General Accounting Office (GAO) countered that oncologists receive sufficient fees. Tom Scully, administrator of the Centers for Medicare & Medicaid Services (CMS), noted that HHS tried to fix the problem a year ago, but Congress blocked it. Representative Jim Greenwood (R, Pennsylvania) now wants to revise the law so that Medicare reimbursement is based on wholesale acquisition costs instead of AWPs. Even if Congress fails to act this year-which seemed likely at press time-the spotlight on industry pricing is already curbing the promotion of "spread" profits.  

To clarify those and other issues, the OIG is developing a Compliance Guide to help pharma companies establish internal programs that ensure employees understand and obey all rules and statutes. In announcing the project last June, OIG listed seven major elements to be included in a comprehensive program and asked for suggestions about what risk areas need to be addressed. OIG is examining comments from interested parties and is expected to issue a draft early next year.    

An indication of how OIG might expect marketers to demonstrate compliance appears in the agency's Corporate Integrity Agreement negotiated as part of TAP's settlement agreement. The basic provisions are not that surprising. They require TAP to provide employee training in ethical marketing practices, to appoint a compliance officer and a corporate compliance committee, and to issue a code of conduct. Every quarter, TAP also has to report its "true average sale price" for all products covered by Medicare and Medicaid, a requirement similar to OIG's agreement with Bayer last January. (See PE Washington Report, June 2001.)

What is unusual is the broad scope of oversight and review that independent review organizations (IROs) will conduct. To ensure that TAP calculates prices correctly, the integrity agreement calls for an outside consultant to review the company's records and transactions, including how it calculates best prices and corrects inaccurate data. 

Even more sweeping is the call for an annual independent review of TAP's systems, policies, and practices governing sales and marketing. That requirement allows an IRO to examine all documents dealing with sales of Lupron and Prevacid (lansoprazole) to see if the company has established controls and written policies for key marketing activities such as   

retention of physicians and other prescribers for consulting, speaking, or advisory arrangements 

payment of educational, clinical, and research grants

expenditures for third-party advice on reimbursement

gifts and payments for business courtesies and customer assistance programs

reduction or forgiveness of debt and other assistance to customers

The IRO will review expense reports and agreements with speakers and consultants, with emphasis on the company's arrangements with its largest and fastest growing purchasers and prescribers. The detailed review of marketing practices represents a "quantum leap" over previous requirements, comments attorney Paul Kalb of Sidley, Austin, Brown & Wood. Kalb also notes that a key whistleblower in the TAP case was a physician who objected to the company's sales practices, highlighting the need for marketers to examine how promotional activities affect customers and disgruntled employees. 

Articles

Washington Report

Government efforts to trim budgets has put the spotlight on unethical pharma marketing tactics.

Feds Crack Down on Fraud

The September 11 attacks on the United States caused pharma shares to fall along with others, but as investors switched to safe stocks, considered less susceptible to cyclical consumer trends, they rebounded. On September 12, broker WestLB Panmure raised its recommendation of the pharma sector from "neutral" to "outperform," favoring Sanofi-Synthelabo, Novo-Nordisk, Shire Pharmaceuticals, and GSK. 

By the end of September, some European companies recorded sharp rises almost daily. GSK, for example, climbed 4.7 percent in one day, following chief financial officer John Coombe's upbeat presentation to the Merrill Lynch Global Pharmaceutical Conference in London. 

Coombe emphasized that the company's postmerger integration went well and increased its estimate of cost savings from Â£1.6 billion to Â£1.8 billion by 2003. GSK spokesperson Alan Chandler said he did not expect the Twin Towers attacks to have a great effect on the company's performance.

Yet business as usual doesn't mean doing business is easy. Paxil/Seroxat (paroxetine) may be a key growth driver, but a California law firm has launched a class action suit against GSK on behalf of 35 patients who said they suffered distressing withdrawal symptoms after discontinuing use of the selective serotonin reuptake inhibitor (SSRI). The suit alleges the company failed to warn doctors and patients of the withdrawal symptoms, said to include head pain, vertigo, loss of coordination, abdominal discomfort, agitation, and confusion.

The UK's Guardian reported that more than 1,500 patients with similar complaints have contacted the law firm since it initiated the class action. GSK maintains there is no reliable scientific evidence that the product is addictive, but the Medicines Control Agency has forced all UK-based SSRI manufacturers to amend product labeling to highlight the possibility of adverse reactions. GSK may also have to deal with claims that SSRIs are associated with a greater risk of gastrointestinal bleeding.    

On a brighter note, GSK has strengthened its pipeline prospects through a collaboration with Tanabe Seiyaku, one of the oldest--and, after its merger with Taisho, one of the largest--pharma companies in Japan. By next April, the companies will begin working together to research, develop, and market a number of Tanabe compounds in the areas of psychiatry, neurology, urology, and diabetes. 

Pipeline prospects at AstraZeneca are already among the best in the world. Datamonitor forecasts that new blockbuster sales for the company will reach $6.34 billion in 2007--better than any company in the industry and strong enough to make up for the imminent loss of US patent protection for Prilosec (omeprazole), according to the market research company.    

Not everyone agrees, particularly in the City of London, where the company has always had an uneasy ride. Most recently, broker JP Morgan gave the company a "market performer" recommendation. It acknowledged the strength of AZ's pipeline but said in a research note that the company also has the industry's "biggest patent headache"--products worth $8.5 billion, or 54 percent of 2000 sales, that are facing near-term patent expirations. Schroder Salomon Smith Barney, another City firm to express doubts about AZ, downgraded its rating from "buy" to "neutral."

The company's 2001 half-year sales rose by 8 percent and pretax profits were up by 5 percent. CEO Tom McKillop makes much of AZ's ability to extend the life of its key products. The latest example of that came with the UK approval of a 150-mg Casodex (bicalutamide) dosage for the treatment of early stage prostate cancer, the first once-daily medicine to treat that phase of the disease. 

Because the United Kingdom acts as a reference member state for the authorization procedure, approval for the new indication was also granted in Greece, Portugal, and Austria, and the rest of the European Union is expected to follow suit. AZ is planning a regulatory submission to FDA by the end of the year. 

As the prospect of military conflict looms larger, whether business as usual can be maintained in the coming months remains to be seen. For the moment, the pharma industry is doing its best.    

World News

The September 11 attacks on the United States caused pharma shares to fall along with others, but as investors switched to safe stocks, considered less susceptible to cyclical consumer trends, they rebounded. On September 12, broker WestLB Panmure raised its recommendation of the pharma sector from "neutral" to "outperform," favoring Sanofi-Synthelabo, Novo-Nordisk, Shire Pharmaceuticals, and GSK.

Business as Usual

Sampling is a sales rep's foot in the door to doctors' offices and the quickest way to get products into consumers' hands. That's why reps handed out $5 billion worth of the freebies last year, spending 30 percent of companies' promotional budgets in the process. Despite that huge investment, few product managers can assess its impact on product inventory, consumer demand, prescription rates, or market share. But sampling's greatest failure is its inability to provide the healthcare industry with product-use or patient data.     

Without a tracking mechanism, pharma marketers don't know who is actually using the samples. In fact, those who question the value of traditional samples suggest that the practice may put patients at greater risk for adverse drug reactions or drug-drug interactions. And that risk will only increase as patients' use of prescription drugs, over-the-counter medications, and nutraceuticals also increases-often without their physicians' knowledge.

This article describes a new approach to product sampling that uses coupons in place of physical samples. It discusses   

benefits for physicians, distributors, and manufacturers

It also explains how vouchers can give healthcare stakeholders a new tool for tracking product sample use and gaining insight into the delivery system. 

Sampling has been a standard practice for more than 30 years, and some sales reps fear that replacing it with vouchers could inhibit their ability to detail doctors. Yet RxCentric.com found that 50 percent of physicians surveyed prefer vouchers to product samples for the following reasons:   

On the flip side, doctors who prefer product samples over vouchers cite the additional patient interaction that can occur during dispensing and the ability to observe patients after they take the medications. Yet, even with demand for both types of sampling, there is no indication that sales reps would limit their access to physicians if they provided vouchers instead of actual products. Over time, voucher proponents believe that pharma sales forces will benefit from increased access to healthcare providers who appreciate the value of vouchers for tracking product use and simplifying the sampling process. 

Vouchers-slips of paper that contain a free prescription for a specific amount and dosage of a particular product-offer healthcare providers significant advantages. A paper sampling system requires substantially less time than the recording, storage, and handling of actual packets and pills. Vouchers don't require extra space, security against theft, or climate controls. They are also exempt from state and federal requirements for dispensing prescription drugs. The standards of the Joint Commission for Accreditation of Health Care Organizations (JCAHO) for receiving, tracking, storing, and dispensing product samples do not apply to vouchers, freeing doctors and their staffs from cumbersome sample-management duties. And, because vouchers can be sent through the mail, healthcare providers can review product literature and samples at their leisure.     

The paper system also can improve patient care by minimizing the potential for dangerous drug interactions. Rather than simply popping a pill on the way home from the doctor's office, patients must take vouchers to a pharmacy to be filled.

With access to sophisticated databases, pharmacists can determine if the sample product will interact with other medications the patient is taking. They can also detect other potential problems such as allergies to the sample medications or  duplication of prescriptions. Because it comes from the pharmacy, the free trial medication contains directions for use and comes in childproof containers. Pharmacists also discuss the medication's proper use with patients-yet another safeguard against adverse outcomes. To continue using the therapy, a patient simply phones the pharmacy or doctor and requests a refill.

When pharmacists redeem the coupons, they record product information such as sample size, dosage, and other data. Those data, including patient information, the authorizing physician's name, and usage are available to healthcare providers and pharma marketers.

The data may also be accessible to health plan managers, who can use it to make critical decisions about formulary management, medication purchases, marketing, and other healthcare services. Pharma companies also benefit from the additional data.

Armed with the new information, product managers and sales staff can use the data to support and assess product use and make better informed decisions. Manufacturers can track the sampling and prescribing behavior of a target physician or physician group, as each redeemed voucher provides information about the prescribing physician and the dispense date. Voucher sampling programs also allow healthcare providers and pharma reps to work more effectively together. The sales force can use vouchers to help physician groups meet clinical and financial goals in areas such as health screening programs and formulary conversion, compliance, and persistency. 

An increasing number of pharma companies are piloting e-detailing initiatives, including direct-to-physician product promotions using online and video conferencing technology and websites offering self-study programs. Early studies indicate that e-detailing increases access to physicians and improves the duration and quality of product detail. Bruce Kent, Novartis' executive director of e-sales, speaking at eHealthWorld in San Diego in May, indicated that e-reps complete 13 details per day, spend 9 minutes per visit, and detail 2.7 products per call.     

E-sampling is yet another new application of e-commerce and pharma sales that provides immediate fulfillment of physicians' sample needs. They can access a company's website and print out vouchers that, when signed by a doctor, patients can redeem at pharmacies for free trial medications. Static webpages, secure internet sites, and sampling programs that are integrated into electronic prescribing systems can all be used to provide e-vouchers. 

 This method requires physicians to access a website and print copies of e-vouchers. Products recently offered through online coupons include Prozac Weekly (fluoxetine), Glucophage XR (metformin), and Xenical (orlistat). Although the approach is moderately effective in driving consumer demand, it provides no information about the physicians who print the e-samples.

 Designed as a direct-to-physician program, this method directs doctors to a website through sales and marketing efforts. Once there, they can register, verify information about their medical practices, and request and print e-samples. The registration process allows doctors to customize printed e-samples, which can include their names, addresses, and phone numbers. 

Secure sites with registered physicians also track website use, the quantity of e-samples printed, and sampling trends. Both static webpages and secure sites allow the redemption of e-samples to be tracked through pharmacy sales data. But only the secure-site method allows product managers to track and compare the number of e-samples printed and redeemed. To see an example of a secure site for printing e-samples, check out  www.emedsample.com.

 Yet another opportunity for e-sampling is e-prescribing. Such systems include hand-held, desktop, and internet-based systems. In all cases, doctors are offered samples at the point of prescribing. 

Once a physician chooses a patient's category or product, the e-prescribing system shows the name of each medication sample and its availability. The doctor then chooses a sample product, completes the prescription, and prints a voucher for the patient to redeem at a pharmacy. 

E-prescribing systems collect data on doctors, patients, and medications prescribed. Their value is that they can record therapy switches that occur because e-samples are available.

The biggest advantage of e-sampling programs, though, is their ability to target low prescribing and difficult-to-access physicians as well as healthcare providers in remote areas or territories not frequented by reps.        

E-sampling initiatives can rapidly distribute sample vouchers to thousands of doctors. Companies benefit in two ways: there is more demand for their products through retail pharmacies and less need to package and distribute traditional samples.

E-sampling programs are also responsive to market changes, making them easy to implement, discontinue, or modify. Because of  their targeting ability and tight control, they are also easy to measure. And product managers and marketers can evaluate physician use, voucher redemption, territory mapping, impact on market share, total investment, and return on investment.

The distribution of prescription samples may soon change because of      

physician demand for alternatives to traditional samples

the ability to track and report sample use

the need to manage the time spent conforming with Prescription Drug Marketing Act (PDMA) regulations 

Product sample vouchers, whether they are paper or electronic, provide effective tools with which to meet those demands. 

Features

Sampling is a sales rep's foot in the door to doctors' offices and the quickest way to get products into consumers' hands. That's why reps handed out $5 billion worth of the freebies last year, spending 30 percent of companies' promotional budgets in the process. Despite that huge investment, few product managers can assess its impact on product inventory, consumer demand, prescription rates, or market share. But sampling's greatest failure is its inability to provide the healthcare industry with product-use or patient data.

Vouchers: More Data, Fewer Dollars

"I really want to work in the pharmaceutical industry. I'm taking CME courses focused on clinical research and am getting involved in clinical trials whenever I can. But none of the companies that I apply to will even return my phone calls."

"We have 13 unfilled positions for physicians and just can't seem to find any qualified candidates. The only prospects we meet are older doctors who are burned out and are trying to find any way they can to get out of practice."

A growing number of physicians are expressing interest in working in the pharmaceutical industry. Many are motivated by the desire to get as far away from managed clinical care as possible. Others want to broaden their sphere of influence in healthcare-to move from treating one patient at a time to helping an entire patient population. Still others are excited by the chance to participate in well funded cutting-edge innovation or are influenced by colleagues who have moved into pharmaceutical medicine and are vocal about their enhanced career satisfaction.

Despite all that interest, many pharma jobs for doctors remain unfilled. And turnover is unacceptably high because competitors go to great lengths to steal qualified physicians from each other whenever possible. Pharma companies say the reason for the shortage is that there are simply not enough qualified physicians-with three to five years of industry experience, plus the right academic pedigree and publication history-to go around. 

Yet physicians seeking to enter the industry find themselves in the same catch 22 as young college graduates: How can they get a job that requires experience when no one will give them even an entry-level opportunity to accumulate the requisite industry skills? This article provides insight into the dilemma and the factors fueling it and offers pharma companies practical approaches for solving it.

Developing better relationships with physicians through improved recruiting and retaining practices will benefit pharma companies' competitive interests for the following reasons:  

Physicians control or influence more than $800 billion in annual healthcare expenditures. They are also the target audience for more than $5 billion in pharmaceutical advertising each year.

Even the slightest competitive edge is crucial to being first to market with new products, and physicians know how to talk to, work with, and influence their peers-a notoriously challenging task for pharma companies. 

Physicians' knowledge of basic science and clinical medicine-representing, on average, a $500,000 investment in medical school and postgraduate training- is critical to the success of new pharma products. 

As a group, doctors have certain traits that make them highly desirable employees: Typically, they are smart, possess valuable intellectual capital, work hard, are driven to succeed, and don't go home until the day's work is done. But some can be challenging to "manage." The stereotype of physicians as arrogant, egotistical, entitled, independent (not team players), and possessing an inflated sense of self-worth is legendary-and often true. 

That profile was such a prominent and consistent theme in a recent series of MD IntelliNet interviews with pharmaceutical executives that researchers coined the term "cultural impairment syndrome." Many employers believe the syndrome is so deeply rooted that physicians can never successfully adapt to new roles and work environments. 

But stereotypes seldom change as fast as the group they apply to, and the research suggests that is the case here. More than 60 percent of the 3,300 physicians profiled say they would be interested in working for three to six months for little or no pay in an apprenticeship as a way to learn more about a new industry and to assess potential career growth opportunities. Unfortunately, they are unable to find such training opportunities.

 Research also suggests that by carefully selecting physicians and providing them with the right orientation and training, pharma employers will find that the vast majority of MD professionals can learn to modify their work styles to succeed in a nonclinical work culture. 

Corporate recruiters and human resource directors agree that when any new employee is hired, 20 percent of the likelihood of her or his success in the new job relates to technical skills. The other 80 percent depends on how well the individual's behavior fits with the  organization's culture. Most doctors find themselves on a steep learning curve in both the technical and cultural arenas for the first two years of their transition into pharmaceutical medicine.    

It's a flaw in the training of US physicians. Those students are not required to study pharma sciences during medical school and internships. Few, if any, doctors entering the industry have had standardized training for their new careers. Consequently, it is difficult for pharma employers to know precisely what technical competencies entering physicians have at the time of hire. 

Physicians coming into the industry must learn or enhance their existing knowledge about a range of technical skills relating to drug development; drug safety; and clinical trial design, documentation, and monitoring. Some continuing education courses provide such training, but not knowing which competencies they need to develop, most physicians tend to select programs haphazardly.

They must also learn how the industry works. Many executives and recruiters say that technical training alone isn't enough, that actual hands-on experience is necessary for even entry-level hires. That presents an essentially insurmountable barrier to improving the current physician shortage, because industry internship or apprenticeship opportunities are rare. 

Although doctors spend much of their first two years acquiring technical and industry-specific knowledge, most new hires also spend a significant amount of time figuring out how to function effectively in a corporate environment, a dramatic cultural change from their former practice or academic research setting. Moreover, pharma companies often expect physicians' age and experience to qualify them to be managers. Yet many doctors have never had significant personnel management responsibility. 

Physicians new to the industry frequently describe their entry experience as being "thrown to the wolves." Many admit to a sense of floundering and frustration as they try to figure out what competencies they need and how to obtain them in the absence of any structured learning curriculum, clearly defined development objectives, or practical feedback from supervisors and mentors.    

There are several practical steps the pharmaceutical industry can, and should, take to maximize its return on investment in physician employees.    

 Physicians and pharma companies alike would benefit greatly from a "development pipeline." That pipeline should consist of a standardized training curriculum with both didactic and experiential learning that would prepare doctors for a certifying examination. 

The majority of the nearly 1,000 physicians who work in the UK pharma industry have been trained in that model through the British Association of Pharmaceutical Physicians and have received a diploma from the Faculty of Pharmaceutical Medicine. The International Federation of Associations of Pharmaceutical Physicians (IFAPP) advocates such standardized training and certification on a global basis. The "faculty" is also working to develop a specialty certification process for pharmaceutical medicine similar to that of other medical specialties.

Similarly, the American Academy of Pharmaceutical Physicians (AAPP), a member of IFAPP, strongly advocates the standardization of training in the United States and the development of a specialty certification process for pharmaceutical medicine. 

Formalized training for that specialty will establish a more robust pool of qualified candidates, and the physicians' competencies would be clearly known to those who hire them. As a side benefit, that standardization is also likely to help reduce press and public skepticism of the industry's clinical research efforts.

The seeds of that pipeline have already been planted. Pharma companies can now direct grant money to the AAPP Education Foundation, a 501(c)(3) tax-exempt charity, to support and develop its recently established Pharmaceutical Medicine Fellowship program. 

 During the past decade, the number of physician trainees pursuing clinical research careers declined significantly. Between 1994 and 1997, first-time physician applicants for National Institutes of Health (NIH) research grants dropped 31 percent. From 1992 to 1997, physician postdoctoral trainees supported by NIH through individual fellowships and training grants plummeted 51 percent.

Several factors contributed to the trend, including income disparities between specialist clinicians and researchers, rising medical student debt, difficulties obtaining grant funding for patient-oriented research, and the pressures on academic faculty to see more patients and generate more revenue, leaving less time for research. 

Perhaps more important is the fact that few medical students or residents are guided toward, or even consider, pharmaceutical medicine as a professional pathway. For the most part, they don't know any physicians who work in the industry or have any role models who have pursued such a career. 

To address the problem, pharma companies need to establish an aggressive direct-to-students, -residents, and -faculty marketing campaign that highlights industry career options. Ideally, the target audience would be provided with general information about the various roles physicians play in the industry, specific information about how to prepare for those roles, and opportunities to meet physicians who have successfully transitioned into them. Such a campaign would be well received and would probably attract some of the best and brightest scientists from top medical training institutions. Currently, the only contact that most medical students and residents have with pharma is when a sales rep brings pizza into the hospital at lunch time; the exhausted, famished trainees sit through a product pitch just so they don't feel guilty when they grab a slice or two.

 Most companies still believe that physicians are moving into the industry simply to exit clinical practice. Although that is true in some cases, making that assumption can limit the candidate pool. Even mid-career physicians can be highly motivated and committed to pursuing pharmaceutical medicine for the "right" reasons. 

Providing interested physicians with a clearly defined transition pathway allows them to both prepare for their new career and demonstrate their commitment to it. Mid-career physicians who demonstrate a willingness to retrain and move to the bottom of the corporate ladder are clearly not burdened with "cultural impairment syndrome."

Pharma companies would be wise to use a proven approach to selection: Develop a success profile of doctors in their employee and use it as a guide when assessing new candidates. An effective success profile will not only assess why a candidate is motivated to move into pharmaceutical medicine but will also identify the characteristics that correspond to a likely behavioral and cultural fit with the company.

Pharma companies may also want to consider establishing several entry pathways for potential physician employees. By creating low-grade physician trainee positions that lie somewhere between internships and traditional employment, executives will have the opportunity to directly assess the individual's ability to adapt, learn, and fit into the corporate culture. Those who excel can be confidently hired into traditional roles and will have a jump start on the learning curve.

 Although in-house training is standard for most other pharma employees, it is relatively rare for physicians. Some hiring managers assume that physicians are already so well schooled that they need no further training. Unfortunately, some physicians make that assumption as well. Yet, in-house training in some unfamiliar areas can be very valuable in successfully integrating staff doctors into the new corporate environment and their new roles. 

Some companies offer courses focused on business, financial, and interpersonal skills, as well as diversity training and team building to other employees but not to physicians. Interpersonal skills training, for instance, can teach physicians useful alternatives to their traditional habit of giving orders in patient-care settings. 

An effective selection strategy is the first step toward the successful integration of new physician hires. In addition, companies could make integration even easier by providing training not only to the new physicians but also to the key employees who will regularly interact with them. Understanding is a two-way street, and such training on the company's side helps alleviate the professional jealousies, antagonisms, and biases that doctors report are sometimes palpable enough to cause them to leave the company. 

Doctors are highly achievement oriented and eager to master the requisite success skills. But like other employees, they need clearly defined learning and performance objectives, access to training opportunities, and structured performance feedback at regular intervals.    

Opportunities for learning include in-house or outsourced training, focused reading materials, online forums, executive coaching, and mentoring. Companies should structure the learning framework according to individual career stages and areas of performance mastery. Target competency areas should extend beyond the technical and regulatory to include management.

Some physicians, no matter how bright, well trained, or seasoned, are simply not suited for management careers. Nor would they choose to become managers if any other promotion tracks were available to them. But because they can see no other way to advance in their organizations, they often accept roles for which they are ill suited. Ideally, all pharma doctors should be assessed for management abilities and interest, then tracked accordingly. Those identified as well suited for management should receive additional training to help them successfully move into those roles.

Every physician needs a personalized career development path. To address that need, some organizations have developed alternative career development tracks for experienced doctor-scientists, allowing for incremental promotions outside of management but at parallel levels. 

Another approach is to design management roles so they are shared by a team: One person-often a nonphysician-manages administrative and personnel issues, and the other-typically the physician-focuses on the technical ones. Burroughs Wellcome used that technique during the development of Zovirax (acyclovir). Given that the program resulted in expeditious FDA approval and 17 years of unopposed patent life, the company and the individuals involved view it as an extremely successful approach. 

Retention of a company's best and brightest physicians is notoriously challenging. Although research indicates that industry physicians turn over, on average, every four years, the doctors interviewed by MD IntelliNet report that within a month of assuming their first industry position, they begin receiving calls from recruiters seeking to entice them to join another company.    

The cost of that turnover, including replacement, training, vacancy, and sometimes severance pay, is estimated to be one-and-a-half times the position's average salary of $262,000. It is difficult, however, to capture the full costs of lost productivity when considering that each week that a patented major drug is delayed results in $11 million in lost revenue. 

Many industry executives simply shrug and accept physician turnover as inevitable because of their belief that everyone can be bought for a price. But there are plenty of countervailing incentives that can help retain valued and talented physician employees. 

First, companies can optimize the recruitment process. If the fit between the individual and the employer is solid, the employee is unlikely to jump ship the first time a recruiter calls. Assessing the fit early in the recruitment process-by using a well conceived and developed success profile-must go beyond evaluating credentials and technical skills to include the behavioral and cultural elements of the match.

Second, human resource managers can conduct exit interviews with all physicians who leave to join a competitor. It's important to not make the mistake of believing that such defections are only about money. People have good reasons to leave that transcend salary. Getting their feedback is a smart offensive tactic for developing and improving retention strategies.

Pharmaceutical Executive-11-01-2001

Feds Crack Down on Fraud

Business as Usual

Vouchers: More Data, Fewer Dollars

Doctors in the House