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NielsenHealth rises from the ashes of failed deal with IMS Health
Look out, IMS Health: The media monitoring Nielsen Company (formerly VNU NV) just created a special division for pharma--NielsenHealth. VNU's bid on IMS in November 2005 imploded when VNU shareholders mutinied after hearing about the $7 billion buyout, but the revamped company still wants in on the pharma action.
The creation of NielsenHealth seems odd when you look at former CEO Rob van den Bergh's statement after the failed deal. In it, he said the two companies, VNU and IMS, would cooperate on initiatives. Creating a competing data and consulting division isn't exaclty cooperation, but it does give pharma companies two--more defined--choices. Of course, both NielsenHealth Managing Director Matthew Dumas and IMS claim the majority of pharma companies as their clients, which would indicate some double-dipping on pharma's part.
Dumas didn't give an exact reason for the timing of NielsenHealth's birth, but he did say the technology at Nielsen was always available, and various Nielsens had already been working with pharma. The only difference now is that the technology can be tailored to suit pharma's needs, a la IMS.
Dumas said pharma companies spent $4.8 billion on DTC advertising last year, with 98% going to TV ads. "That's ludicrous," he said. "That money should be going to online and print ads." Not only do companies have to figure out the proper ratio of money spent on TV/online/print ads, which is different for every company and every product, but they also have to take into account the doctor detailing/DTC ratio. DTC doesn't do any good if doctors don't know anything about the drug, but what's the right split? And with more companies' bottom lines being squeezed, finding the right split can save millions.
To figure out those ratios, NielsenHealth has compliance surveys, software that monitors the frequency of certain words on public Internet domains, and other trend-gathering techniques. With patients going outside the exam room for information, Dumas said tracking the way they get that information is more important than ever. "That way, we can tell companies to fish where the fish are."
New in-store clinics can be quite the monkey wrench, though. With Wal-Mart and major pharmacy chains implementing their own clinics with cheaper prescriptions, Dumas said this is a whole new ballgame. "Here's this new touchpoint for the patient that we never even considered," he said. "And just like with the movement of pharmacies into grocery stores, we need to foster a relationship between the company and the retailer."
Consulting companies also keep a close eye on FDA to track the marketing repercussions of new warning labels and withdrawal requests and to ease the difficulty of switching ad strategies for drugs going OTC. Dumas said it's all part of getting companies a greater return on their investment.
"We're trying to not only help execs make decisions, but to let them track the impact of those decisions," Dumas said.