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Paul Pinsonault is president of Flanders, NJ-based Pinsonault Associates L.L.C., a managed care training and information company for the pharmaceutical industry. He can be reached at (800) 372-9009 or by e-mail at email@example.com.
Selling from every angle.
"I would like to prescribe your product, but there are brand-name alternatives available with a lower co-pay for my patients." Sound familiar?
Physicians practicing in today's managed care environment are often required to adhere to prescribing guidelines set by managed care organizations. As a pharmaceutical sales representative, it is imperative that you take a close look at what's going on in your territory regarding these guidelines for cost control and patient care assessment. You need to analyze how managed care influences your key physicians and how it affects the sales of your company's products. You should begin by determining which competitive products physicians are prescribing and what their co-payments are at the major MCOs impacting your territory, because oftentimes, the co-pay differences can be minimal. Armed with this knowledge, you'll be better prepared to respond to prescribing objections made by healthcare providers who write for brand-name alternatives with lower co-pays.
Today, many MCOs have adopted a "tiered" co-payment system, the most popular type being the "three-tier" model. The tiered co-pay system is particularly effective in encouraging formulary compliance, and can produce dramatic savings in pharmaceutical expenditures. The tiered system works by using pharmacy co-payments that shift part of the cost of prescription drugs to plan members. The co-pay levels increase in dollar amounts relative to the cost of the drugs, meaning that a plan member's out-of-pocket expenditure at the pharmacy increases in relation to the cost of the product selected. Prescribers working within a tiered system are encouraged to choose from those drugs that the MCO has deemed the most safe and efficacious at the lowest price, since these products will keep patients healthy with minimal out-of-pocket cost. In this manner, the MCO creates a win-win situation through tiered co-pays: the MCO saves money by promoting the appropriate and cost-effective use of prescription medication while giving providers and plan members the freedom of choice they demand.
The tiered co-pay system continues to grow in popularity over the "restrictive formulary" method, which limits therapeutic options and requires a complex prior-authorization procedure to gain access to non-formulary products. Indeed, the prior-authorization process used by MCOs in restrictive settings is both time-consuming and expensive to administer. In addition, the prior authorization process can be lengthy, cumbersome and frustrating for the patient and the provider, which is not in the best interest of member satisfaction. Managed care organizations have found that it is often simpler and more economical to provide access to more expensive products by simply shifting cost through higher co-pays whenever a higher-priced or non-formulary product is requested or required. As a result, many health plans have instituted a tiered co-payment system in order to shift more of the responsibility and cost of healthcare decisions to the patient. In effect, the tiered co-payment system allows plan members to participate in the decision of whether or not they really need to go off formulary or use the most expensive drug available, since the selection of a higher-cost medicine now translates into more out-of-pocket liability for the patient.
Typically, the first-tier product is a generic drug offered at a nominal co-payment, which normally ranges from $5 to $10. The second tier usually includes branded products that are on formulary, and the co-payment may range from $10 to $25. The third tier is reserved for non-formulary branded products, and the co-payments can range from about $25 to as much as 50% of the cost of the drug. There can also be product exclusions in the third tier, such as an NDC block, which means the drug may not be covered at all. At some MCOs, fourth- and fifth-tier levels are even being introduced for high-cost products, with fourth tiers reserved for drugs such as self-administered injectables and certain oral medications, and fifth tiers for lifestyle or experimental drugs as well as certain advanced biologicals.
Your pharmaceutical products will normally fall into one of three "buckets" on an MCO's formulary. This means your products may be in an advantaged position, neutral position or disadvantaged position when measured against their competitors.
Advantaged position - pull-through: When your branded product is in an advantaged position, that usually means it is on formulary and is a preferred agent on the second tier of an MCO's formulary. In this instance, the MCO has determined the product to be safe, clinically efficacious and among the most cost-effective when compared with similar products in the therapeutic category. However, this does not mean your product will sell itself! What it means is that you have a golden opportunity to use pull-through programs to increase the use of your product.
Pull-through programs may exist between your company and an MCO in order to drive market share for the preferred drug. Pull-through programs can contain components that are aimed at providers, pharmacists, patients and payers. Always remember to use the detail pieces you've been provided with when promoting your product's preferred status, as these pieces were developed by your company in conjunction with the MCO and contain a sales message that has been mutually agreed upon. Also remember to leave behind patient education materials with whoever distributes them to patients, as these are vital compliance and persistence components of a pull-through program.
Keep in mind that even though your product is in an advantaged position on the second tier, you need to emphasize the initial co-payment savings for patients and also provide any information that clearly differentiates your product from the competition. This information can be specific to the disease, product, patient or marketplace. Remember that physicians and other prescribers often receive "Drug Utilization Review" letters from MCOs noting your product's preferred status and why it is the product of choice. Seize this opportunity to remind providers of your product's preferred status and the benefits it offers them in prescribing convenience, as well as safety, efficacy and low-cost benefits for their patients.
In the advantaged position, you also have the opportunity to direct pharmacists to either recommend your product to physicians at the point of sale or to recommend that the physician substitute it when a non-preferred agent is prescribed. In turn, you should remind physicians to direct pharmacists in switching prescriptions to your preferred product at the point of sale in order to increase formulary compliance.
Neutral position: When your product is in the neutral position, it means your drug has no advantages or disadvantages over the competition as far as formulary position is concerned. In the neutral position, your drug is likely on the same formulary tier - and has the same co-payment amount - as its competitors. In this situation, you must differentiate your product based on the benefits your drug offers the patient. Your sales message to prescribers should emphasize the clinical aspects that differentiate your product from the competitors' products.
Disadvantaged position - push-through: When your product is in the disadvantaged formulary position, that usually means it has been consigned by the MCO's pharmacy and therapeutics committee to the third or higher tier of the formulary, or has been locked off formulary altogether. In the disadvantaged position, your company's drug is in a less favorable position than the competition's. In fact, your competition is likely to be in a better position - on the second tier or preferred position - on the MCO formulary.
In these instances, "push-through" opportunities exist for third-tier products that are in a disadvantaged position compared with their therapeutic alternatives. When faced with this situation, it is important that you stress the overall economic cost benefits of your product, which may include the need for fewer specialist and hospital referrals, fewer additional medications, fewer repeat office visits, fewer lab requirements, and any other product benefits that will result in overall cost savings and convenience for the physician, the patient and the MCO.
When you are successful in getting physicians to be advocates of a product that has a disadvantaged formulary position, they in turn can educate their patients on the value your product brings to them. For example, if a patient does not want to pay the higher co-payment for the product, the physician can stress the safety and efficacy profile of your product, which may save patients money in the long run due to the need for fewer repeat office visits, specialist referrals and additional drug therapies that may be required when other therapies fail.
If your product is not on a specific formulary and one of your physicians is an avid prescriber of it, you also have an opportunity to determine if he or she is willing to request a prior authorization for the product from the MCO. This may set the groundwork for your product being repeatedly prescribed and in higher demand, which may eventually result in its formulary status being improved by the MCO.
Selling in today's managed care environment is both a challenge and an opportunity. Take every opportunity to sell prescribers on the benefits your product offers their patients by using pull-through to drive market share when your drug is preferred. Emphasize the clinical aspects that differentiate your product from the competitors' when your drug has no formulary advantages or disadvantages over the competition. Most importantly, use push-through to stress the overall economic benefits of your product when it is in a disadvantaged formulary position, because this is the key that can drive demand and ultimately improve your product's formulary status for the MCOs impacting your territory. PR
Formulary position strategies
nÂ Use the detail pieces you've been provided with when promoting your product's preferred status.
nÂ Remember to leave behind patient education materials.
nÂ Emphasize the initial co-payment savings for patients and provide any information that clearly differentiates your product from the competition.
nÂ Remind physicians to direct pharmacists in switching prescriptions to your preferred product at the point of sale in order to increase formulary compliance.
nÂ Differentiate your product based on the benefits your drug offers the patient.
nÂ Emphasize the clinical aspects that differentiate your product from the competitors' products.
nÂ Stress the overall economic cost benefits of your product, like the need for fewer referrals, additional medications, repeat office visits or lab requirements.
nÂ Try getting physicians to be advocates of your product so they can educate their patients on the value your product brings to them.
nÂ If your product is not on a specific formulary and one of your physicians is an avid prescriber of it, you also have an opportunity to determine if he or she is willing to request a prior authorization for the product from the MCO.