Novartis targeting health providers

Dec/19/2007 06:23 Filed in: Pharma Business
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Just how much power do health providers have over what we are prescribed? Well with a majority of leading products due to come off patent, a lot ! Novartis therefore has decided to target health providers by having members of the sales force call on payers. Will it work? Well it may come down to science vs. economics. Does the science justify a branded product over a generic and can a branded product lower overall long term health costs? Now pharma sales people may have to become economists to "detail" payers.



With so many leading drugs, like Lipitor, coming off patent in the near future payers see a major opportunity to reduce drug costs. The pharma model to date has been to market "new and improved" products to replace blockbuster coming off patent but payers are saying "not too fast". Before they add these new products to formularies they want proof that in fact these products are better than generic rivals and provide patients with better outcomes. It therefore makes sense for Novartis to target payers but is their sales force equipped to handle the objections they will get from payers?


Formulary managers are under a lot of pressure to reduce costs and recommending generics is a great way to cut costs. Often physicians are given notice to recommend OTC products, such as Prilosec and Ibuprofen, before writing an Rx. Some physicians even have to get special permission to write branded prescription products when there are OTC equivalents. So salespeople are going to have to explain to formulary managers why their branded product is better than generics or OTC products. This means that more head to head clinical trials maybe required leading to more costs for drug development.


The idea to detail formulary managers is a good one and a great move by Novartis but it is going to require a new breed of pharma salesperson with a wealth of new information based on science and economics. I can see the seminar now "The economics of treating acid reflux" by Nexium.


Of course who is left out in the cold on all this? The patients who are increasingly becoming more knowledgeable about health care choices. They may find that after they see a DTC commercial and do their research that their health plan will not allow their physicians to write an Rx for the medication of their choice or that the copay for a branded Rx is $30 while the generic is $7. Big pharma has received a lot of negative press in the media but that spotlight may soon be shared as more and more patients understand the power that insurers have over their health care choices.
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