Healthy Skepticism Library item: 16196

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Publication type: news

Roner L.
Capitalizing on synergies to deliver total healthcare solutions
Eyeforpharma.com 2009 Jul 28
http://social.eyeforpharma.com/story/capitalizing-synergies-deliver-total-healthcare-solutions

Full text:

Like all other industries, pharma is looking for ways to optimize its operations and processes – and if not reinvent its mission, at least rearticulate its value. Baba Awopetu, director marketing excellence at Stryker, believes today’s industry and global economic pressures make it a particularly good time for healthcare companies to think about the kinds of innovative partnership models they might take forward. Synergies with other healthcare organizations must be explored and capitalized upon, he says.

“It’s a perfect opportunity for pharma to have a rethink in terms of how it operates,” Awopetu says. “Typically in tough times, companies lay off staff and/or do mergers and acquisitions to try to take costs out of the system – and we’ve had a series of those. But it’s almost like trying to fix a new problem with old tricks. Eventually those run out of steam, and it certainly seems those traditional approaches may not be enough right now.”

Awopetu says if you think about the NHS in the UK, or any kind of system that acts as a healthcare provider, their need isn’t really around drugs, or devices, or diagnostics. Ultimately, their goal is making sure their participant population is in good health.

“Ultimately, what they want to buy, in an ideal scenario, is something that ensures their population is in good health, that they’ve got good preventive care – and if they happen to fall ill, that they get quick treatment and experience a quick turn around with the right medicines to make sure they don’t end up back in care,” he explains. “But at the moment, what they end up having to buy is a bunch of different pieces that they have to get from different providers – so the doctor or surgeon is one piece, but then you’ve got the pharma companies, the device companies, the diagnostic companies and so forth.”

But as Awopetu points out, all of these providers cater to essentially the same customer base.

“They’re all trying to serve physicians, but at the same time they’ve got to deal with payers, administrators, government …and so forth,” he says. “So the customers are very similar, and the needs that we’re trying to meet are really very much the same. The challenges are also similar – generally everybody wants more for less, because there’s just not enough money to go around.”

Combining strengths

But pharmas, diagnostics companies and medical device makers all have strengths in different areas, Awopetu says. While pharma is very skilled at aspects of sales and marketing, like branding, messaging, segmentation and CRM, device companies tend to be more sophisticated when it comes to customer service, knowledge of therapy area, support and technical advice, he says.

And those differing strengths are precisely the reason there’s an obvious synergy to be had in terms of these two or three parties coming together, Awopetu stresses.

“The pharma guys stand to learn from the device guys in terms of how to deliver service, support the customer and create a scenario where the customer invites you, rather than you have to go knocking on the door,” Awopetu explains. “Vice versa, the devices guys can get a lesson from pharma in terms of how to maximize the opportunity once they get in front of the customer, making sure they get the right message across about their proposition so that they can win the deal and ensuring they get the right price and that their products are used.”

And he says, if pharma and device or diagnostic makers were to collaborate, they could accomplish in one sales call, with one rep what currently is taking two or three reps from different companies.

“You could actually have one touch point that sells everything,” Awopetu explains. “It would cut down on how much time we’re asking customers to give up for being sold to. Consider an orthopedic surgeon who needs to do a knee replacement. He needs certain drugs, certain devices and he needs certain diagnostic tools. If an organization or alliance would set up around that and deliver the whole piece, they would essentially become a one-stop shop to deliver everything that a surgeon requires to get his patient back to normal.”

Delivering true healthcare

Awopetu says where it really gets interesting is when it comes to messaging and proposition.

“You can really start to push the idea of partnering with the surgeon to get the patient back to normal,” he suggests. “And that will ring true with physicians – because you’re taking them from the diagnostic stage all the way to post-treatment. At the moment, it’s like we want to find a way to sell pills, but pretend like we’re saving or bettering lives. But these kinds of synergistic, service-oriented partnerships could really move us significantly down the path towards the goal of saving or improving lives. It sounds credible and believable, because that finally, truly is what we’d be doing.”

Awopetu believes synergistic partnerships between pharma and medical device and diagnostic companies also might benefit R&D. Getting approvals in tandem might be easier, he says, and in terms of compliance, there might be ways to collaborate to be sure a treatment is less of a burden for patients.

“If you think about it, it’s like some of the tricks the pharmas have been trying in terms of combining two drugs in one tablet,” Awopetu says. “It becomes even more interesting if you can find a way to use devices to administer slow release drugs post implantation of a device, for instance. All of the sudden there’s not this need for patients to take tablets for the next six months, because the whole system is built in together. I can imagine if pharma and the device sector got together and actually had some synergistic discussion, there would be new product lines that could be created that would add tremendous value to both the patients and doctors.”

Navigating the hurdles

Some of the challenges to building such partnerships would be cultural, he says, because currently organizations are very different.

“Just in the simplest of terms, I think now the device reps see themselves as independent ‘value adders,’ but pharma reps sees themselves as a little more than walking advertisements,” Awopetu says. And that allows the device guy to care a lot about his job; he’s typically very engaged. On the other hand, the pharma guy tends to be a little less so.”

He says there is also disparity in the pay different reps receive.

“A successful device rep can earn half a million dollars, so they’re not dreaming about moving into marketing,” he says. “But in the pharma world, their salary tends to be capped. That will lead to compensation challenges if the two groups try to work more closely together.”

What would it take to get the ball rolling?

Awopetu believes we would need to see a few companies take initial steps that might begin to prove the concept. One place to start, Awopetu says, may be just getting the R&D teams or sales and marketing teams from the various sectors together to begin exploring what’s possible.

Changing the game

He cautions, however, that companies also have to think about the buying behaviors of their customers and whether they buy in a way that accommodates this kind of synergy between pharma, devices and diagnostics.

“Customers are molded by suppliers, and suppliers are molded by their customers,” he says. “And at the moment, it’s not on our customers’ radars, because nobody’s suggested to them that it’s possible. Ultimately, what governments and hospitals want to buy, though, is getting the patient back to normal. Right now, nobody’s selling that – they only sell parts of it.”

“What we need is somebody to take the necessary steps and build the right partnerships to supply that end-to-end,” Awopetu stresses. “If someone could put that kind of proposition together, they could change the game.”

And pharmas and device companies are slowly moving in this direction with device/product combinations already on the market, he says.