IMS Health data for the first quarter of 2008 in the US apparently suggest that:
- the number of scripts dispensed is growing at its slowest rate in at least a decade
- the rate of prescription growth has fallen steadily since early 2007
- the number of scripts dispensed may actually have fallen in 2Q08
Furthermore, for May 2008, branded products represented only 30.6 percent of treatments dispensed, down from 45.9 percent in 2003.
Health + Strategy has suggested for some time that there has been a major disconnect between the expectations of the biopharmaceutical industry and the realities of the health-care market. These data may be the ”wake-up” call that urgent, creative, and cost-affecting actions still need to be taken by the industry if we are to continue to hold a major position in the minds of investors and customers as a great and highly valued US-based global industry.
It is time for the US biopharmaceutical industry to get itself out of the “basic care” business — unless of course it truly believes that we can develop revolutionary products that can actually manage things like hypertension, diabetes, and asthma with a quantum leap in quality over current therapies, most of which either are or soon will be available generically).
The opportunities to develop and market high value, inventive products that can address real unmet needs in smaller but well-defined market segments are still vast. Such products will not need the huge sales forces and administrative overhead that have characterized “big pharma” for the past 20 years. They need creative thinking, high levels of efficiency in product development and commercialization, and transparent data that support appropriate use of the products.
We appreciate that many companies have started to take steps down this path. And some are a great deal further along than others. But the message still isn’t being delivered effectively to the American public, and the value not only of available products but also of many development-stage products is still open to considerable question. Our recent history and behavior is profoundly affecting our current opportunities, and still greater effort is needed to send signals to the public that their concerns have been heard.
Leadership is still being controlled by an outdated set of investment and business expectations. Transformation of these expectations is at the heart of the future of the global bipharmaceutical industry.
However, apparently Billy Tauzin, the president of PhRMA, “get’s it,” according to a report today in FiercePharma. The report attributes the following quotations to the “Cagey Cajun:”
- “Your house is on fire, and you’re still smoking in bed.”
- “Our members were advertising life-saving medicines like it’s Pepsi, and that hurt us.”
The first of the quotes was apparently made on a recent conference call with senior pharma company executives. These two statements from Tauzin are among the first real signs of meaningful life beyond the 1980s from PhRMA in more than a decade!
Filed under: Business strategy, Health and drug costs, health economics
