BioNJ white paper: Pharma companies need to market their innovation

It’s no secret that New Jersey, despite growing competition from other states, remains a stronghold for the pharmaceutical industry.

Which is why the ongoing political pressure nationally over the cost of drugs is relevant to, and tied to, the state’s economy.

In recent years, drug manufacturers have focused on changing their messaging, highlighting the value to a person’s life that their products bring.

A recent white paper from BioNJ highlights this value proposition, and its authors said changing the way pharmaceutical companies think of their products is as important.

“Many more innovative medicines are in the pipeline,” the white paper said.

“This new generation of precision medicine can be used to develop targeted preventive strategies and disease-specific therapies. This approach can improve quality of care, enhance the patient experience and allow more efficient health care expenditures. However, the current approach of providing access and drug benefits is at odds with this goal. In current benefit design, higher cost-sharing levels and step therapy do not reflect the variations in clinical conditions and patient response. It assumes an approach of ‘one size fits all.’ Such policies may increase spending on low-value care and discourage and reduce the use of more innovative and effective medicines.

“In addition, there is a lot of waste in the system, since innovator companies must pay at least 15-20% of the price of a product directly to wholesalers, specialty pharmacies and other intermediaries; as well as subsidize the out-of-pocket costs of many consumers while maintaining programs to negotiate with Pharmacy Benefits Managers (PBMs) and insurance companies to allow and approve the use of new medicines. Even if rebates and prior authorization are eliminated altogether, innovator companies will still struggle to differentiate their products and demonstrate effectiveness due to lack of data and the right analytical framework.”

Shailja Dixit, president and founder of ApexBio, said the next step to presenting the white paper is to get a buy-in from all stakeholders, including patient advocacy groups, pharma and biotech companies, and commercial and government payors.

Which is why BioNJ — where all are members — was the platform chosen to disseminate the white paper.

“We have to have either a roundtable or talk to some of the BioNJ members and engage them more and get their feedback,” she said.

“This is just the first step.”

The framework in the white paper addresses what the authors identified a four-pronged approach that would satisfy payors’ need to have proof of efficacy, provide more information to patients and health care providers, gather more real-world data from social media and the like, and move beyond simply providing medication to engaging in the overall health care of the patient.

The “beyond the pill approach,” as it has been dubbed, looks at external health care products such as wearables and apps as part of the conversation.

Robert Goldberg, another author and co-founder and vice president of the Center for Medicine in the Public Interest, said the shift is necessary to take back the conversation from the grasp of politicians.

“The leadership has to come from the industry on this issue, because, for too long, the legislative and lobbying environment has (rewarded) defensiveness and caution,” Goldberg said.

“I believe, given the value of the products that companies develop and invest in, they ought to continue to demonstrate, as well as they can, the value of their innovations. Death is the most cost-effective medicine, if you want to be blunt about it, but we want to demonstrate that the products enrich and enhance the lives of the people who benefit from it.”

And taking the conversation out of the political context will help with that, he said.

The authors reached out to all stakeholders and intend to continue conversations in order to help develop the tools necessary to change the current conversation.

They acknowledge that people generally don’t think beyond their out-of-pocket burden, so it’s a hard conversation to have.

“What consumers are incensed about is the cost they are paying out of pocket,” Goldberg said.

“Your copay is a percentage, not of the charge, but of what the insurance negotiates. It’s the opposite, its completely upside-down with pharmaceuticals. Because the payors and the PBMs pay a reduced price, then they markup that price at the retail level and then consumers … have to pay a percentage of the list price. And they never see any benefit. The point being, that the value proposition cannot be divorced from the way medicines are paid for.”

But, by creating a more convincing conversation around the issue, there can be a change.

“I think the way to increase the interest in the value paradigm is to develop data to demonstrate the downstream benefits,” he said.

“You have to basically make sure that people are able to ask for products that are more valuable to them and they should pay less for them.”

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