Innovation and Focus in Healthcare

An Industry Insight with GfK US Healthcare

Richard Vanderveer, Chief Executive Officer, GfK Healthcare, discusses a fundamental shift on the horizon, both in the practice of medicine and our approach to pharmaceutical marketing.

Pfizer recently announced it was terminating more than 800 drug discovery scientists and would release more than 2,400 pharmaceutical sales representatives, each a significant percentage of its respective cadre. What's going on?

At the same time, newly inaugurated President Barack Obama seeks to provide healthcare to the approximately one-third of American citizens currently not covered. The only problem is that he plans to do this with a $75 billion opener that is neither available nor enough.

In brief, 2009 will be a year that continues the significant change in healthcare, pharmaceutical marketing and pharmaceutical marketing research. The Innovator's Prescription, a new book by Clayton M. Christensen, provides a clear understanding of many of the facets of these changes.

As for companies like Pfizer, which are radically downsizing, abandoning their research strategy and outsourcing as much as possible, Christensen points out that such organizations, originally designed to support blockbuster drugs, are now sinking under their own weight as mega-drugs go off patent and are not replaced by new agents.

Most serious conditions are well-controlled in only about half the cases, most probably because we have not become good enough at diagnostics to know which agent will work on which patients. Exceptions to this pronouncement can be found in infectious disease, where specific antibiotics targeted at specific pathogens move us from 'intuitive' medicine to 'precision' medicine, with a similar phenomenon now being observed in oncology. Christensen tells us to look for significantly more emphasis to be placed on precision diagnostics in the future.

Greater focus

As medicine moves in this direction, also look for greater precision and focus in service providers. General hospitals that attempt to do everything for everybody are hopelessly inefficient. since they are not focused in staff, equipment, etc. Compare this with the Shouldice Hospital in Ontario, Canada, that does nothing but abdominal hernia repairs, but does so at significantly less cost and with far fewer negative outcomes.

Additionally, Christensen predicts that as medicine becomes less about the intuition of the practitioner and more about the rules and tools of practice, we will be able to use much less highly trained professionals to provide much of our healthcare and do so in entirely new and more efficient settings (such as the MinuteClinics established in local pharmacies, using nurse practitioners to treat many simple conditions quickly and cost-effectively). This will help convert the cottage industry that currently constitutes healthcare into a far more organized and efficient entity, and change the question of how will we pay for the current costs of healthcare to how do we make healthcare affordable.

Progress in areas such as electronic patient records, which have failed to come to fruition not because of technical limitations but because of proprietary and protectionist interests among healthcare suppliers, will assist greatly in making order out of chaos.

Need for change

But who will make all these changes? The author is understandably schizophrenic in noting that market leaders and other established entities are usually the leaders in evolution, rather than in the kind of disruptive evolution called for here. But, he also writes that the small, upstart organizations - usually the best at disruptive solutions - will have a difficult time pulling all the pieces together that are necessary to generate efficient focus from chaos.

Finally, expect our role as marketing researchers to change fundamentally over the next few years. As medicine becomes increasingly rules-based, with less emphasis on the intuitive decision-making of the practitioner, we will certainly spend less time testing the types of promotion and persuasion currently practiced by pharmaceutical sales representatives and through other channels to influence practitioners, of which there will be fewer and fewer.

Rather, our focus will turn to the conduct of research that will help prioritize rule generation, to develop the rules and clear ways of communicating and applying them, and to investigate other ways in which we can make healthcare more precise, focused and affordable.

Richard Vanderveer has spent almost 40 years in the pharmaceutical industry and is recognized as one of the foremost thought leaders in healthcare marketing research. He is Chief Executive Officer of GfK Healthcare (www.gfkhc.com), the largest provider of fully integrated custom healthcare marketing research in the US, offering the broadest range of custom and multi-client research offerings as well as innovative proprietary approaches to meet a product's needs across its life cycle.

Dr. Vanderveer can be reached at 215.283.3200 x303 or richard.vanderveer@gfk.com