Can Pharma Market Adherence?

Alex Savic - Alensa CEO

Alex has been working in the European generics sector for the last decade, primarily focusing on cross-border in- and out-licensing as well as pioneering the concept of outsourcing the granulation process through the use of direct compression products. Since 2005, Alex has been director at ALENSA AG, where he has concentrated on the role of IT within the pharma industry and initiated several eHealth projects including an e-commerce application for pharmacies for which ALENSA was selected as a "Top 10 eHealth Innovator" by MarketIntellNow in 2008. Alex will be presenting ALENSA's latest projects at this years Medicine 2.0 congress in Toronto and Health 2.0 conference in San Francisco.

Imagine a scenario where you must choose a medication for which there are multiple competing products on the market, but only one of which has a pharmacy consultation, education and follow-up intervention program attached at no extra cost to you. Which one would you go for ? Most likely, the product that has the service package attached. Now imagine you are a prescribing doctor, and you’re faced with the same question. In a perfect world, you would of course prescribe the product that ensures the best health outcome for your patient, thus the product with the adherence service package attached.

That is the premise behind the idea of pharmaceutical companies developing and marketing products with adherence as an integral part of the product, rather than as an afterthought. Can this vision be turned into reality ? If the latest examples of pharma companies and health insurers working together to improve patient outcomes is any indication, then perhaps yes.

The first example, as reported in the New York Times, is a deal between Merck and Cigna “to peg what Cigna pays for the diabetes drugs Januvia and Janumet to how well Type 2 diabetes patients are able to control their blood sugar”. Under the novel arrangement, Merck will give Cigna discounts on Januvia and Janumet for patients with good adherence and patients whose blood sugar is better controlled — regardless of whether the improvement comes through Merck’s drugs or other medications. This arrangement encourages Cigna to promote adherence which should result in higher sales for Merck, due both to patients taking their medication as prescribed, but also because “Cigna’s incentives to reap the benefits of the deeper Januvia and Janumet discounts will prompt the insurer to try to keep patients on those drugs”. Also as part of the agreement, Merck will get “better placement for Januvia and Janumet on Cigna’s formulary, meaning a lower co-payment for patients than for some other branded drugs”.

A second example is a deal struck by Procter & Gamble in coordination with marketing partner Sanofi Aventis, and the insurer Health Alliance. In this arrangement, P&G will reimburse Health Alliance for the costs of treating fractures suffered by patients taking P&G’s osteoporosis drug Actonel. As quoted in the New York Times, Dan Hecht, general manager of the North American pharmaceutical business of Procter & Gamble said “we’re standing behind our product, we’re willing to put our money where our mouth is.” Naturally this deal also has commercial benefits for Procter & Gamble, namely that the deal could “reduce the pressure on the insurance company to move patients off Actonel, which costs about $100 a month, to less-expensive generic versions of Fosamax”. Plus the insurer keeps “Actonel in a tier of its drug list that requires a smaller co-payment than for a competing brand-name drug, Boniva”.

In both of the examples above, it is self-evident that an investment in a pharmacy led adherence program would greatly improve the chances of achieving a positive patient, and therefore financial, outcome. What is very interesting is that such adherence programs now have a business model where they are paid for by the health insurer in the first example and the pharmaceutical company in the second, rather than placing the burden on the pharmacy or patient.

These two examples suggest that pharmacy adherence programs could become very significant components of pay for performance deals between pharma companies and insurers in the future and may lead to the pharmacy gaining a significant role in, and financial benefit from, adherence based marketing strategies.