GlaxoSmithKline Plans to Bring Physician Reps In-House Instead of Paying External Promotional Speakers

Deirdre Connelly, head of GlaxoSmithKline’s (GSK) US pharmaceuticals business, announced that GSK will recruit doctors as in-house representatives to provide education about its medicines instead of paying external speakers (Bloomberg).

Earlier this month, we saw that GSK had been cutting back its promotional speaker payments—including a 60% drop from 2011 to 2012. It looks like they will be whittling that down even further. GSK’s decision comes in the wake of a number of changes in their promotional tactics after a $3 billion settlement in 2012.

In December, we reported on GSK’s initial plan to curtail speaker pay, and to end their practice of tying sales representative compensation to prescriptions. That announcement came amid a major bribery investigation in China.

According to Connelly, GSK will “continue to disseminate this very important information on drug benefits and risks, but we’re just not going to do that by hiring external speakers.” She added: “we want to ensure that no one even perceives us to be doing anything wrong” (Bloomberg).

GSK plans to hire a range of people with medical backgrounds, including doctors and scientists with expertise in specific disease areas. These experts will utilize digital tools, including mobile platforms and online streaming of educational content to help market products. Bloomberg reported that the number of new recruits will be fewer than the number of external speakers the company has employed. According to Connelly, the drugmaker has reduced its sales force by more than 30 percent since 2009, while creating new educational roles and jobs targeting pharmacies.

Analyses

Under the Physician Payments Sunshine Act, GSK will not have to report payments to its doctor-employees. Covered recipients, under the Act, include “any physician, except for a physician who is a bona fide employee of the applicable manufacturer that is reporting the payment” so long as the applicable manufacturers do not try to circumvent the reporting requirements by styling a physician as an “employee” and not reporting payments made to such a physician.

The benefit of the physician-employee exemption under the Sunshine Act is offset in part by a potential lack of credibility among the target audience of potential prescribers. GSK employees may not be regarded as having the same clout as well-known external speakers. It will be interesting to see if the employee-physicians also maintain part-time practices as is the case of many physician employees at pharmaceutical companies. That would at least give them practical and up-to-date experience to share with their colleagues.

It is interesting to note that this is a change from the previous announcement that GSK would be utilizing current medical science liasons to provide the lecturers.  This change will probably not begin until 2015 and be fully implemented in 2016 the year that GSK is expected to move completely away from using outside speakers worldwide for their promotional talks.

We will keep watch to see whether the industry shifts as the Sunshine Act discourages external doctors from their previous speaking engagements. Pharmaceutical companies, almost all across the industry, are drastically cutting their speaker payments for physicians. Industry needs a way to promote its products. GSK could be exploring a new model.