How Are Pharma Reps Dealing With The Changing Healthcare Landscape?

A recent article honed in on how regulations and market forces facing the pharmaceutical industry affect the way sales representatives interact with physicians and other healthcare providers. Published in MedReps.com, the article lays out certain evolutions to the life sciences industries, which have occurred in just the last few years that have caused major changes for pharmaceutical sales reps.

First, the article examines the Physician Payments Sunshine Act’s role in making doctors less likely to see sales reps. The Sunshine Act (or Open Payments) was enacted as part of the Affordable Care Act and requires pharmaceutical manufacturers to publicly report any payments they make to physicians or teaching hospitals—this could include lunch, speaker fees, consulting payments, etc. The article quotes a 2014 survey of 3,000 U.S. physicians conducted by Quantia and Capgemini that found about 40 percent of physicians never see a pharma sales rep. Further, 80 percent said their organizations have policies in place that restrict their contact with industry reps.

The article notes that in light of the face-to-face restrictions, the pharma sales model needs to go digital; a process the author states is “already underway.” Pharmaceutical executives reported in a 2013 survey that “one in four direct sales force interactions migrated to digital interactions with doctors, providers, payers, and patients.”

Further, the Quantia and Capgemini survey found that 76 percent of physicians surveyed preferred to receive information about new drugs, products, and indications digitally. (See their complete study here)

The article also looks at a general shift in how providers view the value of what pharmaceutical companies can offer. The Quantia and Capgemini survey found that,
“while providers aren’t interested in promotional educational seminars, 83 percent would like to see more pharma-sponsored accredited CME events,” the author writes. “In addition, 83 percent want more provider-focused information about disease states, while 77 percent want more detailed product information written for prescribers.” Providers “don’t have time to listen to a sales pitch, but they will make time for educational opportunities,” the article notes.

The shift from individual physicians practices to health systems is another large change facing healthcare delivery, and thus sales reps looking to meet with doctors. More and more physicians are moving to health systems and accountable care organizations (ACOs); the article states that as of 2014, 57 percent of all doctors were employed by a health system. However, even more significant “70 percent of newer physicians who had earned their medical degrees in the last 10 years worked for health systems.”

This is clearly a trend and has a large effect on sales reps. “As a result of the new health system landscape, physicians have less decision-making power,” the article states. “The Quantia survey found that 70 percent of physicians who belong to a health care system are restricted in their prescribing behaviors. They don’t control the formularies of their organizations and must follow tight guidelines when it comes to prescribing.”

“This means interactions between pharma reps and physicians carry less weight,” the article concludes. “To be effective, pharma sales reps will need to find other channels to communicate value.”

Executive Vice President at Quantia, Dan Malloy summed his company’s survey up:

There is a perfect storm occurring in healthcare as more physicians are being employed by health systems and thereby less accessible to pharmaceutical reps, more constrained in their prescribing behaviors, and increasingly beholden to performance metrics. Yet the survey findings indicate that despite this increasingly consolidated environment, physicians overwhelmingly believe that pharmaceutical companies willing to adapt their physician engagement strategies have the potential to add real value to their organized networks.

Introducing physician engagement strategies such as credible online communities and digital content sharing gives pharmaceutical firms the opportunity to promote the latest, critical drug information to these organized physicians while aligning with the performance objectives of the health systems in which they work—a  true push/pull approach that will drive success for all constituents.