The Road Map to Action-Ready Solutions in the Managed Markets Arena

By Sue Ramspacher, Senior Vice President, and Lisa Fox, Associate Vice President, Managed Markets Research

Communicating the right messages to managed care decision makers is critical to achieving the best possible positioning for your products. But with so many important areas to cover and the competition fighting for a share of voice with your key customers, it’s easy to lose your way in the process.

The arena of managed markets is an ever-evolving space, where co-pays for prescription medications continue to rise, managed care organizations are revisiting their business models to accommodate an influx of expensive biologic therapies and the push by managed care toward generics becomes stronger each day. Indeed, the role of the MCO as the great equalizer in prescribing decisions has never been more prominent, and the ability of a product to obtain preferred formulary placement or to maintain an unrestricted presence can mean either financial success or demise.

To guide health care marketers in navigating the complexities of the managed markets arena, GfK Healthcare recently held a webcast titled GfK Healthcare’s Managed Markets Landmark Tour: The Most Direct Route to Optimizing Your Strategic Plan.

Let's revisit some key points of interest that were part of the itinerary for this webcast.

Findings for the presentation were derived from a number of GfK Healthcare’s primary market research studies. At the 30,000-foot level, our qualitative research, based on in-depth interviews with 20 MCO decision makers, provided an aerial view of the dynamics of MCO relationships with pharmaceutical manufacturers. Then we drilled down to the street level, with quantitative findings from our Managed Markets Monitor™ Pilot Study, examining such topics as the number of interactions between pharma/MCO decision makers, the top therapy areas discussed, as well as the types of interactions – in person or via other means. Excerpts from our multi-client managed care research, covering select therapy areas across the CNS and cardiovascular/metabolics areas, rounded out the tour and provided perspective on who the perceived “best pharmaceutical partners” are across these two areas.




What significance do our findings have for you?

With more than 80 percent of the U.S. population impacted by payors, communicating the right message to MCOs, using the appropriate interaction, whether in person or by other means and with the right frequency, is essential for success.

The challenge? Communicating and selling to MCOs is very different from detailing physicians. A one-size-fits-all approach does not resonate with this audience. To ensure your product establishes and maintains a solid formulary presence in the marketplace, it is essential to remember that “when you’ve talked to one MCO, you’ve talked to one MCO.” Organizations can vary significantly in their philosophies, policies and member composition, and their responses to pharma strategies and messages can also differ significantly.

How did your company stack up against other pharma manufacturers?




In this more complex selling environment, which Tony Yost, president of Innovex, has said requires “a more consultative sell,” Merck and Novartis are most often acknowledged as having excellent relationships with MCOs. Clearly, interactions with MCOs require a completely different approach than detailing to physicians. The findings revealed at our October 2008 sales force effectiveness teleconference Beyond the Vital Signs and Into the Hearts and Minds of Your Physician Stakeholders seem to emphasize the disconnect, since the top company in detailing to physicians was Pfizer. Yet, in the managed markets marketplace, Pfizer’s position drops substantially.

At the heart of every managed care decision is the relationship between manufacturer and MCO, fostered day-to-day by national and regional account managers. In the same way that good detail representatives can influence prescribing outcomes, so too can the managed care sales force. Strategies, message programs and contracting terms must be individualized to address each organization’s specific issues, needs and nuances.

What account team characteristics do managed care decision makers say facilitate strong relationships?

Knowledge of managed care, a working understanding of the individual MCO’s business needs, combined with honesty, integrity and not being pushy, all contribute to a strong relationship with MCOs.

So where are missteps likely to occur in relating to MCOs? Some key factors that contribute to a poor relationship stem from corporate arrogance and ineffective account management, followed by poor communications or lack of follow-up, along with lack of managed care focus.

Conversely, as shown below, factors that positively influence the MCO/pharmaceutical manufacturers’ relationships are also the account manager/account team, followed closely by therapeutic categories and number of products offered and favorable contracting.





How frequently should you reach out to the MCO decision makers?

Staying relevant without being arrogant or pushy differentiates the best account reps. How many are too many contacts? Our findings revealed that unless you have new information to share, the preference is for contact on a quarterly basis – via e-mail or in person.

Now, let’s examine the 830 pharma/MCO interactions tracked within a four-week period (9-26-08 to 10-24-08) for our Managed Markets Monitor Pilot Study:

• The method of contact was almost evenly split between in person (45 percent) and other means (55 percent).


• On average, pharmacy directors and medical directors are approached at relatively equal levels.

Which pharma manufacturers maintained the strongest presence among the MCO decision makers surveyed?

Novartis and GSK led the field in this category. In fact, findings revealed Novartis, Merck and Schering-Plough approached MCOs in person and via other means, such as e-mail, at comparable levels. Contact was more frequent from J&J companies, Pfizer, GSK and AZ, but often not in person.

Which were the top therapy areas and topics discussed?

Metabolics and CNS were the categories discussed most often, e.g., dyslipidemia, diabetes, psychiatry and neurology.

Turning to the main topics of interaction, as would be expected, clinical information and contracting are most often discussed. Novartis, focusing exclusively on clinical messages – compared to other manufacturers such as Pfizer, GSK, J&J companies, Schering-Plough and Merck – is perceived to have the best value in its messaging.

What type of information is sought by MCO decision makers and what has greatest influence on advocating formulary change?

MCO decision makers place great importance on obtaining new information in their interactions with pharma manufacturers. In our research, we were surprised to learn that new information was provided in only slightly more than 50 percent of interactions reported. One of the most important reasons pharma MCO key account managers want to meet with MCO decision makers is either to maintain current advantageous formulary status or to improve status of those drugs with less favorable positions. From the MCO decision makers’ perspective, specific information provided during the interaction and the offer presented are most instrumental in affecting positive change to formulary.

Which pharmaceutical manufacturers were perceived to have the most effective account representatives during the pilot study time frame?

Novartis, Abbott and Pfizer are viewed as having the most effective account representatives, as well as ranking highest in overall company perception. In the dyslipidemia therapeutic category specifically, AstraZeneca and Pfizer are most often acknowledged as having the best pharma-MCO relationships, but for very different reasons. Despite a perception as having inflexible contracting, Pfizer’s generous funding, educational materials and excellent account management are valued by a number of MCOs. Conversely, AstraZeneca is valued for offering flexible contracting and being aligned with the need of MCOs to push generics.

What can we conclude from our findings and what does the future hold?

In summary:

• The influence of managed care will continue to intensify, and understanding what makes each managed care organization “tick” is crucial to success.


• Given all the nuances of the environment, a one-size-fits-all approach is sure to lead you down a very bumpy road, one that does not provide a smooth path with MCO decision makers.


• As far as taking a pulse of managed care and marketing activities, continuous tracking is key. MCOs may be making decisions on your products once or twice per year, but selling on value is a year-round exercise. Basically, you can’t manage what you don’t monitor. And if you are not monitoring activity on an ongoing basis, you risk the chance of missing critical signals that can lead you off course.

The information shared here captures only some key points of interest along the landmark tour of the managed markets space. For more comprehensive information and data, please access GfK Healthcare's complete managed care webcast. (Click here to view the archived presentation. Please note: You must enter your contact information to access the presentation).





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