Pharm Exec’s sister conference organization, CBI, sponsored its 10th annual Patient Adherence Forum in April to highlight current trends in industry compliance and adherence programs — where companies reach out to help an increasingly skittish community of patients take their pills. A key feature of the conference is the grant of the Strategic Patient Adherence Awards (SPA) to recognize companies doing breakthrough work to promote the compliance agenda.

The competition aims to recognize successful programs that measurably increase patients’ compliance to their prescription medication regimen, devised and implemented by bio or pharmaceutical companies, pharmacies, health systems, payer groups, employers, agencies, or vendors.

To be eligible, a program must have been implemented prior to February 1, 2010, and campaigns must have been produced, printed, or aired and had response results tabulated between January 1, 2010 and December 30, 2010.

This year’s winners are:

• Best Branded Program: Lori-Jean Manness of Merck Canada, for the Merck/RxCanada Januvia program
• Scientific Pursuit of Excellence: Abhijit Gadkari of Merck US on behalf of Colleen McHorney
• Innovation – Suzanne Clough of WellDoc
• Best Employee Participation Program:  Laura Del Guerra of MAHCP’s Take Control Program
• Best Managed Care Program: Kelley Green of Kaiser Permanente

“I look for programs that use research, evidence, and science to drive design. I look for programs that operate at the patient level. Adherence is about people’s behavior and choices, which are terribly complex and not logical or rational. It’s personal. We quip that education alone does not improve adherence and that’s why. I also look for programs that are more subtle and affect behavior through the subconscious because that’s what drives our daily behavior,” says Steve Basiago, veteran judge and VP of trade relations at Walgreens.

“The biggest challenge is to address adherence as a long-term proposition. Chronic medications taken for a short period of time only add cost to the healthcare system without tangible benefit to health. Chronic medications when taken consistently over a longer time are more likely to provide health benefit and hopefully, reduce overall healthcare cost,” he continues.

“We often focus our attention on patients starting therapy because that’s a critical decision-making phase for them. But we still see significant discontinuation as time goes on. Instead of programs getting one extra prescription per year, how about getting an extra year of persistence?”

Finally, when asked what pharma can do to promote improved compliance, Basiago says, “My best advice is to get the funding of adherence out from under the brand marketing budget. Too often, brand marketers don’t understand adherence but are tasked with funding it as part of the brand strategy. They’re driven by and measured by new patient acquisition and not patient retention. They ration dollars and often under-fund adherence. The most successful companies have created an adherence leader, which helps with understanding. The really successful companies have funded adherence through Finance directly as an overall company priority.”

There were some surprising changes in the format of the 29th Annual JP Morgan Healthcare Conference, the world’s premier health care industry investment meeting which took place Monday through Thursday this week in San Francisco. There were increases in number of presenting companies and attendance versus last year, but curious was the first-time addition of a seventh “track” of presenting companies. The new “channel” included not-for-profit organizations for first two days and Chinese companies on Wednesday — a sign of the dynamic changes afoot.

In conversations with investors and JP Morgan staff, I learned that the nonprofits were pitching purchases of “debt.” While public companies use their presentations to promote stock purchases, the nonprofits tout their outstanding management to encourage bond purchases. Based on the sessions I attended, they sure looked like better investments than most municipal bonds. These sessions were well attended and judged a big success.

In the opening remarks on Monday, Doug Bronstein, CFO, JP Morgan Chase, covered positive economic trends across our business upon which Jamie Dimon, CEO of JP Morgan Chase, expanded at the Tuesday luncheon. Bronstein was upbeat about the conference and mentioned that there were 22 nonprofits presenting for the first time. He advised that interest in the 14 company Chinese track resulted from 40 Chinese U.S. IPOs in 2010.

It was just a couple of years ago that companies were looking to “repurposed” drugs, combinations of individual blockbusters, in-licensing of new entities and diversification to include more biologics alongside small molecule drugs to replace revenues to be lost to blockbuster patent expirations. All that has changed in the face of increasing challenges to the healthy growth of the industry from continually rising product development costs without increases in number of approved drugs; increased failure rate of Phase III drugs; rapidly rising share of health care costs as portion of GDP; the heightened “bar” for FDA approvals; and rise of reimbursement to primary consideration for investment decisions. Big Pharma which so depended on the primary care blockbuster drug business model has had a crash course in finding and substituting new revenues to replace those lost to generics and the failure of anticipated new drugs to replace those revenues to be approved.

At the 2010 JP Morgan meeting, companies started to discuss opportunities in emerging markets as an additional revenue stream to help overcome lost revenues in the big seven markets. Now with almost a “herd mentality,” almost every company is after a portion of the much higher growth in emerging markets versus the traditional markets. The majors are making large investments to develop viable pharmaceutical sales and distribution operations to market their branded generic products which they believe will be better received by middle-class patients there than much cheaper domestic drugs.

The high cost of drug development in the US  and EU has led many companies to pursue much lower labor costs in China and India through outsourcing, setting up company research labs there or acquiring existing companies. Their cutbacks in headcount and closing of facilities in the Western countries are helping fund hiring of staff and facilities in these newer markets. Those familiar with costs in China and India advise that management costs are approximately or will soon be the same as in the States but savings are from manufacturing and bench scientist staff which are approximately one 12th and one 7th the cost of a U.S. worker, respectively.

So here are the prominent “themes” this year emphasized in presentations Monday and Tuesday by many Big Pharma companies, which one assumes they think match desired success parameters from the investor’s perspective. They include:
•    20-25 percent of sales will come from emerging markets by middle of decade
•    Diversification into animal health, OTC products, vaccines, diagnostics, as well as branded generics (for some this is the reverse of divestments made in earlier decades)
•    Headcount cuts in US and European staffing
•    Hiring in emerging markets
•    Going after leading company ranking in emerging markets
•    Quality of research and development, and, finally,
•    Continued interest in innovation! (At least that wasn’t forgotten.)

Abbott’s presenter Thomas Freyman, EVP, Finance and CFO, emphasized Abbott had 50% of business outside the U.S. with 20% in emerging markets; had branded generics business outside the U.S bolstered by acquisition of Solvay and was diversified with drug, medical device, diagnostic and nutritional businesses.

Merck’s new CEO, Ken Frazier had slightly different focus but all the familiar “sound bites” — “uniquely positioned to outperform broader health care market with broad portfolio from Merck and Schering Plough merger, broader footprint in key markets and strong financials, and ability to meet needs in Emerging Markets. He mentioned their strengthened efforts and partnerships in emerging markets and diversification through drugs and vaccines. Their headcount cuts included 12% reduction in their sales force; 33% in U.S. pharmaceuticals but expansion of staff in China and Russia with expectations of 25% of business coming from these new markets by 2013. But note he didn’t fail to mention “Innovation is even more important.” Merck is still a science-based company.

Roche’s Erich Hunzik, CFO, emphasized that Roche wasn’t interested in generic or biosimilar business but rather was focused on maintaining a leading late-stage pipeline and progressing personalized medicine — they were in the “best position to push this (personalized medicine) ahead.” He reminded audience that Roche Diagnostics was the largest diagnostic company and reassured the listeners that “innovation remains key” for Roche. He wanted to be clear that their cost cutting via staff reductions planned at 4,800 by the end of 2012 was not at expense of long-term future.

Finally, Bristol Myers Squibb’s Elliott Segal, Executive VP, CSO and President, R&D countered with a very different vision — he proudly emphasized focus was on biopharma with divestment of non-pharmaceutical businesses, perspective as mid-sized company and reduction of geographic footprint.  He attributed this approach taken since 2002 as resulting in 11 new products in 8 years with the potential for four new products approved in 2011.

Audrey S. Erbes is Principal of Erbes & Associates.

The global economic crisis and its impact on the healthcare industry clearly became the central theme beginning with the opening remarks Monday morning when Doug Braunstein, Head of Investment Banking at JP Morgan, claimed there has never been a time when “credit, liquidity, and capital” were so central to every healthcare company’s strategy. This focus permeated presentations of companies and keynote luncheon speakers. Company presentations I attended included some mention or clarification about the company’s cash balance, cash flow, cash management, operational efficiencies, etc. up front and center—across big pharma, big biotech, specialty, and generic companies.

Art Levinson, GENE CEO, had a slightly different message slant—assuring listeners that innovation wasn’t dead at his company by listing their 26 NMEs in clinical development. He amused all when he took several minutes at the beginning of his talk to demonstrate how JP Morgan’s conference logo incorrectly represented the right-handed DNA helix as left-handed, a fact he thought a bank with involvement in such a highly capitalized sector should correct. He commented that if he talked about pursuing biogenerics as a strategy he would expect his board to fire him. Was this remark directed at Merck, Roche or both? Both companies have recently mentioned their prowess to pursue that business opportunity with Merck CEO Richard T. Clark making a strong point on Tuesday that they would be pursuing new revenue growth opportunities in “follow on biologics.”

A day earlier, Roche CFO Erich Hunziker spoke about its management of cash which he noted was critical to managing the business. He also wanted to make it clear that Roche wasn’t making short-sighted cost cuts and, thereby, sacrificing long-term perspective. He spoke of enhancing innovation and “operational efficiency” in the planned merger of Roche and Genentech operations. Hunziker answered an unspoken question—that Roche did not intend to kill innovation at Genentech with their planned buyout of the remaining 44 percent that they don’t already own. His tone of voice suggested he really meant it but many just don’t believe Roche can control their management style from destroying the GENE culture that nurtures their innovation. Many believe the “biomarker” for implementation of that intent or not will be whether Art Levinson and his team leaves or stays.

It was clear that there will be major changes in the healthcare system in the US with reinforcement of how that might take form by the keynote speakers Uwe Reinhardt, professor of health economics at Princeton University on Tuesday and Ted Kennedy, Jr., Marwood Group, on Wednesday. Reinhardt thought that a universal healthcare plan could be sold on its stimulus potential alone, and Kennedy assured the audience that “out the gate” the new administration would deliver the expansion of SCHIP, a Medicaid bailout for the states and a major investment in Health IT. Kennedy declared there was a “planetary alignment” on a health plan as result of the appointment of former Sen. Tom Daschle (D-SD) to head Health and Human Services and the new White House Office of Health Reform and the state of the economy. This coming together might finally result in a single comprehensive universal coverage bill in the US.

Kennedy further delineated the industry sectors most likely to feel pricing pressure and included all branded pharma and biotech drugs. He predicted new policy initiatives would drive growth for generic pharma and pathway for biogenerics as well.

There were 337 healthcare companies presenting starting Monday and running through Thursday, Jan. 12–15. These include 276 public and 61 private companies making their “pitches” to 1,427 public and 1,124 private equity and venture capital investors, respectively. Registration of attendees was sharply constrained by JP Morgan to a total of about 3,500 altogether versus 6,000 in the past. Many who couldn’t gain admittance to the upper floors where the formal presentations and breakout sessions occur filled the St. Francis hotel lobby below. They made appointments with attendees for meetings in the lobby and other venues around Union Square or waited near the elevators and stairs to introduce themselves to attendees exiting the meeting.

“The first thing out of everyone’s mouth when they come to my table is, ‘How are you handling the new PhRMA guidelines?’” said Tammy Kornfeld, senior account manager of Beyond Branding at Compas. The new marketing code is set to take effect in January 2009.

Kornfeld said the company is distributing flash drives with presentations explaining the tactics pharma companies can employ under the new regulations. “Reps may not be able to pass out pads and pens anymore, but there are many things that they will still be able to do,” she said. Kornfeld also added that, though the gifts are gone, corporate material can still be distributed.

Times have dramatically changed for the industry, said Chris Adams Kaufman, senior director of marketing operations at King Pharmaceuticals, from when she began as a sales representative more than 30 years ago. “When I started, profits were huge, sales were going up all the time, the drugs were all patented,” she said. “And now it is more of a challenge.”

Kaufman says differentiating your brand in the face of generic competition and selling products in an increasingly restricted managed healthcare system are the major issues confronting marketers. And while the new PhRMA guidelines will pull back on the activities companies can conduct (and the number of pens that they can pass out), Kaufman believes the industry can easily overcome that barrier with a little creativity. Despite a shrinking sales force, she says, reps are still integral to delivering a brand. And we shouldn’t forget it.

“There are business clichés that say there are two jobs in America: You either make it or sell it,” said Kaufman. “Being a sales rep demonstrates you have the intelligence to do the job, learn the therapeutic category, learn the marketing place, understand the clinical studies, and acquire both oral and written communication skills.” She’s sure that reps can learn how to maneuver in the new environment as well.

The trends that surfaced today are clear: It’s time to prepare to enter a new era of marketing to physicians, be cognizant and ready for the inevitable challenges, and remember the invaluable service of our sales force teams.

Today was Day 2 at Health 2.0 in San Francisco, and the overwhelming theme for me at the conference was this: it feels a lot like it did eight years ago.

In many ways, I am impressed with the number of companies that are all focused on the same goal of improving the way people consume healthcare and related information. Many more start-ups and early stage companies presented again in the standard, rapid-fire demo mode, where each company has less than four minutes to make their pitch. While this does allow for greater awareness of some of the new companies out there, it all starts to sound the same after a while.

A lot of companies talked of significant traffic to their sites or to their communities – but I had to wonder if in fact all of this traffic is coming from the same people, continuing to search many websites, hoping to find the answers or feedback that they want to hear.

A colleague of mine had an interesting insight: that the experience for a consumer to search for information online happens as a very intimate moment. If you or a loved one was just diagnosed with a serious disease, you will likely then turn to many websites to find answers and seek hope.

So where do you place your trust?

The thing is, there is no trust yet of a significant scale. As I said yesterday, Google is doing a great job to build that trust – they are the go-to place to start almost every search query, health-related or otherwise. This points to the great opportunity ahead. It is a wide open space now with many companies trying to create a brand, and become integrated into people’s lives when it comes to helping them understanding healthcare.

And that’s why it feels like it did during the Internet boom of 2000 – lots of companies, all chasing the same dollars, trying to carve out ownership of a vertical or space, each offering the same type of service solution. In time, most companies went out of business, there was a lot of consolidation, and a couple of big players paved the way.

Chances are, history will repeat itself. The reality is that the ad-driven revenue model just can’t sustain all of these new companies, and just about all of them depend on ads to survive. Furthermore, click through rates will continue to be extremely low such that companies will need to find alternative revenue streams to stay afloat.

One company did stand out for me today. Wellsphere has a Google-like interface that makes search really user friendly. Results are organized according to type, so it is easy to see if results from your search on a topic come from a blog, a journal article, a community, etc. It is one of the nicer user experiences I’ve seen to date, and worth checking out, and possibly the site that earns our trust.

Amidst all of the hype of what’s to come from Health 2.0 tools, I was a bit surprised that few companies spoke directly to the pharmaceutical companies, offering solutions for them that matter. With so much emphasis on the improvement of patient lives, it was odd to me that more energy is not being spent from these smaller start-up-like companies on building meaningful partnerships with large manufacturers by offering unique value.

I’m heading back home to Boston tonight and look forward to seeing how the vibe differs at the Eye For Pharma conference on Friday.

“Language is very important, and you have to understand how it affects perception,” says Maria Hardin, vice president of patient services for NORD (National Organization for Rare Diseases). “You have to think of the 30 million patients with rare diseases as a whole. We don’t want to salami slice it any more than we already have.”

Hardin presented today at CBI’s Pre-Approval Access conference, here at the Hilton Baltimore, and said she is concerned that classifying some drugs as “ultra-orphan” and others just “orphan” will artificially divide services and access to life-saving drugs. “We refuse to use that word,” she says.

Instead, says Hardin, the word “ultra-orphan” has been put into play by pharma companies that specialize in treating rare diseases. But sources say that this sub-classification has at least one utilitarian purpose.

“How do you explain to a regulatory agency that your trial only has 30 patients in it–and half of those are on placebo control?” asks Mark DeRosch, senior director of regulatory affairs for Vertex Pharmaceuticals. DeRosch plays a part in the development of the company’s promising cystic fibrosis candidate, VX-770.

Pammer, executive director, IS client engagement for AstraZeneca, led a one-hour session that not only defined closed-loop marketing for me (finally!), but also provided a rundown of six keys for successful promotion:

1. Focus on digital content development. In other words, work closely with advertising agencies to identify what capabilities are appropriate for your brand. You don’t want anything in your ad taking away relative information from the consumer; there’s “no value to the discussion” if that occurs.
2. Speed the content-approval process. Ongoing education of key stakeholders is crucial. Pammer confidently admitted that AstraZeneca should have taken a more modular approach at the beginning.
3. Create and sustain marketing ownership. If you find problems flaring up in your marketing programs, take a step back and identify accountabilities.
4. Encourage sales engagement. To put it the Pammer way: “Tame the big brother fear.” It’s understandable that you can’t tell reps a specific way to sell. Instead, focus on usage and don’t short-circuit the training either. Training technology is reinforcement.
5. Integrate and focus on technologies. There is no such thing as an “insignificant” change with technology.
6. Practice organization-wide investment support. It’s not cheap but it’s measurable and will pave the way for future sales force technologies to follow. With the right hardware, CLP can do its job!

The future of closed-loop marketing is here. AstraZeneca has employed it for five years, and has reaped the benefits. By exploring trends with these capabilities in the marketplace, sales reps can produce similar results.