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Hélène Moore
Sessional
Lecturer at Wilfrid Laurier University
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Pharmaceutical Marketing is considered by many as a unique by its
scientific aspect[1] and
paradoxical set of objectives or “dual personality” as proposed by Ming et al.
(2014)[2]. From a
fundamental point of view, pharmaceutical marketing carries a double set of
clashing objectives. The first objective, is one that is humanitarian. By its
nature, the pharmaceutical industry is aiming to offer our humanity some
therapeutic solutions to their health issues, in an ethical manner. On the
other hand, these firms survival involves that they must offer acceptable
financial performance and return to their shareholders. The World Health
Organization states that this dual set of objectives is (WHO, 2015), “an inherent conflict of interest between the legitimate business goals of
(pharmaceutical) manufacturers and the social, medical and economic needs of
providers and the public to select and use drugs in the most rational way”[3].
In Figure 1, I use a simple bicycle metaphor to illustrate this dual set of
objectives. In that analogy, let’s assume that the forward movement of a simple
bicycle is representing the set of commercial activities leading to the offer
of pharmaceutical solution to the population. In that analogy, the front wheel
of the bicycle represents the humanitarian and altruistic aspect of the
pharmaceutical industry. That wheel is not directly linked to the bicycle
propulsion system, and is dependent of the rear wheel (that is linked to the
pedals by a chain) to start moving. That front wheels is also directly
influencing the direction of the bicycle. But without the back wheel, the
bicycle will remain stationary.
The back wheel represents the mercantile objective of pharmaceutical firms.
Ultimately, companies need to make profit. The firm management makes ongoing
decisions on drug prices or the amount of money they will invest in R&D to
build their pipeline as well as how much money will be invested in marketing
activities in order to optimize the financial profiles of their existing drugs
on the market.
The chain of the bicycle is at the core of the propulsion mechanism. The
chain represents the complex set of marketing activities involved in
commercializing a therapeutic solution. And we know that there is a direct and
positive correlation between the marketing activities and drug sales. There’s
the bicycle potential forward movement. Nevertheless, pharmaceutical marketing
activities are meant to be implemented in the spirit of the humanitarian side
of the business. Keeping an eye on that front wheel while moving is paramount.
Hence, research-based pharmaceutical companies have self-imposed regulations
and guidelines in order to remain in-line and reminded of their ethical “raison
d’être”.[4] Yes, there
was glitches and “oupsies”. But overall, these companies contributed to our
gigantic step forward to better understand, prevent, treat and cure human
diseases on a global scale.
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Figure 1: The Pharmaceutical Industry Bicycle
Metaphor
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In September 2015, a hedge fund scandal went viral after the company Turing
Pharmaceuticals increased the price of a previously acquired drug (daraprim)
from $13 to $750 per dose. Daraprim (scientific name Pyrimethamine), is a drug
indicated as an anti-malaria drug. Most importantly, it is on the World Health
Organization list of Essential medicines[5]. In the United States, the product is considered mature and old, as it has
been on the market since 1953. Most interesting, that drug has not been copied
by generic companies, even after a long time without formal patent protection.
The decision made by Turing screams financial genius. In the context, a
price increase was an easy and logical move. Most people would have seen the
same opportunity! Milk the cow to feed the pipeline. And all that is made
possible in the actual pharmaceutical industry context. In the United States,
the set of legislations on pharmaceutical pricing and patent challenges has
been a hot topic in the last few years. (see http://www.bloomberg.com/news/articles/2015-03-20/hedge-funds-take-advantage-of-patent-rules-to-target-drugmakers )
The only thing that Martin Shkreli (Turing Pharmaceuticals Founder and CEO)
forgot about, is to keep an eye on the front wheel of his bicycle. -He actually
might have gotten rid of that front wheel this time.-Consequence? First, the
outcome could be a very good one. By his actions and multiple media interviews,
M. Shkreli contributed to raise awareness to this ethical and legislative black
hole. This could be the start of some real change, (thank you @HillaryClinton[6]) which
would ultimately protect the interest of the patients. But for M. Shkreli, that
missing front wheel impelled him in some more decision making, and we are
looking forward to see what the next price for Daraprim will be.
The risk is that companies like that keep trying to ride the “mercantile”
monowheel.
And we all know about the best place to find good monowheel riders… the
circus.
References
[1]Stremersch, S. Van Dick, W. (2009) Marketing of the Life Sciences: A New
Framework and Research Agenda for a Nascent Field, Journal of Marketing,
73(4), 4–30.
[2] Ding, M., Eliashberg, J., Stremersch, S. (2014), Innovation and Marketing
in the Pharmaceutical Industry, International Series in Quantitative Marketing
20, DOI 10.1007/978–1–4614–7801–0_1.
[3] http://[4] See http://www.phrma.org/, http://www.efpia.eu/about-us/who-we-are ,http://canadapharma.org/
[6] On September 21, Hillary Clinton publicly protested against the daraprim
price increase on Twitter and also committed to layout a plan to stop such
practice.www.who.int/trade/glossary/story073/en/