Medicare drug pricing negotiations have put pharma in the hot seat, forcing the industry to defend its worth to an American public that believes prescription drug costs are unreasonably high.
But as the first group of companies with drugs subject to negotiations decides by the end of this week whether they’ll participate in the process, it could be the perfect time for pharma marketers to reframe the conversation, according to Leslie Isenegger, practice leader for corporate pricing and public affairs at Real Chemistry.
The agreements between those companies and the CMS will kickstart a yearslong behind-the-scenes tête-à-tête that will appear to outside observers like a relatively quiet negotiation period. But between proceedings on the bevy of lawsuits pharma has levied against the Biden administration and messaging around the upcoming presidential elections, Isenegger said Medicare negotiations will remain in the news.
“Drug pricing is one of those issues that's very populist … and it's something we're going to see come up throughout the election year,” Isenegger explained. “Now is the time for pharma communicators to get engaged, to anticipate questions, to build that value story and how they want to communicate their role within the system.”
Here, Isenegger offers advice for pharma marketers looking to lead the conversation around drug negotiations and better champion the industry’s positive work.
Focus on value
First, Isenegger said it’s important for marketers to reset expectations around what price negotiations are designed to do and correct misunderstandings about why drugs are put on the list.
For instance, she said that while the HHS chose the first 10 drugs because of their overall cost to the government — in total they accounted for 20% of Medicare Part D spending between 2022 and 2023 — the treatments weren’t necessarily among the most expensive for patients.
“Now is the time for pharma communicators to get engaged, to anticipate questions, to build that value story.”
Practice leader, corporate pricing and public affairs, Real Chemistry
“These companies were not put on the list because they are bad pricing actors,” she said. “If a lot of people benefit from the drug and a lot of people take the medicine, you could get on this list.”
Rather than fighting pricing and profit accusations, she argued that marketers should reframe the conversation around the list to show that it’s about volume of sales, targeting drugs that are important for society.
Contextualize drug costs
She also recommended that companies double down on exploring the unknown implications of the law on patients, especially when it comes to other players in the healthcare sector.
“There are so many different actors and levers and there are a lot of things not covered by how the law works,” she said.
One way to do this is by peeling back the curtain to show why a Medicare-negotiated maximum fair price for a drug might not “mean that patients are going to be paying less out of pocket for prescriptions,” Isenegger suggested.
Marketers could also compare drug prices to other costs in the healthcare sector.
“We're spending a lot of money on blood thinners to prevent stroke, but what is the overall cost of stroke to the healthcare system?” Isenegger asked.
Answering questions like this can help reframe the conversation around the value of medications and potentially position the pharma industry as a more positive player in the system.
Leverage internal stakeholders
While communicating with regulators and the business community is an important piece of marketing around drug pricing, it’s vital that the message also reaches the general public.
Typically, pharma uses advertising campaigns and public relations efforts for this type of outreach, but Isenegger recommended leveraging employees as advocates who can stimulate conversations around the issue in a way that people can understand.
“Every person who works at a pharmaceutical company has the opportunity to be a champion for what they do for a living, bringing medicines to patients,” she said.
To kickstart grassroots communication, companies can develop strong internal communications by holding regular town halls and circulating fact sheets to help employees understand the value propositions of the medicines they’re developing so they can better explain the value of their work and the industry at large.
“When they go to a barbecue or Thanksgiving dinner, they can have a conversation and explain and provide context, even a few people at a time,” Isenegger said of the approach. “That's where you make headway into getting real understanding. It's not one big conversation; it's a lot of smaller conversations.”