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Emerging Channels of Innovation in Pharma

4PL Models, Value-Based Services and Patient/Pharmacist Bloggers

In this US presidential election year, political candidates and commentators alike are engaging in passionate discussions about the current movement. The candidate campaign slogans run the gamut from “A Future to Believe In” to “Fighting to Break Down Barriers that Stand in the Way.” The pharmaceutical industry should go with the flow of the political karma, part of which is to pursue a path of emerging channel innovations including 4PLs, value-based services, and scientific evidence – as well as experience-based communication. As with every revolution, there are advantages/disadvantages, opportunities/threats, and benefits/obstacles. The only way that pharma can truly succeed is by owning it – assuming responsibility for the strategies – and making the best decisions possible to bring about change.

Moving from Wholesalers to a 4PL Model: Logistics of Selling/Delivering Drugs to the Patient

A fourth-party logistics model (4PL) hinges on providing services to patients for their supply chain management functions. 4PLs specialize in integrated operation, warehousing, and transportation services which can be adapted to fit patient needs.

DiPersio-March2016artwork1Advantages

4PL costs will be lower than the fee that is currently charged by wholesalers. The supply chain design is simplified because the current wholesaler and distribution centers will be eliminated. Shipment data, security, drug safety, and simplicity are increased and improved. Manufacturers will be allowed to build direct relationships with retailers and focus on their R&D and marketing efforts.

Disadvantages

On the other hand, wholesalers believe that profits are hindered by unions. Manufacturers will be forced to retain product liability for a longer period. 4PLs have a trivial reach in remote areas. A copacetic ordering interface for patients will not be realized due to a lack of relationships with retailers. 4PLs also do not have the overall scale, size, or experience of wholesalers, and are not prepared to deal with business continuity planning. Waste will be increased, medications discarded, and supply chain inhibited by non-salable drug returns.

Moving from Price per Tablet to Price per Outcome: Value-Based Services

Designing services that are focused on value will enhance patient compliance and diagnostics through value-based health care. This approach will deliver the best probable health consequences at the lowest cost by using new health care informatics. Creative technology allows pharma to collect outcome data that identifies best practices, drives interventions that have the highest impact, and shares conclusions with clinicians and the public.

DiPersio-March2016artwork2Opportunities

Pharma has a chance to not only reestablish strategies but also rearrange operating models to attain high efficiency. Corporations will engage in different strategies that take into consideration treatment paths, drug services, and partnerships in a challenging market. Their expertise in epidemiology, health economics, and e-health promotes collaborative efforts between R&D and commercial business. Improving health outcomes requires distinct ways of handling research, clinical development, regulatory, and medical affairs. Pharma has the resources to financially support investigations into different value-based business models.

Threats

Past regulatory approvals relied heavily on efficacy, safety, and the potential of pioneering drugs for unaddressed medical needs. With leading edge value-added services, both public and private payers will create health technology assessment (HTA) units that evaluate new drugs in terms of their comparative and cost-effectiveness based on real time, real-world evidence. Less reimbursement, benefits package exclusion, and lack of regulatory approval can result when established criteria remains unmet.

Moving from Non-Critical Thinking to Scientific Evidence- and Experience-Based Communication: Patient and Pharmacist Bloggers

The dynamics of patient and pharmacist bloggers in social media emphasize a patient-centric strategy, transparency, and scientific evidence- and experience-based communication. Gathering input from patients to understand their needs so that advanced health services can be delivered, engaging, interacting with patients individually and in group settings, and encouraging a patient-focused community culture is significant in the evolving communication styles.

DiPersio-March2016artwork3Benefits

Patient bloggers interact with an online population about their personal health experiences at individual stages of their illness and develop relationships and build trust each step of the way. Studies show that patients who ask questions and offer opinions about their treatment process have considerably better results and will often share more information and be more motivated to adhere to a treatment plan. Pharmacist bloggers provide scientific evidence-based information which identifies, resolves, and prevents unanticipated and unwelcome drug therapy issues. These bloggers educate in the decision making process and encourage patients to take an active role in their self-care.

Obstacles

The privacy issues of patient bloggers become paramount when patients expose the details of their illnesses and specific medications / treatments. Transparency is stifled and real life experiences are hidden. Patient ego prohibits inquisitiveness at the risk of appearing to be unintelligent and uninformed due to a lack of medical awareness. Patients adopt the idea that pharmacists may have ulterior motives, such as promoting certain drugs over others for personal monetary gain. They assume a passive approach and allow pharmacists to drive their care as a patriarchal figure and decision-maker in the absence of a physician.

In summary, pharma can learn from the heated presidential debates and town halls that are taking place all over the country this year. The message is clear for pharma. It needs to understand the strategy of emerging channel innovations by identifying goals, assembling teams, building business cases, communicating plans, and implementing innovations. The industry will move forward by confronting barriers and doing everything possible with channel innovations such as 4PLs, value-based services, and scientific evidence- and experience-based communication to effect positive transformation. Pharma needs to establish expectations that are higher than the norm and hold itself accountable while setting aside all doubts and fears.

Linda J. DiPersio
Freelance Professional Writer
Linda J. DiPersio, MSM, MSHC, is a freelance professional writer and narrator/producer of an oral history video series for the Public Health Museum (estimated completion date June 2016). She earned a Master’s in Health Communication from Boston University and a Master’s in Management from Lesley University. Linda DiPersio has been published in the Journal of Communication in Healthcare. She is a member of the American Public Health Association and Massachusetts Public Health Association.
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