It's become axiomatic in drug development circles that unless you're looking to move the dial on treatment standards in your chosen field, you're in the wrong business. Me-too drugs are out. Proving a therapy is essential for a person's health and wellbeing is in, especially as payers around the world are under pressure to ration increasingly limited resources as best as possible.
But despite the widespread consensus, the biopharma business as a whole gets poor marks for its ability to demonstrate in convincing terms what it often refers to as the "value proposition." In a broad survey undertaken by the Economist Intelligence Unit for the CRO Quintiles, which has a big vested interest in helping its clients navigate this tricky terrain, only about half of the respondents say the pharma sector is up to the task of demonstrating value. And if you narrow the range down to payers and regulators, you find a deep-seated skepticism in play about the value propositions being advanced by pharma companies. Only one in four says they are confident about the broader claims of value made by biopharma firms, according to the report.
That doubt persists even as large concentrations of life sciences executives see themselves making fundamental changes to the R&D process (82%) as well as commercial strategies (78%) to help make their case. And there's a wide divergence of opinion over just who holds the cards these days. Most life sciences companies see the power shifting to payers and regulators. But even after conceding a shift in their direction, most of the payers still see themselves on the lower end of the totem pole.
"Our influence has increased, but payers are still price takers for most medications," says Dr. Ed Pezalla, the national medical director for pharmaceutical policy and strategy at Aetna.
- here's the study from Quintiles (.pdf)