The importance of the economic value message

2 min read
First Published: 
Jan 2008

Key Learnings contained in this article:

The pharmaceutical industry faces the major issue of top selling drugs losing their patent protection, allowing generic products to replace them at much lower prices.

This leads not only to the restructuring of the larger pharmaceutical companies to mitigate financial losses, but the subsequent job losses lead to insecurity and to cutbacks in research, sales, and marketing efforts.

This means the important benefits of major drugs are communicated less – or less strongly – thus creating confusion about which drugs actually improve the overall quality of patient life.

Far too often, internal communication of a drug’s economic value fails at the first hurdle because sales and marketing departments don’t understand the economist’s message.

This can lead to a mixed message about the products and to misconceptions among consumers about what the best treatment is for them – a generic product or the more expensive brand-name one.

If pharmaceutical companies fail to communicate the key messages about cost-effectiveness, budget impact analysis, burden of disease and the quality of life, their branded products will have a shorter life cycle.

This could allow those products to be totally outpaced by cheaper mass generics that may not necessarily provide the most effective therapeutic outcomes.

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Ruth Whittington
CEO of Rx Values Group Ltd
MSc(hons), NZSRN
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