Favorable Health Care Reform Legislation Impact on Pharmaceutical Companies
It appears the pharmaceutical industry may have dodged a few healthcare reform bullets, at least temporarily, with the pending legislation. Again, maintaining the industry business model status quo while enhancing their potential customer base by tens of millions of newly insured patients.
So the industry “bought” some time.
It is not clear that companies have figured out that the need for change is still there. Even the hot legislative issues of government negotiated prices, additional rebates or other price control strategies, and importation are not going away. Market expectations also remain high for more effective and safer products at market sensitive, value-based prices. The market is also no less weary from the “hype”, questionable ethics, and financial “conflicts” of traditional sales and marketing tactics. Public trust and confidence has probably not improved as a result of the multimillion dollar lobbying campaign.
Healthcare reform should be acting as a catalyst for change. Now is the time for pharmaceutical companies to formulate new, more market receptive strategies, and retool their R & D to deliver truly innovative new products, dramatically reduce their operating expenses, and reestablish corporate cultures that embrace integrity. Unfortunately, the “dodged bullets” and “bought time” may have just mitigated the organizational “need for change” and sense of urgency.
Companies that remain committed to change, address their organizational challenges, and correct the market driven concerns will find they are creating a competitive advantage for when the market, and not legislators, decide how to employ pharmaceuticals in the delivery of healthcare. An increasingly cost conscious “managed” market with expectations to have better treatments for more patients at lower costs awaits the industry.