Cheesecake Factory Medicine

Physicians, nurses and pharmacists are required to spend hours each year in order to maintain their license and right to make a living.  In the pharmaceutical world, we have no such legal requirements and it is often up to the individual to stay abreast with changes in the market and the art of commercializing pharmaceuticals.  I say this because today I would challenge you to commit a few minutes and completely read through this New Yorker article that clearly shows the future of medical care and why it will happen.  I know it is long, but I am sure you will find it interesting even if you just learn about running a restaurant!

The medical world is definitely changing.  The days of every doctor doing her or his own thing are coming to an end.  Medicine is becoming much more protocol driven and these protocols are based on clinical evidence and cost/benefit considerations.  There are a couple really significant lines in the article that should stick with you.  The first is that medicine should be 95% consistent and only 5% customized rather than the other way around.  The next line is that we are tired of getting greasy-spoon fare while paying 5 star restaurant prices.  Healthcare needs Cheesecake Factory consistency where you are guaranteed quality, choice and value for your money.

Note that the article points out that only 25% of physicians are now self employed and for the 75% who are not, the arrangements are quite different than those of a decade ago.  Physicians are now not just tenets of hospitals but are expected and even somewhat required to follow strict protocols.  Medicine has become big business in that there are now huge financial risks and rewards tied to attaining the best outcomes possible.  If you have any doubt where this is leading, go to the tele-ICU section at the end of the article and you will be amazed.  It is about time we begin treating the care of patients with the same degree of rigor and oversight as we see at the Cheesecake Factory Restaurants.

What does this mean for us in the pharmaceutical world?  It is imperative when beginning drug development that you clearly have an understanding of all the protocols for the disease area you are entering.  Then you need to make a very realistic evaluation as to whether your new product will be able to break into the protocols and what price you will need to charge to make this happen.  Note this is different than thinking about what segment of doctors will use your product, or what share you can get and how much you can charge to “maximize” revenue.  Your thinking needs to change from looking at unique doctors or even buckets of doctors to trying to displace other products on the very formal protocols that all doctors are required to follow.  You need to think of the marketplace as policy makers and protocol developers, not reps sitting in doctor offices.

When designing sales aids and other materials, how often do you consider protocols?  Do you just keep talking with small groups of community doctors who have opinions but no longer have the autonomy to do what they say?  When you do targeting work, do you really still assume those physicians you are putting in buckets are thinking and acting for themselves, rather than merely following formularies and protocols determined by others?

Take a look at Richard Vanderveer’s blog from Tuesday and see how his thinking ties in with the article.  Keep in mind that Richard is one of industry’s most respected market research executives and I would argue the “father” of targeting and micromarketing.  Note how many of the things we take for granted in pharmaceutical marketing might not make sense in the new world.  If you think all this is way out or futuristic, all you have to do is take a close look at the launches over the last five years in our industry and determine if the failures can be explained by this new model.

Medicine will continue to get better due to accountable care and all the other items discussed in the Cheesecake Factory article.  This should excite us all and also be a challenge to our current way of thinking.  Everything needs to be scrutinized for its relevance in this new world.  We can either sit around reminiscing about the good old days or jump in the ICU control room and start improving the way we market branded pharmaceuticals.  I say the ICU not just because of the article but rather because of the urgency of the situation.  Think about it.

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