Can Pharma and Health Systems Collaborate?
The short answer is yes. But it takes a special blend of strategy and effective key account management.
A recent incident sums up a key challenge Pharma has when attempting to work with health systems. A vice president at a pharma company (we’ll call him Sam) got a phone call one afternoon. A VIP at a VIP health system was on the line. You’d know the place instantly even if you weren’t in the health care business.
The VIP said to Sam, “That account manager you have calling on us? Don’t ever send him here again.”
“But why?” answered Sam, totally confused. The account manager in question was senior and had done well at the pharma company for many years.
The VIP replied, “All he does is talk about your product. He doesn’t care about us or our problems, or even how your drug can help solve our problems. We only needed to hear his product spiel once; now it’s a waste of our time.”
There’s a whole lot of insight squeezed into that simple exchange.
First, let’s look at this from the pharma account manager perspective. How did a smart, tenured account manager get himself into this situation?
To state the obvious, there’s great pressure on account managers and brand teams to sell product. Senior leadership wants quarterly goals met and market share charts and graphs with steep upward slopes. Common sense would dictate that if you want to sell the brand, sell the brand. In other words, talk about the brand early, often, and nonstop.
But what worked a few years ago, or in other customer settings, might not work here and today. We’re in a transitional phase that has been caused by:
The patent cliff. No longer are manufacturers dominant monopolies with unstoppable mass-market products where they can afford a calcified sales model. Pitching product features and benefits outside the context of articulated customer needs is a sales tactic that other industries already moved away from en masse.
Health system and insurance carriers have gotten larger and more powerful. A pharma sales call with the decision-suite at a health care organization is now a meeting of collaborative peers.
Some pharma manufacturers have contributed to the industry building a bad reputation for being untrustworthy: https://relentlesshealthvalue.com/audios/148/
Health system needs, such as population health management and patient satisfaction, have in some cases begun to supersede interest in drug discounts. The question isn’t always how much the drug costs. The question might be if the drug is needed at all.
I’m assuming this isn’t a news flash for most, but talking exclusively about brand efficacy and safety is no longer a surefire path to success. In fact, talking about the brand too much may be a doomed way to sell the brand. How’s that for counterintuitive?
“Sometimes the long way around is the shortest way home.” —Ryan Halliday
So now we’re left with a conundrum: If your task is to help an account team sell product but they can’t focus exclusively on the product, what should be done instead?
Ensure that every account manager discussion helps the health system client discover:
The problem you solve that makes them want what you offer
The likely outcome of your solution with respect to that problem
Why you’re the best option for their current situation
Bottom line: Solve your customers’ problems.
“Impact is not about your product or service. What you are selling matters, but what’s far more important is how your offering solves someone else’s problem.” —Ian Altman
This is actually the second step in a sales approach if you think about it.
In order to solve a customer’s problem, you have to know what the customer’s problems are to begin with. Account managers cannot solve problems they don’t know about. But to get a customer to open the kimono and reveal their challenges and needs, the account manager must be trusted and valued. The account manager needs to be seen as a partner and collaborator. Said differently, there needs to be a relationship.
“We all know someone who is transactional, and it makes us feel icky. What we strive for is to feel relational, to feel that we have a relationship with someone. We all know when we’re being manipulated.” —Seth Godin
Valued partners win business today, tomorrow, and next year. Valued partners have a seat at the table so they’re the first to know of organizational changes that may affect their business. Valued partners are given first dibs on opportunities.
“If you don’t have a seat at the table, consider yourself on the menu.” —Billy Tauzin
What do pharma account managers who are valued partners strive to accomplish?
Helping to plan, build, and deploy quality improvement activities in pursuit of better patient outcomes
Leveraging disease expertise to improve clinical results that matter to health systems
Considering the whole patient journey and what happens before or after the patient’s stay or visit at a health system
Entrenching solutions that impact better patient care and, at the same time, better product utilization
Sometimes account managers are working on the types of things listed above, but as a team they’re not seeing the fruits of their efforts. If this is the case, their approach might be wrong, or they are talking to the wrong people.
To solve customer problems well, account management teams need a strategy and a comprehensive plan backing them up. No matter how spectacular any given account manager is, without the appropriate resources, training, and alignment, it is almost impossible to build the kind of relationships that add up to corporate sales expectations.
“If your go-to plan is to discount to win share, are you a valued partner?” —Dave Dierk
When striving to build an account team of valued partners, challenges and barriers abound. Here’s the top 7 to watch out for and overcome:
1. The account team is not optimally trained
Account managers may not know the right people with the right roles and responsibilities at their health system accounts.
Some account managers don’t understand the concept of “Crossing the chasm” and finding champions.
Account managers may be talking about the brand without first understanding how—or even if—the brand is needed.
Some incentive compensation plans are misaligned with training directives
2. Tactics are confused with strategy
Is there a 1-, 3-, and 5-year plan not only for brands but also for the company and sales team? If not, you’re likely lacking a strategy and you’re definitely lacking a comprehensive plan.
Everyone loves sexy. Everyone loves tangible. It’s a whole lot easier to show off a mobile app than to communicate a path to success.
“All men can see these tactics whereby I conquer, but what none can see is the strategy out of which victory is evolved.” —Sun Tzu
3. Analysis paralysis
Data can be overwhelming, and there’s always a new report that will be out shortly that you could wait for. You have to find the sweet spot where you know just enough to move forward.
4. “You can only run value-above-the-brand programming if your brand is the market leader; otherwise, you’re just driving business to your biggest competitor”
This often-cited rationale forces account managers to stick with outmoded sales strategies. It usually creates backlash in the short term, but it always creates backlash in the long term.
Instead of reverting to the lowest common denominator, leverage your competitive advantage. Find your point of differentiation and create programs that help those patients who can be best helped.
“As soon as your prospect senses you are there to push your agenda rather than further theirs—game’s over. You lose.” —Kevin Trokey
5. Medical, regulatory, and legal committees
Sometimes there is a need to educate marketers and review committees on why programs are approvable in the current ecosystem.
6. Organizational challenges
There are managers lacking adequate training and those getting promoted into roles they may not be ready for.
There’s lots of turnover, which causes issues with relationship building, customer profiling information, and also with collaborative opportunities with large accounts. When leadership changes, priorities change. And when priorities change, the programs that receive funding come and go. It is difficult for health systems to collaborate when they cannot count on program continuity. A health system is not going to alter a workflow and change staff behavior only to have the rug pulled out from under them.
There’s an organizational imperative to be innovative but also to have proven ROI as part of the program approval process. Of course, this is a paradox. If you want to be a market leader, you can’t be second or third. But you can only show proven ROI if you’re running programs someone else already is running, probably at the same accounts you’re targeting.
7. Leadership understanding, enablement, and championship
There’s a need for approval and alignment right up from the top.
It’s not coincidental that the companies achieving their market goals are the ones with the most top-down alignment.
Health care is becoming more interconnected. Physicians (nearly 80% in total) are increasingly part of networks. The obvious answer to drive brand growth is to consider how to leverage the power of health systems on behalf of your brand. Don’t miss out.
If you’d like to talk through your organizational needs, please contact David Dierk, co-president at Aventria Health Group at firstname.lastname@example.org.
For more information, listen to the following podcasts:
Can Pharma and IDNs Collaborate? https://relentlesshealthvalue.com/audios/inbw20/
The Essential Ingredient for a Successful Pharma EHR Strategy: https://relentlesshealthvalue.com/audios/inbw17/
Lifting Pharma Credibility and Trustworthiness: https://relentlesshealthvalue.com/audios/ep188/
— Stacey Richter is co-president of Aventria Health Group.
The views and opinions expressed are those of the author and do not imply endorsement by Aventria Health Group.