David Schmahl is the executive vice president and chief executive of SmithBucklin’s health care and scientific industry practice, which supports the missions and objectives of 26 health care and scientific organizations. He provides unmatched expertise and specific knowledge of the issues, challenges and actions distinctive to the changing health care environment. SmithBucklin’s Jeanette Ruby, senior manager, health care and scientific industry practice, and Jennifer Shupe, senior manager, sales services, also contributed to this article.
What happens when you mention the 1990s to an assembly of health care-specialized sales and development professionals? You hear a unified “Those were the days.”
It’s true. Those were the days for professionals engaged in sales and development with pharmaceutical and medical device companies. Eight of today’s top 10 blockbuster drugs were approved for marketing between 1995 and 2000. Tens of millions of dollars were spent in pre- and post-launch marketing efforts, with little meaningful regulation or oversight. The “gray area” of funding wasn’t between marketing and education activities, the entire realm of funding seemed to be in “the gray.”
Let’s come back to reality. Today, PhRMA, AdvaMed and ACCME (the Accreditation Council for Continuing Medical Education) are scrutinizing commercial support more than ever. The Affordable Care Act of 2010 is taking effect in various stages. Physicians and other clinicians are increasingly cautious to comply with changing regulations. And “big Pharma,” on the heels of recession and a slump in blockbuster drug launches, has tightened purse strings. Phew!
While the landscape is different, opportunities for growth haven’t disappeared altogether. We’re examining four new realities, and offering suggestions to keep commercial support a healthy component of your trade show or meeting.
1. Less money, more uncertainty. To comply with regulation, pharmaceutical and medical device companies (“commercial supporters”) have cleaved general sponsorship budgets into distinct marketing and education budgets. Unfortunately, total available budgets are trending downward. Some companies are increasingly hesitant to allocate funding given the uncertainty of costs associated with future regulation. However, these companies play a significant role in informing health care professionals by supporting continuing education, and ensuring health care professionals are informed about patient care products and services.
Health care professionals value commercial-supported education, and nothing unites them more efficiently than their respective medical societies. Accordingly, collaborations between societies and industry partners should be established and nurtured. Successful societies work to develop educational activities (accredited and non-accredited) that can be measured against specifically stated outcomes. Furthermore, it’s important to leverage your society’s protocols and culture to assure supporters that the highest levels of ethics and compliance will prevail. It’s a win-win.
To secure funding, it’s critical to demonstrate a thorough understanding of each company’s education and business objectives. Offer customized opportunities that meet their needs. Consider new ways to access your society membership year-round. Then develop relationships with marketing and education teams, and meet with them regularly to discuss how dialogue with members can be improved. Another suggestion is to invite commercial supporters into positions of society leadership (committees, task forces). The optics of such a governance shift demonstrate the society’s commitment to mutually beneficial relationships between membership and supporters.
2. Varied and complex grant procedures. Supporters have all worked to design grant submission, review and selection processes that reflect a non-biased and almost scientific methodology. The trouble is, none of them are the same. These processes serve the disbursement of education-related funding. Such funding differs from general marketing and promotion dollars typically associated with the exhibit floor.
The new reality in accessing these education-earmarked funds is that more care, time and knowledge of each supporters’ protocols and requirements are necessary. Societies substantially increase their chances of winning grant applications when they employ staff with specific expertise in preparing and submitting these grant applications. Expertise ensures that an application includes key elements such as defined learning objectives, needs assessment, budget details and a relevant program with speakers and working session titles. While most companies require submission no later than 60 days prior to the meeting, the varying decision times mean that the earlier the submission, the better. It’s no longer unusual for a grant application that was submitted in February to be awaiting decision in August.
3. The Sunshine Act — find a rainbow. The Physician Payment Sunshine Act went into effect on August 1, 2013, nearly three years after being signed into law. The delay was intended to provide pharmaceutical and device manufacturers time to put in place appropriate processes, resources and systems to properly collect and disclose any “transfer of value” to physicians. This has resulted in a significant amount of new protocols and rules, issued by supporters and societies alike, for development professionals to study and learn. Factors such as whether the meeting is accredited or non-accredited, whether meals are served buffet-style, and whether faculty received any honorarium now have real impact on possible funding success, since these factors require additional Sunshine Act-related reporting for supporters.
In past months, pharmaceutical and device companies have been sending out notices to grant seekers with declarations of specific exclusions from future support, related to the Sunshine Act. Carefully file any forms that accompanied the notification. If such notifications haven’t been received, contact your historical supporters and inquire about any changes driven by the Sunshine Act. It will be appreciated. There is a vocal debate within the overall health care industry on the merits of the Sunshine Act. As a professional charged with securing support for your society, it’s critical to stay above the political debate and simply be informed and comply.
4. More corporate complexity. Forming and nurturing relationships with key personnel within supporter companies should never be neglected. Online grant processes and seemingly impersonal decision factors will never wholly eliminate the value gained, either in the form of information or advocacy, of a friend within the target company. Complexity of today’s corporate structures, however, and fast-changing organization charts make it difficult to accomplish this. Many drugs advance through development stages under stewardship of multiple companies — through joint ventures, collaborations or speedy acquisitions. Globalization is a driving factor behind the constant shifting of personnel. Researching drugs or devices, in efforts to identify those likely to be supported by large education and marketing budgets, requires much more time and an effective means to track and organize all the information.
It’s critical that today’s development professionals utilize a powerful, yet user-friendly Customer Relationship Management (CRM) system. Spend time establishing a flowchart or roadmap that explains how a drug or device in development stage will proceed to market. Then test for clarity and understanding with your various contacts. This will heighten respect of your knowledge within the companies you are targeting and make you more efficient. The companies themselves often can explain their complex business relationships.
Health care innovation will never cease, and the outcomes will need to be promoted, marketed and explained. By considering these new realities and selecting ways to adjust your approach, success is more likely to be achieved. AC&F