While looking around, it won’t be difficult to spot many types of steep-priced highly innovative products, where high costs aren’t justified by high R&D expenditure, but for unique ‘customer value’ offerings. Many consumers evaluate those and decide to settle for one, instead of opting for cheaper variants – delivering the basic customer requirements in that product class or category. Although, both pharma and electronic goods belong to high tech-based knowledge industries, similar examples are in plenty of the latter, but hardly any in pharma.
Agreed that pharma is a highly regulated industry, unlike electronic goods. But so are banks, financial services, airlines, telecommunication, among many others. Interestingly, all these industries are building great brands without talking about their investment costs in R&D, while doing so.
In this article, I shall focus on – despite facing a formidable headwind, mostly for the same, pharma industry, in general, continue to lack in two critical areas of brand building. But, before doing that let me quote from some recent research papers wondering, how is this situation continuing unchanged, despite all concerned being aware of it.
Two opposing views:
Just to recap, let me put below, two diametrically opposing views that continue to clash with each one, since long:
- New and innovative drug costs being excessive, globally, lowering their prices will not harm the progress of innovation.
- Drug industry argues, any restriction of free pricing of innovative drugs, will seriously jeopardize innovation of newer medicines and treatments.
So much of divergence in the views of two key partners within the industry, can’t just continue any longer, without a serious intervention of governments across the world, including the United States.
Pharma does want to talk about ‘Cost & Value of Medicines’. But…
It’s not that pharma doesn’t want to talk about ‘Value of Medicines,’ but not, apparently, to create an ‘emotional connect’ with its stakeholders, including the patients. It appears, more as a general justification for the high cost of new drugs. For example, a pharma trade association’s communication, after acknowledging ‘that many are struggling to access the medicine they need,’ says upfront: ‘Discussions about costs are important.’ It follows a series of much-repeated common justifications, which are no- brainer, such as:
- Medicines Help Patients Avoid Expensive Hospital Services,
- Developing New Treatments and Cures is a Complex and Risky Undertaking,
- Medicines are Transforming the Treatment of Devastating Diseases.
But, the reality is,…continue reading…
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