Lynn Pellicano is an associate research director for APCO Insight in the Washington, D.C. office.
Today’s biopharmaceutical companies arguably face more research and development (R&D) challenges than ever before. Despite an industry-wide surge in the past decade that has nearly doubled investments in R&D, the FDA has approved considerably fewer new drugs. Add in brand names going off patent, increased competition with generics, upsets in late-phase clinical trials and dwindling pipelines, and biopharmaceutical companies are in a rough place, often finding that they don’t have enough revenue to sustain levels of R&D. It’s no wonder why in the last five years we have been witness to several large biopharmaceutical companies buying out the entrepreneurial talent of smaller biopharmaceutical companies with more promising pipelines. At the same time, public trust and confidence in the industry (as evidenced by ample research on the topic) has steadily been declining.
As I sit here scratching my head, thinking about what do to reinvigorate public confidence in an industry plagued with such challenges, I turn to the results of this past year’s ROR Indicator: State of the Biopharmaceutical Industry for some guidance. What immediately caught my eye was that the importance of Executive Engagement significantly increased in 2011 but remained a vulnerability for the industry as a whole. This got me thinking about successful leaders in other industries such as Steve Jobs and Bill Gates, and how their strong leadership often served to their own advantage amid controversy or challenges. If it worked so well for them, why aren’t the “leaders” of the biopharmaceutical industry following suit? Executive leadership is desperately needed to bolster public confidence. In its absence, confidence in the industry continues to corrode.
As the results show, there is an increased burden for industry executives to step up to the plate and demonstrate leadership on these issues. Their non-response is actually hurting the already blemished image of biopharmaceutical companies.
So, who should executives talk to? A good place to start would be engaging health care opinion leaders (the top 10 percent of the most active and engaged segment of the general public who are knowledgeable about health care issues; they are also the ones that policy-makers listen to when making or influencing public policy). Interestingly, the data shows a significant positive correlation between performance on Executive Engagement and the ability of the industry to mobilize advocates–suggesting that opinion leader perceptions of the industry can be positively impacted simply by the act of making executives more visible.
But what about what they need to say? Executives need to do a better job at demonstrating the industry’s value proposition. Specifically, they need to communicate that the nature of biopharmaceutical R&D has always been traditionally slower than innovation in other industries. And even though biopharmaceutical companies may be in a tough place at the moment, it doesn’t mean they aren’t being productive. In fact, it’s quite the opposite. More companies are actually investing in R&D for potential therapies that aim to respond to public health needs than in year’s past – especially for chronic and rare diseases. Not only are the costs associated with chronic and rare disease particularly high, but they often have a long-lasting impact on a patient’s quality of life. By investing in such R&D, biopharmaceutical companies are actually charting a course forward to reduce costs to the health care system as a whole, cure devastating illnesses, and improve quality of life.
So then, who’s the next (arguably, the first) face of the biopharmaceutical industry, the one that puts this all in perspective and calms our nerves? That is yet to be determined.
Findings from the latest tracking phase are now available to member companies. Specifically, this Return on Reputation Indicator explores the evolving expectations of key stakeholders. In addition, we are preparing for the next tracking phase and expect the survey fieldwork to begin in October 2012.
For more information, please visit www.rorindicator.com – or contact Chrystine Zacherau (email@example.com).