On October 26, 2016 at the National Press Club in Washington D.C., CARMA hosted a forum entitled, A Crisis of Trust? Pharma and Healthcare Beyond 2016. This event discussed the reputation of, media and public perceptions about, and policies and practices concerning the pharmaceutical industry. For a full list of panelists, see below.
Pharmaceutical Industry Insights – Media & Stakeholder Analyses
Jason Booms, Managing Director of Analytics, North America with CARMA, opened the discussion with a presentation of media research conducted to assess the reputation of pharmaceutical companies. His presentation provided the following insights:
- Although the precise scope and significance of reputation is the subject of debate, Jason provided data indicating that pharmaceutical company successes and failures that impact reputation have real-world consequences.
- According to Jason, “As you can see with one specific Bio-Pharmaceutical company that underwent some challenges, [these challenges] impacted their stock price, which frankly is a very tangible diagnostic measure.” In short, changes in perceptions drive behaviors.
- He acknowledged that positive topics did appear in the research, but negative coverage was pervasive, such as “corruption stories, product flaws, data issues, [and] questionable communications practices.”
- Moreover, even within themes where the industry generally performs well (financial, management), there were concerns that can have a significant deleterious impact on corporate favorability.
- Jason introduced the Reputation Resilience Score and explained that there was an unusual parity among several pharmaceutical companies, showing an unusual lack of differentiation and a level of reputation vulnerability that can best be described as “exposed.”
- He concluded his presentation with the idea that companies have the opportunity to distinguish themselves by creating their own positive identity based on values core to those in the health care arena (societal benefits, patient care, advancing science, etc…)
- He then transitioned to the larger panel discussion to consider methods of achieving this. Throughout the talk, recurring themes emerged that shaped the conversation and provoked interesting considerations about the industry.
The panelists began the conversation by discussing drug prices and the controversy that can surround them. Although the panelists acknowledged that there are different factors affecting drug prices, David Seldin, Partner with Brunswick Group and Former Corporate Communications Director at Blue Shield of California, said, “[pharmaceutical companies] are at the tip of the spear in terms of what the consumer actually pays [and] get a bulk of the blame for high pricing.”
This blaming appears in media coverage. According to Robert Zirkelbach, SVP of Communications with PhRMA, “You have a challenge where you’ve got a lot of these stories in the media that are out there. You’ve got people facing real cost challenges to be able to access their medicines and they’re connecting the dots in a way that might not be accurate.” The media’s abundant coverage of the pharmaceutical industry’s responsibility for rising drug costs influences how the public regards pharmaceutical companies, generally causing greater mistrust and a lack of good-will.
During their discussion of rising drug costs, the panelists identified price negotiation tactics, as well as the misinformation surrounding these strategies. Dr. Francis Palumbo, Professor and Executive Director at the Center on Drugs and Public Policy with the University of Maryland, explained that, contrary to popular belief, negotiation does occur in the Medicare system. Although negotiation does affect Medicare costs, circulating information about the lack of negotiation skews the public’s perception and understanding of the prices they’re made to pay.
The panelists frequently re-visited the issues and challenges surrounding the advertising for drugs. According to Dr. Ruth Lopert, Adjunct Professor at George Washington University School of Medicine and Milken Institute School of Public Health, only two countries worldwide allow direct advertising of medications to consumers, and “part of the problem is that a lot of the direct to consumer advertising oversells the benefits of medicines and underplays the risks… it creates fear, and anxiety about conditions and increases perception of the severity of some things.”
Throughout the conversation, the panelists considered how the media affects discussions and perceptions of the pharma industry. Peggy Peck, Editor-in-Chief of MedPage Today, stated that nontraditional types of media, such as social media and blogging, have increased the access and visibility of conversations about issues within the pharmaceutical industry. The blog post or tweets of an agitated consumer can proliferate and gain attention from larger media sources, who further propagate the story. This creates a large network for discussing issues in the pharmaceutical industry, thereby impacting their public reputation.
Question & Answer Period
During the Q&A at the end of the event, audience members proposed questions about creating an open dialogue in the industry, increasing competition among companies, and improving reputation of the industry. Transparency and the benefits of storytelling and content were the main proposals for improving the reputation of the pharmaceutical industry.
For full coverage of the panel, see the video above.
The panelists included the following individuals:
- Jason Booms Managing Director, Analysis, North America, CARMA
- Ruth Lopert Adjunct Professor, George Washington University School of Medicine and Milken Institute School of Public Health
- Francis Palumbo Professor and Executive Director, Center on Drugs and Public Policy, University of Maryland
- Peggy Peck Vice President and Editor-in-Chief, MedPage Today
- David Seldin Partner, Brunswick Group; Former Corporate Communications Director, Blue Shield of California
- Robert Zirkelbach SVP, Communications, PhRMA
Photo credit: Gordon Platt