Novartis Pilot Projects Will Shift Marketing Attention To Insurers, HMOs

Main Category: Pharma Industry / Biotech Industry
Also Included In: Primary Care / General Practice;  Health Insurance / Medical Insurance
Article Date: 17 Dec 2007 - 11:00 PDT

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Novartis officials on Thursday announced pilot projects in three states aimed at developing closer relations with health insurers and HMOs, which increasingly are influencing what medications physicians prescribe, the Wall Street Journal reports. The pilot projects will begin in January 2008 in Minnesota, Oregon and Washington state.

According to the Journal, "The move reflects a growing reality" in the pharmaceutical industry as major payers seek to cut health care costs by influencing physician prescribing habits. In some U.S. markets, many physicians work for HMOs that decide which drugs to cover based on cost and efficacy. Physicians often are less likely to prescribe drugs if payers refuse to cover the medications. The Journal reports that the "frugality of payers is a big reason pharmaceutical companies are tightening their belts and predicting a sales slowdown."

Joe Jimenez, CEO of the Novartis pharmaceutical division, said that sales representatives in some markets will focus more attention on payers and less on individual physicians. He added that in HMO markets, "if you are organized around the physician, you are missing the key influencer." If the projects are successful, the initiative will be introduced to other areas of the U.S. and in Europe (Whalen, Wall Street Journal, 12/14).

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