Lack of credibility starts to hurt pharma

The pharmaceutical industry has lost a lot of credibility in the eyes of the public, and to a certain extent the medical establishment, over the past year or two. The New York Times reports today on the forces that are combining to hurt pharmaceutical industry revenues:

  • Doctors are writing fewer prescriptions for specific drugs and whole classes of drugs that have had challenges to their safety
  • Payers are more aggressively pushing generics
  • Consumers are taking a more balanced view –starting to realize that taking a drug is not always a good idea

Pharma will try hard to stabilize and improve its image, but it will be hard. In the meantime, expect pharma to look for growth by expanding sales to patients who have already filled a prescription. Compliance and persistency are low, even for drugs people should take indefinitely. There’s an opportunity to encourage consumers to keep taking their chronic medications for a longer time and to take them more regularly. That kind of encouragement is less likely to generate a backlash.

November 14, 2005

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