Daniel Karam Toumeh
President and Director General of Hill+Knowlton Strategies and Former Director General
IMSS
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View from the Top

Expert Public Market Entry Strategies

Wed, 09/09/2015 - 15:02

Q: What is the importance of the healthcare area for Hill+Knowlton and how is it evolving?

A: Globally speaking, healthcare represents our second most important industry in terms of revenue. This is not yet the case for Mexico. We are optimistic, as we expect this area to score double-digit growth in the next few years. At this point, the main challenge facing the industry are the deep budget cuts affecting all public healthcare institutions. This is because the public health sector is the main buyer for medications from big pharmaceutical companies in Mexico. The vast majority of our clients are interested in increasing these sales to public institutions. However, in this new context of financial constraints, public hospitals may see their purchasing power curtailed.

Q: What would be the basic requirements for a successful collaboration between pharmaceutical companies and the public health sector?

A: Pharmaceutical companies must comply with all regulations imposed by the government to be potential sellers. Transparency in all sales processes is crucial. Two large factors that influence decisions for public health officials: quality and price. On the private market, potential buyers are looking for good quality, the best prices, and an integral service. The current trend among private buyers is to not be interested just in a single, specific device, but to request the device itself and all support services for a fixed price. This is part of the wider trend of clients seeking integral solutions to concrete problems.

Q: What are the main services you provide for the pharmaceutical industry?

A: One of our main strengths is educating pharmaceutical companies about the proper procedures to follow when launching new products. It is important to acknowledge that the pharmaceutical industry is not in the same position as it was ten years ago. Back then, around ten blockbuster drugs were released a year but that is no longer the case. PR budgets have been greatly reduced meaning that, as consultants, we have to provide the best possible value for these decreased budgets. We provide services mainly in communications, PR, and marketing for the pharmaceutical industry. Most new products being released address rare diseases, which means they are focused on very few patients but can have a strong impact on their lives. Developing these medications takes large investments in R&D from pharmaceutical companies which they hope to recover at the commercialization stage. However, the introduction of these innovative medicines into the public sector has been complex due to the aforementioned financial constraints. These days, it is extremely complicated to introduce new molecules into the National Formulary. To facilitate this process, we teach our clients to be extremely accurate in the way they represent their products and in their financial and efficacy studies.

Q: How do you help companies to develop innovative strategies?

A: We help them to stand out in terms of quality in comparison to a generic product. Our clients have to focus on quality and efficacy, measured by indices from customer experience studies. We also try to create awareness within different audiences as to the benefits of innovative drugs. Companies are making solid efforts to document and communicate to the public the experiences of patients having been treated with the medicines in question. To do this, companies need to take strong documentation to back up their assertions and to prove scientific evidence and proof of quality to justify the higher price point. Although such medicines might be more expensive, they are also more attractive for specific segments of the market that may be willing to pay extra for a better quality product. Still, we also help our clients to generate branded generics.

Q: How do you manage communications between pharmaceuticals and the point of sale?

A: We have been approached by both manufacturers and distributors, requesting ways to improve their communication. It does not matter at what part of the chain clients are located, as they all need to communicate with their audiences. What differentiates us from other PR firms is that we spend a large amount of money to fully understand the market. As we know all the players in the market, we can tutor our clients about how to get their message out there effectively and timely.