After the various reforms in the White Paper to healthcare and how new outcomes will be measured, Jean-Francois Delas discusses how pharma has been presented with the perfect opportunity to introduce new strategies and systems.
It is now widely recognised that pharma’s new commercial models will rely on the principles of account management, working collaboratively across key functions to navigate an increasingly complex stakeholder environment involving payers, providers, patients and other influencers and decision-makers. The basis of the relationship with customers will also change from transactional to one based on ‘value’. Even though the exact definition of value in this context is still evolving, one thing is clear: there will be the need to demonstrate ‘outcomes’.
The triggers of behaviours, measurements, rewards and incentives will therefore have to be re-aligned from the current focus on an individual sales person’s hard earned results to integrate softer elements highlighting intended teamwork to deliver benefits to customers.
GSK US signalled a re-engineering of its whole incentive system earlier in the summer, removing sales-based bonuses for customer satisfaction targets and measures. Other companies in Europe, such as Novo Nordisk, are following suit. But this re-engineering is easier said than done. Moving away from factual data and information is likely to involve some degree of subjectivity and a lack of robustness and reliability in measurements.
We believe that looking at payer-driven countries such as the UK, Germany and Sweden will provide the necessary insights and structure to develop the new wave of KPIs and compensation systems for new commercial models. National authorities and HTAs are pioneering measurement frameworks for an outcome based healthcare environment. Successful pharma companies should use these frameworks to inform their own measurement frameworks, ensuring alignment. This will enable joint working towards common goals and objectives and facilitate win-win relationships between the national authorities, HTAs and pharma companies.
This article draws upon information within the recently published consultation paper Transparency in outcomes – a framework for the NHS to provide example payer frameworks and discuss possible implications for the pharmaceutical industry.
The NHS Outcomes Framework
A cornerstone of the NHS White Paper, Equity and Excellence: Liberating the NHS, is a new Outcomes Framework, which is being designed to hold authorities and providers accountable for improving healthcare outcomes. It will also be linked to payment. This will be developed jointly with clinicians, patients, carers and representative groups with a view to implementation in 2011/12.
This provides pharma companies with a great opportunity to redesign their own measurement, rewards and incentives systems.
In essence, the Framework will measure benefits and outcomes, delivered around three key areas:
· the effectiveness of the treatment and care provided to patients
· the safety of the treatment and care provided to patients
· the broader experience patients and their carers have of the treatment and care they receive
This will guarantee a balanced view of outcomes, looking not only at safety and efficacy of treatments but also at patient experience.
Measuring outcomes within each of the above dimensions will happen at three levels:
· Overarching indicators will define overall outcomes goals that will provide an indication of the overall performance of the NHS against each of the five domains (see Figure 1).
· These indicators will then be associated with specific improvement measures – approximately five for each overarching indicator.
· Finally, a set of quality standards will be published by NICE describing how best to deliver improvements against the selected outcomes by working with providers. They will set out the structures and processes of care that the evidence suggests would be most likely to deliver improved outcomes for the overall domain as well as the specific improvements areas within the domain. In the UK over the next five years, NICE is expected to produce a library of approximately 150 quality standards covering the majority of NHS activity.
Overarching indicators and improvement areas outcome indicators will primarily be the focus for national level authorities, whilst supporting quality standards will be targeted towards providers explaining how best to deliver expected outcomes and benefits.
Embedded in the structure of these three layers is a cause and effect relationship, assuming that providing quality standards will ultimately deliver expected improvements and outcomes.
For pharmaceutical companies, the NHS Outcomes Framework will provide clear structure and focus for the different discussions with stakeholders at national, regional and local level as it provides clarity on accountability for outcomes and standards.
Whilst conversation with national and regional authorities is likely to be centred around outcomes and benefits – as defined by overarching indicators and improvement opportunities – interactions with providers and local bodies will also include structure and processes for the provision of care – as defined by the NICE’s quality standards.
Beyond application for commercial operations, outcomes measures could also be used in the development process in the design of clinical trials studies, helping to define end points
Looking at the scope of each of the five domains, pharma companies have the ability to influence all of them, either directly or in partnership with other bodies. This will foster joint working between the NHS and the industry which is widely recognised as a core priority and feature of the future ‘commercial model’.
Beyond a most-effective use of resources, partnerships have the ability to bring innovation to the way care is and will be delivered, and to ultimately provide better outcomes and experience. Mutual trust is a pre-condition to effective joint working. As such, common objectives and goals will have to be supported via joint measurements.
Opportunities for the organised
The structure of the proposed Outcomes Framework indicators should also be replicated in companies’ dashboard and measurements systems to enable alignment with customers and similar thinking in terms of ‘outcomes dynamics’: which standards lead to what improvement/outcomes?
As these indicators are being measured and reported on a regular basis within the NHS, pharma companies should at least keep abreast of those measures which are relevant to their business and which they can influence. As relevant measures for customers, they should be integrated into respective conversations and supportive materials.
The detailed quality standards give great clarity on expectations for structure and processes of care and the relative expectations of different stakeholders. Whilst most of the standards are not directly related to the use of medicine, it provides great guidance to pharma companies to design services and value proposition beyond the product itself.
The way forward
As we are witnessing a change in the healthcare environment to become outcome driven, some countries have taken the lead to specify and codify frameworks and processes required to provide necessary accountability and transparency.
As key stakeholders in the delivery of care, this is a great opportunity for life sciences companies to ‘piggy back’ on these frameworks to develop their own measurements system. By doing so, this will provide the necessary focus, alignment with customers, and more importantly drive the development of required behaviours for new commercial models. As the development of such outcomes frameworks is at early stage, there is a great opportunity to engage in conversations with payers and decision-makers.
Finally, beyond the actual use for measurements systems for commercial organisations, outcomes indicators could also be used to guide the development process and the design of clinical trials.
Jean-Francois Delas is a Vice President at Kinapse Ltd. and leads the Marketing & Sales Consulting Practice. Kinapse provides consulting and outsourcing services to the life sciences industries, globally. More information is available online at www.kinapse.com or by contacting email@example.com.