Argenta Advisors has contributed a number of articles to the MedTech Intelligence.(www.medtechintelligence.com). The article below appears as first published by MedTech Intelligence
Critical Marketing Considerations for Medical Technologies
Successfully marketing a new medical technology is notoriously challenging due to multiple different constituencies with differing agendas. Patients may respond to ads touting a state-of-the-art product or respond to claims of increased convenience, such as a minimally invasive procedure. Additionally, patients may be prompted to seek medical care by “disturb” ads that highlight risks or describe ominous symptoms. Similarly, physician adoption of medical technologies may also be driven by convenience and a competitive advantage, but physicians will likely also be sensitive to how a new technology, such as a new office-based laboratory test, will impact their bottom line. Healthcare facilities will be sensitive not only to the demands of the physicians, but also how a new test or treatment, such as a new surgical tool or implantable device, impacts payment rates.
Finally, there is the health care insurer who is probably the most important audience at product launch. Quite simply, a technology’s success is unlikely without coverage/payment. Furthermore, the insurer is the one stakeholder who is most explicitly focused on evidence-based medicine, often requiring more data – in both quality and quantity – than the patient, physician or facility. The key question is how to align the marketing messages across all these constituents. Specifically, how do the marketing messages targeted to patients and healthcare providers impact third party payers?
When payers become aware of a new medical –technology – based on publicity in trade publications, a new FDA clearance/approval, new CPT or HCPCS code, inquiry from physician, manufacturer or patient – one of their first decisions is whether or not to manage the technology through an evidence-based coverage policy. Clearly payers can only create, implement and update medical policies on a small subset of medical technologies, and the budget impact is a key consideration for this decision. While payers typically don’t have a clear picture of the full scope of the budget impact, they generally will consider both the cost of the technology per episode of care and the potential size of the target population. Once payers decide to create a medical policy, the next decision focuses on the evidence requirement. What are the key health outcomes for a technology? What type of data is required to validate these outcomes, i.e. randomized trial or observational studies?
It is important to understand that the marketing messages to physicians and patients may prompt payers to prioritize a medical technology to an evidence-based coverage policy AND impose a challenging evidence requirement, resulting in negative coverage.
Policies posted on the payers’ websites focus entirely on the published medical literature; however, payers will also review the manufacturer’s websites and other ancillary sources to get an understanding of how a technology will be integrated into the health care delivery system. A common “disturb” point for payers is the potential size of the target population. Here is where the patient and physician marketing can intersect in unexpected and negative ways with the payer’s agenda. Manufacturer websites that note that a physician can expect a high volume of referrals or direct-to-consumer ads that propose a minimally invasive solution to a chronic problem can prompt payers to prioritize a technology for an explicit coverage policy. For example, a website for laser surgery states, “a less than one inch incision can give you relief from chronic neck or back pain.” This statement is an immediate red flag for payers to investigate the technology further.
Over the past decade a variety of minimally invasive procedures have been promoted as alternatives to the treatment of gastroesophageal reflux disease (GERD). Manufacturer websites that encourage patients to ask their physicians about alternatives to GERD medication will prompt payer concern regarding the potentially large size of the target population. Even though a minimally invasive procedure could offer a permanent solution to GERD and eliminate the need for PPI therapy, payers focused on the budget impact of the immediate up-front costs of a procedure and responded with explicit coverage policies with an extremely high evidence requirement of large, placebo-controlled randomized clinical trials with long term follow-up, far exceeding the evidence required by the FDA through the 510(k) clearance pathway.
There is no easy solution to balancing the competing agendas of patients, providers, facilities and payers. However, at the very least, manufacturers’ reimbursement and marketing departments should work very closely together so that patient and provider marketing does not get ahead of the payer concerns.
About the Author:
Elizabeth Brown, MD, is Medical Director Argenta Advisors Inc, a reimbursement consulting firm that is a recognized leader in the field of health policy and reimbursement for the life science industry. Argenta provides a comprehensive range of healthcare and reimbursement consulting services throughout the medical technology lifecycle, from policy to practice. Reach her at EBrown@ArgentaAdvisors.com.