GREENSBORO, N.C.—One thing was noticeably absent from a recent visit that an Eli Lilly & Co. sales representative paid to a psychiatrist here: a sales pitch.
Michaelene Greenly provided free drug samples, a lunch of salad and iced tea, and a chance to order diagrams of how the brain works. What she didn't do: tout her drugs' benefits or ask the doctor to write more prescriptions. Nevertheless, Lilly's sales of the neuroscience drugs she promotes are rising.
"We used to come in with our own agenda: What can I accomplish today? We've turned that all around. It's what the doctor talks about," Ms. Greenly said.
Her soft sell reflects a major shift in how more pharmaceutical companies target physicians, as the industry remakes its commercial model in response to changing economic and regulatory conditions. Traditionally, armies of sales reps have fanned out to "detail" doctors with aggressive, well-rehearsed sales pitches and pressure to boost prescriptions. Multiple sales reps from one company might call on the same physician. That strategy over the past 15 years helped propel the industry to $300 billion in yearly U.S. sales today.
But the approach has been in flux. Physicians, under pressure from health plans to curb costs, have less time for, and patience with, persistent sales pitches. The government has been cracking down on aggressive, illegal marketing of drugs for unapproved uses. And drug makers, unable to bring enough new products to market to fully offset patent losses, have been forced to tighten belts.
As a result, the industry has slashed 33,000 sales jobs in the U.S. from its peak five years ago, when 105,000 representatives flooded the zone. Most recently, AstraZeneca PLC said it would cut its U.S. sales staff by 24%, or 1,150 jobs. The industry spent $14.5 billion on marketing in the U.S. in 2010, down about 15% from five years ago, according to Cegedim Strategic Data.
Both to adjust to and allow for these changes, some 18 of the top 40 drug makers have reorganized their sales forces to reduce duplication, one industry consultant says. In the wake of costly settlements by other drug makers over illegal marketing practices, British drug giant GlaxoSmithKline PLC stopped evaluating salespeople based on the number of prescriptions written. Instead, companies are considering how well physicians rate their representatives.
Drug makers including GlaxoSmithKline PLC, Merck & Co. and Lilly are also asking their representatives to switch from making forceful, tightly scripted sales pitches to acting more like a resource supporting physicians' treatment. Companies hope to get a foot in the door by providing practical help, such as assistance educating patients about their diseases or navigating reimbursement.
"Increasing physician satisfaction, it turns out, is a much better way to promote a pharmaceutical agent than simply telling them to write more prescriptions or what the benefits" are, said David Ricks, president of Lilly's global business unit.
Shifting gears has proven thorny in some cases, said Chris Wright of ZS Associates, a marketing and sales consulting firm. Some longtime sales representatives, used to repeating a scripted message, aren't equipped to intuit and respond to what doctors want. Promotion of drugs is highly regulated, making it tricky to give salespeople lots of leeway in what they discuss with physicians.
Also, salespeople still can't provide the one thing many doctors want above all: more time to see patients. "As pharmaceutical companies try to engage in a nicer, more pleasant way, they don't always get a positive reception because nothing is being done to solve the doctors' time problem," said Mr. Wright, who runs ZS Associates' global pharmaceuticals practice.
Physicians feel pressured to fit more patients—not sales reps—into their workdays to offset the cost-control efforts imposed by health plans. In addition, doctors feel they have lost some authority picking medicines, as health plans have learned to wield co-pays to steer use of certain drugs.
Sales representatives still pay 115 million visits to 340,000 doctors each year, and some companies and reps have kept up the old, aggressive tactics. Doctors still complain about receiving inappropriate pitches from particular firms, and many hold the pharmaceutical industry and its marketing practices in low esteem. Earlier this year, 23% of 680,000 doctors surveyed by market research firm SK&A said they refused to even see drug reps.
Eli Lilly decided to adopt its new approach after watching launches of new drugs like Strattera for attention deficit-hyperactivity disorder and the blood thinner Effient stumble, according to Mr. Ricks. One possible problem the company identified was a mismatch between what doctors expected based on sales pitches, and what the products delivered.
Now, the company's sales team draws marketing lessons from how Disney keeps families coming to its amusement parks. Lilly's most recent national sales meeting, held at Disney's business training institute in Florida in February, was devoted to customer service, not product training. Sales representatives watched how Animal Kingdom workers greeted families at the gate and answered questions around the attractions.
Surveys of doctors show that 85% are satisfied with Lilly, up from the 60% before the company changed ways, Mr. Ricks says. U.S. sales of antidepressant Cymbalta were $2.98 billion during the first nine months of 2011, more than $450 million higher than during the same period in 2010, according to Wolters Kluwer Pharma Solutions, a data firm. Strattera sales are on pace to surpass 2010's $575 million, and sales of Effient have also picked up, totaling $217 million through October, more than double 2010's tally.
Among those turned off generally by aggressive tactics in years past was psychiatrist Parish McKinney, who owns a practice in Greensboro, N.C. Some representatives took seats in her waiting room, while patients stood. She recalled some opening their laptops to review her prescription numbers, say she wasn't prescribing enough of their drugs and request she write the "next five" for their products.
Also, she said, Lilly representatives downplayed the weight gain that Dr. McKinney saw among some patients taking the company's blockbuster antipsychotic Zyprexa. The salespeople said the issue wasn't any worse than competing drugs, although Dr. McKinney experienced otherwise. They reminded her about Zyprexa's effectiveness.
"They were trying to press hard. They would not acknowledge it was a concern," Dr. McKinney said.
A company spokeswoman said Lilly always told doctors about the known risks of Zyprexa, and its original label listed weight gain as a possible side effect.
In 2007, Lilly added to Zyprexa's label a more specific warning about the potential for weight gain. Separately, Lilly agreed in 2009 to plead guilty to a misdemeanor violation of federal drug laws and pay $1.4 billion for promoting Zyprexa for treatment of dementia in elderly patients, even though the drug wasn't approved for that use.
When she began calling on Dr. McKinney two years ago, Lilly's Ms. Greenly spoke frankly about weight gain, Dr. McKinney recalled. Ms. Greenly provided data for predicting the increase and deciding whether to use another drug. Lilly made available a nutrition program to help patients manage weight gain—even if they were taking competitors' products.
"It felt more like they were starting to listen to our concerns—whether good or bad—about what we were experiencing in our office," Dr. McKinney said.
On a recent day visiting psychiatrists and nurse practitioners, Ms. Greenly, 46 years old, wore a conservative brown suit and a badge with her name and Lilly's. She is responsible for selling the company's neuroscience drugs in a broad swath of central North Carolina. The job combines her childhood dream of becoming a doctor with her college sales and marketing studies. She has worked for Lilly since 2001.
Under the drug maker's personality testing of employees, Ms. Greenly is a "red" for her outgoing, ambitious traits. Yet, she says she always chafed at the company's old, hard sells. She didn't like repeating messages like "Cymbalta is good for depression" over and over, and found that doctors tuned out such pitches.
Before the change in tactics, psychiatrist Carey Cottle Jr. says he was more likely to write prescriptions for a competing antidepressant like Pfizer Inc.'s Effexor over Cymbalta, because Lilly representatives had a "high-pressure, car sales-type approach, and it was just not appropriate." Fed up several years ago, Dr. Cottle called their Lilly manager and complained that the reps' visits were "wasting our time."
Now, Ms. Greenly's service has lifted the bias he had against prescribing Lilly medicines, Dr. Cottle says. When he had a patient who was breast-feeding, she supported his conclusion that it would be safer if the woman took the antipsychotic Risperdal instead of Lilly's Zyprexa because Risperdal had more safety data on that point.
While they ate salads and drank tea in his office, Dr. Cottle expressed concern that a severely depressed women who was finally improving on Zyprexa had gained 30 pounds. Ms. Greenly offered to inquire about enrolling the patient in Lilly's nutrition program.
She also showed him various illustrations of the brain, which he could pick from and Lilly would print for his use, explaining to patients how a drug would work. He said he'd been looking on the Web for just such diagrams. Lilly would print the pictures with Dr. Cottle's name, not the company's.
Ms. Greenly left a collection for Dr. Cottle to choose from. As she stood to walk out of the office, Dr. Cottle thanked her and asked, "When will I see you again?"
Write to Jonathan D. Rockoff at email@example.com
Tuesday, January 10, 2012
Drug Reps Soften Their Sales Pitches - WSJ.com