Pharmaceuticals? Not so much.
According to Ipsos’s survey into global consumers’ perceptions of what’s innovative, the top which at least 1 in 2 Americans find innovative are electronic media, computers, cameras and video equipment.
In fact, pharmaceuticals are pretty close in terms of innovation in the mind of consumers falling between household products and food and beverages.
What is innovation, anyway? Ipsos’s question centers on innovation as something “new and different from currently available products.”
Health Populi’s Hot Points: Since the 1990s, the copayment tiers for prescription drugs have widened between generic (tier 1), branded on-formulary (tier 2) and branded not-on-formulary (tier 3). As the gap in pricing between tiers for generics and brands has grown, health consumers have had to consider prescription drugs as another household spend competing within a household’s budget. Thus, as the price that faces consumers has risen (the copayment for the Rx), the drug has competed with spending on other consumer goods like DVDs at $19.99, Swiffers for $12, and a case of Red Bull.
Without a perception of ‘innovativeness,’ a consumer can naturally de-value a branded prescription drug. That product falls to commoditization – and a win for generics, that seem like good value at the bargain basement price of $4 for a 30 day supply, or $10 for a 90 day supply.
One of the most important jobs for the pharmaceutical and life sciences industries now and in the next decade will be to help define, and then communicate, the innovation message to payers — both institutional and individual. Of course, what underlies that communication is…the innovation itself.