Optimizing Copay Card Programs by Looking Beyond the Discount
Pharmaceutical companies spend tens of millions of dollars a year on copay cards. As insurance companies – in an effort to control the rise in premiums – have increased the amount that insured patients must pay at the pharmacy register for approved medicines, with copays of $10, $20 and $50 becoming common, pharmaceutical companies have developed copay card programs to make sure that patients don’t forgo getting their initial prescription filled and subsequently refilled for the duration of therapy. Copay card programs, properly done, increase treatment adherence: if the cost of medication is eliminated as a factor, then patients are more likely to take the medicine, reducing overall health care costs.
When pharmaceutical brand teams are launching a new medicine, they typically do very little research about how to structure these copay card programs. Copay programs are often the last item on the agenda at the plan of action meetings and are viewed as almost a cost of entry: “Our competitors have them,” a brand manager might say, “so let’s just match what our competitors are doing.”
In fact, structuring copay card programs is a form of pricing strategy, and the price tradeoffs require market input to get right. Two common ways of structuring such programs:
- Static discounts – The value of the card is constant over the life of the program. The question for brand teams is what is the lowest discount that promotes adherence?
- Progressive discounts – The rebate declines over time: for example, it might be $25 off the copay amount for the first 6 months of treatment, $15 for the next 6 months of treatment and $10 from then on. What amount is needed to get patients adherent initially, trusting that the medical benefits they receive will promote continued adherence?
However, there are other pricing constructs that can be explored and which may in fact be more appealing and motivating to patients and more financially feasible for pharmaceutical manufacturers.
Other elements of a good copay card program are rarely researched either:
- Distribution of the card – Do they receive the card from their physician, is it provided in a sample pack or do they enroll online?
- Educational services – Are there nonfinancial benefits that can promote adherence, such as nutritional, lifestyle or treatment education?
- Marketing elements – What’s the name of the program? What’s the message promoting the program? What’s the card look like?
Too often the focus is on the financial value of the program, ignoring how best to promote the patient benefits that come from adherence and treatment compliance. Such benefits can be especially important for controlling chronic conditions such as diabetes or high cholesterol.
Properly designed copay card programs save the industry money while promoting the benefits of living a healthier life and better managing a disease or condition. Optimizing such programs through research is not just good for the health of patients – it’s good for the health of the industry as well.
Art is vice president of client services with Affinnova Life Sciences. He is an 18-year veteran of life sciences market research. He will be moderating a panel on innovative research at the Pharma Market Research Conference on February 7th, 2012.
