The US healthcare system continues to undergo dramatic changes, and the pharmaceutical industry, along with pharmacy, has a critical role to play in improving patient outcomes. From pricing to supply chain integrity, and from gene therapies to integrated delivery networks, the sands of the industry continue to shift with all stakeholders – government, manufacturers, big pharma, and patients – striving for a playing field that all can benefit from.
In this episode, Richard Williams, R.Ph., Senior Vice President of Pharmaceutical Innovation and Insights at CSI Specialty Group, joins host Andrew Maddigan, Vice President, Client Engagement, for an in-depth discussion on the state of the pharmaceutical industry, the major obstacles now being faced, and how the future of the industry may play out.
Tune in to Discover:
- A current breakdown of the five major pharmaceutical industry components
- Where the industry is heading
- The biggest challenges now facing pharma
- How pharmacists may impact the future of the healthcare system
- What the future holds for the pharmaceutical industry
References: The 2019 State of Specialty Pharmacy Report
About Richard Williams, R.Ph.
Richard Williams is a second-generation pharmacist who has spent three decades in the pharmaceutical industry. Throughout his pharma career, he has sold, promoted and contracted for more than 40 products, including more than a dozen blockbuster drugs and many specialty molecules. His background includes experience in neuroscience, endocrine, including diabetes, oncology, and cardiovascular diseases.
In his role as Senior Vice President of Pharmaceutical Innovation and Insights, Richard provides executive leadership and strategic direction to CSI and their partners with an emphasis on business development and growth.
Prior to joining CSI, Richard practiced retail and hospital pharmacy before joining Eli Lilly & Company. During his time at Lilly, he worked with physicians, integrated delivery systems, academic medical centers, long-term care providers, specialty pharmacies, regional and national health plans, and PBMs.
Richard earned his bachelor’s degree in pharmacy from the University of Mississippi in Oxford, MS. He has served on several boards, including Christian Leadership Concepts and Hope Smiles. He regularly volunteers with The Bridge, a Nashville based non-profit that helps the homeless, where he is currently working on intersecting street medicine with population health.
About Andrew Maddigan
During the past 30 years, Andrew Maddigan has directed business strategy and marketing functions in a wide range of venues, including health care, education, aerospace, and energy. His previous roles have included VP of marketing for the nation’s largest not-for-profit hospice agency, VP of sales and marketing for a national specialty and long-term care pharmacy and communications director at a large urban school district.
Andrew also led marketing and strategic communications efforts for an international health care accreditation agency, serving as the organization’s liaison to the United Nations Development Program. Andrew earned his BS in Broadcast Journalism from the S.I. Newhouse School of Public Communications at Syracuse University. He earned an MS in Educational Administration from Canisius College and an MBA from St. Bonaventure University. He currently serves as VP of client engagement at CSI Specialty Group.
About CSI Specialty Group
CSI Specialty Group is a globally recognized leadership consulting firm dedicated to providing solutions that continually elevate the specialty pharmacy industry and improve the patient journey. By providing inventive consulting, workforce planning and talent acquisition solutions, we uniquely tailor our service offerings to help clients drive sustainable, accelerated growth.
As the producer of the industry’s first dedicated podcast for specialty pharmacy and the publisher of the annual CSI State of Specialty Pharmacy Report, CSI is at the forefront of pioneering innovative concepts to meet the changing needs of specialty pharmacy, home infusion, mail order/PBM, health system and pharma/biotech clients across the USA and throughout Europe.
– Welcome to the Specialty Pharmacy Podcast, your prescription for specialty pharmacy success!
– Hello, and welcome to the CSI Specialty Pharmacy Podcast. I’m Andy Maddigan, CSI’s Vice-President of Client Engagement, and your host for this episode. And today I have the pleasure of welcoming Richard Williams. Richard is the Senior Vice-President of Pharmaceutical Innovation and Insights with CSI. Richard is a second-generation pharmacist who has spent more than three decades in the pharmaceutical industry. Welcome, Richard.
– Thank you, Andy, I’m happy to be with you today.
– Likewise, so Richard, to start off, can you help our audience understand your role with CSI Specialty Group?
– I’d be happy to, CSI was founded as a talent company that developed a deep expertise in specialty pharmacy, as specialty pharmacy was just becoming an industry about 15 years ago. Over the last 10 years, specialty pharmacy has evolved and is now one of the most important parts of our health care system. Earlier this year, I joined CSI to engage pharmaceutical manufacturers and help them to better understand how specialty pharmacies can play a role in helping them to commercialize their molecules. We also work with integrated delivery networks, and specialty pharmacies, to help them better understand manufacturer needs and how to gain access to limited distribution products.
– Good, so the pharmaceutical industry, it continues to make headlines. Almost every day you see something regarding drug manufacturing and pharmacies. So Richard, can you tell me how you view the industry today?
– That’s a great question, because the industry is very dynamic. I think it’s really important to understand the various types of companies that make up the industry, and that we don’t paint the industry and every company within the industry with the same paintbrush. I break the industry into five distinct groupings. Let me take a couple minutes to discuss each one, starting with the biopharmaceutical companies. And these are well-established, research-oriented companies that have hundreds of products, that have helped patients live longer and more productive lives. These are companies that everybody would recognize their names. They have brought us vaccines, antibiotics, cardiovascular drugs, products for depression and bipolar disorder, antidiabetic medications, and many others. You think of this group of companies such as Johnson & Johnson, Pfizer, GlaxoSmithKline, Eli Lilly and Company, among others. But those are Big Pharma, those are traditional, historical, what we look at when we think of the pharmaceutical industry. The second group of companies are the generic companies, and today, almost 90% of prescriptions filled are filled with generic products, and these are low-cost products, and companies around the world that have helped the industry balance the cost and value equation. This goes back to, I think in the mid-’80s, there was legislation created in Washington by Henry Waxman that allowed, after a patent expired, for manufacturers to come in and recreate brand-name pharmaceuticals, and for the most part, we really like the generic industry. It has helped us save a lot of dollars, it helps patients save a lot of dollars, but that’s the second big group of companies, when you think of the pharmaceutical industry. The third group of companies are those that are manufacturing biosimilars. Similar to generic companies, these are companies that are looking at recreating biologic products. These are the very expensive specialty pharmaceuticals that are available today, and the success of these products is going to be really a significant contributor to the future of the industry. The adoption of biosimilars is heavily debated here in the U.S., although they have been very successful in Europe. But we all need biosimilars to be adopted to create competition for today’s high-priced specialty biologic products. This pricing pressure will create room for newer innovative products that are being discovered by rare and orphan drug companies. And that leads me to my fourth group, and these are currently, the rare and specialty drug companies, these are really small companies that are passionately connected to individual patients who suffer from rare disease, and there are about 7,000 diseases that are classified as rare in the United States, which means that they impact less than 200,000 patients. These companies are investing heavily to find cures for these debilitating illnesses. And then finally, although not technically a pharmaceutical company, because they’re gonna compete with the pharmaceutical company and they’re gonna enable better outcomes to pharmaceutical products, I’d be remiss not to mention an evolving segment of the industry, which is called digital therapeutics. And I heard recently, there are more than 100,000 of these types of tools currently available and being developed. These range from smart drugs, apps that you use on your phones, wearable devices, and other types of devices that are creating this, what we call invisible data, that will augment or replace a lot of today’s medications. And so this is really an exciting time with the pharmaceutical industry, but that’s the way I break the industry down today.
– Yeah, that is very exciting, so tell me, Richard, where do you think the entire industry is heading today? What do you think, for instance, some of the top stories, some of the top issues that are facing the industry today?
– Andy, you already commented on the fact that you can’t pick up the newspaper or turn on the news without seeing something, a headline, about the pharmaceutical industry, and it all starts with the debate around pricing. Although it has been recently reported that the price increases are lower than ever before, and I think this is some recent data that came out in the last couple of weeks that compare Q2 of 2019 versus Q2 of 2018, that the price increases are lower than they ever have been before, we will continue to see the government actively involved in trying to lower the cost of prescription drugs for Americans. This will be hotly debated as we head into the 2020 election, so that’s number one. And I don’t think anybody would dispute that or disagree that we need help and relief from the cost of products in the United States. Number two, and this is not talked about very much, but it’s my biggest concern, is the integrity of our supply chain.
– Let me ask you a question. Have you ever questioned a prescription or over-the-counter medication that you purchased at a drugstore or pharmacy, and whether it was actually what it said it was?
– Not in a pharmacy, but you do have some doubts about supplements from time to time, there’s the occasional horror story that you hear about offshore manufacturing facilities, but not a prescription or something that you would find inside a consumer drugstore.
– Yeah, it’s something we take for granted. As Congress debates importing drugs, which sounds like a great idea, importing drugs from other countries, as we continue to struggle with trade agreements with China, where 90% of the active pharmaceutical product ingredients come from, and as the FDA struggles to inspect foreign generic drug manufacturers, this topic is going to become more important. When you combine these three issues with the potential for counterfeit medicines being created, we must all work together to ensure the integrity of the U.S. supply chain, and to me, that’s a real issue that no one’s really speaking about, but it is a reality that exists today and it’s somethin’ we need to be very conscious of. The third thing that I would say is probably a hot topic today is the excitement in miracles that will be reported as gene therapies are developed. There are a number of companies providing hope for hundreds and thousands of patients based on some new technology using the human genomic profile and the ability to go in and make adjustments to that, to eliminate, minimize, and in some case, totally cure diseases that we never thought we’d see cures for. And that’s really exciting.
– And then finally, I think the fourth big example that is evolving in the marketplace, and I personally believe we’re gonna see that the integrated delivery systems, large hospitals, academic medical centers, really become more important to the pharmaceutical industry. In the CSI State of Specialty Pharmacy Report that we give away, hospital leaders are beginning to see pharmacy differently than in the past. Senior leaders, C-suite executives are now beginning to view pharmacy as an asset, and not just a cost center. And then finally, my fifth point, I guess would be, is the requirement that pharmaceutical manufacturers guarantee their products by way of value-based contracts. We’ve seen this starting to emerge over the last five to six years, this concept of value-based contract and performance-based contract. Traditional rebate agreements will slowly fade away, and I believe we’re gonna be replaced by these performance contracts that are gonna guarantee some outcomes, and that’s gonna help transform the payment of pharmaceuticals, which gets back to one of the big issues, which is patient out-of-pocket expenses.
– That’s interesting, so what do you see as the biggest challenges facing the pharmaceutical industry?
– Andy, for all the good that the industry contributes, it continues to have a major credibility issue. In a recent Gallup study, the pharmaceutical industry was rated dead last, even below the federal government, as the most poorly regarded industry in the United States! 58% of Americans, that’s six out of 10 surveyed, ranked the industry negatively. Another challenge is Washington. Attacking the industry is one area that Republicans, Democrats, and even the White House, they all agree, although they each have different solutions, they all agree that Americans pay too much for their medicines.
– Right, so Richard, how do these challenges make you feel, as somebody who’s spent so many years in the industry?
– Well, that’s a great question, and I gotta be honest, I’m a fan of the industry! Every day, thousands of scientists, pharmacists, and other researchers wake up and go to work to help find cures for many diseases. We’ve all benefited from those discoveries of the pharmaceutical industry. Even my mom, who, at the age of 93 told me the most significant scientific or event that she experienced in her life, and it wasn’t goin’ to the moon or having automobiles, or the ability to fly to Europe, it was the discovery of penicillin, because as a child, it saved her life. And so, going forward, manufacturers are going to have to clearly demonstrate and effectively communicate the value of their products and ensure that they are appropriately used by the right patients. I’m hopeful that the industry will do a better job of telling its story. I’m also extremely excited to help companies navigate the complexity of the U.S. marketplace to connect their innovation to patients. That continues to excite and motivate me every day.
– And what excites you most about the industry, looking ahead at maybe the next three to five years?
– Well, the pharmaceutical industry is one of the great American success stories. Today, there are about 18 companies that make up 50% of the U.S. pharmaceutical revenues. The other 50% of revenues are made up of hundreds of small, agile, innovative companies. These companies are going to deliver hope and amazing products to treat and cure some awful diseases. I also believe the role of pharmacists are going to continue to grow and that pharmacists will become a much more important part of our health care system. They have great reputations, they’re accessible, they’re highly trained on drug therapies. We’ve underutilized pharmacists for years, and the value that they can provide will have a huge impact to improve the entire health care system.
– Well, Richard, that’s all the time we have today, but I wanna thank you very much for your perspectives on the pharmaceutical industry today. You’ve touched on a number of very important topics, and I have to ask, if you had to boil everything down, regarding the industry, what would you say?
– Well, I go back to kind of the entire health care system, as it undergoes just dramatic transformation, the pharmaceutical industry combined with pharmacists, working together can play a critical part in improving patient outcomes. Today, pharmaceutical costs continue to make up only 13% of the total health care expenditures. And the value of these pharmaceuticals continue to be underappreciated, and the role that pharmacists play in the delivery of those medications is also underappreciated.
– Well said, Richard. Well, thanks again for joining us today. We look forward to having you come back in the future, and perhaps share some additional thoughts, and maybe delve into the State of Specialty Pharmacies Report that was recently published, so Richard, if someone has a question or like to get in touch with you, how would they do that?
– Well, I can be reached at firstname.lastname@example.org, or they can connect with me on LinkedIn, and we can schedule a time to speak live. But I enjoyed being here today, Andy, and continued success.
– Well, thanks again, Richard, and thank you all for listening. You’ve been listening to the CSI Specialty Pharmacy Podcast.
– Thanks for listening to the Specialty Pharmacy Podcast! If there’s anything we mentioned in today’s show you missed, don’t worry, we take the show notes for you at csigroup.net/podcast! If you’re not already a subscriber, please consider pressing the subscribe button on our podcast player, so you never miss one of our future episodes. And if you haven’t given us a rating or a review on iTunes yet, please find a spare minute and help us reach and educate even more of our specialty pharmacy peers. The Specialty Pharmacy Podcast is a production of CSI Specialty Group, your go-to firm for all things specialty pharmacy! Thanks again for listening, and we’ll catch you next time! Doctors’ orders.