Will Pfizer's Free Drug Program Give PR Lift to Big Pharma?

Groundbreaking Effort Will Provide Financially Challenged Families Select Primary-Care Meds

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NEW YORK (AdAge.com) -- In a PR masterstroke for the world's largest drug maker, Pfizer today said it will provide free select prescription drugs to Americans and their families who lose their jobs and -- as a result -- their health insurance.

The first-of-its-kind program for Big Pharma brings to mind Hyundai's groundbreaking "Assurance" program earlier this year, when it became the first automaker to offer to pick up the consumer's car payments if they lose their job. In Pfizer's case, the idea came as a suggestion made by an employee at a Pfizer meeting four and a half weeks ago.

Pfizer's program, called Maintain (an acronym for Medicines Assistance for Those who Are in Need), will provide newly unemployed Americans and their families more than 70 primary-care drugs manufactured by Pfizer, including cholesterol-lowering agent Lipitor, at no charge. To become eligible, patients must prove financial hardship and lack of insurance coverage, as well as demonstrate that they have been taking the Pfizer medication for at least three months prior to losing their jobs. The program only applies to those who lose their jobs in 2009.

The program "shows great courage and heart to step forward and provide people with the health care they need in times of national distress," said Peter Pitts, partner and director of global health care at PR firm Porter Novelli. Not to mention it has a pleasant side effect: "It's probably worth more than $100 million in free advertising," said Dorothy Wetzel, the former VP-consumer marketing at Pfizer who now runs her own health-care ad agency, Extrovertic. "Think of the goodwill, think of the brand advocates they're creating by providing these medicines. You have somebody who's going to say 'I lost my job but I can still get my Lipitor for free? I'm going to tell everybody.' And all the studies show that some of the biggest influencers in health care are friends and family. People are going to be talking about this."

Not its first assistance program
While this particular promise is unique to the industry, this is not the first financial-assistance program in the U.S. that Pfizer has developed. For more than 20 years the company has offered support through a number of programs that cater to individuals with low incomes or who are uninsured or underinsured, among other things. And the company will continue to do so, said spokesman Ray Kerins. "[This program] is, in many ways, the next step in evolution of decades of work," he said. "If you don't have medicine, you shouldn't lose access to it because you've lost your job."

Clearly, there's a need, given evidence that Americans are cutting back on their prescribed medicines during the recession. According to an April 2009 Kaiser Family Foundation tracking poll, within the last 12 months, six out of 10 Americans said they or their families put off medical care due to cost. Some 29% of said they did not fill a prescription for medicine and 18% cut their pills in half or skipped doses of medicine.

Mr. Kerins declined to comment on how much the new program will cost Pfizer or how many patients will be eligible. But from 2004 through 2008, Pfizer's existing patient-assistance programs helped more than 1.5 million people get 51 million prescriptions for free or at a reduced cost -- an estimated $4.8 billion cost to the company.

A former high-ranking pharmaceutical company executive said the cost to Pfizer for this new push may not be as high as people think. "Most of the money [drug companies spend] is in [research and development]," said the former executive, who asked not to be identified. "It doesn't cost a lot to manufacture the pills or package them."

On the flip side, not only does Pfizer stand to gain from the move, but so does the entire industry, which has taken a beating from critics who charge that its advertising influences consumers to ask physicians for drugs they don't need.

No advertising
Pfizer is counting on word-of-mouth to bring attention to the new program. It will not advertise through traditional media, and it won't need to. Seamus Fernandez, a pharmaceutical analyst at Leerink Swan, called the move "smart PR," not only for Pfizer, but for the industry as a whole. "As we approach health-care reform legislation, I think pharmaceutical companies will continue to announce and implement programs like this in order to keep public perception from sliding, which could result in more onerous legislative decisions," he said.

"My suspicion is that they probably wouldn't be doing the program if it had a genuine negative impact on their profit and loss statement in the long-term," Mr. Fernandez said, noting that the company is not, for example, doling out free oncology drugs -- which are much more expensive that those for primary care.

Still, when it comes to competing pharmaceutical companies, Mr. Pitts said Pfizer's efforts are unparalleled. "Pfizer is taking a leadership position and should be congratulated for it," he said, noting the financial enormity of the commitment. "Not everybody can do the same thing."

Since the economy soured, various pharmacies have implemented cost-savings programs for consumers. Weis Markets launched a 90-day, $9.99 generic prescription plan program in October that it expanded in February to include more than 400 drugs. Last month CVS Pharmacy started offering additional store credit (called Extra Bucks) to customers purchasing prescriptions between May 1 and June 15.

Ms. Wetzel, who was part of the previous patient assistance programs at Pfizer, said she was surprised with how quickly the Pfizer program came together. "I'm impressed," she said. "Those other programs were in development for years. They're showing an increased nimbleness on the part of Big Pharma. But it's great. It shows the commitment to patient care that goes beyond the delivery of drugs and medicine. Doing things like this makes pharma companies more relevant."

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