But it is no secret that “Big Pharma” has been going through traumatic times over the past few years. Consider these facts:

• In January, 2007 Pfizer, the world’s largest pharmaceutical company, announced that it plans to cut 10,000 jobs over the next two years. Pointing to a combination of flat sales, disappointing study results with a lead product in development, and relatively few new drugs coming through their pipeline despite spending more on research than any other drug maker.  Pfizer hopes to cut costs by $4 billion by 2008.

• In February, 2007, AstraZeneca announced plans to cut 3,000 jobs over the next three years, stressing the need to control costs so the company can focus more on strengthening it weakened pipeline

• In November, 2005, Merck announced plans to slash 7,000 jobs and close five plants in an effort to save $3.5 to $4 billion over five years

In case anybody has missed it, the days of the blockbuster model, where the big pharmaceutical companies focused all their efforts on discovering, developing and selling “blockbuster” drugs that could deliver sales of $1 billion or more, are over. With few exceptions, the mega mergers and acquisitions that have taken place in the pharmaceutical industry over the last 10 years have not delivered consistent shareholder returns. According to Datamonitor, the pharmaceutical industry looks set to experience an unprecedented slowdown in growth over the next five years.

The Emergence of Specialty Pharma

Against this backdrop, a group of smaller, more nimble pharmaceutical companies has emerged. These companies specialize in a few areas or even a single therapeutic area that they know very well; they build deep relationships with key stakeholders, and translate these relationships into strong results.

These companies are called “specialty pharmaceutical” companies—“specialty pharma” for short. Specialty pharma companies are not burdened by the huge cost structures of big pharmaceutical companies, and many of them are managed by veterans of Big Pharma who have learned the lesson that bigger is not always better.

Successful specialty pharma companies use their resources very efficiently, and understand the importance of outsourcing. This is good news for service providers, including healthcare communications agencies.. There are now a number of specialty pharma companies throughout the world, and new ones are emerging every day. Many are well funded; in fact a number of Big Pharma companies are investing heavily in these smaller, more nimble organizations because they recognize the opportunity to partner with specialty pharma and add innovative new drugs to their shrinking pipelines.

The healthcare industry has seen traumatic changes over the past 10 years. And more changes are likely to come with the emergence of Medicare Part D and a congress under Democratic control. Healthcare public relations professionals understand that the pharmaceutical/healthcare environment is ever-changing.  A deep understanding of these changes and their implications for the industry will help companies develop proactive communications strategies to ensure success in these challenging times.  For the seasoned pro, that’s part of the fun of healthcare communications.

All indicators show that the specialty pharma sector will continue to grow and most of the significant healthcare  innovations in the coming decades will emerge from these companies.   This trend is great news for healthcare communications professionals.  Despite their smaller size, specialty pharma companies will still require healthcare public relations support. 

The demand for support activities will be similar to big pharma – media relations, patient advocacy, clinical trial recruitment, investor relations, issues management, medical meeting data communications, etc.  However, the one major difference is that most specialty pharma partners are unburdened by silos and multiple layers of bureaucracy.  Smart agencies will seize the opportunities that specialty pharma provides.

David Avitabile is President of JFK Communications, a healthcare public relations agency based in Princeton, New Jersey.

All content ©2008 FWP Acquisition Corp.,Inc.