Mr. Tichopad, can you please begin by introducing yourself and your company to our readers?
My background is in bio-statistics. I am a biologist by education, and in the beginning of my career I worked in contract research for pharmaceutical companies as a statistician. Subsequently, I became a health economics analyst.
In 2006, together with a colleague Dr. Igor Gembula, who is an IT and a Market Research professional, I started CEEOR, which stands for Central and Eastern European Outcomes Research. The company is today active in most CEE countries, and has two major divisions. The larger division is concerned with market research; the smaller branch deals with outcomes research,all together 16 people.
Our outcomes research branch is our original branch, and we have been active in this sphere from the beginning. We provide services both to local country affiliates and to corporate headquarters. Mainly, our studies aim to facilitate reimbursement negotiations with local authorities; however, they may also be used as a marketing instrument or argumentation support for communication with doctors. We have had projects that cover every aspect of the outcomes research field: modeling studies, retrospective and prospective patient surveys, patient-reported outcomes studies, reviews of literature, and etc.
We also provide companies with ‘support in place’during negotiations, we can help clients to prepare their presentations, or we can physically represent them in the discussion. For instance, just last week, I represented a company in negotiations with the Ministry of Health of Belarus. We are proud to provide such services, because they confirm the quality of our work. We stand behind what we deliver, and we are not afraid to support it in front of oponents.
What do you believe differentiates your outcomes research services from the more established consultants we see in the industry today?
I believe that a persistent trend in our industry is the hiring of consultants, but are actually positioned as single players holding particular knowhow, having previously worked within or alongside the industry. These individuals operate somewhere in the interface between companies’ needs and the needs of the regulator. Companies utilize such people as instruments to deliver their key messages.
However, what I believe is missing in the Czech Republic and in the CEE at large is something that I learned in Germany. My career started in a rather large international CRO called Kendle (recently acquired by INC research). Kendle had a structured approach of putting a team on a project, delivering in accordance with deadlines, and delivering something that really looks like a project rather than advice over the phone.
I believe that CEEOR has made quite a successful step simply in declaring ourselves a commercial provider of team expertise that is totally independent both from the state and the pharmaceutical industry. We hold the necessary capacity to accumulate enough people on a project, and, moreover, we have the capacity to take on many projects at the same time—relative to an individual player that can maintain only a limited capacity.
The expertise that I believe I brought to this company from international projects is an expertise that I have not seen to be present on this market at all.
To what degree does CEEOR overlap with mega data providers such as Cegedim and IMS?
Surprisingly, we overlap in an area that was not original to our business model. As I mentioned, in addition to outcomes research, we also conduct market research. In this sense, since 2008, we have penetrated the markets of Cegedim and IMS quite heavily: we all work in the field of promotion and sales data, as well as ad-hoc market research.
However, in the small markets of the CEE, these organizations are not active in health economics, so we do not compete there. It seems that it remains difficult for them to find the right experts in these countries on a cost-effective basis. In general, the large service providers that I am familiar with have not been successful in establishing health economics branches in this region. Hence, there is substantial room for skilled local players.
Local knowledge does not consist only of understanding the system; it consists also of understanding the needs of stakeholders, knowing the language, and understanding the bit of permanent chaos that we see here. Things are not perfect; things are in transition. Local expertise lies, therefore, also in the ability to monitor the situation, predict outcomes, and flexibly manage business parameters.
Dr. Sommermeyer, CEEOR’s partner through the consultancy Pronaos, explained to Focus Reports that you are an expert in the seeming impasse that we see today between pharmaceutical companies and the payer in terms of market access for innovation. Can you delve into the challenges we see in this regard for the industry, and how we can identify a solution?
It is obvious to me that innovative pharmaceutical companies are making a great effort to establish health economics argumentation as a strong tool for bringing their innovations to market. Within the industry, there are people that have substantial knowledge in this field, and are able to provide material of reasonable quality—i.e., they know what to look for and how to present it.
On the other hand, there are still pharmaceutical companies that are missing the right people in the right positions. I still see market access managers that are not very skilled in health economics—unskilled in the terminology, in the meaning, and in the goals. Today, health economics is still unfortunately misunderstood as a way to save money, or to make healthcare cheaper by some. This is definitely not its direct intention—and yet people in the business accept this view.
Originally, health economics originated within the governments. It came from regulators. The concept was actually tto pay more money for more innovation and better health outcomes. This philosophy has not been clearly established in this region. We have the impasse you mentioned: pharma companies want more money for products whose added value they have insufficiently proved; the payer, meanwhile, wants to cut costs. This is where the two sides have met. CEE government stakeholders have a generics-oriented approach: they want the same quality, at a lower price, without considering if there is outstanding innovation that they should pay a premium for.
I believe that people are missing whose mentality is progressive: people who want to balance cost and innovation delivery, rather than simply look at cost.
For pharmaceutical companies, it is essential to get the right people into these positions, and such people should be involved in the interface activities such as to attract people from the regulator side to a negotiation, organize education as well as initiate a dialogue that will better establish the concept of adequate payment for innovation.
Another problem that I see is that there is a bit of mistrust on the part of the regulator: they often believe that the quality of the argumentation is not sufficient; that it is tendential or produced unprofessionally. Many of the pharmaco-economic studies produced in the CEE that I have personally reviewed have also been very biased. This is a very damaging trend that ruins the evidence power of this instrument.
The Ministry of Health in the Czech Republic has recently made a tangible effort to establish an HTA decision-making body. The steps have been taken, and I believe that this effort will be successful. There will be reasonably good policies available soon that will provide for a more sophisticated receptor of this kind of argumentation.
On the side of the manufacturers, they must ensure that the supporting data that they deliver is of a high quality. There can be no compromise. I feel that this goal has not yet been accomplished—a lot of poor-quality evidence is out there.
Is there a light at the end of the tunnel? Do you believe regulators will increasingly consider the validity of pharmaco-economic arguments, and pharmaceutical companies will increasingly deliver them in a satisfactory fashion?
We are speaking about a circle. At the moment when we have a skilled receptor, there will be a skilled provider. Companies will require the skilled provider.
At the same time, the challenge is whether the people at the Ministry that will work for the HTA committees have the necessary skills to judge projects.
The development of this expertise should definitely be promoted in the country. One of the ways forward may be to turn to an outside organization to provide training. As CEEOR, we have offered such training for companies for free, and it has been very well accepted. The goal is simply to establish a receptive atmosphere for the discipline.
Do you see that this lack of sophistication is a Czech problem, or does it extend to the region?
I believe that the challenge is closely correlated with the historical usage of solid argumentation for medical products. The Czech market as we know it today, for instance, has been in place since the end of communism—over 20 years. It is only in the last 10 years that there has been a heavy focus on expenditures. Therefore, the available time to build these skills has been limited. The same is true of neighboring countries. Nonetheless, I see that in Poland, there are outstanding health economics providers. In Slovakia, there has been a substantial governmental effort to establish the requirement for health economics evidence in the national legislation. The authorities established the willingness to pay as an act of the law—which is quite unique for the region. It seems to me that the Czech government is too heading in this direction.
And Western Europe? Are companies like CEEOR needed there?
I actually see more opportunity in emerging markets, as the need there for services like ours is not fully satisfied yet. Our advantage is that we have a fully international team; we have four nationalities on board, and have colleagues working in Hungary, Slovakia, Poland, Romania, and other countries. We are fairly easily able to orient ourselves in most countries in the CEE, which is a great competitive advantage relative to competitors, who try to bring their vision from mature markets like Germany to, say Slovakia—where things need a more local touch.
Do you feel that the opportunities for CEEOR will endure, if companies truly shift toward a health economics-based mentality? Is it possible that clients will prefer to collect the data in-house?
I do not believe so. Actually, our best customers are those that have very skilled local experts. The companies whose hearts we fail to win are those that do not have a counterpart that we can speak to: a counterpart that appreciates the quality of our work. We actually hope that company expertise will be elevated with time—this will create a more receptive market for us.
Moreover, companies have the power and the financial means to enforce changes in society. They may organize conferences or educational courses; they may influence regulators via unifying trade organizations like the AIFP, the Associating of Innovative Pharmaceutical Industry in the Czech Republic.
Looking beyond health economics and outcomes research, another element of your work is in Sales Force Effectiveness (SFE); a consulting service built upon your market research efforts. In this area, you work in conjunction with Pronaos. Can you tell our readers more about this feature of CEEOR’s portfolio?
Our SFE work started when we produced a customized solution for a client in 2007. It was nothing more than an internet-based reporting system that allowed doctors to report on pharma rep visits, within a particular frame. Reporting of this kind has been in place in the Czech market since the early 2000s, via IMS. We soon recognized the potential in making this instrument quicker, digital, more visually attractive, and closer to the client. This is certainly the advantage that a local provider has relative to a global corporation: the global entity may not be able to change some aspect of their product for the sake of a small country such as the Czech Republic because everything is already systematized.
Today, we are the number one provider of this intelligence in the Czech Republic. We have added a number of additional derivatives of this business, which are mainly consulting-based. We are able to do more than provide the customers with the data and charts: we also sit with them and interface this data with their sales data. Out of the figures, we can extract action decisions—this is something that we do in conjunction with Pronaos.
We have also started to produce various intelligence tools wherein these data may be combined with sales data and other statistics, which can enforce proper market strategies for the future.
What will the next five years look like for CEEOR?
We have started our penetration of other national markets. We believe that serving customers on a face-to-face, local level is highly important. For instance, we have taken successful steps to establish CEEOR in Hungary, and we are half way to do the same in Poland.
Ultimately, we also want to interconnect different services in the field of sales effectiveness, market intelligence, and market access, creating complex tools that span the entire lifespan for a pharmaceutical product. Our message is that clients do not need another provider.