Compliance, technology energize the master-data management business

There might have been a time when mail lists of doctors was just another database that pharma marketers, and their ad agencies, reached for when assigning sales reps or preparing a direct-mail campaign. And maybe some pharma companies still have a relatively casual approach to the task. But increasingly, driven by tighter regulations worldwide, and by the urgency to maximize resource allocations in sales efforts, maintaining these “master data lists” has become a critical operational function. Some of the largest multinational pharma companies are consolidating worldwide master data lists, creating the vision of being able to tap into any doctor’s office in most parts of the world from a desktop.

Without question, the newest driver for this activity is the aggregate-spending rules, aka the “Physician’s Sunshine Act,” which will go into force (after a delay from January) later this year. The regulations, part of the Patient Protection and Affordable Care Act of 2010 (PPACA), which put on a national level the state rules that have been implemented in Vermont, Massachusetts and a few other states. Under agg spend rules, pharma and medical device manufacturers are required to compile nearly all payments or “transfers of value” to many types of healthcare providers (HCPs), and report aggregated sums to CMS, which will publish the amounts and HCP names. When CMS eventually got its regulatory guidance for the Sunshine Act published in December, it decided to delay the beginning of the reporting period to this summer, and has yet to announce how much of 2012’s activity will need to be reported by March 2013. (Adding unpleasant uncertainty to all this, if the Supreme Court decides to throw out PPACA in its entirety, the legal and regulatory structure will have to be re-legislated.)

Many pharma companies have already been realigning their internal compliance resources in anticipation of the agg spend rules, and similar programs are coming into force in the UK, France and elsewhere. “The implementation delay has allowed industry to take a pause in its preparations, but there’s a general recognition that this is not going away,” says Theresa Greco, VP at Health Market Science (King of Prussia, PA). “Our master-data business targeted at agg spend compliance has quintupled in the past year.”

Over the years, data providers have thrived on providing necessary documentation for the sample accountability programs required by the Prescription Drug Marketing Act (PDMA—see Pharmaceutical Commerce, July/Aug, p. 18). But under the newer agg spend rules, sample accountability gets rolled up (like many other “transfers of value”) to one more reporting requirement to states and to CMS.

“Agg spend is forcing pharma companies to look at HCP interactions as a reportable event” and not just a matter of noting an appropriate HCP identifier in a trip report, says Dave Escalante, president of SK&A, a unit of Cegedim Relationship Management (Irvine, CA). “We’re gearing our database services to reporting activities so that they can be validated in near real time.” Escalante adds that while many pharma manufacturers have been working on their reporting systems in the past couple years, these requirements are a new undertaking for many medical device companies—and they are scrambling now to get ready, adding to the fast growth SK&A has seen in this activity.

SK&A, through its affiliation with Cegedim Relationship Management, is able to integrate its MDM offerings with Cegedim AggregateSpend360, a dedicated IT solution for Sunshine Act reporting, as well as Mobile Intelligence, the CRM platform widely used in life sciences. Seeking a similar integrated solution, Concur Technologies (Redmond, WA), a provider of a cloud-based expense reporting system, struck partnering agreements with MedPro Systems (Mt. Arlington, NJ), Healthcare Data Solutions (HDS; Foothill Ranch, CA), AdvantageMS (Fort Washington, PA), R-Squared (Princeton, NJ) and Porzio Pharmaceutical Services (Morristown, NJ). The first three are MDM providers; the latter two have agg spend IT solutions. “The idea is to get the right data into reports as they’re being composed” by reps or others, rather than to clean up the report later, says Chris Lundgren, VP of sales at HDS. Concur’s expense-management systems are said to be used by 17 of the top 20 pharma companies.

AMA and all the rest

The MDM list-management business is hotly competitive among the dozen or so vendors of the service, and while no one talks about overall market share, most discussions revolve around the Physician Masterfile of the American Medical Assn. (Chicago, IL) and how a particular vendor aligns against it. AMA does extensive mailings to its members (and to non-member physicians), and researches other sources of information, such as various medical or professional societies; it counts more than 700,000 records, plus current medical students and 180,000 deceased physicians. It does not, however, include other types of HCPs. Medical journal publishers compare their subscription lists to the AMA list; advertising agencies working on behalf of life sciences marketers often start with the AMA list.

AMA licenses its Masterfile to a small number of resellers (see figure), and also makes it available to others who build their own databases on top of it. “AMA has been at this for over 60 years, and we consider it the gold standard,” says Terry Nugent, SVP of sales at Medical Marketing Service, Inc. (MMS; Wood Dale, IL), one of the database licensees. Even so, MMS does its own enhancements; the company has recently focused its efforts on e-mail list management and services around e-mail marketing, and e-mails are not typically part of the AMA license. “We continue to advise on, and execute, direct-mail campaigns, but more and more, direct mail is part of a multichannel marketing effort that includes e-mail and telemarketing in coordination with the face-to-face interactions of pharma reps.”

In today’s networked world, compiling data on individuals has become easier than ever, and that capability is fueling list managers’ efforts to build lists without accessing the AMA list. Arguably the biggest of these is SK&A, which was acquired by Cegedim Relationship Management a few years ago, and married with the list-management business that Cegedim (which is based in Paris) does in Europe and the rest of the world. The result: the 8-million, and growing, Cegedim OneKey service, which includes 2.1 million records of US-based HCPs, including nursing, practice managers, hospital administrators and others, and HCPs of 69 other countries. SK&A touts its 100-person call center that re-verifies record data every six months, and lately has begun doing custom market research for clients as part of its call-center operations.

“The best multinational pharma companies are managing their operations globally, and now this includes master data management,” says Dave Escalante, president of SK&A. He cites as an example Actelion Pharmaceuticals, which is managing its database across 25 European countries centrally through the use of OneKey. He adds that today’s environment of complex agg spend reporting, combined with the many corporate integrity agreements (CIAs) that pharma companies operate under, make it more valuable to have near real-time accurate information (i.e., that the HCP records are updated frequently), which SK&A has resources in place to do.

Manage your data

Health Market Science is another database provider that puts an emphasis on near real-time accuracy. Theresa Greco says that the company does many of the same verification processes that others do, but adds in a set of clients and data sources, which it calls the Provider Data Consortium, to access scrip adjudication processes as they occur, and then convey that information over to its HCP database. The Consortium includes chain pharmacies and healthcare organizations (Health Market Science, like some of the other master data providers, sells to insurance companies and provider organizations, as well as to the pharma industry). “We work from very pristine data sources, and when we add in adjudication or medical-claims data, we can get a very fast reading of changed status by HCPs or their companies. When such changes are flagged, they get attention from an audit team that does further investigation.”

Greco says that the company is positioning itself as something more than a database provider, but not as an IT solutions provider for agg spend or other compliance requirements. “Companies should be looking on their master data as an asset to be managed routinely, and neither just a compliance tool nor a marketing tool. We help companies build the right infrastructure and establish the business rules to maintain this asset.”

Going from a list to a corporate asset is also the message at J. Knipper (Hightstown, NJ), where SVP David Merkel says that the company—which is an AMA Database Licensee—works with multiple list vendors on campaigns. “There are different strengths and weaknesses to these databases, and the key is to understand the demographics of the audience you want to reach with a campaign.” A further refinement, these days, is to deploy multichannel marketing campaigns in phases so that each phase becomes a more targeted message based on the results obtained from earlier phases. “A campaign shouldn’t be a one-step process, whether it’s direct mail, fax, e-mail or any other channel. You want to deploy analytics that allow you to tailor the call to action to the response you receive.” In doing so, he says, the pharma company running such campaigns are building a corporate asset for compliance, marketing performance and other purposes. In addition to organizing multichannel marketing campaigns, Knipper has a substantial business in sample fulfillment and accountability programs, meeting PDMA requirements.

A full-blown system like that might be more than smaller pharma companies want to undertake, and this market need is where Healthcare Data Solutions sees its niche. According to Chris Lundgren, some providers want to lock in higher-cost annual subscriptions or large database offerings. Healthcare Data can parse its data to provide a limited number of specialties (for, for example, a company that markets only to one medical specialty). Its latest service offering, HDS Verify, is meant to enable sales reps to check on the suitability of sampling a physician literally on the spot.

Another vendor that takes a focused approach to the market is MedPro Systems, which puts an emphasis on maintaining accurate data on state and professional licenses—a requirement for PDMA compliance, and one that will feed into overall agg spend compliance reporting. “You would think that if there are 50 states, then there are just 50 state licensing boards to check with,” says Ray Ungemach, VP at the company. “The reality is that when you add in medical specialties, you’re dealing with over 550 sources, most of which have different data-access processes that need to be managed.” He adds that because states vary in their rules for who is allowed to prescribe, or to receive samples, there can be a need for linking the licensure and work status of different HCPs to properly record a sample distribution.

Ungemach says that the company has never been busier, driven mostly by the desire today to provide needed verification data on mobile platforms (thus the agreement with Concur Technologies). MedPro’s online offering is called MedProID. Nearly all the other vendors are providing the same accessibility: HDS has HDS Verify; MMS has the NOWW system; Health Market Science’s is called ClearView.