For years, the pharmaceutical industry treated employer health plans the way Madison Avenue once treated network television: as a reliable delivery system for reaching large audiences with minimal friction. That delivery system, it seems, is developing some static.
A growing number of employers have begun to drop or reconsider coverage for GLP-1 medications used for weight management, according to industry observers, a shift that threatens to alter the competitive calculus for drugmakers who have enjoyed what can only be described as a very good run.
"As major insurers roll back coverage of expensive weight-loss medications, more of the cost shifts from insurers onto consumers, which will change the way weight-loss brands compete," said Sam Brough, head of brand at Tracksuit, a global brand research firm.
The implications for marketers are considerable. When a third party foots the bill, awareness is often sufficient; when consumers pay directly, the emotional stakes rise. Mr. Brough told Adweek that two factors will matter far more in this new environment: "whether they trust a brand, and whether it feels made for them."
(One might observe that this has always been true of marketing, though it is perhaps useful to be reminded occasionally.)
The shift may also open doors to previously overlooked demographics. Adults over 65 currently represent just 12 percent of the weight-loss category, according to Tracksuit data, but that figure could grow as the economics of access change. Winning campaigns, Mr. Brough suggested, may focus less on creating demand for a miracle drug and more on helping patients — including older ones — navigate the complicated path to obtaining one.
"The brands that treat this as a brand-building opportunity, not another awareness push, are the ones that will pull ahead in the out-of-pocket era," Mr. Brough said.
It is a reminder that in advertising, as in pharmacology, the dosage often matters less than the delivery mechanism.
Original story published in adweek.com: "Cutbacks in GLP-1 Insurance Coverage Are Forcing Marketers to Pivot"