Consumer Market Entry: Can Pfizer and Lilly Succeed in Direct-to-Consumer Sales?

Consumer market trends show that direct-to-consumer (DTC) platforms are becoming an increasingly popular method for consumers to access medications online, bypassing traditional in-person doctor visits and brick-and-mortar pharmacies. This approach may be particularly effective in certain therapeutic areas. Notably, pharmaceutical giants Eli Lilly and Pfizer have recently launched their own DTC platforms, signaling a potential new trend in Big Pharma.

Eli Lilly introduced its DTC platform, LillyDirect, at the start of the year. The platform aims to simplify the patient experience, according to CEO David Ricks. LillyDirect offers disease management services for diabetes, migraine, and obesity. It includes a telehealth program that connects users with healthcare professionals who can prescribe medications delivered directly to the home. In March, Lilly announced a partnership with Amazon Pharmacy, allowing LillyDirect patients to access the same products with Amazon’s free, two-day delivery. This partnership not only bypasses traditional pharmacies but also offers Amazon’s around-the-clock pharmacist support.

Consumer Market Expansion: New Avenues for Accessing Lilly’s Weight Loss Drug Zepbound

These changes provide another avenue for consumers to obtain Lilly’s popular weight loss drug, Zepbound, which competes with Novo Nordisk’s drugs Ozempic and Wegovy. However, Lilly’s diabetes medication, Mounjaro, is not yet available on LillyDirect, though the company plans to expand its offerings on the platform.

Following Lilly’s lead, Pfizer announced in May its plans to launch a DTC website by the end of the year. Like LillyDirect, Pfizer’s platform will offer medication for migraine sufferers and its COVID-19 drug, Paxlovid, prescribed through telehealth professionals.

While Big Pharma has experimented with the DTC model in the past, it has often been in response to patent losses as a way to counteract the influx of generics. Bill Roth, managing partner of healthcare consultancy firm Blue Fin Group, noted that when Pfizer lost exclusivity on its cholesterol drug Lipitor in 2011, the company launched a DTC platform to sell the drug at generic prices. Roth suggests that companies like Lilly and Pfizer might be looking to get ahead of potential revenue declines by embracing the DTC model early in the product life cycle.

Despite the potential advantages of providing direct access to prescriptions, pharmaceutical companies face the challenge of convincing patients to change their usual medication acquisition routes, especially if they are taking multiple drugs. Roth questioned whether patients would be willing to visit multiple pharmaceutical websites to purchase their medications. He pointed out that patients generally prefer to order all their medications from a single pharmacy, whether it’s brick-and-mortar or home delivery.

Beyond Big Pharma, the DTC market is already populated with lifestyle brands offering generic medications across various personal care and health categories. Companies like Hims & Hers Health and Lemonaid Health have established themselves as destinations for consumers seeking prescription medications in areas such as personal care, sexual and reproductive health. Roth believes these therapeutic areas may be better suited for the DTC model.

Lilly’s weight loss medications stand out in the DTC market due to their high demand and current short supply. Hims & Hers Health recently announced it would offer weight loss medications in the form of a compounded GLP-1, using the same active ingredient as Novo Nordisk’s Ozempic and Wegovy (semaglutide), at a starting price of $199 per month. This move highlights opportunities in the booming weight loss space and reveals a gap in Lilly’s DTC offering. If patients can access cheaper alternatives, they may not turn to LillyDirect, especially if brand-name medications are in shortage.

With LillyDirect and Pfizer’s upcoming DTC platform, it remains unclear who exactly the pharmaceutical companies are targeting. This is particularly pertinent given that Lilly’s weight loss medications might not be covered by all insurers and come with a list price of around $1,000 per month. Roth suggested that pharmaceutical companies are currently debating whether it is better to pursue a cash market or rely on insurance.

Although only two major pharmaceutical companies have launched new DTC offerings this year, Roth predicts that more could follow. He expressed skepticism about the long-term sustainability of these platforms as alternatives to traditional retail or home delivery options but acknowledged that the industry tends to follow trends once they gain traction.

In conclusion, while the DTC model presents opportunities for pharmaceutical companies to reach consumers directly, it also poses significant challenges. The success of Lilly and Pfizer in this space will depend on their ability to attract and retain patients, navigate regulatory requirements, and compete with established DTC brands. As the DTC trend continues to evolve, it will be interesting to see how other pharmaceutical companies respond and whether this model will become a standard approach in the industry.