EXECUTIVE  MANAGEMENT      •      MARKET STRATEGY      •       VENTURE CAPITAL      •       CORPORATE DEVELOPMENT

by Linda Holliday

Executive Summary

The healthcare information infrastructure is exploding. New media, from CD-ROM, to TV-based networks, to closed computer networks, and more, promise to transform the healthcare and pharmaceutical industries. They will empower patients to make new demands and challenge marketers to shape the therapeutic agenda, increase volume, and develop whole new marketing strategies. Here is an assessment, followed by a list of new media.

Is new media going to transform the healthcare and pharmaceutical industries as promised, or is it just a sensational but short-lived fad?

Last year's report card (MM&M Jan 1994) reviewed a wide array of ambitious, expensive, and visionary technology-driven media that promised to be the salvation of more than a few of the healthcare industry's ills. In twelve months, we've seen significant crashing and burning, acquisitions, and some major delays. Meanwhile, even newer new media lurk in the wings; they're well capitalized and wide reaching: C. Everett Koop and Time Life are getting into patient videos; Reuters is backing GeoMedica; hospitals and states Ñ even individual physicians Ñ are setting up networks with the help of the Internet and some high-tech, cost-saving applications. All of these avenues are the result of expanding digital communications. Most stretch our definition of "media" and force us to rethink traditional commercial and noncommercial communications.

We see

• Computer-assisted, menu-driven "toll- free" patient assessment
• Physicians on two continents jointly diagnosing patients with desktop multimedia and a modem
• Pharmaceutical companies publishing tours and press releases on graphical Internet "home pages"
• Laptop-interactive-data-collecting product details

In fact, what seems to be evolving is a burgeoning number of highly diverse technology-based products both public and for profit; for consumer and provider; restricted and open; utilizing both primitive and highly sophisticated technology and distribution. Some offer or promise opportunities for quasi-traditional promotional uses. Others will create more fundamental shifts in the way pharmaceutical products and information are developed, purchased, and supported.

How do we make sense of it all? How do we pick the winners and the losers? How do we use all of this communications technology to expand sales, profits, markets, and jobs? We can start by analyzing some key events and identifying potentially powerful trends.

American Medical Television goes dark As this article goes to press, AMT is off the air. Difficult partnerships seem to have sealed the fate of the last physician-targeted conventional television programming project. (Lifetime Medical Television was replaced on the cable channel by more profitable women's programming, while some of the management and physician programming has resurfaced, repurposed, at GeoMedica. Physicians News Network still delivers a graphic-based daily news feed to 650+ hospital sites.) Delivering MD-targeted programming on an open channel was always a delicate economic relationship, and as pharmaceutical purse-strings tightened on this traditional audience with declining influence, the equation became all the more vulnerable to failure. Some of AMT's programming did garner sizable loyal audiences, and you can expect it to resurface in a more efficient distribution plan.

Physicians Television Network occupies a position on the new high-powered Hughes satellite and begins programming in July with plans to add interactivity by year end. Both the digital distribution technology (utilizing an 18-inch receiver dish) and the programming seem to be a big hit with consumers. More than 500,000 of the $800 systems are projected to be purchased by the end of 1994. The system capacity of 150+ channels may ease the economics enough to make this product viable in the medium term.

Consumer healthcare television plans big While 13 channels have business plans and even investors for healthcare programming, which of these will actually launch remains to be seen. Consumer interest in health continues to expand but the competition for channel space is ferocious until "on-demand" television or cable system rebuilding create additional capacity. Securing enough homes for economic viability will take some sizable investing. Look for the winners by pocket depth.

PROPOSED HEALTH CHANNELS

Network       Location
America's Health Network Longwood, FL
Cable Health Club Virginia Beach, VA
The Enrichment Channel New York
Fitness Interactive Television Los Angeles
The Health Channel Washington, DC
WFIT/Health & Fitness Network Providence RI
The Health Network Englewood, CO
Kaleidoscope San Antonio, TX
National Health Network New York
Recovery Net Denver, CO
The Senior Channel Los Angeles
The Therapy Channel Los Angeles

What you're more likely to see in the short term is more and more sensational and sophisticated health programs appearing on existing channels. And if you have doubts as to the consumer's aptitude for or understanding of "real medicine," check out an episode of E.R. (Thurs. at 10:00 pm EST, NBC) Medical News Network: Too late? Too early? Too expensive?

Much has been written, and more said, as to why MNN didn't make it. Certainly again, the economics of producing and distributing a dedicated closed system like MNN are demanding. But the one sure bet in all this chaos is that technology gets cheaper. Since that's the case, what's to be learned from MNN is that it worked. V.P. marketing Jim Cain says that in the last month of air, viewership averaged over 40 percent daily and sometimes reached 50 percent of potential viewers. Nine out of the eleven products promoted showed positive new prescription gains against controls, the highest being a 36-percent increase in just nine months. Would Medical News Network have been successful if pharmaceutical companies hadn't diverted spending away from the traditional physician customer? Or if reform had brought sizeable field force layoffs? Maybe. Maybe.

Whittle's plan was ambitious in trying to exclusively own the physician's (then later the managed care executive's) office, but a cheaper open system could potentially deliver similar clout.

GeoMedica acquired by information giant GeoMedica represents the most aggressive digital/multimedia physician product on the market (There's really nothing comparable in the consumer area yet!). The product offers the timeliness and vast resources of an on-line service, with the multimedia sight and sound potential available from CD-ROMs. Services include multimedia category 1 and 2 CME, pharmaceutical information, private medical bulletin board systems, specialty society access, Medline, and daily news. The physician also receives word processing, spreadsheet, and financial software. Slated to roll-out from beta testing mid-95, the daily news feed will be updated from text to a graphic format as other offerings will continue to expand. Doctors pay $48/month for the services alone, $98/month for the services and the hardware necessary to operate the system. Pfizer, Parke-Davis and Wyeth-Ayerst have all signed on for sponsorship slots that give the physicians access to a deep inventory of company-sponsored multimedia promotion and education.

The Reuters June acquisition of GeoMedica is important for several reasons. The parent's capital secures time to grow through the start-up phase. Reuters also has vast systems and information technology experience, and its expertise in the highly complex and secure banking industry translates elegantly to healthcare. Furthermore, the company has acquired V.A.M.P., the U.K. computer-based-patient record system (CBR), and has been revising it for U.S. use. Many believe that the computerization of the patient record, along with the diagnostic and monitoring support that it enables, will truly revolutionize medicine, and that the winner of the CBR contest will be the Microsoft of the healthcare industry. (At this rate, it might be Microsoft.) Certainly with desk-top presence and a near ready CBR, GeoMedica looks promising. Unfortunately, there's more

Understanding and anticipating the changes in healthcare communications media and technology requires a lot of looking around outside marketing and healthcare. What follows are some trends and observations that we think are worth noticing.

Oxymoron: healthcare information systems. There's more technology involved in checking out your groceries than there is at your doctor's office. Where else do you see walls of manila envelopes? What other industry still has such a problem reading handwriting? When you think about how archaic the MD's information tools are, you'll see how radical and potent changes might be. Once the doctor's "wired," it's a double paradigm-shift.

Empowered patients change healthcare dynamics. Patients will have to care more because they'll be paying more and/or they won't take the quality of their care for granted. Patients will be able to self-care more because technology will give them expert tools. "Does your baby's rash look like this—? Or like this—?" In the same way that photography (at the turn of the century—expensive gear, expert knowledge, fragile inventory) was made accessible, executable, and affordable to everyone by improvements in technology, healthcare may be turned upside-down by patient power.

Right now PCs are shipped along with the MAYO clinic Family Health Book CD-ROM. Right now patients can call a nurse to see if they really need a MD consultation. And right now there's a telemedicine system on the Internet that charges $4.00 a minute for MD consultations. You can even enter your lab values! Look at the increase in home-testing. Trend it out five years.

The net lives. A service called E-Span, an interactive employment network, posts your job listing to the Internet, America Online, CompuServe, Prodigy, and E-World. It's a net of nets! Everything's already connected: phone, cable, satellite. You can move a digital "envelope" (data, voice, pictures, movies) from site A to ANYWHERE, faster and cheaper all the time. And the net is smart. Unlike mass media, it knows who you are, if you received the delivery, if you responded Ñ and it remembers. Media waste and paper waste will both be nice add-backs in the "wired" future! The Internet: big, busy and big business. It's growing, it's getting commercialized, and it's getting darn good-looking and easier to use. There are 25-40,000,000 users and 25,000 commercial hosts (projected to be 100,000 by 1999), some of which are Eli Lilly, IBM, FedEx, Herbalife. You can currently chat with host companies, obtain equipment specs, order flowers, tour the breweries of San Francisco, and visit an Aspen home page to preview the mountain, book reservations, or check conditions.

In the noncommercial areas, the Internet is so vast and complex it's difficult to describe. In addition to the widely publicized academic, government, and technology resources and the myriad "newsgroups," there's OncoLink for cancer patients, where 10,000 users per day access medical and alternative cancer info, participate in peer and professional discussions, even view the art of children with cancer. Users can access and tour the student health databases of various universities, peruse movie reviews, tour countries, and download satellite weather maps. Almost anything you can imagine is available at least in some primitive form on the Internet.

Microsoft takes it to the bank. What will Microsoft's acquisition of Quicken financial services software mean? You get to supply your own implication/speculation here. Just watch the changes in the banking industry over the coming year.

Publish your own paper. Every business day I walk into the office and pick up a fax with a one paragraph summary of 15-20 news stories for TODAY that I programmed the database to select. I can call in the code for complete text, or look it up in my copy of the publication, if I have one. This could easily be on my computer, on my television, or in my voice mail. The "Me Channel" is going to hit us a lot faster in the office than in the family room.

Lawyers in cyberspace. State-by-state regulation of practices, antiquated reimbursement standards, FDA commercial speech regulation, and the complex liability issues all represent sizeable barriers to the healthcare info highway in general, and to the pharmaceutical company's role specifically. Look for the universities and local governments to blaze some of these trails.

If a lot of this sounds like it doesn't have much to do with marketing at the moment, you're right. But it will. Widespread distribution of information is really expensive. The infrastructure's not entirely in place. We already have phone lines, billing systems, pharmacy records, and satellites. We need MD support systems, hardware, servers, switchers, and software galore. And, just as the explosion of the cable network has created a vacuum for TV programming, the electronic network will require enormous numbers of computer programs.

What have we done? What have marketers always done? Found a way to subsidize a transaction, to get some attention, to persuade and motivate. With soap operas, advertisements, symposia, and refrigerator magnets. Only at some point they'll be made from digital "1's" and "0's." NONE of the 40,000 Physicians' Online subscribers chose to forgo the ads and pay a monthly subscription fee!

As always, marketers can use subsidies to shape the therapeutic agenda, increase the "volume," increase information, and make superior tools available.

What haven't we done? Faced a "pure" market. As access to and quality of information goes up, valuable drugs will be brought to optimal use. Poor performers, well, they'll have to be cheap. But as the industry strives for "optimal use of pharmaceuticals" from a relatively low leverage position in the therapeutic chain, all of this information may turn out to be a blessing in disguise.

Bundled pharmaceutical products and service products. The phone company's trying to bring you movies; your retailers are selling you service contracts; your airline's in the catalog business. The services you provide customers may have true unique value. They'll build loyalty, and they might be the difference between red ink and black.

It also has a lot to do with the charter; "efficient use of pharmaceuticals." These systems have the double-edged ability to optimize valuable drug use, and bury the poor performers. An arbitrary partial listing of interesting new media.

Static / CD-ROM
These media are "read-only" references that primarily give the user easy and powerful searching of vast amounts of information. Remember a CD-ROM currently holds 200,000 pages of text, and compression will soon expand that. When used in combination with a hard drive, some user-generated files can be written and networked.

SilverPlatter
An information publisher via CD-ROM and connector/reference source; arranges the access and distribution of information from its own and existing databases and libraries. SilverPlatter offers Internet subscriptions to provide access to its databases, where subscribers can download information on demand. SilverPlatter will eventually incorporate cross-library thesauri, natural language mapping, artificial intelligence, and other tools. It may also incorporate foreign language interfaces and enable users to access many publications from different sources.

Mayo Clinic Family Health Book
A complete medical reference with animated examples, 500 color illustrations, and all 1378 pages of the popular book. Allows shuffling between topics via "hot spot" indicators.

HouseCall
An interactive medical reference library. A personal health section allows the user interactive access to Symptoms, Drug Interactions, and a personalized Medical Record. "Symptoms" asks the ailing user increasingly specific questions, ultimately arriving at a possible cause of illness. The computer then stores the information in the patient's medical record for future reference.

The medical encyclopedia section of HouseCall is replete with the informational equivalent of a volume of an encyclopedia. Users may search for terms, conditions, and general medical information, such as surgical procedures, drugs, and first aid.

TV-Based Networks

These more traditional video-based networks currently require the wide bandwidth of over-the-air, cable, or direct broadcast satellite. Data compression and the interactive television technology now being developed by the phone companies promise to make high quality signal distribution more widely available in the not-too distant future. Bandwidth requirements are generally forgiven due to the superior impact of full-motion media.

Physicians Television Network
Distributed via the new Hughes high-powered digital satellite, PTN is projected to launch mid '95. The Physicians Television Network will allow instantaneous interaction. Physicians will be able to select programming, communicate directly with advertisers, and hear the responses of fellow viewers. PTN plans to place the service in the homes of 100,000 physicians (80,000 primary care providers) and 1,000 hospitals. To defray the cost of the service, NCME has arranged for selected physicians to receive satellite dishes free as long as they continue to receive the programming (full, individual monitoring is possible with this technology). Initially, the network will run six to eight programs repeated each week.

America's Health Network
This advertiser-supported basic cable television network providing health information and products is set to launch in the second quarter of 1995. It will telecast 24 hours a day, 7 days a week. AHN will feature sixteen hours of original programming daily, including "Ask the Doctor" and "Home Health Shopping" programs. Commercial segments will be bracketed by "Health IQ" bumpers that allow viewers to test their health-related knowledge and earn discounts on AHN products.

Closed Computer Networks
Access to these dedicated computer systems is on a membership-only basis either through subscription, or through participation in a networked group.

RHINNO
In December 1994, the Greater Cleveland Hospital Association announced that it will join with hospitals in its area to form the first community-sponsored health information network. The Regional Health Information Network of Northern Ohio (RHINNO), when fully operational, will link healthcare providers, payors, employers, and other participants to improve patient care and cut administrative costs. What sets RHINNO apart from other networks is that it's comprised of local entities, with the common goal of reducing administration costs. This shared resource will, through sharing vital information, inevitably reduce duplication of tests, forms, etc., and save members money.

Physician Computer Network (PCN)
Physician Computer Network allows physicians to communicate with hospitals, insurance companies, clinical laboratories, managed care organizations, and any other location on the network. Doctors can receive the service by leasing PCN computers. In exchange, PCN acquires data on patients, which it will then use to compile statistics of interest to pharmaceutical companies and other organizations. PCN facilitates on-premises electronic patient records, appointment scheduling, billing and reimbursement, and clinical/financial reporting. Other, more specific services include submitting electronic claims and exchanging data on patient eligibility verification, plan benefits, claims status, etc.; viewing hospital records, interactive patient charting, drug interactions and lab results; handling E-mail with other physicians; and accessing other health information networks.

Interactive, Proprietary Online Services

Unlike the aforementioned dedicated closed systems, the following online networks allow the user access to many or all servers and services available on "the net."

Physicians' Online
A less elaborate and less expensive concept than GeoMedica, POL gives the MD a user-friendly graphical interface to Medline, AIDSLINE, Physicians GenRx, Prescribing Decision Support Module, drug prescribing information from the FDA, and Quick Medical Reference. Pfizer is now developing programs for this interactive database. As of November 1994, Physicians' Online had 40,000 users with 200 joining daily. Marion Merrell Dow, Sandoz, and Astra/Merck now sponsor Physicians' Online in exchange for one-eighth screen ads.

Telemedicine
Telemedicine is the term indicating the use of electronic communication technology to aid or perform medical procedures from another location. Telemedicine implies vast possibilities, ranging from centralized medical records to surgery by remote control. By using a two-way video linkup, urban doctors, often more versed in the most recent technological developments, can assist other physicians in various aspects of care. The federal government has displayed a committed interest in expanding the use of telemedicine. Expenditures of $25 million were planned in 1994, with millions more allocated for related projects. In all, Congress spent approximately $1.1 billion on the information infrastructure, which includes apparati utilized in telemedicine.

Wireless Information Systems
Systems such as Med-E-Systems allows doctors to check patients' records, prescribe drugs, check drug interactions and complete insurance forms via a wireless data network. Wireless systems give the user the ability to take computing, network access, and resources anywhere.

Med-E-Systems
Med-E-Systems has launched the first wireless health data network for use by physicians by way of hand-held, pen-based computers. Designed to be used at the point of care, the Wireless Health Information Network (WHIN) allows doctors access to local and national medical data from any location. Med-E-Systems says that the convenience of WHIN could reduce healthcare costs by at least 15 percent.

The Internet and General Online Services

These are open systems that contain some resources that are either by content appealing only to special interest groups, or contain limited access areas and services.

CompuServe
Highly intuitive and has numerous health-related information sources. SDV's online vitamin catalog (GO SDV) supplies information not available on food packages and in the popular media. "Holistic Health" is a forum of various health interests (GO HOLISTIC). There is a standard conference "room" and library files, ranging from nutritional therapy to holistic dentistry. If you are looking for a discussion or information on health and diet recommendations, you can GO GOODHEALTH. Discussion groups, germane libraries, and other health-related files await at this location on CompuServe. The Health Periodicals Database contains a wide variety of articles from many publications, including nutrition, fitness and medicine.

ABI/INFORM For employers trying to make sense out of the health benefits options, there is ABI/INFORM. Accessible through Dialog and BRS, this service indexes journals pertaining to employee health insurance and benefits. It also provides many full-text articles from over 1,000 business journals. More specialized information is available through the Employee Benefits Infosource database (through Dialog). The service is maintained by the International Foundation of Employee Benefits Plans and pools articles pertaining to heath benefits from various sources. Topics include HMOs, disability benefits, PPOs, wellness programs, and other areas, such as retirement plans, profit sharing, worker's compensation and unemployment. Management Contents (via Dialog and BRS) provides abstracts of articles appearing in national and international journals and publications a wide variety of finance- and management-related topics.

Public access destinations/sites

Finding your way around the untamed Internet is a daunting venture; hence the growing popularity of programs, such as Mosaic, which utilize a graphic interface to allow more user-friendly "net-surfing."

Healthline
The University of Montana's HEALTHLINE (telnet to selway.umt.edu, log in as health) contains basic health and medical information directed at the layperson. Topics range from vitamins and minerals to giardiasis, an intestinal illness transmitted by fecal matter in mountain streams. The service is also available through the World Wide Web by using an "http" prefix.

Management Archive
Management Archive is an Internet archive (gopher to chimera.sph.umn.edu) that assembles papers, discussion lists, and other information. It also provides access to myriad medical and science resources through the Health Corner. From there you have access to such spots as the National Health Security Plan, and archives of the White House healthcare announcements. Gophers at this site include the World Health Organization, the National Institute of Health, Yale Biomedical, Human Genome Mapping Project, and others.

Virtual Hospital
The University of Iowa's Virtual Hospital began as an aid to medical students who needed information at all hours. Understanding that few, if any, people are able to remember everything they read and hear and that information is necessary at all times, three UIHC professors came up with the idea that would become the Virtual Hospital. They developed multimedia medical education materials and eventually uploaded them to Internet servers. The Virtual Hospital has a variety of text, pictures, sounds, and "discussions" pertaining to medical procedures and conditions ranging from pediatric respiratory problems to the latest developments in telemedicine. An emphasis is placed on pictures and medical explanations Ñ an invaluable service to healthcare providers everywhere. The information there is broken down into most likely audiences: healthcare providers, patients, and home pages. The general statistics indicate that there are over 50,000 users per week. The Virtual Hospital resides at  http://indy.radiology.uiowa.edu/ 

University Systems— dozens available
Too many and too diverse to describe. Many institutions have developed specialty content; many have elaborate health resources originally designed to support student and employee services. Try searching for one of interest through YahooHealth: http://akebono.stanford.edu/yahoo/Health/ 

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Bridging the Gap between Concept & Execution