Tag Archives: Panic

THE TRUMP EFFECT

WHAT THE NEW ADMINISTRATION MIGHT MEAN FOR HEALTH CARE

By Erik Clausen

Several months have passed since the U.S. Presidential election, and…we’re still here, folks. After years of political rhetoric and theatrics, and a few months of uncertainty, we are starting to gain some clarity around exactly what the new administration and its policies might mean for the life science industry and, by extension, marketers within it.

Most importantly and as a wise man wrote before the election, “There is no need for panic.”

the scream EdvardMunch

Edvard Munch – The Scream

Now that the rhetoric has momentarily quieted, we need to balance Trump’s desire to make dramatic policy changes with the realities of the legislative process and with the expectations of a public that benefits from life science and healthcare innovation. Widespread policy changes take time to implement and often require strong Congressional support, even with a Republican-controlled House and Senate. The recent defeat of the health care bill is a case in point.

In other words, as we look at the major policy changes that are likely to affect life science marketing in the years ahead, we need to recognize that there will be time to adjust marketing strategies and tactics accordingly. This may even mean building multiple marketing plans to address different contingencies.

fear MS Office

 

Possible repatriation of US dollars

U.S. pharmaceutical companies have substantial funds tied up in accounts overseas due to punitive tax laws. The administration has proposed, as part of his economic stimulus plan, to dramatically reduce this tax rate and encourage those dollars to come back to the U.S.

In theory, by lowering the tax burden on these businesses, the economy will see an uptick as businesses are encouraged to invest. These companies benefitting from tax relief would in turn reinvest those dollars domestically in the form of new deals, R&D, acquisition and job creation.

Since pharmaceutical and instrumentation companies typically grow based on acquisition, we could see a resurgence in life science M&A and dramatic increases in the value of emerging biotech, diagnostic and tools companies. No doubt, these topics are top of mind at industry gatherings like the January 2017 J.P. Morgan Healthcare conference.

dollars MS Office

If this move does have the immediate and positive effect on the life science sector as promised, it would give corporate brand managers and marketers much to do to position their companies correctly to take full advantage of the M&A environment.

Of course, this assumes that the financial boon to corporations is reinvested or used for acquisition and not simply distributed to shareholders. Increased deal-flow will lead to increased budgets. This will undoubtedly bring increased noise in a busy economy. Therefore, we should focus on building long-term brand equity in an expanding GDP and economy.

 

Corporate tax rate reduction

The administration will also propose in the President’s Budget Bill, a much lower corporate tax rate. This plan would significantly reduce the cost of capital and reduce the marginal tax rate on labor.

By most analyses, these incentives could increase the U.S. economy’s size in the long run, boost wages, and result in more full-time equivalent jobs—including in the life science sector. The question remains, what the estimated reduction in federal revenue will mean for federal funding of medical and scientific research. Such grants often precipitate early discovery that soon become commercialized.

 

tax tax tax MS Office

The size of the proposed tax breaks for corporations are, simply put, Huge.” But if the administration can actually get it through Congress, it has the potential to give corporations exponential buying power, increase cash flow, build up inventory, and re-invest in technology. Dismissing any possibility of a bubble and or the rich simply getting richer, these tax breaks should create jobs and boost all sectors of the economy, including life science and healthcare.

 

Reforming the FDA

In his 100-day plan, Trump specifically cited, “…cutting the red tape at the FDA…” as among his highest priorities. In the plan, he stated that, “…there are over 4,000 drugs awaiting approval, and we especially want to speed the approval of life-saving medications.” We can only assume that such reforms would also have a direct effect on approval and clearances for new medical devices and diagnostic tests, as well.

An accelerated approval process at the FDA could potentially have a positive effect—at least in the short-term—on the life science sector. With therapeutic candidates and devices moving more rapidly through review than anticipated, biotech, pharmaceutical and device companies in mid to late stage clinical phases could see increased valuations of companies with early approvals.

fda MS Office

Additionally, this could encourage earlier stage companies to get more ambitious about moving candidates to the clinic and could make would-be acquirers more bullish.

In the long term, if that accelerated review brings products to market too quickly, it could threaten public health, cause another costly set of reforms, and damage the brands of those companies.

 

What does the new agenda mean for marketers?

While it will take some time to feel the effects on any proposed legislation or policy changes, the administration will tie everything back to growing the economy: no small challenge. A lot has to come together with or without a cooperative Congress. The President will have to build a consensus.

marketing MS Office

For now, as marketers we need to do what we’ve always done—assess market opportunities, pinpoint our target audiences, develop smart strategies to reach and influence their behavior, and measure outcomes. Certainly, researching the impact of policy decisions is part of that research, but acting too quickly on proposed policy changes only fuels uncertainty.

And, if there is one truth in the market, it doesn’t like uncertainty.

screaming robot MS Office

In the end, even if the President is able to pass a fraction of what he’s proposing, it should lead to economic prosperity and marketing opportunity in our industry.

Now, if we could just turn off his Twitter account, we might make social media great again, as well.

 

chempetitive group logo

About the Author

Erik Clausen is part of the Chempetitive Group, a Chicago based marketing initiative for pharmaceutical, chemical, biotechnology, diagnostics, and medical devices.

This article was previously posted online

Graphics: THE SCREAM courtesy www.EdvardMunch.org

All other graphics from MS Office.

 

Chicago Venture Magazine is a publication of Nathaniel Press www.ChicagoVentureMagazine.com Comments and re-posts in full or in part are welcomed and encouraged if accompanied by attribution and a web link. This is not investment advice. We do not guarantee accuracy. Please perform your own due diligence. It’s not our fault if you lose money.
.Copyright © 2017 John Jonelis – All Rights Reserved
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UNDERESTIMATING THE COMPETITION

Olga of Kiev Tby Robert Jonelis

Ever face a crisis situation?  Raw panic?  Of course you have.  We’ve all been burned by miscalculation, greed, and shoddy research.  People have been making the same mistakes for quite a long time and a young woman from the 10th Century can teach us a pointed lesson about the importance of accurately sizing up the competition.

Miscalculation

Meet Princess Olga.  She lived in Kiev back in the 900s with her husband Igor, ruler of Kiev, and their young son Svyatoslav.  Igor was leaning on the Drevlians, a neighboring people, for tribute.

The Drevlians decided that killing Igor would be cheaper than paying up, so they assassinated him.  That left Olga, a young widow, as regent for her three-year-old son.

The Drevlians were now dealing with an angry leader that they had badly underestimated.

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Greed

The Drevlian ruler wasn’t satisfied with merely eliminating the payment of tribute.  He could do even better.  If he married Olga, he’d rule Kiev!  After all, she was a poor widow with nobody to protect her or rule her kingdom.  He dispatched a group of important Drevlians to make the pitch to Olga—something along the lines of, “We know you’re single since we killed your husband, how about you marry our leader?”

Olga’s response was not what they were hoping for.  She buried the envoys alive.

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Shoddy Research

Before news got out about the demise of the Drevlian ambassadors of love, Olga sent word to the Drevlian leader that she accepted his proposal.  However, she said, for her people to accept her remarriage, the wisest and most knowledgeable of the Drevlians must come to serve as an honor guard on her perilous journey.

When these men arrived, she burned them to death.

Undeterred by her delayed arrival and still blissfully unaware of events, the Drevlians send a huge contingent to a feast put on by Olga.  A large number of them became exceeding intoxicated.  Her soldiers then attacked the largely helpless drunks.  Several thousand more Drevlians perished.

Pieter_Bruegel_the_Elder_-_The_Dutch_Proverbs 500

Painting by Pieter Bruegal the Elder

The Drevlians finally caught on that Olga was less than happy with them, but by this time she was gathering her army.  Deprived of much of their leadership and a significant chunk of their manpower, things didn’t go well for the Drevlians, and Olga soon besieged their main city.

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Crisis Management

Sensing doom, the Drevlians tried to negotiate peace. Olga responded that all she required would be three live pigeons and three live doves from each Drevlian household as tribute. (Drevlian families commonly kept bird coops on the roofs of their homes).

The night after delivery of the tribute, Olga’s troops tied a piece of string to the leg of each bird, bearing a flaming material.  They released the birds, all of which immediately flew back to their homes.  Every building in the city caught fire at about the same time.

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Panic Mode

The Drevlians fled their flaming fortified city into the arms of Olga’s waiting troops.

The Drevlians underestimated their competition.  This is probably why you don’t hear much about them today.

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Bob Face 2

Robert Jonelis is a mathematician and history buff who knows how to tell a good story.  He spends his days programming automated machinery in search of the perfect robot.

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This article originally appeared in NEWS FROM HEARTLAND – The Journal of the Heartland Angels.    http://news.heartlandangels.com   Copyright © 2014 John Jonelis

Chicago Venture Magazine is a publication of Nathaniel Press www.ChicagoVentureMagazine.com Comments and re-posts in full or in part are welcomed and encouraged if accompanied by attribution and a web link. This is not investment advice. We do not guarantee accuracy. It’s not our fault if you lose money.

.Copyright © 2015 John Jonelis – All Rights Reserved

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