Reputation of Pharmaceutical Companies.

Every year, Harris Interactive measures the public’s perceptions of approximately 20 industries. Specifically, we ask people to say if they think each industry is generally doing a good or a bad job of serving their consumers. It is clear that answers to this question reflect not just the specific wording, but many general public feelings about the different industries. If people feel good about an industry, they tend to say it is doing a good job of serving its consumers and vice versa.

Over the nine years since we first asked these questions in 1997, the overall ratings of pharmaceutical companies, managed care companies and health insurance companies have been among the most volatile.

Until last year, most of the news we brought to the healthcare industries measured was bad. The public seemed to be more hostile to them with each succeeding year. However, that changed in 2005, when public attitudes toward drug companies, managed care companies and health insurance companies improved from what had been their abysmally poor ratings in 2005. These upward trends have continued this year. Nevertheless, in spite of the improvement in their reputations, the pharmaceutical industry, the managed care industry and the health insurance industry are still among the most unpopular of the 21 industries on this year’s list.

The big picture; different industries compared

Several industries are widely perceived by three-quarters or more of adults to be doing a good job of serving their consumers. These include supermarkets (91%), banks (80%), computer software companies (79%), packaged food companies (77%), Internet service providers (76%), online search engines (75%) and computer hardware companies (75%).

At the other end of the spectrum, two industries are perceived the most negatively, with only about a third of the public thinking they do a good job of serving their consumers. These are the tobacco industry (34%) and the oil industry (36%).

Hospitals

The great majority of adults continue to give hospitals positive ratings, with 74 percent saying they are doing a good job, and 23 percent saying they are doing a bad job. This gives them a net positive rating (i.e., good job minus bad job) of 51 percent.

Over the years, hospitals’ positive ratings have fluctuated between a high of 59 percent in 2005 and a low of 41 percent in 2001. Therefore this year’s rating of 51 percent is not particularly high or low. However, it is a decline of eight percentage points since their highest-ever rating of 59 percent last year.

Pharmaceutical companies

The ratings of the pharmaceutical industry have been the most volatile of any industry. Nine years ago, in 1997, the pharmaceutical industry had a net positive rating of 60 percent. This fell fast over the years until it touched rock bottom at minus four percent in 2004. However, last year, it jumped up to 13 percent and this year it is up sharply again at 25 percent.

Managed care companies and health insurance companies

Health insurance companies and managed care companies such as HMOs have always been near the bottom of the list. At their best, their net positive score was only 13 percent. At the lowest point, the managed care industry had a net negative score of minus 30 percent in 2001, while the health insurance industry had a net score of minus 20 percent in 2004.

Over the years the distinction between health insurance and managed care has, of course, greatly diminished and it now seems that most adults do not distinguish between. This year both have a net score of minus three percent which puts them almost at the bottom of the list, above only oil and tobacco industries.

However, the reputation of the industry has been improving sharply over the last two years. The net rating of managed care companies rose from minus 23 in 2004 to minus 13 last year and to minus three this year.

The rating of the health insurance industry has risen from minus 19 in 2005 to minus three this year, an improvement of fully 16 percentage points.

What’s going on, and why

These numbers will probably stimulate some debate. Some commentators may even ask how such unpopular industries, which continue to get a dismal press, can possibly have improved their reputations. Of course, this survey only measures their reputations and does not attempt the much harder task of explaining why their reputations have changed. However, we can speculate as what is going on.

First of all, it is important to recognize that the pharmaceutical, managed care and health insurance industries are stilled rated very near the bottom of the list in terms of public approval. They are not popular, but they have become less unpopular. A plausible explanation of their upward trend is that they have been receiving less unfavorable media coverage and publicity over the last two years than previously.

The lowest numbers for the health insurance and managed care industries came at a time when they were often portrayed as organizations that frequently refused to provide coverage for essential, very important medical care. They “just said no.” That kind of media coverage is much less common nowadays.

In the case of the pharmaceutical industry, the massive decline from plus 60 percent in 1997 to minus four percent in 2004 was surely a direct result of the constant drumbeat of unfavorable publicity about their prices. While drug prices are still a major issue for many people, there has probably been less negative publicity on this issue over the last two years than previously. Another interesting point is that the bad publicity in relation to drug safety problems does not seem to have had much impact.

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