Incoming Pharmaceutical Care Management Association CEO Mark Merritt brings PR experience and Republican contacts to the PBM trade association.

Merritt will join PCMA in early April from the Pharmaceutical Research & Manufacturers of America, where he was senior VP in charge of the association's communications strategy. Merritt is leaving PhRMA after just five months (see ¹ Also see "PhRMA Says Changes To Communications Strategy “Un-Merritted”" - Pink Sheet, 24 March, 2003.).

Merritt will be joining PCMA at a time when the pharmacy benefit management association is boosting its public relations efforts after a difficult period of scrutiny during the Medicare prescription drug benefit debate.

Over the past year, PCMA has retained the public relations firm Porter Novelli and launched an image advertising campaign (² 'The Pink Sheet' Feb. 3, In Brief).

Merritt is familiar with the challenges of rehabilitating the image of health care intermediaries; before joining PhRMA in October, he was head of public affairs and strategy for the managed care trade association AAHP (³ Also see "PhRMA’s Badge Of Merritt: AAHP Exec Joining Rx Association As Head Of PR" - Pink Sheet, 23 September, 2002., p. 12).

Merritt, 38, will succeed LaVarne Burton as president. Burton will remain with PCMA as exec VP and chief operating officer. She will be responsible for overseeing the day-to-day operations of the staff. Burton, formerly an HHS policy analyst in the Clinton Administration, took over as PCMA president two years ago (⁴ Also see "PCMA Prepares For Medicare Debate: Former HHS Analyst Burton Is President" - Pink Sheet, 23 April, 2001., p. 28).

PCMA is not describing the arrangement as transitional, but rather as an attempt to create a complementary team atop the association.

Merritt's background in strategy and communications may better serve the trade association's increasing focus on image campaigns. Burton's background may be more suited to behind-the-scenes work on the nuts-and-bolts of drug benefit design and day-to-day management of the trade group.

Merritt also brings closer ties to the GOP majorities on Capitol Hill. Before joining AAHP, he worked on Lamar Alexander's presidential campaign in 1996 and was selected by eventual Republican nominee Bob Dole to serve as media strategist for the convention.

Burton's Clinton Administration experience, including work in the health care reform debate in 1993-94, may continue to prove useful in working with congressional Democrats on Medicare issues - but risked shutting the association out of GOP-dominated policy debates.

The dynamics behind the PCMA leadership change were evident last summer, when the large PBMs began devoting much of their investor communications to defending their practices, and the CEOs became more active in the Washington policy debate and at the trade association level.

Caremark CEO Mac Crawford told investors in July that the PBM sector has to do a "better job getting our story out" to counter the "misinformation and disinformation" about PBM practices.

Crawford indicated concern that the sector's engagement in the Medicare debate was causing more harm than any foreseeable benefit would justify. "I really have never counted on a Medicare prescription drug benefit as a big source of revenue," he said. "Whoever wants to do it, do it," but "keep me out of the shooting gallery" (⁵ [A#00640310008], p. 15).

Crawford was a member of the PCMA presidential search committee. The Korn Ferry search firm assisted the association in the effort.

Merritt is understood to have been contacted by PCMA before he joined PhRMA when the search was in a preliminary phase. The association contacted him again in February. He informed PhRMA that he had accepted the post March 14.

The PCMA board is likely to consider other additions to its staff. The trade association currently has 12 full-time employees. Four staff members hired by Merritt at PhRMA - Michael Tuffin, John Murray, Dan McLagan, and Tom Bunnell - also resigned March 14 and will presumably be joining the PCMA staff.

An early test for PCMA's new leadership may come in hearings on the Bush Administration's Medicare prescription drug discount card proposal. The large PBMs generally support the plan, but it has been blocked in court after retail pharmacy groups filed suit (⁶ Also see "Medicare Rx Discount Card Blocked By Court; Industry Programs Continue" - Pink Sheet, 3 February, 2003., p. 7).

PBM Association Picks PhRMA’s Merritt To Lead Image Renewal Effort

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