Forecasting Physicians’ Choice of Prescriptions? Ask Their Patients, Says Management Insights Study

HANOVER, MD, April 9, 2007 – Physicians’ choice of prescriptions are often influenced by patients, with patient experience with specific drugs playing a strong role, according to the Management Insights feature in the current issue of Management Science, the flagship journal of the Institute for Operations Research and the Management Sciences (INFORMS®). The results have important implications for those who market pharmaceuticals.

Management Insights, a regular feature of the journal, is a digest of important research in business, management, operations research, and management science. It appears in every issue of the monthly journal.

“A Dynamic Competitive Forecasting Model Incorporating Dyadic Decision-Making” is by Min Ding of Smeal College of Business at Pennsylvania State University and Jehoshua Eliashberg of the Wharton School.

The researchers addressed several questions: Do physicians incorporate patients’ inputs into their prescription decisions? If so, to what extent modeling such inputs improves the forecasting performance compared to models that do not explicitly incorporate patients’ inputs? Additionally, to what extent do the patients’ inputs depend on the type of patients, disease, and the physicians themselves?

Using prescription data from different therapeutic classes and physician specialties, the empirical results indicate improvement in forecasting when patients’ inputs are explicitly considered.

The authors find that, in most cases, the inherent preference for a drug, by both patients and physicians, increases once a patient has used the drug. They also find that patients play an important role in prescription decisions, but that their influence diminishes when the doctor is a specialist, and that they have no influence in situations where specialists are treating patients with severe symptoms.

These results have forecasting implications, as well as fundamental implications for how pharmaceutical executives should allocate their promotional resources.

The current issue of Management Insights is available at http://mansci.journal.informs.org/cgi/reprint/54/4/iv. The full papers associated with the Insights are available to Management Science subscribers. Individual papers can be purchased at http://institutions.informs.org. Additional issues of Management Insights can be accessed at http://mansci.pubs/informs/org/.

The Insights in the current issue are:

- Inventory Record Inaccuracy: An Empirical Analysis by Nicole DeHoratius, Ananth Raman

- Optimal Policy for Software Vulnerability Disclosure by Ashish Arora, Rahul Telang, Hao Xu

- Security Patch Management: Share the Burden or Share the Damage? by Hasan Cavusoglu, Huseyin Cavusoglu, Jun Zhang

- High Touch Through High Tech: The Impact of Salesperson Technology Usage on Sales Performance via Mediating Mechanisms by Michael Ahearne, Eli Jones, Adam Rapp, John Mathieu

- Designing Pricing Contracts for Boundedly Rational Customers: Does the Framing of the Fixed Fee Matter? by Teck Hua Ho, Juanjuan Zhang

- Contracting and Information Sharing Under Supply Chain Competition by Albert Y. Ha, Shilu Tong

- Inventory Management with Advance Demand Information and Flexible Delivery by Tong Wang, Beril L. Toktay

- Competition and Cooperation in Decentralized Push and Pull Assembly Systems by Daniel Granot, Shuya Yin

- Analysis of Direct Shipping Policies in an Inventory Routing Problem with Discrete Shipping Times by Luca Bertazzi

- A Constant Approximation Algorithm for the One Warehouse Multi-Retailer Problem by Levi Retsef, Robin Roundy, David Shmoys, Maxim Sviridenko

- Quantity Discounts Under Demand Uncertainty by Nihat Altintas, Feryal Erhun, Sridhar Tayur

- Call Center Outsourcing Contracts Under Information Asymmetry by Sameer Hasija, Edieal J Pinker, Robert A Shumsky

- Regret and Feedback Information in First-Price Sealed-Bid Auctions by Richard Engelbrecht-Wiggans, Elena Katok

- Interior Additivity and Subjective Probability Assessment of Continuous Variables by Robert Clemen, Canan Ulu

INFORMS journals are strongly cited in Journal Citation Reports, an industry source. In the JCR subject category “operations research and management science,” Management Science ranked in the top 10 along with two other INFORMS journals.

The special MBA issue published by Business Week includes Management Science and two other INFORMS journals in its list of 20 top academic journals that are used to evaluate business school programs. Financial Times includes Management Science and four other INFORMS journals in its list of academic journals used to evaluate MBA programs.

About INFORMS

The Institute for Operations Research and the Management Sciences (INFORMS®) is an international scientific society with 10,000 members, including Nobel Prize laureates, dedicated to applying scientific methods to help improve decision-making, management, and operations. Members of INFORMS work in business, government, and academia. They are represented in fields as diverse as airlines, health care, law enforcement, the military, financial engineering, and telecommunications. The INFORMS website is www.informs.org. More information about operations research is at www.scienceofbetter.org.

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