Deal Moves P&G Into Health And Wellness

by Christine Bittar, Feb 20, 2007, 5:00 AM

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Procter & Gamble's investment in a Boca Raton, Fla.-based preventative care medical chain MDVIP marks a new kind of relationship for P&G with health care.

The still low-profile MDVIP is similar to supplemental health coverage for wellness. In exchange for a premium of $125 to $150 per month, enrollees get more attention from primary care physicians. P&G's involvement is expected to ramp up the visibility.

"P&G has marketing expertise with consumers, brand value messages, and business propositions," said Dr. Edward E. Goldman, president and CEO of MDVIP. "If we wanted to be a niche player, P&G wouldn't fit."

P&G and MDVIP insist that the minority investment announced in January is not about creating new product distribution channels.

Goldman said MDVIP could also use assistance with computer systems and data gathering, but one thing P&G won't be doing is using the wellness firm as a distribution or marketing platform for existing products. "We are very clear--we are not a distribution channel," said Goldman.

Nathan Estruth, P&G's general manager for new business development, agreed. "The focus is on wellness, not P&G product marketing," he said.

P&G approached the company about a year ago, Estruth said, because "we looked at the health care landscape and were very impressed with MDVIP, its size and its business model ... no other company came close."

P&G's immediate goals with MDVIP are marketing to consumers, getting more doctors into the system, and to "help with scale," he added. Currently, only 140 or so physicians are enrolled nationwide. One idea is to market the service to corporations as an employee benefit.

To date, most consumers have enrolled through word of mouth, and often recommend that their own family physicians come on board, Estruth said.

According to MDVIP's Goldman, the average amount of time doctors now spend with a patient is a mere eight minutes--barely enough time to make a simple diagnosis, and not sufficient to learn and understand what's going on with the patient as a whole.

An MDVIP enrollee gets a full evaluation with annual physicals lasting about an hour. Included is a "health risk assessment" in which an MDVIP doctor screens and speaks with a new patient about family history--asking probing questions to determine whether a person tends toward diabetes, heart problems, or even depression.

Doctors with their own practices are recruited, and MDVIP then limits them to a maximum base of 600 patients, so that they can take more time with each patient, Goldman said. A typical MDVIP patient makes three or four visits a year.

The MDVIP investment is not P&G's only recent healthcare initiative. Last month the company also announced a partnership with ScriptAssist to offer a nationwide "Nurse Call-Back Program" to encourage patients who are on the colitis drug Asacol--a drug P&G markets for the biotech firm, ARYx Therapeutics--to take it as directed.

That activity falls under P&G's pharmaceutical umbrella, while MDVIP is part of its health care business.

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