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Marketing, Sales and Supply Chain Management in the Pharmaceutical Industry

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Marketing, Sales and Supply Chain Management in the Pharmaceutical Industry MGT 682 Prof. Elby Nash E-MAIL: enash_at_stevens.edu COURSE GRADING COURSE GRADING A PEST ... – PowerPoint PPT presentation

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Title: Marketing, Sales and Supply Chain Management in the Pharmaceutical Industry


1
Marketing, Sales and Supply Chain Management in
the Pharmaceutical Industry

MGT 682 Prof. Elby Nash
E-MAIL enash_at_stevens.edu
2
MGT 682
Course description
The course focuses on
the organizational, management and information
technology issues and considerations related to
the sales, marketing and supply chain functions
of the pharmaceutical industry as key components
of its business and competitive success and as
key boundary-spanning functions. This course
will use extensive research and current
literature on pharmaceutical sales, marketing and
supply chain management to explore the real and
potential information, technology and knowledge
linkages between the sales and marketing that
drive or support sales and marketing plans and
knowledge management considerations that drive
competitive distinctiveness. The course will also
explore the real and potential information and
knowledge linkages between the sales and
marketing function and the discovery, product
development and the supply chain functions of the
pharmaceutical industry. This course will
also examine the regulatory and ethical
considerations that impact these functions and
examine current issues in these domains which
impact pharmaceutical industry sales and
marketing and supply chain management.

3
COURSE GRADING
  • PARTICIPATION, RELIABILITY 10
  • INDIVIDUAL PRESENTATIONS 20
  • TEAM PRESENTATIONS 20
  • CASE STUDY (WEEK 13) 20
  • FINAL RESEARCH PAPER 30

4
COURSE GRADING
  • PARTICIPATION
  • General reliability
  • Successfully complete in-class assignments and
    submit them on/before due date
  • Contribute to class discussion by verbally
    sharing your opinions and knowledge
  • Incorporate concepts and draw parallels from
    cases, readings, and previous class discussions
  • Draw from your work, school, and life
    experiences

5
REQUIRED READING
  • Smith, M., Pharmaceutical Marketing Strategy
    and Cases, Haworth Press, 1991
  • Simchi-Levy, D., Kaminsky, P. Simchi-Levy,
    E., Managing the Supply Chain The Definitive
    Guide for the Business Professional,
    McGraw-Hill, 2004
  • Cohen, S. Roussel, J., Strategic Supply Chain
    Management, McGraw-Hill, 2005
  • Vandermerwe, S. and Atun, R., Imperial College
    Tanaka Business School Case 502-023-1
    Pharmalife A Deciding Whether to Build a
    Web-based Services Company from Scratch, 2002

6
ETHICAL CONDUCT
The following statement is printed in the Stevens
Graduate Catalog and applies to all students
taking Stevens courses, on and off
campus.   Cheating during in-class tests or
take-home examinations or homework is, of course,
illegal and immoral. A Graduate Academic
Evaluation Board exists to investigate academic
improprieties, conduct hearings, and determine
any necessary actions. The term academic
impropriety is meant to include, but is not
limited to, cheating on homework, during in-class
or take home examinations and plagiarism.   Conseq
uences of academic impropriety are severe,
ranging from receiving an F in a course, to a
warning from the Dean of the Howe School, which
becomes a part of the permanent student record,
to expulsion.
7
THE FIVE COMPETITIVE FORCES THAT DETERMINE
INDUSTRY PROFITABILITY
Source Porter
8
  • Potential Entrants
  • Other combinations (high likelihood)
  • Zocor-Zetia Combo
  • Can remove distinctive competency
  • THREAT VERY HIGH

Porters Five Forces Analysis for a Proposed New
Statin
  • Buyers
  • Physicians are demanding more relevant research
    findings
  • Patients are becoming more knowledgeable
  • Payors spend significant resources to mitigate
    and to negotiate the cost of statins.
  • THREAT MODERATE
  • Industry Competitors
  • Long-established statin industry
  • Generics
  • Bristol-Myers Squibb (Pravachol)
  • Pfizer (Lipitor)
  • AstraZeneca (Crestor)
  • Merck (Zocor)
  • Novartis (Lescol XL)
  • THREAT HIGH
  • Suppliers
  • Many available suppliers
  • Simple starting materials
  • THREAT LOW
  • Substitutes
  • New class of cholesterol-lowering medicines,
    (ezetimibe)
  • Herbal medications
  • Decision not to use drugs
  • Homeopaths
  • Diet and exercise
  • Orange Juice
  • Oat bran
  • Cholesterol-lowering margarine
  • Garlic
  • THREAT HIGH (because of new class, Low
    otherwise)
  • Customer Need
  • Lower LDL-Cholesterol
  • Reduce risk of primary and secondary coronary
    events

Overall Threat Level HIGH
9
A PEST Analysis of Environmental Influences
1. What environmental factors are affecting the
organization ? 2. Which of these are the most
important at the present time ? In the next few
years ?
  • Political / Legal
  • Monopolies legislation
  • Environmental protection laws
  • Taxation policy
  • Foreign trade regulations
  • Employment law
  • Government stability
  • Sociocultural factors
  • Population demographics
  • Income distribution
  • Social mobility
  • Lifestyle changes
  • Attitudes to work and leisure
  • Consumerism
  • Levels of education
  • Economic factors
  • Business cycles
  • GNP trends
  • Interest rates
  • Money supply
  • Inflation
  • Unemployment
  • Disposable income
  • Energy availability and cost
  • Technological
  • Government spending on research
  • Government and industry focus on technological
    effort
  • New discoveries / development
  • Speed of technology transfer
  • Rates of obsolescence

Ref Johnson Scholes, Exploring Corporate
Strategy
10
Sample PEST
11
Sample SWOT
12
Sample Ansoff Analysis
  • Market Penetration (Current Products, Current
    Customers)
  • 40 of patients will be new Rxs.
  • 55 of patients will be switchers.
  • 5 of volume will be market widening due to
    increased compliance.
  • Market Development (Current Products, New
    Customers)
  • Cholesterol testing vouchers, (work with MCO)
  • Pre-30-years-old patients (pending pediatric
    safety studies)
  • Product Development (New Products, Current
    Customers)
  • Possible treatment of atherosclerosis
  • Diversification (New Products, New Customers)
  • Potential partnership with Merck to test
    combinations with ezetemibe

13
INTRODUCTION
14
Today's Pharmaceutical Industry Challenges
Research Development
Standards Regulations
Sales
Information Technology
15
Today's Challenges RD
  • Demands to improve clinical trial productivity
    and reduce time from First in Man studies to
    final approval
  • Use of multidisciplinary teams that need
  • Information from many sources that is readily
    available
  • Information that has been organized and
    appropriately contextualized
  • Information that has been personalized to each
    researchers needs
  • Growing trend of outsourcing parts of the
    clinical trial value chain to CROs
  • Data from many sources that needs to be
    standardized for cross-study analysis
  • Examination of alternative models for data
    management from multiple CROs e.g., use of
    super CROs to coordinate data management from
    other CROs
  • Increasing emphasis on earlier availability of
    data for decision-making
  • Growing need to share data, insights and
    conclusions with researchers and study
    coordinators who are likely to be geographically
    dispersed
  • Need to share clinical trial data with multiple
    geographically dispersed investigators, monitors
    and statisticians

16
The Clinical Trial Value Chain
17
Today's Challenges Sales
  • Globalization
  • Increased demand to understand lessons learned
    across different product lines and geographies
  • Increased requirement to understand local needs
    to sell more effectively, but to act across the
    enterprise
  • Customer saturation with sales literature
  • Need for continuously updated information about
    drug efficacy, interactions, contraindications
    and adverse effects
  • Greater emphasis on economic and health care
    aspects of specific drugs and therapies by
    customers with high bargaining power
  • Increased demand for sharing information and
    knowledge gained regarding comparative drug
    efficacy for clinical targets

18
Today's Challenges Standards Regulations
  • Need to accelerate the process of moving from
    drug discovery through clinical trials and then
    through approval by FDA and other (trans)national
    agencies
  • Inconsistent organizational responses to Part 11
    some slow to start serious assessment and
    remediation while others are setting the pace
  • Increased pressure by FDA on non-compliant
    organizations
  • Multiple sources of regulatory references
  • Multiple sources (or non-explicated sources)
    regarding advice process shortcuts and lessons
    learned
  • Replicable approaches for opportunity teams for
    preparing data and cases to national advisory
    boards

19
Today's Challenges IT
  • Poor alignment of IT with business strategy
  • IT seen as a support service and not as a
    strategic enabler
  • IT organizations still in functional silos
  • IT seen as a (high) cost of doing business
  • IT organizations not respected by RD or
    manufacturing organizations
  • Greater focus on cost containment by business
  • Increased short term focus on compliance related
    issues
  • Program/project funding for other projects
    impacted
  • History of poor program management and PM
    practices
  • Measurement systems for organizational
    effectiveness not employed or poorly linked to
    business objectives
  • IT strategies not well articulated (if at all)
  • Methodologies and architectures not well
    articulated
  • Poor track record in meeting project deliverables
    (on time and on budget)
  • Slow response to meeting RD challenges,
    especially around the deployment of IT to address
    flood of data

20
The Pharmaceutical Marketplace
  • Globalization of the pharmaceutical marketplace
  • U.S., EU and Japan 80 of sales of all
    pharmaceutical products
  • RD and manufacturing facilities frequently
    located in multiple geographies
  • International co-development and co-marketing of
    products
  • Regulatory governance crossing international
    boundaries

21
The Top 10 Pharmaceutical Companies
In 2004, prescription sales exceeded 500 billion
for the first time, while revenues grew by 7 to
550 billion
Source Pharmaceutical Executive
22
The Global Pharmaceutical Market
  • From 2003 2008, the fastest growing markets
    will be
  • North America
  • Middle East
  • Australasia
  • Latin America

Source IMS Health 2002 Pharma Prognosis
23
The Pharmaceutical Marketplace
  • Waves of mergers and consolidations continue

Sanofi-Synthelabo
Aventis
Sanofi-Aventis
2004
24
The Pharmaceutical Marketplace
  • High and continually escalating RD costs

Source Pharmaceutical Research and Manufacturers
of America (PhRMa) Annual Survey, 2001
25
The Pharmaceutical Marketplace
  • High and continually escalating RD costs

Source Pharmaceutical Research and Manufacturers
of America (PhRMa) Annual Survey, 2001
26
The Pharmaceutical Marketplace
  • High and continually escalating cost to develop a
    single drug now estimated at 500 - 800
    million
  • In 1986 the cost to develop a new drug was
    estimated at 231 million (average annual growth
    rate of 38), yet
  • Average sales for new drugs is only 265 million
    per drug (industry norm) and 90 of all drugs
    bring in lt 180 million in revenue!
  • High failure rate of chemical compounds to make
    it through clinical trials to measure toxicity
  • (are they safe?),
  • efficacy (do they produce the desired effect?)
    and
  • adverse events (do they produce undesired
    effects?).
  • PhRMa has estimated that less than one formal
    study project in 100 ever makes it to FDA
    approval and commercial introduction

27
The Pharmaceutical Marketplace
  • The long timeframe required to successfully bring
    a proposed drug from initial discovery through
    clinical trials and on to FDA approval and
    ultimately to market currently estimated at 10
    years per drug
  • Limitations on the length of time a company can
    retain exclusivity to the patent for a drug
    before the drug can be marketed by competitors as
    a generic currently 17 years from the time a
    company files an application with the FDA (called
    an Investigational New Drug Application or
    IND for short)

28
The Pharmaceutical Marketplace
29
The Pharmaceutical Marketplace
  • The paradoxical decline in drug discovery
    productivity and efficiency despite significant
    advances in the use of information technology in
    drug discovery

Source Number of New Molecular Entities (NMEs)
Introduced to the Global Market 1987 1996,
Source Centre for Medicines Research
International, 1997
30
The Pharmaceutical Marketplace
  • Submission to the FDA for New Drug Applications
    (NDAs) have been on a steady decline since 1970

Source FDA
31
The Pharmaceutical Marketplace
  • New drugs to treat and cure sick patients are
    coming into the market in the United States at
    the slowest rate in a decade, despite billions
    invested by pharmaceutical companies on research
    and a costly expansion by the federal agency that
    reviews new medicines.
  • The decline in the number of new drugs is most
    pronounced in the category considered by the Food
    and Drug Administration to have the greatest
    promise for patients -- those listed as
    breakthrough "priority" drugs and "new molecular
    entities" that are different from any others on
    the market.

Source Washington Post, 11/18/02
32
The Pharmaceutical Marketplace
33
The Pharmaceutical Marketplace
  • Alliances and partnerships are becoming the norm

Source Recombinant Capital
34
The Pharmaceutical Marketplace
  • The ever-rising cost of drugs

Pharmaceutical expenditures will continue to grow
at twice the rate of overall healthcare spending
in the USb
US Expenditure on Prescription Drugs (USbn)
Projections
Source S. Scala, Pharmaceutical Industry
Pulse, S G Cowen Securities Corp., 1/9/00.
35
The Pharmaceutical Marketplace
  • The number of sales reps continues to increase
    (80,000!)

Source PhRMA Industry Profile 2001
36
The Pharmaceutical Marketplace
  • US pharmaceutical online and offline sales and
    promotion costs are expected to grow at a
    compound annual rate of 12 - 16
  • Current spending on sales, marketing, promotion
    and related administrative costs are double the
    total spending on RD for the pharmaceutical
    industry (total pharmaceutical industry spending
    is 38 billion according to PhRMa and FDA)
  • Yet the amount of time pharmaceutical sales
    representatives spend with physicians to describe
    (detail) the safety and efficacy
    characteristics of their products has plummeted
    to less than 2 minutes per visit
  • Merely to maintain industry profitability at
    double-digit levels, sales must grow at a 7
    annual rate

37
The Pharmaceutical Marketplace
  • Marketing expenditures continue to rise

Source PhRMA Industry Profile
38
The Pharmaceutical Marketplace
Source 1999 Company SEC 10K Filings and Company
Annual Reports
39
The Pharmaceutical Marketplace
  • The rise of the HMOs and Pharmaceutical Benefit
    Managers (PBMs) as buyers of large quantities
    of drugs at consequently lower prices in order to
    pass these prices along to members of
    prescription benefit plans
  • Influence of HMOs and PBMs on government
    legislation to restrict patent protection and
    gain greater access to generics (Hatch-Waxman
    bill)

40
The Pharmaceutical Marketplace
  • The rise of the generic drug industry
  • Since 1983, market share of generic drugs has
    risen from 19 to 50 of the prescription drug
    market today
  • By 2005, this is projected to rise to 57 of the
    market
  • Prior to Hatch-Waxman, 35 of the top selling
    prescription drugs had no generic competition
    after their patents expired today almost all of
    the top selling drugs with expired patents have
    generic competition!

Source Eli Lilly Company Pharmaceutical
Intellectual Property Overview, 9/4/02
41
Competing in the Pharmaceutical Marketplace
42
The Industrys Expectations for the 21st Century
Managed Care
Redefining of the Industrys Basic Customers
Need for RD to Provide Unique and Cost-effective
Drugs
Continuing Efforts at Cost Containment
A Substantial Slowdown In Growth
Increased Government Intervention
A Substantial Reduction in Profitability
Increasing Role For Generics
Increasing Role For OTC Drugs
43
Healthcares Growing Share of the Wallet
44
Prescription Drug Channels
Brand Manufacturers
Generic Manufacturers
Repackagers/Marketers
Wholesalers
Chain Warehouses
Group Purchase Depots
Hospitals
Independent Pharmacies
Chain Drug Stores
Mail Order Pharmacy Services
HMOs
Dispensing Physicians
Nursing Homes
Government
Patient
45
Top Ten Therapeutic Classes
Source Pharmaceutical Executive
46
Top Ten Products
Source Pharmaceutical Executive
47
The Buyers Pharmaceutical Wholesalers
  • The most important class of buyers based on of
    total sales
  • 80 of total drug sales in 1998
  • CAGR of almost 15 projected through 2004 (IFPW
    Focus, 1/24/02)
  • 90 of the total 103 billion pharmaceutical
    distribution market in U.S. dominated by 4 major
    players
  • Amerisource Bergen
  • Cardinal
  • McKesson
  • DK Healthcare
  • Key Challenges
  • Increasing complexity of pharmaceutical supply
    chain
  • Increasing collaboration between wholesalers and
    large chains regarding inventory management
  • Increasingly powerful retailers and institutions
    (e.g., Wal-Mart)
  • Increasing regulatory pressures (e.g., PDMA 1988)
  • Shrinking margins (4 of sales in 2001)

48
The Buyers Retail Pharmacies
  • More than 50,000 drug stores in the U.S.
  • Independents (40 of market and sliding)
  • Large chains (e.g., Walgreens, Eckerd, Rite-Aid,
    CVS)
  • Key Trends
  • Continued growth of large chains at the expense
    of independents
  • Growing power of large chains due to use of IT
  • Item data capture (more information about the
    direct consumer than the manufacturers)
  • Direct Profitability Analysis (DFP) influences
    shelf-space allocation
  • Forward investment buying - JIT delivery of
    drugs buying on deal rather than on demand
  • Key Challenges
  • Growth of the discount mega-markets such as
    Wal-Mart, Costco
  • Slowdown in new drug introductions
  • Changing consumer preferences for places to buy
    drugs

49
The Buyers Hospitals
  • Largest dispensers of drugs other than retail
    drug stores
  • Differentiated by number of beds
  • Teaching hospitals average gt 300 beds so
    marketing emphasis is directed towards them
  • Key Trends
  • Size of the market in is growing substantially
  • Selection of drugs moving away from physician to
    others (e.g., hospital pharmacists) hospital
    formulary
  • Growth in power of Pharmacy Therapeutics (PT)
    committees in teaching hospitals
  • Key Challenges
  • Availability of physicians to marketing sales
    staff is limited
  • Free market forces dont completely apply in
    hospital settings
  • Focus on cost containment as cost of drugs
    skyrockets
  • Complex purchasing systems emergence of group
    purchasing organizations

50
The Buyers HMOs
  • Cost-containment mechanisms for health care
  • Drug utilization within HMOs focus on
  • Symptomatic control of chronic illness
  • Curing acute distressing (painful) or infectious
    disease
  • Attempts to control prescribing practices and
    dispensing costs (Drug Utilization Evaluation)
    especially for high-priced drugs or those with
    adverse events
  • Growing role in legislative lobbying
  • Generic drugs
  • Patent limitation
  • Key Trends
  • Consolidation
  • Rising costs to members (employers)
  • Challenges to manufacturers on efficacy of new
    drugs vs. old formulations
  • Limitations on prescription formularies
  • Key Challenges
  • Legislative curbs on practices
  • Rising consumer anger

51
The Buyers Patients
Tomorrows Influences
Costs shifting to end consumer a
Baby boomers over 50 a
Further rise in education and healthcare literacy
b
People living longer c
Cultural shift in the relationship between
patients and physicians b
Cash and time rich baby boomers due to early
retirement c
Caring for ageing parents b
Greater choice in other areas of life c
By 2005 empowered health consumers will
constitute 52 of the US population.c
a. J. A. Kelley, Medicare Reform Update, CSFB,
12/9/00. b. The New Healthcare Consumer,
Institute for the Future, 1998. c. R. Scase,
Britain in 2010, Capstone Publishing, 2000.
52
The Buyers Patients
  • Aging population and concomitant increasing drug
    use

Breakdown of Drug Use by Age
of Drug Usage by Age Band
Source Lehman Brothers Equity Research.
53
The Buyers Patients
  • Baby boomers (b. 1947 1964) are positioned to
    transform healthcare
  • Spend a greater percentage of their own income on
    health services and products
  • Invest in treatments to prevent future illnesses
    and enhance their well-being
  • Alternative medicine is becoming mainstream as
    the demand keeps growing
  • Redefine health to encompass quality of life as
    they try to stay young
  • Care for elderly parents and are fighting to
    improve quality of care
  • Question physicians, push back against
    institutions of organised care and demand better
    health benefits

Many of these characteristics could make baby
boomers a pharmaceutical companys ally.
Source World Population Prospects (1999
revision), United Nations, Dept. of Economics and
Social Development, New York, 1999.
54
The Buyers Physicians
  • The doctor-patient relationship is changing
  • Patients want to see the full range of options
    with all the relevant evidence so they can
    participate in decisions regarding treatment
  • Patients are seeking supplemental sources of
    information in addition to their doctors
  • Patients are using the Internet to gather
    information about their disease conditions and
    the efficacy and side effects of drugs
  • More and more patients want to use
    doctor-provided web sites or to e-mail their
    doctors
  • But.
  • The physician is still seen as the primary
    marketing target for new drugs, with over 90 of
    the spending on sales and marketing directed to
    physicians
  • TRADITIONAL
  • DOCTOR-PATIENT RELATIONSHIP
  • High degree of doctor control
  • Low degree of patient control
  • EMERGING
  • DOCTOR-PATIENT
  • RELATIONSHIP
  • Lower degree of doctor control
  • Higher degree of patient control

Source INSEAD, On the Health Consumer, 2000
55
Threats - The Rise of the Generics
56
Threats - The Growth of Biologics
  • In 2004, the biologics market exceeded 42
    billion
  • At 17 growth, it is the fastest-growing segment
    of the pharmaceutical marketplace and is the
    result of investments made 15-20 years ago
  • Companies with strong biologics pipelines
  • Johnson Johnson
  • Lilly
  • Roche
  • There are many companies today that have
    virtually no biologics in their pipelines today

57
Segmenting Markets
58
Markets Two Views
59
Markets Two Views
Most Often Prescribed Drugs
  • Anti-infectives
  • Analgesics
  • Psychotherapeutics
  • Vascular agents
  • Hormones
  • Respiratory therapy
  • Cough/cold preps
  • Anti-arthritics
  • Gastrointestinal
  • Cholesterol reducers and lipotropics
  • Source IMS 2001 Prescription Data

60
Markets Two Views
  • Demographics (age, gender, income)
  • Socioeconomics (social class, stage in family
    life cycle)
  • Geography
  • Psychological (lifestyle, personality traits)
  • Consumption patterns
  • Perceptual (benefit perceived)
  • Brand loyalty patterns
  • Medical condition

61
Market Segmentation
Today
Tomorrow?
  • DNA characteristics
  • Diagnostic tests
  • Disease
  • Targets
  • States
  • Career
  • Psychological states
  • Pain
  • Discomfort
  • Social
  • Age
  • lt 5
  • 5 to 15
  • 16 to 29
  • 29 to 44
  • 45 to 64
  • 65 and over
  • Gender
  • Race
  • Family Income
  • Geography
  • Residence Location
  • Urban
  • Suburban

62
Key Market Segments
  • How to determine a segments importance?
  • Number of contacts with physicians
  • Visits to doctors office
  • Places of contact (hospital, outpatient, home,
    etc.)
  • Gender
  • Women gt 50 of the market and growing
    significantly greater proportionate share of
    prescription drug purchases
  • Age
  • The 0-19 and 65 age groups are greatest
    proportionate users of healthcare
  • Income
  • The greater the family income level, the more
    likely to seek medical care and use prescription
    drugs
  • Lower income brackets do more self-medication and
    are more likely to be non-compliant with
    prescription drug regimens

63
Direct-to-Consumer Marketing
64
Direct-to-Consumer
  • Pharmaceutical companies spent an estimated 4.1
    billion in direct-to-consumer (DTC) advertising
    in 2004, an increase in 900 million from 2003
  • DTC spending is increasing at a rate of 25-35
    per year
  • Categories of DTC spending
  • Television
  • Medical Journals
  • Magazines
  • Newspapers
  • Radio
  • Other (including the Web)
  • Television spending dominates all DTC categories,
    with over 2.7 billion

65
Direct-to-Consumer
66
Direct-to-Consumer Big Spenders
67
Direct-to-Consumer - Using the Web
  • Pharmaceutical executives expect that DTC
    spending will not slow down, but shift from
    promotion to drug adherence over the next
    12-18 months
  • Keeping people on drugs to treat chronic
    conditions (e.g., hyperlipidemia) will be the new
    focus of DTC advertising
  • 50 of all patients on statins stop taking them
    after 6 months
  • 60 of all patients on statins are completely off
    them in 12 months
  • The Web and other related technologies are being
    explored to improve drug adherence
  • Nearly one-third of those who contacted their
    doctors after seeing a DTC ad first went to the
    web to find out more

68
Direct-to-Consumer Using the Web
  • Issues
  • Regulatory
  • FDA Center for Drug Evaluation Research (CDER)
    OTC and ethical drug approval
  • FDA Division of Drug Marketing, Advertising and
    Communications (DMAC) approves labeling,
    advertising and marketing materials
  • Little formal guidance for online marketing or
    advertising
  • Coordination
  • Offline and online campaigns rarely coordinated
  • Metrics for evaluating the effectiveness of
    online campaigns not well understood
  • Consumers
  • Mistrust of online health websites
  • Concerns about misuse of personal data
  • Reluctance to enroll in wellness programs or
    disease management programs
  • Butthey want a doctor-approved resource for
    information and..
  • Better access to their own doctors!

69
Direct-to-Consumer via the Web
70
Whos Advertising on the Web?
71
Direct-to-Consumer - Caveats
  • Consumer resistance is increasing to
    advertisements in prime time for sensitive
    products (e.g., ED, incontinence, etc.)
  • Public pressure is growing to establish a 1-year
    moratorium on DTC advertising for new drugs
  • Pfizer has voluntarily adopted this as a policy
    for new drug introductions
  • Research has shown that DTC primarily influences
    patients who are already diagnosed and are being
    treated, but fails to motivate the undiagnosed
    and untreated who represent more than 50 percent
    of sufferers in many large categories.
  • Even when a patient receives a prescription from
    the doctor in response to a DTC advertisement,
    25 never make it to the pharmacy

Source Pharmaceutical Executive, Pfizer.com
72
PhRMAs New DTC Guidelines
  • Companies should submit all new
    direct-to-consumer television advertisements to
    the FDA before releasing them for broadcast
  • DTC television advertising that identifies a
    product by name should clearly state the health
    conditions for which the medicine is approved and
    the major risks associated with the medicine
    being advertised
  • DTC television and print advertising should be
    designed to achieve a balanced presentation of
    the benefits and risks associated with the
    advertised prescription medicine.  Specifically,
    risks and safety information in DTC television
    advertising should be presented in clear,
    understandable language, without distraction from
    the content, and in a manner that supports the
    responsible dialogue between patients and health
    care professionals
  • Companies should spend an appropriate amount of
    time to educate health professionals about new
    medicines or new therapeutic indications before
    beginning the first direct-to-consumer
    advertising campaign

Source PhRMA
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