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Redefining of pharma marketing and business

Dr R B Smarta
Thursday, June 19, 2008, 08:00 Hrs  [IST]

Moksha 8 is a new drug firm launched last month, financed by Texas Pacific group. It aims to capitalize on big pharma neglect of many emerging economies by striking deals for branded drugs which in turn intends to market to affluent customers in those countries. Within a month, it has already around two dozen drugs under licence for Brazil from Roche and Pfizer.

Free market
There are three beliefs commonly associated with the "free market". The first is that human beings are creatures of limitless but insatiable needs, wants and discomforts. The second is that the free market is a place where these needs might be satisfied through the exercise of free choice. The last of these beliefs is that the surest avenue to innovation in all industries is unfettered competition in the market.

Prescribers/providers/patients
If you consider prescribers or health providers, all of them have these beliefs. Does industry also respond to them through marketing strategies and tactics! Prescribers exercise their choice by prescribing relevant brands.

You will observe the same beliefs surface for health providers. They are also specifying their demands from pharma, diagnostics, medical devices and other related industries. Marketing methods of other than pharma industry have resorted to industrial marketing models like buy or lease or rent model or education based revenue models etc.

Patients to medical consumer
Let's take a bottom up approach and understand emerging consumer. Since in consumer society, we see ourselves as individuals. Even patients are thinking in some way. New York Times article says "for a sizeable group of people in their 20's and 30's deciding on their own what drugs to have - in particular stimulants, anti-depressants and other psychiatric medicines is becoming a norm". Views of our patients are changing towards a choice driven by familiarity with the drugs once prescribed by their specialists. This emergence of potential dangerous situation demonstrates that patients when they are healthy, they have a different way to look at themselves!

The inclusion of patients in the distribution chain of pharmaceuticals is specially for lifestyle diseases and more so for chronic and terminal ailments is changing their role from recipients of medical care to active consumers from merely being a patient, they are walking towards a new group of medical consumers who in sickness become a recipient of medical care, otherwise, exercise their own choices on low involvement, low risk medicaments.

Prescribers and providers way of life
If pharma marketing and sales tactics treat prescribers Key Opinion Leaders (KOLs) like 'apple of an eye' then they will further extend their beliefs to be fulfilled by pharma marketers. It is likely to become individualized and no strategic initiatives will work in cohesion.

Overall medical reps have lost respectability in the eyes of prescribers and they also do not opt this profession. As a profession, nobody, even pharma marketers are not engaging them enough or do not cohesively work for attracting better talent. If the representation of pharma company is not happening in a respectable way, brands may substitute, but all efforts of entire marketing mix may make this representative an inadequate creature in front of prescribers!

Redefine of pharma marketing
It's compelling yet equally important to develop new thinking. It has to emerge as the context and environment are changing so fast that we need to redefine pharma marketing principles and practices related to changed customer groups.

When I ask a few questions to myself how can I redefine 'Marketing'? I had to introspect. I was feeling helplessness in the beginning but I then got guts to determine. Hope it will bear fruits. While introspecting, a few questions probed me, wanted to ask me so what do you say! The questions are like:
■ Has marketing in pharma gone beyond 4 or 5 Ps?
■ Has it derailed towards customer gratification only? Has it exhausted its tactics and new tactics have yet to come in?
■ Do strategic initiatives of marketing lead field force to carry them out and build sales?
■ Does a competitive force interfere and field force work with exceptions?
■ Are marketers finding out ways to beat competition through unfair or fair means as in war everything is fair?
■ Is pharma marketing treating as matured markets and emerging markets same way?

All these questions ask whether we are still trying to upgrade our own conventional marketing stances to achieve desired targets.

Yet, many organisations achieve their sales in last 4 days or a week in every month!
■ Is context of supply chain, retailing, distribution network constantly changing without our stance of change?
■ Is it that the organizational representative who represents organisation doesn't represent all?
■ Is it that he has lost the desirability and respect of customers and society? Is it that constraints are overwhelming and marketers are compromised?
■ Has the marketing mix revolved around only a few specific ways?

Yet after taking many initiatives, attrition at the entry level of the pharma sales and marketing hierarchy is so high that the stability runs miles away and management looses face while confronting the issues with those who are directly fighting with the environment.
■ Are marketing & sales cost too high to improve sales force effectiveness?
■ Have we not changed JDs of all marketing sales hierarchy over decades?
■ Has the hierarchy become experience driven than competency driven?
■ Have we lost differentiation, competitiveness and competitive advantage through marketing?
■ Are we looking at Regulatory Issues as part of marketing?
■ Are we considering 'Pricing' as part of marketing or its 'Finance' prerogative?
■ Are we starting 'marketing bias' right from clinical trials?
■ Are we launching new products with adequate preparation?

So long as products/brands used to provide differentiation and competitive advantage, marketing overtone was seen, but the moment the differentiation at product level has gone away and pricing became a differentiator, we lost out in creating value through marketing!

Business value
On the contrary, when I looked at total Indian pharma market value and compare it with just one brand of Pfizer like Lipitor, I find Lipitor may exceed total pharma market in value. What does it really mean! When we on one hand proudly inform the world that there are 41 million diabetics in this country and reality is that just 4 to 5 million take medicines and insulin! What's correct? You can imagine how far the scope of marketing is! Is it to penetrate markets and improve the sales? Is it to create markets and improve the scope of pharma business!!! What is it?

In order to reconcile potential of India in the world and potential of the world in India, it's imperative that we start introspecting on few of the above questions and look at redefining context, scope, strategy and methodology of marketing. We need to also consider the hardships of field force to execute, implement and get results from the designed marketing strategy. At every level it's important to redefine the value chain of marketing.

(Dr. R. B. Smarta is managing director of Interlink, a business management consulting Firm)

 

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