Pharmaceutical marketing

From Wikipedia, the free encyclopedia

This article may require cleanup to meet Wikipedia's quality standards. Please improve this article if you can. (December 2008)

This article needs additional citations for verification. Please help improve this article by adding reliable references. Unsourced material may be challenged and removed. (December 2008)

The examples and perspective in this article may not represent a worldwide view of the subject. Please improve this article or discuss the issue on the talk page.

Pharmaceutical marketing is the business of advertising or otherwise promoting the sale of pharmaceuticals or drugs.

Evidences show that marketing practices can negatively affect both patients and the health care profession.^[1] Many countries have measures in place to limit advertising by pharmaceutical companies.

Contents 1 History 2 Direct and indirect marketing to health care providers 2.1 Individual research 2.2 Peer influence 2.3 Direct physician contact with pharmaceutical sales representatives 2.3.1 Physician targeting 2.3.2 Opinion Leader Influence Mapping 2.3.3 Sales force size and structure 2.4 Private and public insurers 3 Direct marketing to patients 4 Digital media and the evolution of pharmaceutical marketing 5 Regulation 6 Controversy 7 See also 8 References 9 Bibliography 10 External links

[edit] History

The marketing of medication has a long history. The sale of miracle cures, many with little real potency, has always been common. Marketing of legitimate non-prescription medications, such as pain relievers or allergy medicine, has also long been practiced. Mass marketing of prescription medications was rare until recently, however. It was long believed that since doctors made the selection of drugs, mass marketing was a waste of resources; specific ads targeting the medical profession were thought to be cheaper and just as effective.^{[citation needed]} This would involve ads in professional journals and visits by sales staff to doctor’s offices and hospitals. An important part of these efforts was marketing to medical students.^{[citation needed]}

[edit] Direct and indirect marketing to health care providers

Physicians are perhaps the most important component in pharmaceutical sales. They write the prescriptions that determine which drugs will be used by the patient. Influencing the physician is the key to pharmaceutical sales. Historically, this was done by a large pharmaceutical sales force. A medium-sized pharmaceutical company might have a sales force of 1000 representatives.^{[citation needed]} The largest companies have tens of thousands of representatives around the world. Sales representatives called upon physicians regularly, providing information and free drug samples to the physicians. This is still the approach today; however, economic pressures on the industry are causing pharmaceutical companies to rethink the traditional sales process to physicians.

More recently, the Partners Healthcare, Massachusetts' largest hospital and physician network, will adopt new guidelines prohibiting physicians and researchers from accepting gifts from pharmaceutical manufacturers. This will include meals or individual drug samples, and also drug samples left by companies will be distributed through a centralized system, while educational programs and fellowships will also be required to be centrally reviewed and approved.[1]

Pharmaceutical companies are developing processes to influence the people who influence the physicians.^{[citation needed]} There are several channels by which a physician may be influenced, including self-influence through research, peer influence, direct interaction with pharmaceutical companies, patients, and public or private insurance companies. There are also web based instruments that can be used to determine the influencers and buying motives of physicians.

There are a number of firms that specialize in data and analytics for pharmaceutical marketing.

[edit] Individual research

Physicians discover pharmaceutical information from such sources as the Physician's Desk Reference and online sources such as PDR.net, as well as via PDAs with applications.

They also rely upon pharmaceutical-branded e-detailing sites, pharmaceutical sales and non-sales representatives, and scholarly literature. Scholarly literature can be in the form of medical journal article reprints, often delivered by sales representatives at their place of employment or at conference exhibitions.^{[citation needed]}

[edit] Peer influence

• Key opinion leaders

Key opinion leaders (KOL), or "thought leaders", are respected individuals, such as prominent medical school faculty, who influence physicians through their professional status. Pharmaceutical companies generally engage key opinion leaders early in the drug development process to provide advocacy and key marketing feedback.^[2] Some pharmaceutical companies identify key opinion leaders through direct inquiry of physicians (primary research).

• Colleagues

Physicians acquire information through informal contacts with their colleagues, including social events, professional affiliations, common hospital affiliations, and common medical school affiliations. Some pharmaceutical companies identify influential colleagues through commercially available prescription writing and patient level data^[3]. Doctor dinner meetings are an effective way for physicians to acquire educational information from respected peers. These meetings are sponsored by some pharmaceutical companies.

[edit] Direct physician contact with pharmaceutical sales representatives

Currently, there are approximately 100,000 pharmaceutical sales reps in the United States^[4] pursuing some 830,000 pharmaceutical prescribers. A pharmaceutical representative will often try to see a given physician every few weeks. Representatives often have a call list of about 200 physicians with 120 targets that should be visited in 1-2 week cycles.

Because of the large size of the pharmaceutical sales force, the organization, management, and measurement of effectiveness of the sales force are significant business challenges. Management tasks are usually broken down into the areas of physician targeting, sales force size and structure, sales force optimization, call planning, and sales forces effectiveness. A few pharmaceutical companies have realized that training sales representatives on high science alone is not enough, especially when most products are similar in quality. Thus, training sales representatives on relationship selling techniques in addition to medical science and product knowledge, can make a difference in sales force effectiveness. Specialist physicians are relying more and more on specialty sales reps for product information, because they are more knowledgeable than primary care reps.

[edit] Physician targeting

Marketers attempt to identify the universe of physicians most likely to prescribe a given drug. Historically, this was done by measuring the number of total prescriptions (TRx) and new prescriptions (NRx) per week that each physician writes. This information is collected by commercial vendors. The physicians are then "deciled" into ten groups based on their writing patterns. Higher deciles are more aggressively targeted. Some pharmaceutical companies use additional information such as:

• profitability of a prescription (script),
• accessibility of the physician,
• tendency of the physician to use the pharmaceutical company's drugs,
• effect of managed care formularies on the ability of the physician to prescribe a drug,
• the adoption sequence of the physician (that is, how readily the physician adopts new drugs in place of older, established treatments), and
• the tendency of the physician to use a wide palette of drugs
• influence that physicians have on their colleagues.

Data for drugs prescribed in a hospital are not usually available at the physician level. Advanced analytic techniques are used to value physicians in a hospital setting.^{[citation needed]}

[edit] Opinion Leader Influence Mapping

Alternatives to segmenting physicians purely on the basis of prescribing do exist, and marketers can call upon strategic partners who specialize in delineating which characteristics of true opinion leadership, a physician does or does not possess. Such analyses can help guide marketers in how to optimize KOL engagements as bona fide advisors to a brand, and can help shape clinical development and clinical data publication plans for instance, ultimately advancing patient care.

[edit] Sales force size and structure

Marketers must decide on the appropriate size of a sales force needed to sell a particular portfolio of drugs to the target universe. Design the optimal reach (how many physicians to see) and frequency (how often to see them) for each individual physician. Decide how many sales representatives to devote to office and group practice and how many to devote to hospital accounts. Additionally, customers are broken down into different classes, each class is differentiated by their prescription behaviour and of course, their business potential.

[edit] Private and public insurers

Public and private insurers affect the writing of prescriptions by physicians through formularies that restrict the number and types of drugs that the insurer will cover. Not only can the insurer affect drug sales by including or excluding a particular drug from a formulary, they can affect sales by tiering, or placing bureaucratic hurdles to prescribing certain drugs. In January 2006, the U.S. instituted a new public prescription drug plan through its Medicare program. Known as Medicare Part D, this program engages private insurers to negotiate with pharmaceutical companies for the placement of drugs on tiered formularies.

[edit] Direct marketing to patients

Since the late 1970s, direct-to-patient marketing of prescription drugs has become important. Many patients will inquire about, or even demand to receive, a medication they have seen advertised on television. In the United States, recent years have seen an increase in mass media advertisements for pharmaceuticals. Expenditures on direct-to-consumer (DTC pharmaceutical advertising) have more than quintupled in the last seven years since the FDA changed the guidelines, from $700 million in 1997 to more than $4.2 billion in 2005, according to the United States GAO (Government Accountability Office, 2006).

[edit] Digital media and the evolution of pharmaceutical marketing

The emergence of new media and technologies in recent years is quickly changing the pharmaceutical marketing landscape in the United States. Both physicians and consumers are increasing their reliance on the Internet as a source of health and medical information, prompting pharmaceutical marketers to look at digital channels for opportunities to reach their target audiences.

In 2008, eighty-four percent of U.S. physicians used the Internet and other technologies to access pharmaceutical, biotech or medical device information – a twenty percent increase from 2004. At the same time, sales reps are finding it more difficult to get time with doctor’s for in-person details. Pharmaceutical companies are exploring online marketing as an alternative way to reach physicians. Emerging e-promotional activities include live video detailing, online events, electronic sampling, and physician customer service portals.

Direct-to-consumer marketers are also recognizing the need to shift to digital channels as audiences become more fragmented and the number of access points for news, entertainment and information multiplies. Standard television, radio and print direct-to-consumer (DTC) advertisements are less relevant than in the past, and companies are beginning to focus more on digital marketing efforts like product websites, online display advertising, search engine marketing, social media campaigns, and mobile advertising to reach the over 145 million U.S. adults online for health information.

[edit] Regulation

In the United States, marketing and distribution of pharmaceuticals is regulated by the federal Prescription Drug Marketing Act of 1987. In general, pharmaceutical companies adhere to FDA regulatory guidelines which call for all DTC advertising and information to be accurate, to provide substantial evidence for any claims that are made, to provide a balance between the risks and benefits of the promoted drug, and to maintain consistency with labeling approved by the FDA.

[edit] Controversy

• The mass marketing to consumers of pharmaceuticals is controversial. It is banned in over 30 industrialized nations, but not in the US and New Zealand, which is considering a ban.^[5] Some feel it is better to leave the decision wholly in the hands of medical professionals; others feel that consumer education and participation in health is useful, but consumers need independent, comparative information about drugs (not promotional information)^[6]. For these reasons, most countries impose limits on pharmaceutical mass marketing that are not placed on the marketing of other products. In some areas it is required that ads for drugs include a list of possible side effects, so that consumers are informed of both facets of a medicine. Canada's limitations on pharmaceutical advertising ensure that commercials that mention the name of a product cannot in any way describe what it does. Commercials that mention a medical problem cannot also mention the name of the product for sale; at most, they can direct the viewer to a website or telephone number operated by the pharmaceutical company.
• The number and persistence of pharmaceutical representatives has placed a burden on the time of physicians^[7]. "As the number of reps went up, the amount of time an average rep spent with doctors went down—so far down, that tactical scaling has spawned a strategic crisis. Physicians no longer spend much time with sales reps, nor do they see this as a serious problem."
• Recent legal cases and US congressional hearings have provided access to pharmaceutical industry documents revealing new marketing strategies for drugs.^[8] Activities once considered independent of promotional intent, including continuing medical education and medical research, are used, including paying to publish articles about promoted drugs for the medical literature, and alleged suppression of unfavorable study results.^[9]

[edit] See also

[edit] References

[edit] Bibliography

• Insider's Guide to the World of Pharmaceutical Sales, Seventh Edition (Paperback) (ISBN 0-9704153-6-2)
• Merrill Goozner: The $800 million pill. University of California Press, Berkeley 2004, 297 S., ISBN 0-520-23945-8
• Ray Moynihan, Alan Cassels: Selling sickness: How the world's biggest pharmaceutical companies are turning us all into patients. Nation Books, New York 2005
• Be Brief, Be Bright, Be Gone: Career Essentials for Pharmaceutical Representatives (Paperback) (ISBN 0-595-17418-3)
• PharmRepSelect-Your Complete Guide to Getting a Pharmaceutical Sales Job (Pharmrepselect, 1) (Paperback) (ISBN 0-9724675-1-3)
• The Rx Factor : Strategic Creativity in Pharmaceutical Marketing (Response Book) (Hardcover) (ISBN 0-8039-9378-1)
• Pharmaceutical Marketing: Principles, Environment, and Practice (Hardcover) (ISBN 0-7890-1582-X)
• Presentation Planning and Media Relations for the Pharmaceutical Industry
• Lynn Payer: Disease-Mongers. John Wiley, 1992
• Little Black Book of Pharmaceutical Marketing [2]
• How To Conduct Doctor Dinner Meetings (Paperback) (ISBN 0-9656231-1-4)
• Drugs, Doctors and Dinners: How drug companies influence health in the developing world. Consumers International, London 2007 (ISBN 1-902391-59-4)[3]
• 360 Degree Selling - How To Sell Biotechnology Products (Paperback) (ISBN 0-9656231-3-0)
• Selling To Specialist Physicians (Paperback) (ISBN 0-9656231-5-7)
• Cybercitizen Health(tm). Manhattan Research, 2008 [4]
• ePharma Physician(r). Manhattan Research, 2008 [5]

[edit] External links

• No Free Lunch Organization
• Health Action International
• Healthy Skepticism
• Pharmaceutical Management Science Association