With the introduction of Product Patentin India in January 2005, it was predicted by many that the golden age of Indian pharmaceutical companies was closing to an end. From 1970 some of the Indian companies took full advantage of regulatory system, which supported process patent in favour of Indian companies. This policy helped some of the ambitious Indian companies to develop and produce in India, cheaper versions of successful molecules, through ingenious alternative processes. The government's drug policy encouraged and supported domestic industry to lay a strong foundation due to lack of intellectual property rights. The price of drugs in India remained one of the lowest, basically due to three reasons:
*Rigid drug price control,
*Lack of intellectual property rights,
*Intense competition from large number of companies having similar or 'me- too' products.
Now, with introduction of product patents, the Indian companies are facing new challenges and testing times. We have to wait and see how the Indian companies will adapt to the emerging new situation, and what will be its impact on the growth ofIndian companies as well as the price and availability of products to the Indian consumers.
Impact on drug promotion
The promotional strategies and promotional mix that were employed before the patent era (i.e. used in eighties and nineties) are no longer adequate or effective. The promotional cost has increased substantially and likely to go up further. Only those companies that are innovative are likely to make a dent in the market. In today's highly competitive environment it is not adequate to be just customer oriented, one has to be equally competition oriented.
During the pre-patent era, products were launched in India in a hurry to be ahead of the competitors in the race. The one that managed to launch the product first had the edge in establishing the brand. It was a well-known fact that at least a few more competitors were in the fray. The objective of the prime mover was to gain as much 'lead period' as possible, whereas the second and the third movers attempted to minimize this lead and to grab maximum possible market share. Companies will not hesitate to pump-in more resources because of the monopoly that they may enjoy for a particular new molecule.
In earlier days companies were not giving enough importance to marketing strategies like product differentiation, product positioning or market segmentation etc. Pricing was the most important factor deciding promotional strategies and inputs. However, in future, when one does not expect many other companies to launch the same molecule with different brand names, the strategy naturally has to be geared to the long term objective of building a mega brand. Marketing companies will be compelled to give high priority to the coining of an appropriate brand name, creating product differentiation to justify why customer needs to shift from existing brands to their's and develop product positioning so that the customer perceives the product in the right perspective. Moreover, the brand needs to be targeted to the potential customers through a proper segmentation study. It is not entirely appropriate to say that these aspects were overlooked earlier. But the marketing companies are bound to focus on these aspects more seriously and are likely to take the help and expertise of market research companies or advertising agencies, as very few companies have their own market research department worthy of mentioning.
In the brand building process, companies will spend a considerable portion of the budget, before the launch of a new product, in initiating multi-centric trials involving the provision of seedling samples to the 'Opinion leaders'. This will not only reduce the time for opinion leaders to start using the new product but also help the companies to prepare speakers for their medical symposia and seminars at the time of the product launch. Multinational companies may prefer to bring the speakers for their symposia from their R&D centers; the scientists directly involved in the development of molecule or those who are involved in the clinical trials. This will also compel the Indian companies to organize their symposia and seminars in innovative ways, so that they are neither ignored nor belittled by their target customers.
The cost of participating in national conferences or conventions has become very expensive. Many multinationals have their stalls designed and erected by international advertising agencies. They have a tremendous impact on the participating delegates. This compels the Indian companies to also participate in more professional manner and assign this task to the event management agencies.
New strategies needed
The pharmaceutical companies all over the world have been using well tried and time tested promotional strategies that have proven results. However, the rising cost of drug development and shortened product life-cycles have forced the companies to examine newer ways of creating innovative promotional strategies to maximize revenue potential for their brands. The cost and limited success of traditional marketing methods has been the major reasonfor the companies to look into alternative marketing strategies world over. Various challenges faced by the pharmaceutical marketers are:
*With increased patient load, doctors are busier
*There is an explosion of new and useful information
*Doctors are receiving more calls from pharmaceutical sales representatives and though the calls are typically for just two to three minutes, many doctors are refusing to meet or speak to pharmaceuticals representatives
*Doctors are inundated with direct mail advertising, reducing the effectiveness of direct mail
In the meantime, the pharmaceutical marketers are finding it difficult to recruit and train good medical representatives. Retaining good representatives has become even more difficult. The preference for the job of a medical representative is low among new graduates. This is mainly because of the poor working conditions, high sales pressure and intense competition within the industry. All these aspects will make the Indian pharmaceutical companies to look at additional, more efficient andcost effective methods of marketing being tried by companies in developed countries. E-marketing has been adopted by many of the companies there, as an alternative, cost effective media. The internet has many of the qualities of traditional media; it can provide in-depth content seen in print advertising, the real time impact of television, the immediate response of direct mail and mass reach of outdoor advertising. The internet is however, not without challenges and is unlikely to replace direct selling or any other channels completely. Furthermore, a significant proportion of the doctor population still do not use internet even in developed countries. This is due to the inverse relationship between age and internet use.
Web design and development :
In developed countries the internet has emerged as one of the most important communication channels for pharmaceutical companies managing multiple brands. It is a single place where you can instantly control your message and drive business opportunities.
e-Detailing:
The quality of detailing session is dropping due to the increasingly limited time that representatives have with doctors. To help address this problem and reverse the decline in detailing productivity, technology based solutions such as e-Detailing have been tried in developed countries. If used appropriately, e-Detailing can provide doctors with high quality information in a convenient and interactive format. e-Detailing offers pharmaceutical companies the potential to increase both the reach and quality of their messages. At the same time, e-Detailing is not a replacement of sales force, instead it allows medical representatives to be more effective and concentrate on those doctors for whom face to face calls are essential.
Two basic models of e- Detailing that have evolved are Live-video e-Detailing and Virtual e-Detailing. Live video e-Detailing involves doctors using in-office computer systems provided by the company, linked to the pharmaceutical sponsor's facilities via high speed video link. Doctors are contractually obligated to go on-line a pre-determined number of times. The video e-Detailing is normally done during office hours, averages more than eight minutes, and allows sponsors to detail a range of products.
Virtual e-Detailing has been growing dramatically in USA. Manhattan Research found that in 2002 36%of the primary care physicians have already participated in an e-Detailing with 80% expected to participate again within next 12 months.The physicians that have participated write, on an average, 37% more prescription than do their colleagues. Benefits of e-Detailing to the doctors include:
*Access to timely and updated product information that is valuable to them.
*Sample ordering with the click of a mouse.
*Participation in peer to peer discussions on topics that interest them.
*More time efficient interaction with medical representative.
*Flexibility and control to accomplish these tasks on their own schedules
e- CME programme
Pharmaceutical companies in developed countries have also begun creating or recreating a traditional CME program with digital technology (e-CME). There has been three-fold increase in number of on-line programs offered in the last four years.e-CME can be custom tailored to meet the pharmaceutical marketers' for educating doctors.
e-Sampling
Sampling is likely the greatest marketing opportunity area for pharmaceutical marketers. If doctors can get samples when and where they need them, they will feel comfortable writing more prescriptions. e-Sampling will enable the doctors to place the requisition for sample as and when they needed for trial. Companies will have better control on sample distribution.A fact validated through implementation of e-Sampling in some countries.
The greatest constraint for the pharmaceutical companies is the initial capital required to implement these strategies by providing the laptop and other accompanying equipment and its regular servicing. Nonetheless, these technologies will definitely come to India in the near future as cost of equipment is expected to come down due tomass consumption.Meanwhile, more and more doctors will adopt these technologies and derive its benefits in their day-to-day practice.
(The author is vice-president, MarketingBPRL Pvt. Ltd, Bangalore)