Tag Archives: intrinsic

An Essential ‘Acrobatic Feat’ Remains Relevant Even In Digital Pharma World

Posted on by
Reply

“A manager must, so to speak, keep his nose to the grindstone while lifting his eyes to the hills — quite an acrobatic feat!” This profound statement was articulated by the Management Guru of all-time – Peter F. Drucker, in his book named “The Practice of Management.” This book was published probably before many management experts of today were even born – in 1954. This epic quote of Drucker is in context of the critical requirement to harmonize management decisions affecting the short and the long-term strategic business goals.

While looking at the pharma industry from the above perspective, one may often find, the quality-time spent, especially by its marketers, on ‘lifting their eyes to the hills’ – looking for the early signals on critical changes in future success requirement – is often minimal. Most seem comfortable in ‘keeping their nose to the grindstone’ to deliver the short-term objectives, with a belief that the future brand success factors will replicate the present ones. Thus, honing the current strategies would automatically ensure achieving the long-term requirements.

This prompts a question, should pharma marketers predominantly concentrate on sharpening their traditional marketing tools for near-term excellence or reach out much beyond that? Today’s article will deliberate on this subject, in the context of changing market dynamics and consumer expectations in the today’s world.

Are the brand success parameters changing?

Scores of data-based assessments of progressive changes in the customer value trend, highlight significant shifts from the past, necessitating an overhaul of the value delivery parameters and the system – not just honing. More often than not, such reconditioning could even be disruptive in nature – as may happen with the change to a well-integrated digital marketing system.

For example, until recently pharma brands used to be differentiated primarily based on its intrinsic key features and benefits, like efficacy and speed of recovery, safety and side-effects profile, ease of compliance and nature of drug interactions during concomitant use and more. Today, the parameters of brand differentiation have gone much beyond that, which could have been captured by an astute marketer while ‘lifting his eyes to the hills’, alongside ‘keeping his nose to the grindstone.’

The evolving parameters of brand-differentiation are not just restricted to the features and benefits, but call for unique customer value creation – such as providing a unique treatment experience to patients – understanding their needs, expectations and preferences. This, in turn, change the traditional pharma marketing ball game, as the success ingredients are so different.

Capturing, conceptualizing and delivering customer value, following the traditional pharma marketing tools and processes will increasingly be a daunting task. New digital tools and platforms – well-integrated into the evolving pharma marketing processes, would be necessary to win customers’ share of mind, more effectively than ever before. Nevertheless, value delivery still remains at the core of the pharma marketing system.

Value delivery still remains at the core – with significant changes: 

Value delivery will always remain the core purpose, and a constant factor in pharma marketing initiatives. It was so in the past, is at present, and will continue to be in the future, regardless of changes in the market and customer dynamics.

Nonetheless, what is construed as ‘value’ to capture a sizeable share of consumers’ mind has changed. Traditionally, it has been mostly intrinsic to the organization, revolving around the product features and benefits, as stated earlier. But, today, it is getting more focused on the extrinsic factor – related to the customers.

Thus, creating a unique experience for them with the brand has become the new challenge of change to pharma marketers for performance excellence, as I discussed in one of my recent articles. Consequently, providing this external and well-researched ‘customer-centric value’ has become the new brand differentiator.

While ‘lifting eyes to the hills’, some interesting findings:

Among many others, Decision Support Group (DCG), as well, while ‘lifting their eyes to the hills,’ well-captured the emerging consumer expectations in health care through a detailed study. This was published as ‘Cybercitizen Health Infographic’ on October 27, 2015. Let me paraphrase below some of the important findings of this study:

  • As customers are expecting pharma to provide best-in-class patient experience and associated services in the disease treatment process, marketers need to differentiate brands through these parameters.
  • 59 percent of health care consumers expect brand experiences and services beyond what the physical brand offers.
  • Only 8 percent of the respondents said pharma companies are providing a better customer experience than 2 years ago, while 30 percent said so for doctors, and 21 percent regarding pharmacists.
  • 40 percent of the consumers who value experience as much as drug effectiveness, would pay a little more for a drug or a health procedure.

How is this extrinsic value measured?

As confirmed by several studies, going beyond what a physical pharma brand would offer, the customers, including individuals who pay from the pocket for a disease treatment, measure the value of a drug today differently. It is now predominately by outcomes, the patients’ overall experience during the treatment, and overall – cost-effectiveness of the entire process, and not just the medicine.

Thus, the pharma market is sending a clear signal to the marketers to ‘shape up’ accordingly, soon and start with measuring care by outcomes – going beyond the product features and benefits – just as patients would do. If not, there could be a strong possibility of being ‘shipped out’, as the marketing productivity could head south, with more capable professionals filling up the void.

Commensurate changes in marketing success measurement:

The emerging changes in measuring ‘marketing success’ were aptly demonstrated in the article, ‘Redefining Value: What Value-Based Care Means for Pharma’, published by the Intouch Solutions on July 07, 2016.

It said: ‘Once, success simply meant a “blockbuster” – a drug that sold enough.’ However, this paradigm is shifting. Soon, it will be measured by the value of outcomes with the brand – the positive impact that it creates on the patient’s health, leaving behind a unique treatment experience.

To be successful with the brand, the marketer will, therefore, need to create a genuine, credible and powerful data-based outcome story. It should effectively demonstrate how the unique brand value offerings, supported by services can make it possible. The services may include, among others:

  • Supporting patients in managing their condition as part of their life.
  • Educating patients and helping them feel empowered in the treatment decision making process.
  • Helping patient access to medication.
  • Assisting patients in developing and maintaining a healthy lifestyle.

For many pharma marketers this exercise will involve a strategic shift in their thinking process. Embracing a fundamental change in the way they have been practicing traditional pharma marketing all these years.

Are some of these changes disruptive in nature?

Several of the aforesaid changes may appear disruptive to many, causing a discomfort of moving out of their comfort zones. Some may even try to wish it away, and continue practicing the traditional pathways as long as these help achieving some results. But, not certainly for a long while. In which case, it will be akin to delaying a greater disruption before ultimately getting caught off-guard.

Dr. Vas Narasimhan, Chief Executive of the Swiss pharmaceutical giant Novartis, puts it nicely. He advised, ‘the key to surviving disruption is understanding that a leader needs to be prepared to embrace it – even if that means willfully disrupting yourself.’

However, the good news is, digital transformation of a business makes embracing this change less difficult. Which is why, a number of companies are trying to seriously engage in digital marketing. Let me hasten to add, the ‘digital transformation process’, regardless of promises that many self-styled experts would make, is tough. It makes the organization chart an uncharted frontier and starts from the very top.

Digital transformation follows an arduous path, starting from the very top: 

There are many descriptions of the ‘digital transformation process’. However, the one that appealed to me is the one that comes from the Agile Elephant. It describes the process as follows:

‘Digital transformation is the process of shifting your organization from a legacy approach to new ways of working and thinking using digital, social, mobile and emerging technologies.  It involves a change in leadership, different thinking, the encouragement of innovation and new business models, incorporating digitization of assets and an increased use of technology to improve the experience of your organization’s employees, customers, suppliers, partners and stakeholders.’

The recent examples in this regard that come at the top of my mind, include:

Does digital marketing transform the brand value delivery process? 

Digital marketing facilitates the new and extrinsic brand value delivery process, as the use of this technology is all pervasive in our everyday life. Interestingly, almost all businesses, mostly in the organized sectors and technology startups, are trying to leverage digital technology to create sets of differential customer values.

And then integrating those to the core marketing strategy, for effective delivery of a crafted solution to the patients’ comprehensive needs, will be a challenging task. Moving in this direction, besides creating interactive websites, many drug players are using a number of digital tools, including social media sites, to start with. These are all serving as integrated digital marketing platforms to engage with targeted customers.

It’s apparently a foregone conclusion today that ‘the traditional one-way relationship in our health care system, will soon change to two-way relationship.’ Where interactive digital marketing, social media and other similar platforms, will facilitate building such relationship for a meaningful exchange of information with the target groups, transforming in the healthcare landscape.

Some key transformation areas with the digital marketing system:

As Agile Elephant puts it, the following are a few examples of key healthcare transformation areas with digital marketing:

  • The efficacy of treatment will be transparent with cost-effective data-based outcomes story.
  • Data transparency will follow data visualization enhancing how patient data is communicated to them, or how certain medications and treatments are affecting different areas of the physiological system.
  • Patients will be empowered to play an active role in their health care.
  • Patients disease treatment experience could be optimized across multiple touchpoints’.

Conclusion:

Currently, it appears, most pharma marketers ‘keep their nose to the grindstone’ to continue honing the traditional processes of brand marketing with an expectation for better return. However, if they could find time for ‘lifting eyes to the hills’ with all seriousness, they will be able to sense a shifting paradigm with a new set of marketing success factors. If not done even now, it could perhaps be too late to make amends for business sustainability.

Many may get carried away by the hype of digitalization as a panacea, but this is just a facilitating technology – to be in sync with, among others, the evolving values of pharma customers, through innovative value delivery systems. Regardless of digitalization all around us, the name of the game that differentiate men from the boys in this game, remains – generation of cutting-edge ideas. Only this can transform – effective delivery of differentiated ‘customer value’ into business excellence.

Interestingly, to accomplish this objective meaningfully, the aforesaid ‘acrobatic feat’, as enunciated by Peter Drucker in 1954, remains relevant and essential for pharma marketers, just as all other managers, even in the digital pharma world.

By: Tapan J. Ray 

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

Creating A ‘Virtuous Cycle’ Through Patient Reach and Care

Posted on by
Reply

As many would know, in the strategic marketing process of any product including patented and generic drugs crafty product differentiation plays a critical role.

This strategic process of creating a competitive edge with unique product differentials is necessary. It helps perceiving a product more attractive to the target audience, against its competitors. When done effectively, the product fetches a greater share of mind for usage, achieving higher levels of top of mind recall, and, of course, a price premium.

In pharma, the traditional brand differentiation revolves around delivering cutting-edge values, skimming through the intrinsic product features and benefits. In India, which is predominantly a branded generic market, the local pharma marketers almost routinely keep trying to toe this line.

As I said before, some of them often vehemently argue in favor of maintaining a status quo in this area. It could probably be due to professional discomfort in venturing out of their respective comfort zones.

In the current pharma marketing environment, especially in India, finding the right answer to a not-so-easy-to-reply question may trigger a disruptive change in the traditional, or virtually routine marketing practices. This is widely considered a prevailing normal of date, and generally includes ‘features and benefits oriented product differentiation.’

In this article, I shall dwell on this important area, picking a thread from this simple, but a difficult-to-answer question.

The question:

This question goes like this: ‘How does a pharma marketer conceptualize product features and benefits oriented differential values, when there are virtually no clinically significant differentials between the competing products?’ There would possibly be no credible answers, justifying this practice.

Are branded generic sales mostly driven by contentious factors?

This query is more relevant in a branded generic market, such as India. Yet, pharma marketers keep following routinely the traditional methods in this area. As many say, actual product sales are driven by mostly by those critical factors, which are contentious and are being fiercely debated within the country, even today.

Pharma needs more extrinsic differentiation rather than intrinsic:

In the midst of an evolving new value expectation of pharma consumers, the market access strategy of the industry marketers must also evolve, keeping at least a step ahead of the former. This would help in delighting the customers, by offering them something meaningful, well before they start expecting the same. Thus, it makes me believe, a time has come to make the extrinsic factors, such as patient experience or delight, the center piece of product differentiation, weaving around its intrinsic qualities.

Many global companies have already started acting in this area – creating a whole new experience of care and relief for the patients, with new marketing models delivering differential product values to the target groups. Similar steps can successfully be taken even where there are no clinically significant differentials between the competing products.

Greater participation of consumers in treatment choices:

The information revolution in the world, mainly empowered by the Internet-based platforms – social or otherwise, is enabling many consumers to be partners in the disease treatment choices along with the doctors. In India too, it has started happening – slowly, but surely.

Those consumers, both in urban and mostly in the rural India, who won’t have any direct access to such information, ‘word of mouth’ enlightenment received from others would have a somewhat compensatory effect. Thus, the patients and their near and dear ones will have multiple treatment choices to choose from. In my view, this situation would gain a critical mass – much faster than what the current trend suggests. There won’t be any surprises, if this change assumes a snowballing effect, with modern technology being the key catalyst.

The current attitude could be counterproductive:

In this dynamic situation, any arrogance or ignorance of pharma marketers nurturing a seemingly ‘perennial’ conviction that ‘Indian pharma market and the patients are different’, could indeed be grossly counterproductive. This group of people seems to form a majority, today.

However, it is great to notice that some young Indian pharma professionals with an agile mindset and cerebral power, are thinking differently. They are not just keenly observing the ‘dots’, but also capturing, connecting and mapping the changing needs of the patients.

Their fingers are always on the pulse – concentrating more on strategizing extrinsic differentiation of products rather than remaining in the cocoon of the intrinsic ones. This quest to create an unchallenged and difficult to match market-space, will be essential in gaining the competitive cutting edge, as we move on.

Creating a virtuous cycle:

The focus of a pharma player in creating an extrinsic product differential edge, in pursuit of delivering the value of unique consumer experience, would in turn help enhancing the company reputation. This would, consequently, add value in creating an extrinsic product differential edge – thus, completing a ‘Virtuous Cycle’. It is generally caused by ‘complex chains of events that reinforce themselves through a feedback loop.’

A study on the ‘Impact of Corporate Reputation on Brand Differentiation’, has also established the ‘influence of company reputation, or what is often referred to as corporate reputation on branding strategy and producing intangible asset for different industries…’ This study is considered a pioneering attempt to measure the impact of corporate reputation on brand differentiation strategy.

Conclusion:

Today, especially in the marketing process of branded generic drugs, Indian marketers keep following a system that creates a sequence of reciprocal cause and effect, in which different elements of this overall activity intensify and aggravate each other, leading inexorably to a worsening of the situation. The Oxford dictionary defines this situation as a ‘Vicious Cycle.’

It’s not quite easy to come out of it, extricating the involved players from caustic remarks and allegations of indulging into contentious sales activities, if not blatant ‘marketing malpractices’. Nevertheless, breaking this mold is a ‘must do’ requirement, as many industry watchers believe.

This is because, if one wants to build a company for sustainable business excellence, it has to follow the principles of a ‘Virtuous Cycle’. Otherwise, it could threaten the very survival of the business, as we have witnessed several such instances in India, involving pharma companies. Several global pharma players are now trying hard to create a ‘Virtuous Cycle’, through well-researched strategic initiatives of patient reach and care.

To face this challenge of change squarely, Indian pharma marketers may also wish to focus on extrinsic differentiation of products, rather than intrinsic ones, as is mostly being done today, routinely. This course correction, I reckon, would play a ‘make or mar’ role in the pharma business, eventually. The passion to create a relatively unchallenged and difficult to match market space around patients, will be essential in gaining the requisite competitive advantage – giving shape to the much desired ‘Virtuous cycle’, as we move on.

By: Tapan J. Ray   

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

Should ‘Pharma Marketing’ Be In The Line of Fire?

Posted on by
Reply

Close to half a century ago, Peter Drucker – the Management Guru wrote: As the purpose of business is to create customers, any business enterprise has two basic functions: marketing and innovation. Drucker’s concept is so fundamental in nature that it will possibly never change, ever.

That innovation is the lifeblood of pharma industry is well-accepted by most people, if not all. However, when similar discussion focuses on pharma marketing, the industry virtually exposes itself in the line of fire, apparently from all directions. This trend, coupled with a few more in other areas, is making a significant dent in the reputation of the pharma industry, triggering a chain of events that create a strong headwind for business growth.

The consequences of such dent in pharma reputation get well-reflected in an article titled “How Pharma Can Fix Its Reputation and Its Business at the Same Time,” published in the Harvard Business Review (HBR) on February 3, 2017. The author observed:

“This worrisome mix of little growth potential and low reputation is the main explanation for why investors are increasingly interested in how pharma companies manage access-to-medicine opportunities and risks, which range from developing new treatments for neglected populations and pricing existing products at affordable levels to avoiding corruption and price collusion.”

On the above backdrop, this article will try to explore the relevance of Drucker’s ‘marketing’ concept in the pharma business – dispassionately. Alongside, I shall also deliberate on the possibility of a general misunderstanding, or misinterpretation of facts related to ‘pharma marketing’ activities, as these are today.

Communicating the intrinsic value of medications:

Moving in this direction, let me recapitulate what ‘pharma marketing’ generally does for the patients – through the doctors.

Despite being lifeblood that carries the intrinsic value of a medication from research lab to manufacturing plants and finally to patients, ‘pharma marketing’ is, unfortunately under incessant public criticism. It continues to happen, regardless of the fact that one of the key responsibilities of pharma players is to disseminate information on their drugs to the doctors, for the benefits of patients.

One may justifiably question any ‘marketing practice’ that is not patient-friendly. However, the importance of ‘marketing’ in the pharma business can’t just be wished away – for patients’ sake.

Way back in 1994, the article titled, “The role and value of pharmaceutical marketing” captured its relevance, aptly articulated:

“Pharmaceutical marketing is the last element of an information continuum, where research concepts are transformed into practical therapeutic tools and where information is progressively layered and made more useful to the health care system. Thus, transfer of information to physicians through marketing is a crucial element of pharmaceutical innovation. By providing an informed choice of carefully characterized agents, marketing assists physicians in matching drug therapy to individual patient needs. Pharmaceutical marketing is presently the most organized and comprehensive information system for updating physicians about the availability, safety, efficacy, hazards, and techniques of using medicines.”

The above relevance of ‘pharma marketing’, whether globally or locally, remains unchanged, even today, and would remain so, at least, in the foreseeable future.

It’s a serious business:

As many would know, in many respect ‘pharma marketing’, especially of complex small and large molecules, is quite a different ball game, altogether. It’s markedly different from marketing activities in most other industries, including Fast Moving Consumer Goods (FMCG), where customers and consumers are generally the same.

In contrast, in prescription drug market customers are not the consumers. In fact, most consumers of any prescription medicine don’t really know much, either about the drugs or their prices. They get to know about their costs while actually paying for those directly or indirectly. Healthcare providers, mostly in those countries that provide Universal Healthcare (UHC) in any form, may also be customers for the drug manufacturers. Even Direct to Consumer (DTC) drug advertisements, such as in the United States, can’t result into a direct choice for self-medication, other than Over the Counter (OTC) drugs.

Additionally, pharma market is highly regulated with a plethora of Do’s and Don’ts, unlike most other industries. Thus, for the drug manufacturers, medical professionals are the real customers, whereas patients are the consumers of medicines, as and when prescribed by doctors.

With this perspective, ‘Pharma marketing’ assumes a critical importance. It is too serious a strategic business process to be jettisoned by any. There exists a fundamental responsibility for the drug manufacturers to communicate important information on various aspects of drugs to individual physicians, in the interest of patients. This has to happen, regardless of any controversy in this regard, though the type of communication platforms, contents used and the degree of leveraging technology in this process may widely vary from company to company.

Assuming that the marketing practices followed by the industry players would be ethical and the regulators keep a strict vigil on the same, effective marketing of a large number of competing molecules or similar brand increases competition, significantly. In that process, it should ultimately enable physicians to prescribe drugs that will suit each patient the most, in every way. There can’t possibly be any other alternative to this concept.

A common allegation:

Despite these, a common allegation against ‘pharma marketing’ keeps gathering momentum. Reports continue pouring in that pharma companies spend far more on marketing drugs than on developing them. One such example is a stinging article, published by the BBC News on November 6, 2014.

Quoting various published reports as evidence, this article highlighted that – 9 out of 10 large pharma players spend more on marketing than R&D. These examples are generally construed as testimony for the profiteering motive of the pharma companies.

Is the reason necessarily so?

As any other knowledge-based industry, effective communication process of complex product information with precision, to highly knowledgeable medical professionals individually, obviously makes pharma marketing cost commensurately high. If the entire process of marketing remains fair, ethical and patient centric, such costs may get well-neutralized by the benefits accrued from the medicines, including lesser cost of drugs driven by high competition.

Further, a successful pharma marketing campaign is the ultimate tool that ensures a reasonable return on investments for further fund allocation, although in varying degree, to offer more new drugs to patients – both innovative and generics.

Marketing decision-support data generation is also cost-intensive:

Achieving short, medium and long-term growth objectives are as fundamental in pharma as in any other business. This prompts that investments made on ‘pharma marketing’, fetch commensurate returns, year after year. To succeed in this report, one of the prime requirements is to ensure that the content, platform and ultimate delivery of the product communication is based on current and credible research data having statistical significance.

With increasing brand proliferation, especially in competing molecules or branded generic market, arriving at cutting-edge brand differentiation has also become more challenging than ever before. Nevertheless, identification of well-differentiated patient-centric product value offerings will always remain ‘a must’ for any persuasive brand communication to be effective.

It calls for generating a vast amount of custom made decision-support data on each aspect of ‘pharma marketing’, such as target market, target patients, target doctors, competitive environment, differential value offering, and scores of others. The key to success in this effort is to come out with that ‘rare commodity’ that separates men from the boys. This is cost intensive.

What ails pharma marketing, then?

So far so good –  the real issue is not, therefore, whether ‘pharma marketing’ deserves to be in the line of fire. The raging debate on what ails ‘pharma marketing’ should primarily focus on – how to ensure that this process remains ethical and fair, for all.

Thus, when criticism mounts on related issues, it may not necessarily mean that ‘marketing’ is avoidable in the pharma business. Quite often, critics do mix-up between the crucial ‘importance of pharma marketing’ and ‘malpractices in pharma marketing.’ Consequently, public impressions take shape, believing that the pharma marketing expenses are generally higher due to malpractices with profiteering motives.

As a result, we come across reports that draw public attention with conclusions like: “Imagine an industry that generates higher profit margins than any other and is no stranger to multi-billion dollar fines for malpractice.”

A similar article published ‘Forbes’ on February 18, 2015 also reiterates: “The deterioration of pharma’s reputation comes from several sources, not the least of which is the staggering amount of criminal behavior that has resulted in billions of dollars’ worth of fines levied against the industry.”

One cannot deny these reports – lock, stock and barrel, either. Several such articles named many large pharma players, both global and local.

Conclusion:

In my view, only pharma marketers with a ‘can do’ resolve will be able to initiate a change in this avoidable perception. No-one else possibly can do so with a total success in the foreseeable future – not even the requirement of a strict compliance with any mandatory code having legal teeth, such as mandatory compliance of the Uniform Code of Pharmaceutical Marketing Practices (UCPMP) that the Indian Government is currently mulling.

I guess so because, after a strong deterrent like mandatory UCPMP is put in place, if reports on marketing malpractices continue to surface, it will invite more intense public criticism against ‘pharma marketing’ – pushing the industry’s reputation further downhill, much faster.

Be that as it may, it’s high time for all to realize, just because some pharma players resort to malpractices, the ‘pharma marketing’ process, as such, doesn’t deserve to be in the line of fire – in any way.

By: Tapan J. Ray 

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.