Tag Archives: Metamorphosis

Why Is ‘Empathy’ Central In Pharma’s Digital World?

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While pharma industry’s late realization of its slower pace of reform is widely criticized, it did demonstrate a resilience in facing several challenges of change, caused by Covid-19 pandemic to keep the business going. This was witnessed in many areas of customer-value delivery systems of various companies, also in India.

That said, digitalization notwithstanding, a critical soft skill has now emerged as central for a long-term success in the patient engagement process. A transformation is now much warranted in this area, as it remains generally neglected, even today. This space involves – target-audience specific marketing communication – with well-researched, and contemporary content materials that each patient can relate with one’s needs and expectations from a brand.

Many marketers may be missing out on this nuanced, yet a critical space while striving to make their stakeholder engagement more productive for business. In this article, I shall focus on the art of leveraging this critical soft skill set – ‘empathy’, to fetch better dividend from such initiatives of pharma marketers.

An empathetic intent of what customers need and expect is critical: 

‘Empathy’ isn’t totally a revolutionary idea in marketing. But Covid-19 related disruptions in peoples lives and livelihoods, have brought the issue at the center stage of even pharma marketing. In depth understanding or an empathetic intent of what the customers need, expect and are looking for, has emerged as a key requirement of today’s marketing success.

According to studies, with changing patient expectations, preferences, and power to influence treatment decision-making choices, traditional ‘source dominated messages’ are making lesser business impact to their ‘receivers’. The old way of ‘talking at’ the stakeholders with brand messages, gives many receivers a feel that the message is brand biased. It doesn’t encourage them to express their point of view on the same.

Many bright pharma marketers have started understanding the need to listen to and ‘talk with’ them – before and after messaging – to prepare the right personalized content for key customers, and evaluate their business effectiveness, thereafter. This is a nuanced, yet a critical area, which we all need to accept and act upon to ensure a fundamental change in the customer engagement process.

The fundamental difference between the two:

Various experts have acknowledged and explained a fundamental difference between ‘talking at’ and ‘talking with’ conversations. Some these are as follows:

“Talking at someone” is generally used when the message doesn’t intend to offer a reasonable scope for exchange of ideas, or to engage in a conversation, or to express a contrarian viewpoint on a brand or service. Probably, the content doesn’t encourage or elicit any kind of response, especially the negative ones.

Whereas ‘talking with someone’ intends to start a conversation with the brand between the company and the stakeholders. I hasten to add, there are occasions when these two terminologies are interchangeably used. That doesn’t really matter. What does matter is – ‘talking with someone’ requires a critical soft skill. This is called ‘empathy.’ It is so essential – because of today’s need to establish an emotional connect with customers – for any brand or service.  

Empathy is essential – remote or digital marketing notwithstanding:

This point was captured in the IBM article, published on August 12, 2020, as it highlighted the Covid pandemic induced rapid transformation in the digital behavior of many consumers in different business areas. This triggered several rapid, path-breaking, and consumer-friendly innovation, even in the health care space. As a result, people witnessed, among many others, a wider use of telehealth, rapid adoption of e-commerce/e-pharmacies, besides a significant swing towards the digital-first economy.

The IBM article also underscored the need of similar transformation in some other critical areas, like marketing, especially to keep pace with the change in digital behavior and expectations of a growing population. ‘People are increasingly demanding authentic connections, helpful information and personalized support from brands,’ as the paper added.

Meeting this demand and further nurturing the same, send a clear signal to pharma marketers to gain deep insight of ‘this new consumer journey,’ the paper reiterated. Thus, in the contemporary business scenario, the marketers would require – ‘to create a sense of empathy and personal connection by scaling your brand voice, delivering valuable content and recommendations, and learning directly from your consumers in the digital ecosystem’- the author emphasized.

It’s now visible in the customer engagement process of several industries:

If one carefully notices a company’s messaging – both its content and the format, it won’t be difficult to sense a transformation taking place in this area for most other industries. The content of the message and the communication format/platform, now appear to be quite dynamic, personalized, and built on a robust pillar of the critical soft skill – empathy, or rather – empathy-based marketing.

Shifting from marketing-centric thinking to customer-centric thinking:

According to an expert group in this area: ‘Empathy-based marketing is about walking into your customer’s shoes to understand their experience and how we can better help them get what they want. You don’t want to think like the customer. You want to BE the customer.’

While trying to do so, a marketer would need to move away from marketing-centric thinking to customer-centric thinking and speak from the customers’ perspective and at their motivational level. Empathy-based marketing, therefore, encompasses the following ideas:

  • Empathizing with target-customer’s experience by going into their world.
  • Thinking like them while solving a problem and understanding each step they may take to solve it.
  • Looking for ways to help customers make their lives better.
  • Providing customers with what they want by understanding what motivates them and not what you want them to have.
  • Helping them identify and solve problems.
  • Empowering employees who are directly in touch with customers and provide them resources, training, and tools, accordingly.

In pharma – its personal or in-person selling – but the messaging is not:

As we know, in pharma the selling process is generally personal. Company representatives personally meet individual customer to deliver a brand message to generate prescription demand. Patient engagement processes too, remain broadly the same, at times with minor variations, though. Despite a great opportunity to deliver unique personalized messages through empathy-based marketing that recognizes individual value and expectation – traditionally, one-size-fits-all type of contents continue to prevail.

Leverage technology to create empath-based marketing:

The challenge is moving towards a whole new digital world order. In this space marketers would require working with a huge volume of credible and contemporary data on target customers, markets, the interplay of different emotional factors. A well thought through analytics-based study, would play a critical role to get a feel of empathy for selected customers. This would, then, be the bedrock to strategize a productive and personalized engagement with them. Leveraging modern technology would be essential to attain this goal.

What would ‘empathy’ construe in pharma marketing:

According to MM+M: “Empathy includes making sure your brand not only understands the condition that a patient has, but also the experience of having that condition, encompassing both the physical and emotional impact.’ People are expecting a reflection of empathy from the pharma players in their engagement process. Patients and consumers can figure out an empathetic message when they see it. They know when a brand ‘gets it’ and when ‘it doesn’t.’ Thus, it’s important that ‘marketers don’t just preach empathy, but they also practice empathy themselves, the paper highlighted.

Today’s marketing mostly addresses the fundamental needs of patients: 

As the above MM+M paper highlighted - at a fundamental level, patients just want to get better and feel better and manage their condition effectively. On this premise, most patient engagement initiatives, basically, try to address these fundamental needs, in different ways. However, as the research reveals, the above approach would not generally try to empathize with the target audience. Companies now move beyond the hard facts of medical conditions – their symptoms and relief.

According to the above study, today’s marketers would, simultaneously need to: “Find out what life is like for them. Is it a long, complex, frustrating process to access their treatment? What emotional toll does the disease have on them? On their loved ones? Are they scared? Depressed? Like a method actor, I will soak up everything I can about this person and close my eyes and become them.”

Conclusion:

In the contemporary changing market` dynamics, pharma markers can boost the brand performance either by generating increasingly more prescriptions from the existing brand prescribers, or by creating new prescribers. This is an eternal truth and is expected to remain so, as one can foresee today.

As this metamorphosis keeps rolling on, it will necessarily require healthcare marketers to gain contemporary and data-based customer insight – with an empathetic mindset. It’s essential for them to create the ‘wow factor’ – for patients to get the ‘wow feeling,’ because they will be getting a workable solution that they were looking for – to get relief from an ailment. It will, in turn, help most drug companies to overcome the trust-barrier, giving a feel to the customers that the brand and the company do care for them – not just serve the corporate vested interests.

Thus, empathy-based marketing leadership, armed with this critical skill, will also build a long-term and trust-based relationship with stakeholders for better business outcomes. According to a recent research study, published in the Forbes Magazine, on September 19, 2021, ‘empathy’ emerged as one of the most important leadership skills, especially, in the post pandemic business environment, for various reasons.

Consequently, in today’s scenario, only science-based brand engagement with patients can’t possibly help achieve the desired goals any longer. Thus, I reckon, honing the unique soft skill – ‘empathy’, has become central for pharma marketers’ professional success in the digital world – more than ever before.

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.

 

 

Why And How To Be In-Sync With Gen Z As Pharma Paradigm Shifts?

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As science and technology, across the world, are progressing at a scorching pace – Covid-19 pandemic notwithstanding, today’s generations are growing up tech savvy – more than ever before. The trend will keep going north faster and with a steeper gradient. This is being driven by transforming social and economic environments – necessitating quicker solutions to any needs, problems, and expectations.

The current signals, as underscored by an article appeared in the Abbott Website on November 19, 2019: ‘Generation Z’s relationship with technology will also influence how the group relates to healthcare.’ Thus, it’s no secret that millennials approach their health care in drastically different ways than members of the Silent Generation, baby boomers or Gen Z, the article added.

Which is why, gradually shifting paradigm of the pharma industry would also eventually create a brand new one – with the Gen Z population growing at a faster pace. From the above perspective, in today’s article, I shall focus on the importance of this shifting paradigm, especially from the pharma industry perspective, including India.

Expectations and experience of Gen Z are contrasting:

Let me start with the definition of Gen Z. In January 2019, Pew Research defined Gen Z as anyone born after1996, just as ‘anyone born between 1981 and 1996 (ages 23 to 38 in 2019) is considered a Millennial.’ Gen Z grew up with technology, the internet, and social media. Moreover, according to another study of Pew Research, published on May 14, 2020, Gen Z is growing up having experienced catastrophic disruptions in almost all spheres of life and livelihoods, triggered by Covid-19 pandemic. It further ascertained, ‘the oldest Gen Zers have been particularly hard hit in the early weeks and months of the Coronavirus crisis.’

Thus, I reckon, the experience and expectations of many of such Gen Z from business and overall environment around – are quite different from earlier generations. More importantly, they will also have a strong influence on younger ones. Hence, the expected transformation would be much broader than what is currently visible today on the ground.

Some core characteristics of Gen X from pharma business perspective:

Various studies have captured the core characteristics of Gen Z, some of which are very relevant to pharma industry and are worth taking note of – for excellence in business performance. These include the followings:

Digital natives:

As McKinsey & Company highlighted in an article, published on November 12, 2018 that Gen Z is the first generation of true digital natives, and they are expanding. Whereas Millennials were regarded as ‘digital pioneers,’ who bore wit­ness to the explo­sion of tech­nol­o­gy and social media, Gen Z populations are born into a world of peak tech­no­log­i­cal inno­va­tion. In that environment infor­ma­tion is imme­di­ate­ly acces­si­ble and social media becoming increas­ing­ly ubiquitous – endorses another study by the Casey Foundation with its own findings on the core characteristics of Gen Z.

Financial minded:

Finan­cial mind­ed­ness is anoth­er core char­ac­ter­is­tic of Gen­er­a­tion Z for several reasons. A major one being, as discussed – many of them grew up witnessing unprecedented impact on lives and livelihoods caused by Covid-19 pandemic. Several other studies, like the one published recently by the Harvard Pilgrim Healthcare, indicates that millennials and Gen Z are especially sensitive to healthcare costs.

Shrewd consumers and cost-value conscious:

Gen Z show characteristics of shrewd consumers and are also cost-value conscious. Being tech savvy, they are more influenced by fast-expanding digital, world and would like to make well-informed purchasing decisions after evaluating a range of options – both for products and services. They tend to be more influenced by the experience of real-life users, rather than a celebrity endorsement and val­ue per­son­al­ized prod­ucts.

Gen Z to herald metamorphosis of future healthcare:

That it is happening gets retreated in the caption of the Fierce Healthcare article of June 16, 2020 – ‘Industry Voices -Generation Z is a game changer for healthcare.’ It emphasized, ‘Generation Z – are likely to turn the health industry on its head with their unique expectations for how healthcare should be delivered.’

Convenience is such a paramount for Gen Z that they are often willing to forgo a personal relationship with their healthcare provider. Besides, they will come to their physician and provider armed with data, information, and knowledge, unlike the past generations. Consequently, the danger for providers is, if Gen Z doesn’t get that desired convenience, they’ll go elsewhere, the article says. Simultaneously, ‘they also want a trusted adviser who can guide them toward holistic health and wellness.’ Thus, delivering patient-centric care, capitalizing on real-world data and automated care experiences, will be key to the transformative process of healthcare.

A recent survey also vindicates that the transformation has begun:

A recent Accenture healthcare consumer survey reiterated: “The new healthcare consumer is here.” The study clearly signaled a paradigm shift in this space spearheaded by millennials and Gen Z. Some of the survey findings encompass the following areas:

  • This group of healthcare consumer expectations for convenience, affordability and quality are redefining how they engage at each stage of care.
  • They are most dissatisfied with health care’s status quo and more willing to try non-traditional services, such as, virtual care and retail walk-in clinics, which are gaining in popularity and use with them.
  • With greater health care needs, they will increasingly look for services to satisfy their expectations for effectiveness, convenience, efficiency, and transparency.
  • With millennials and Gen Z to become the largest generation in not-too-distant future, they hold the most power to influence future healthcare models.

Some pharma players are tracking Gen Z and the changing paradigm:

Some global majors, such as Abbott, are also writing about it in their website Abbott.com. The Company has noted some of these changes, as follows:

  • Generation Z’s relationship with technology will influence how the group relates to healthcare. While growing up in a fully connected world, they ‘are less likely to have primary care providers and are more likely to use apps for scheduling, viewing medical records and paying bills.’ They are also more receptive to telehealth visits and connected healthcare than previous generations.
  • With the wait times for an appointment with a doctor growing longer, Gen X populations are more likely to use walk-in clinics or opt for urgent care centers which are more convenient.
  • Self-service and convenience play into Gen Z’s interactions with doctor’s and the industry as a whole. They prefer email, texting, and apps to manage their appointments or communications with doctors. Finding ways to communicate with this younger generation in their preferred modes, can help keep them engaged with the industry.
  • Millennials and Gen Z populations are most likely to use a wearable device. They typically reach out to friends or online communities to ask about a particular health condition before speaking with a doctor. Although they aren’t the groups using the more healthcare services, millennials and members of Gen Z are showing what the health industry needs to do to provide the best care.

Size of Gen Z population in India:

According to EY Gen Z survey, released on November 04, 2021, the next decade will be shaped by the maturation of Gen Z, the largest generational cohort in history, where India stands out with a population that includes 375 million people or 27% of the total population in Gen Z. Besides, the survey also underscores the importance of Gen Z in the shifting paradigm of market dynamics for the pharma industry, as well.

Conclusion:

Currently, healthcare industry, in general, and most drug companies, in particular -especially, in India, don’t seem to nurture the fast-growing population of Gen Z with a customer engagement strategy that they can relate to. What these players are currently marketing is mostly aimed at traditional customers, and who still form the majority.

Exploring these evolving changes, I wrote an article in this blog, on November 07, 2016. This was titled ‘Millennial Generation Doctors And Patients: Changing Mindset, Aspirations, And Expectations.’ However, the unprecedented impact of Covid-19 pandemic, alongside rapid advancement and adaptation of digital technology, tools, and platforms, has expedited this process.Apace with these changes the pharma paradigm is also shifting, at a much faster pace than ever before. Which is why, I reckon, it’s important for the entire health care industry in India to be in-sync with Gen Z expectations and engage them, accordingly.

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.

 

Post Covid-19 Lockdown: Is Pharma Industry Ready?

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It’s over a month now since national lockdown in India came into force to win the war against Covid-19. Many promises and apprehensions about whether or not Covid-19 will keep ravaging human life, continue surfacing. As it appears today, whatever best happens post May 03, 2020, the Coronavirus outbreak is going to change the way we live and the businesses used to operate, in many respects, till an effective vaccine comes, at the very least. This change also includes the health care, in general, and the pharmaceutical industry, in particular.

It is obvious now that Covid-19 will stalk the planet for a long time to come. On April 22, 2020, the World Health Organization (WHO) also reiterated: ‘Make no mistake, Coronavirus will be with us for a long time.’ This vindicates many apprehensions against an early promise of winning the Covid19 war decisively in 21-days or even by May 03, 2020, or whenever the national lockdown is phased-out in a calibrated manner. Further, W.H.O has also cautioned: “Most countries are still in the early stages of their epidemics. And some that were affected early in the pandemic are now starting to see a resurgence in cases.”

As on April 26, 2020, the recorded Coronavirus cases in India has sharply climbed to 26,496 and 825 deaths, with the Union Health Ministry saying on April 23, 2020: ‘Doubling rate of Covid-19 cases in country is now 10 days.’ Whereas, on the same day, Indian Council of Medical Research (ICMR) also said, ‘for now, it is very difficult to tell when a peak state of COVID-19 pandemic in the country will arrive.’

The life-changing disruptions that Covid19 has caused, and may continue to cause in the near future, has apparently made a significant impact, also on how the healthcare consumers think about the available disease treatment solutions, including buying medicines. Thus, in this article, I shall, focus on this area.

Why winning the Covid-19 war can’t be immediate: 

Covid-19 pandemic brought the drug industry under a sharp focus of the entire world, with an expectation to win the war against this deadly and invisible virus. This solution could be anything – an effective prevention, such as, with a vaccine, or a curing the infection with a drug, or even a mechanism that is able to make the virus less contagious. There are still no scientifically proven and approved drugs or vaccines for Covid-19. Although, many trial and error experiments are in progress, mainly based on anecdotes and gut-feeling, for the respiratory disease caused by Coronavirus.

The good news is, since January 2020, after scientists in China provided the virus’s genetic sequence, over 40 teams of global drug companies and the academia, are working on a vaccine and drugs for Covid-19. As of now, six Coronavirus vaccines are on clinical trial. Last Thursday, human safety trial of Oxford University developed Covid-19 vaccine, with the first two of 800 healthy volunteers, has commenced. Meanwhile, Serum Institute of India (SII) has tied-up with the Oxford University to manufacture the vaccine in India, if the trial succeeds.

Some bad news in this area also came by, such as, ‘remdesivir’ – the well-hyped drug, thought to be one of the best prospects for treating Covid-19, failed to have any effect during the first full trial. However, Gilead – the drug company developing this product has said, ‘the findings were inconclusive because the study was terminated early.’

The bottom-line is, although, first tests for more new vaccines may commence within a few months, the final regulatory approval of these will take much longer - at least 18 months, i.e. not before 2022, according to W.H.O. Meanwhile, some disruptive changes within current health care delivery systems, involving both behavior and transaction practices of key stakeholders, may prompt equally disruptive changes in the Indian health care delivery mechanisms. These changes are likely to have unforeseen impact on several pharma operations, critical for business excellence in the drug industry.

Commonly followed procedures for the Indian healthcare system:

The procedures that most health care consumers currently follow for healthcare in India, require patients to be physically present in most touchpoints of a disease treatment process. These include, doctors, chemist shops, hospitals, diagnostic clinics, among others. During the national lockdown period, redressal of non-Covid-19 related common health issues, has been a great challenge for many people, such as:

  • visiting a doctor
  • going to a hospital outdoor
  • procurement of medicines from retail shops for chronic conditions
  • visiting a diagnostic clinic even for follow-up – previously advised by a doctor

This happened primarily due to the need of compliance of social distancing and mostly out of fear of getting the Covid-19 infection. Fortunately, the available digital platforms to address the pressing common health issues, proved to be of immense help to many.

Pharma business has also been greatly impacted: 

Driven by initial panic buying of regular medicines by the people, for the lockdown period and may be beyond, monthly sales of pharma might show a spurt. But, that is unlikely to be the real picture for a medium to long term. Otherwise, like many other industry sectors, pharma business has also been greatly impacted by the Covid-19 outbreak, across its various domains – right from planned R&D – through manufacturing, sales and marketing – to supply chain.

The early adopters to the new normal will be the outright winners:

For example, meeting a doctor for product detailing following the conventional chain of activities, and simultaneously maintaining strict ‘personal distancing’ or ‘social distancing norms, may not be the same again. The changes required by the pharma companies to make this process effective and productive, may also be disruptive in nature.

No-one can accurately predict toady, how exactly the important business operations can be resumed, ensuring full health-safety for all and with compromising on the effectiveness and productivity of business. Nevertheless, one thing for sure, lockdown during Covid-19 pandemic has brought the possibility and the opportunity of going digital to the fore, for both – the healthcare business and also its consumers, including various other stakeholders. The early adopters to the new normal are expected to be the outright winners.

Green shoots of digitalization within healthcare consumers and providers: 

As digital transformation at health care consumers and providers level, gain a critical mass, the healthcare business would require to be not just digitalized, but also digitally innovative. The situation would demand from them to be much more ‘customer centric’ on digital platforms, as the locked down – homebound health care consumers, complying with ‘social distancing’ norms, get increasingly more digitally empowered.

Bain & Company in its March 20 ‘Brief’, titled ‘How the Coronavirus Will Transform Healthcare in China,’ discussed some of these issues from China perspective, which are already visible there. To illustrate this point in this deliberation from the Indian perspective, let me draw examples from the country’s health care consumers’ standpoint.

Is the traditional health care system slowly undergoing a metamorphosis?

The overall impact of Covid-19 outbreak in India has made visiting general practitioner’s (GP) clinics, pathological labs or even hospital emergency facilities, a tough challenge for many patients. This is primarily out of fear of getting a Coronavirus infection from others during the process, with strict compliance to ‘social distancing’ becoming a top priority for many. Consequently, traditional healthcare related activities in India, is likely to undergo an early metamorphosis.

Being literally locked down at home, a good number of healthcare consumers in India, are utilizing innovative digital platforms, for common illnesses or follow-up consultations, such as:

  • for medical consultation on digital platforms, e.g., Skype, Facetime etc.
  • getting diagnostic tests done at home by requesting through digital apps,
  • sending test reports to doctors digitally,
  • getting doctors prescription through digital mode,
  • ordering medicines through e-pharmacy apps by uploading prescriptions,
  • getting medicines delivered at home after e-payment,
  • repeating the same process whenever required.

An upside of the situation: 

The upside of the situation is, these patients are feeling more digitally empowered and self-reliant to get non-too-serious ailments addressed against all odds. Some of these practices, such as, online consultation with doctors, getting most of the medical tests done at home, buying medicines through e-pharmacies, I reckon, may continue even after calibrated withdrawal of the national lockdown in India.  The net impact of all could trigger a meaningful attitudinal change in patients, especially towards health care delivery processes, in general.

The healthcare industry is ready to log on to this digital mode? 

Many early adopters in the global pharma industry, are going for digitalization within various functional domains of the company, at a varying scale. This has started happening in India, as well. However, as social distancing becomes the new normal in the foreseeable future, how prepared are the pharma companies to adopt themselves with the increasing number of digitally empowered consumers, is still unclear. More importantly, how will the industry meet new demands at various points of transaction and interaction with various critical stakeholders, such as, doctors, in the post Covid-19 eraof social distancing, ensuring health safety of all?

Another requirement that should form the bedrock of the grand integrated corporate strategy of a customer-centric pharma business, necessarily, in the changing times. This is – all decisions in this area must be based on a huge pool of contemporary data, analyzed by sophisticated data analytics and thereafter, the strategic and tactical pathways need to be charted, desirably, through skillful application of Artificial Intelligence (AI), because of evolving complex and multi-dimensional health care needs of the consumers.

Alongside, telemedicine in different new formats – even for GP level consultations, besides, drug procurement through e-payment from approved e-pharmacies by uploading doctor prescriptions, signal a great potential in the years ahead. This appears to be very close to reality, especially, going by the W.H.O prediction for a long-haul Covid-19 battle, where compliance with ‘social distancing,’ is one of the basic requirements of health safety for all.

Conclusion:

‘Month of lockdown impedes virus – a long battle lies ahead’. As the former President of the Unites States twitted on April 25, 2020, ‘If we want life to approach anything like normal anytime soon, we need a comprehensive testing program. It’s not going to be cheap, but it will ultimately pay off many times over in saved lives, saved businesses, and saved jobs.’

In any case the crux of the matter is, Covid-19 is not going to vanish soon, even after scaling down of the lockdown in a calibrated way. Moreover, the fear, if not the panic of a large population in India and around the world, on the possibility of getting infected by Covid-19, will continue – till one does not get vaccinated or acquire ‘herd immunity’ in a different way. Meanwhile, related behavioral changes and habits, of a large number of people, including health care consumers, will continue taking place.

From this perspective, besides the existing ones, once the lockdown-period-converted ‘e-consumers’ of health care get used to the new digital mode of availing healthcare services against e-payments, it could have a snowballing impact on many others. That will help usher in a new paradigm of medical consultation, follow-up interaction, disease diagnosis, drug procurement and all related transactions, through digital platforms.

Having experienced the convenience and user-friendliness of the digital mode, during an extended period of social or physical distancing and other new normal, instead of time-consuming legwork, it seems unlikely that the majority will try to go back to the traditional mode of pre-Covid 19 era. In that situation pharma companies will have no option but to necessarily re-engineer the business operations, bringing disruptive digitalization at the center of any strategy formulation related to mainly patients and doctors, besides others.

Covid-19 prompted lockdown and the post lockdown period, I reckon, is unlikely to be a ‘switch-off’ and ‘switch-on’ type of a situation for anyone or any industry, as threat of getting Coronavirus infected will continue for quite some time. The need of the hour for pharma players in India, therefore, is gaining deep insight, through continuous data capturing and analysis, on each component of the changing market dynamics – prompted by Coronavirus pandemic. The point to ponder, therefore, is pharma industry getting ready for a possible disruptive change in the future environment?

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.

Pharma Marketing in India: 10 Chain Events to Catalyze a Paradigm Shift

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In the matured markets of the world pharmaceutical marketing is quite different in many respect as compared to India. Besides doctors, different sets of customer groups like, healthcare providers, patient advocacy groups, pharmacy benefit managers, clinical assessment authorities play various critical roles for use and consumption of branded or generic pharmaceutical products and related healthcare services.

Quite in contrast, even today, individual doctors have continued to remain almost the sole target customers for the pharmaceutical players in India. This is mainly because, by and large, they are the only decision makers for usage of medicines and other healthcare facilities for most of the patients in the country.

Heralding a new paradigm:

As indicated above, though the current pharmaceutical marketing strategies continue to revolve mostly around the doctors, a distinct change, albeit slowly though, is now anticipated within the pharmaceutical marketing space in India.

Gradual emergence of healthcare providers with medical insurance and other related products, patient advocacy groups and standard treatment guidelines, just to name a few, are expected to facilitate heralding a new paradigm in the strategy dynamics of the Indian Pharmaceuticals Market (IPM) in the coming years. These changes will not be incremental in any way, but disruptive and radical in nature, as they will fully evolve.

This process of transformation, mainly driven by Government policy reform measures like, ‘Universal Health Coverage (UHC)’, ‘Free distribution of medicines’, mandatory prescriptions in generic names, could make the current pharmaceutical business strategy models of majority of companies irrelevant and obsolete, in not too distant future.

It is worth noting that the Government will spend around Rs.14,000 Crores (US$ 2.60 billion, approximately) from the year 2014 to 2017 just on medicine purchases at highly negotiated/discounted prices for free distribution to all through Government hospitals and dispensaries.

10 Chain events envisaged: 


In the evolving scenario, following chain events, taking place almost in tandem, in my view, will gradually usher in a new pharmaceutical marketing paradigm in India:

1. In addition to ‘Universal Health Coverage’, there will be a rapid increase in the number of other healthcare providers with innovative, tailor-made and value added schemes for various strata of the society.

2. This will trigger emergence of very powerful groups of negotiators for adopting treatment guidelines, pharmaceutical products usage and other healthcare related services.

3. These groups will have the wherewithal to strongly and significantly influence the doctors in their prescription and other treatment choices.

4. A significant proportion of the products that the pharmaceutical companies will market, a tough price negotiation with the healthcare providers/ medical insurance companies will be inevitable.

5. Consequently, doctors will no longer be the sole decision makers for prescribing drugs and also the way they will treat the common diseases.

6. Pharmaco-economics or Health Technology Assessment (HTA) or outcome based pricing will gradually play an important role in pricing a healthcare products. Drug Price Control Order (DPCO 2013) has already signaled to this direction for a class of products.

7. An integrated approach towards disease prevention will emerge as equally important as treating diseases.

8. A shift from just product marketing to marketing a bundle of value added comprehensive disease management processes along with the product would be the order of the day.

9. More regulatory control measures on pharmaceutical sales and marketing are expected to be put in place by the Government to prevent alleged widespread sales and marketing malpractices in the country.

10. Over the counter (OTC) medicines, especially those originated from natural products to treat common and less serious illnesses, will carve out a sizable share of the market, as appropriate regulations would be put in place, adequately supported by AYUSH. This will be fueled by overall increase in general health awareness of the population.

Trapped in an ‘Archaic Strategy Cocoon’:

Over a long period of time, Indian pharmaceutical industry seems to have trapped itself in a difficult to explain ‘Archaic  Strategy Cocoon’. No holds bar sales promotion activities, with very little of marketing, continue to dominate the ball game of hitting the month-end numbers, even today.

It is high time to come out of this cocoon and confront the ‘writing on the wall’ upfront, if not try to hasten the process of the evolving changes, boldly and squarely. This will require a strategic long term vision to be implemented in an orderly way to effectively convert all these challenges into possible high growth business opportunities.

A differentiated composite value delivery system:

Moreover, in today’s post product patent regime in the country, product pipelines of the domestic Indian companies with new ‘copycat’ versions of patented products have almost dwindled into nothing, making price competition in the market place even more ‘cut throat’.

In such type of changing environment, all pharmaceutical companies will be under tremendous pressure to create and deliver additional, well differentiated and composite value offerings, beyond physical products, to attract more patients, doctors, healthcare providers and others, in and around related disease areas, for business excellence.

Thus, ability to create and effectively deliver well-differentiated composite value offerings, along with the physical products, will separate men from the boys in the high growth pharmaceutical market of India, in the long run.

This could also possibly create an ‘Alibaba Effect’ for the successful ones in search of pots of gold in the pharmaceutical space of India.

New leadership and managerial skill set requirements:

In the new environment, required skill sets for both the leaders and the managers of Indian pharmaceutical companies will be quite different from what they are today. This will not happen overnight though, but surely will unfold gradually.

New skills:

Leaders and managers with knowledge in just one functional area like, R&D, manufacturing, marketing, regulatory, finance are unlikely to be successful without a broad-based knowledge in the new paradigm. To really understand and handle new types and groups of customers, they will need to break the operational silos and be proficient in other key areas of business too.

These professionals will require ensuring:

• Multi-functional expertise by rotating right people across the key functional areas, as far as possible, even with a stretch.

• Ability to fathom and correctly interpret patients’ clinical benefits against cost incurred to achieve the targeted clinical outcomes, especially in areas of new products.

• Insight into the trend of thought pattern of healthcare providers and other customers or influencers groups.

• Speed in decision-making and delivery…more importantly ability to take ‘first time right’ decisions, which can make or mar an important initiative or a commercial deal.

IPM growing fast, can grow even faster: 

India is now one of fastest growing emerging pharmaceutical markets of the world with 3rd global ranking in the volume of production and 13th in value terms. Domestic turnover of the industry is over US$ 13.1 billion in 2012 (IMS) representing around 1 percent of the global pharmaceutical industry turnover of US$ 956 billion (IMS 2011).

Since 1970, Indian pharmaceutical Industry has rapidly evolved from almost a non-entity to meeting around 20 percent of the global requirements of high quality and low cost generic medicines.

Financial reforms in the health insurance sector and more public investments (2.5% of the GDP) in the healthcare space during the 12th Five Year Plan Period will have significant catalytic effect to further boost the growth of the industry.

Stringent regulations and guidelines of the Government in various areas of pharmaceutical business in India are expected to be in place soon. Ability to ensure system-based rigid organizational compliance to those changing business demands in a sustainable way. will determine the degree of success for the pharma players in India.

One such area, out of many others, is the professional interaction of the Medical Representatives with the doctors and other customer groups.

Require a ‘National Regulatory Standard’ for Medical Representatives in India:

Medical Representatives (MRs) currently form the bedrock of business success, especially for the pharmaceutical industry in India. The Job of MRs is a tough and high voltage one, laced with moments of both elation and frustration, while generating prescription demand for selected products in an assigned business territory.

Though educational qualifications, relevant product and disease knowledge, professional conduct and ethical standards vary widely among them, they are usually friendly, mostly wearing a smile even while working in an environment of long and flexible working hours.

There is a huge challenge in India to strike a right balance between the level and quality of sales pitch generated for a brand by the MRs, at times even without being armed with required scientific knowledge and following professional conduct/ ethical standards, while doing their job.

Straying from the right course:

A recent media report highlighted that ‘Indian subsidiary of a Swiss pharma major has run into trouble with some executives allegedly found to be inflating and presenting fabricated sales data for an anti-diabetic drug.’

The report also indicated that officials from mid-management ranks to sales representatives were allegedly involved in those unethical practices. The company has responded to this incidence by saying that the matter is still under investigation.

It is critical for the MRs not just to understand scientific details of the products, their mode of action in disease conditions, precautions and side effects, but also to have a thorough training on how to ‘walk the line’, in order to be fair to the job and be successful.

As MRs are not just salesmen, they must always be properly educated in their respective fields and given opportunities to constantly hone their knowledge and skills to remain competitive. The role of MRs is expected to remain important even in the changing scenario, though with additional specialized skill sets.

Unfortunately, India still does not have a ‘National Code of Conduct or Regulatory Standards’ applicable to the MRs.

Only the clause 4 of ‘The Magic Remedies (Objectionable Advertisement) Act, 1954’ deals with misleading advertisements. It is about time to formulate not only a ‘National Code on Pharmaceutical Marketing Practices’, but also a mandatory ‘Accreditation program’ and transparent qualifying criteria for the MRs for the entire pharmaceutical industry in India, just like many other countries of the world.

‘Central Drugs Standard Control Organization (CDSCO)’ of the Ministry of Health and Family Welfare of the Government of India in its website lists the “Laws Pertaining to Manufacture and Sale of Drugs in India”. However, it does not specify any regulation for the MRs nor does it recommend any standard of qualification and training for them, which is so critical for all concerned.

There are currently no comprehensive national standards for educational qualification, knowledge, ethics and professional conduct for the MRs. In the absence of all these, it is difficult to fathom, whether they are receiving right and uniform inputs to appropriately interact with the medical profession and others in a manner that will benefit the patients and at the same remain within the boundary of professional ethics and conduct.

Thus, a ‘National Regulatory Standard’ for MRs, I reckon, is absolutely necessary in India… sooner the better.

Global pharmaceutical players:

Facing a huge patent cliff, global pharmaceutical companies are now fast gaining expertise in the ball game of generic pharmaceuticals, especially in the developing markets of the world.

In the emerging markets like India, where branded generic business dominates, global pharmaceutical players seem to be increasingly finding it lucrative enough for a sustainable all round business growth.

However, to outpace competition, they too will need to capture the changing dynamics of the market and strategize accordingly without moaning much about the business environment in the country.

On the other hand, if majority of Indian pharmaceutical companies, who are not yet used to handling such changes, are caught unaware of this evolving scenario, the tsunami of changes, as they will come, could spell a commercial disaster, endangering even very survival of their business.

Managing transition:

During ensuing phase of transition in India, pharmaceutical companies would require to:

• Clearly identify, acquire and continuously hone the new skill sets to effectively manage the evolving challenge of change.

• Get engaged, having clarity in the strategic content and intent, with the existing public/private healthcare providers and health insurance companies like, Mediclaim, ICICI Lombard, large corporate hospital chains, retail chain chemists and others, proactively.

• Drive the change, instead of waiting for the change to take place.

• Ensure that appropriate balance is maintained between different types of marketing strategies with innovative ways and means.

Conclusion:

It may not be easy for the local Indian players to adapt to the new paradigm sooner and compete with the global players on equal footing, even in the branded generic space, with strategies not innovative enough and lacking required cutting edges.

In my view, those Indian Pharmaceutical companies, who are already global players in their own rights and relatively well versed with the nuances of this new ball game in other markets, will have a significant competitive edge over most other domestic players.

If it happens, the global-local companies will offer a tough competition to the local-global players, especially, in the branded generic space with greater cost efficiency.

So far as other domestic players are concerned, the fast changing environment could throw a new challenge to many, accelerating the consolidation process further within the Indian pharmaceutical industry.

As the new paradigm will herald, catalyzed by the above 10 chain events, there will be a metamorphosis in the way pharmaceutical marketing is practiced in India. A well-differentiated composite value delivery system would then, in all probability, be the name of the winning game.

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.

 

Early Signal of Metamorphosis in the Global Pharmaceutical Product Patent Regime

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Before enactment of the Indian Patents Act (amended) 2005, it was widely reported that to protect ‘Public Health Interest’, the Parliament of India has ensured inclusion of a number of ‘safeguards’ including checks on ‘ever-greening’ of pharmaceutical patents and broader provisions for the grant of ‘Compulsory License’ in India.

Such provisions in the Patents Act of any country were almost non-existent at that time and eventually got translated into an eye of a storm spreading across the continents.

Most probably, none could fathom at that juncture, the magnitude of profound impact of the steps taken by the Indian Parliament on the global pharmaceutical product patent regime over a period of time, slowly but steadily. On the contrary, many expected that because of intense global pressure, at least, some of these ‘safeguards’ will subsequently be amended in favor of the innovators.

Instead and surprisingly, despite such intense pressure, especially from the U.S. and Europe, some countries gradually started following similar direction as India did in 2005.

Support of the Experts Group:

Similarly, support of the global expert groups on the above ‘safeguard’ provisions of the Indian Patent Act 2005 has now started surfacing.

This month, September 10, 2012 edition of ‘The Lancet’ featured an article titled, “India’s patent laws under pressure.” Supporting the above safeguard provisions the authors commented as follows:

“The TRIPS Agreement does not limit the grounds on which compulsory licenses can be granted, and does not prevent patent applicants from having to demonstrate enhanced efficacy for their allegedly new and useful inventions. There are many problems facing access to and rational use of medicines in India but the provisions within the country’s patent laws, if more extensively and properly applied, should help rather than hinder such access. India’s laws and experiences could provide a useful example for low-income and middle-income countries worldwide.

Interestingly, The Times of India dated September 14, 2012 in its editorial commented that

“Instead of being browbeaten by foreign multinationals and pressure from the US government, Indian drug policies should be designed to nudge them along this path, while protecting patients and the generic-drug industry. Indian pharma, like Chinese manufacturing, is a potent global force. In the 21st century we ought to move beyond rather than strengthen a system where brown and black people are denied access to life saving drugs.”

Even more recently on September 15, 2012, the business daily of India, The Hindu Business Line reported that dismissing the stay petition of Bayer on the Compulsory License (CL) granted for its Sorafenib Tosylate to Natco, the Intellectual Property Appellate Board (IPAB) comprising its Chairman, Justice Prabha Sridevan, and member D. P. S. Parmar, in the order passed on September 14, 2012 said that, “if stay is granted, it will jeopardize the interest of public who are in the need of the drug. The appellant has not made out any case for granting a stay.”

On the price of Bayer’s Nexavar, Justice Prabha Sridevan further stated that “Selling at Rs 2.80 lakh (US$ 5,100 approx.) can by no stretch of imagination satisfy the requirement of the public.”

Capturing an emerging trend with some examples:

This trend for all practical purpose started with India and may be captured as follows:

India:

Amendment of the India Patents Act in January, 2005, as mentioned above, may in all practical purpose be construed as the beginning of the changing process.

Philippines:

For a long time Philippines remained a market of the highest price medicines as compared to most other Asian countries. However, effective July 4, 2008, the country enacted a law known as “Universally Accessible Cheaper and Quality Medicines Act” reportedly  to protect public health interest. The law:

  • Directed amendment of the Patent Act to limit the monopoly of the patent owners by expanding the scope for non-patentable inventions and redefining inventive step provision, similar to section 3(d) of Indian Patents Act 2005
  • Allowed parallel importation of drugs already released in the international market as limitation to patent rights
  • Provided for the use, by the government or its authorized third party, of the invention even without the agreement of the patent owner, in cases of national emergency, circumstances of extreme urgency, public non-commercial use or inadequately met demand
  • Added ‘inadequately met demand’ as a ground for the grant of Compulsory License.

Taiwan:

In 2009, ‘Taiwan’s Intellectual Property Office (TIPO)’ amended  the Patent Act, again for public health interest, in the following areas, among others:

  • Patentability
  • Public health
  • Compulsory license

China:

The State Intellectual Property Office (SIPO) has announced that the revised version of ‘Measures for the Compulsory Licensing for Patent Implementation’ has already been made operational in China effective May 1, 2012.

Interestingly, for “reasons of public health”, such medicines can also be exported under ‘Compulsory License’ to other countries, including those members of the World Trade Organization, where life-saving treatments are unaffordable.

In tandem, China, reportedly, is in the process of further strengthening its legal framework for local manufacturing of generic equivalents of patented drugs in the country.

Argentina:

Recently Argentina reportedly  has come out with an amendment in their patent law for public health interest and has put in place new guidelines for patents, which besides others, include stringent provisions on patentability quite similar to the Section 3(d) of Indian Patents Act 2005.

Another signal from Asia though disease specific:

From May 29 – 31, 2012, over 90 representatives of government, academia, civil society and the United Nations assembled at the Regional Consultation and Planning Workshop in Bangkok  to deliberate on “Use of TRIPS Flexibilities and Access to Affordable ARVs in Asia.”

The participants felt that in the days ahead there may be several public health related issues where the governments will require making exceptions in form of sovereign decisions to Intellectual Property (IP) Rights to save millions of precious lives.

A close watch for Public Health Interest in South Africa:

It has recently been reported that in South Africa, health activists together with other stakeholders of the local pharmaceutical industry are maintaining close vigil over the possibly amendment of the country’s patent laws by the government. They argue that no such decision to be taken, which can jeopardize access to cheaper generic medicines by the marginalized section of the society.

A review by UNDP:

In a paper titled, “Five years into the Product Patent Regime: India’s response”, published by United Nations Development Program (UNDP), the authors reiterated that in compliance with TRIPS agreement, India re-introduced the product patent protection in pharmaceuticals from  January 1, 2005 by amending its Patent Laws. This development led to serious concerns at that time about the continuing ability of Indian generic companies to supply low cost and high quality medicines across the world. However, these concerns were taken seriously by the Indian Parliament, which utilized flexibilities available under TRIPS to help securing the availability, affordability and accessibility of such medicines in an uninterrupted manner.

The authors concluded by re-emphasizing their views that the Indian patent law contains robust built-in safeguards to eliminate a significant amount of ‘patent barriers’ to reasonably affordable low cost and high quality generic medicines, especially for the poor.

Opposite school of thoughts:

In a paper  titled “Strengthening the Patent Regime: Benefits for Developing countries – A Survey”, published in the Journal of Intellectual Property Rights, the authors concluded that innovativeness of developing countries has now reached a stage where it is positively impacted by a robust Intellectual Property regime. The authors further stated that a robust patent ecosystem is among other important policy variables, which affect inflow of Foreign Direct Investments (FDI) in the developing nations.

Another paper titled, “The Impact of the International Patent system in the Developing Countries”, published by the ‘World Intellectual Property Organization (WIPO)’, though a bit dated of October 2003, states that a robust national patent system in developing countries contributes to their national socioeconomic development.  The paper also highlights the experience of some developing nations, which found usefulness of a strong patent system in creation of wealth for the nation.

Conclusion:

Currently, the issue of giving priority to the public health dimension of TRIPS has become a subject of a raging debate across the world.

As a result, most of the developing countries tend to feel the need of meeting only the minimum standard as specified in the TRIPS Agreement, despite strong opposition mainly from the developed countries of the world.

As indicated in the UNDP paper quoted above, many experts are increasingly highlighting that in order to protect public health interest across the world, the Doha declaration has been a watershed agreement within the global product patent regime. It effectively plugged many loop holes providing adequate flexibilities to the sovereign governments to ensure improved access to medicines, especially for the marginalized section of the society and still being able to encourage, protect and reward innovation in a true win-win situation for all.

The examples as cited above would possibly indicate that gradually many more countries will avail the flexibilities as provided in the Doha declaration, in the years ahead. Though these are very early days, the emerging sequence of global events does send a signal of metamorphosis in the global pharmaceutical product patent regime, paving the way of yet another paradigm shift in not too distant future.

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.

The traditional ‘Business Models’ of R&D focused Global Pharmaceutical majors are undergoing a metamorphosis

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Mounting pressure on the P&L account, as the products go off patent:

Patented new products are the prime growth driver of the research based pharmaceutical companies of the world. Since last few years, because of various reasons, the number of launch of such products has been greatly reduced. To add fuel to the fire, 2010-12 will witness patent expiries of many blockbuster drugs, depleting the growth potential of the most of the research based pharmaceutical companies.

The existing model of growth engine needs a relook:

The blockbuster model of growth engine of the innovator companies effectively relies on a limited number of ‘winning horses’ to achieve the business goal and meeting the Wall Street expectations. In 2007, depleting pipeline of the blockbuster drugs hit a new low in the developed markets of the world. It is estimated that around U.S. $ 140 billion of annual turnover from blockbuster drugs will get almost shaves off due to patent expiry by the year 2016. IMS reports that in 2010 more than U.S. $ 30 billion will be adversely impacted because of patent expiry. Another set of blockbuster drugs with similar value turnover will go off patent the year after i.e. 2011. It will not be out of context to mention, that last year around U.S. $ 27 billion worth of patented drugs had gone off-patent.

Decline in R&D productivity is not related to investments:

The decline in R&D productivity has not been due to lack of investments. It has been reported that between 1993-2004, R&D expenditure by the pharmaceutical industry rose from U.S.$ 16 billion to around U.S.$ 40 billion. However, during the same period the number of applications for New Chemical Entities (NCEs) filed annually to the U.S. FDA grew by just 7%.

Total global expenditure for pharmaceutical R&D was reported to have reached U.S. $ 70 billion in 2007 and is expected to be around U.S. 90 billion in year 2010. 75% of this expenditure was incurred by the U.S alone. It is interesting to note that only 22 NMEs received marketing approval by the US FDA during this period against 53 in 1996, when R&D expenditure was almost less than half of what was incurred in 2007 towards R&D.

Be that as it may, the pressure on the P&L (Profit and Loss) accounts of these companies is indeed mounting.

The silver linings:

However, there seem to be following two silver linings in the present scenario, as reported by IMS:

1. Number of Phase I and Phase II drugs in the pipeline is increasing.

2. R&D applications for clinical trials in the U.S. rose by 11.6% to a record high of 662 last year.

Significant growth of generic pharmaceuticals is expected in near future, far surpassing the patented products growth:

Patent expiry of so many blockbusters during this period will fuel the growth of generic pharmaceutical business, especially in the large developed markets of the world. The market exclusivity for 180 days being given to the first applicant with a paragraph 4 certification in the U.S. is, indeed, a very strong incentive, especially for the generic companies of India.

Healthcare reform of March/April 2010 in the USA is expected to give a further boost to this trend.

Pressure on traditional Marketing strategies:
The marketing expenditure for pharmaceutical of the global pharmaceutical companies as reported by Scrip is U.S. $ 57.5 billion. However, an industry association reported that research based pharmaceutical companies in the U.S. spent $ 29.4 billion on R&D and $ 27.7 billion on promotional activities.

New Product Differentiation could be a big issue:

Products in R&D pipeline could face problems of ‘differentiation’ in terms of value offering to the patients, once they are launched. This issue is expected to surface especially with products in the oncology disease area. IMS Health reports that about 55 oncology projects are now in Phase III and 8 in the pre-registration stage. Thus about 50 new oncology products are expected to hit the market by end 2010. Many experts anticipate that there may not be significant brand differentiation between the brands of the ‘same basket’, leading to cut-throat competition and further pressure on expenditure towards marketing of brands.

The changing business strategy of global pharmaceutical companies during this trying time:

In this trying time, the global pharmaceutical companies are resorting to an interesting strategy, combing both old and the new ones. I shall touch upon the following seven strategies:

1. Mergers and Acquisitions (M&A):
Mega M&A strategies are still being actively followed by some large Pharmaceutical companies mainly to enrich R&D pipeline and achieve both revenue and cost synergies.
However, some of these large global companies have started realizing that ‘powerhouses’ created through past mega mergers and acquisitions have now become too large to manage effectively for various reasons. Mismatch between two different organization cultures also throws a great challenge to obtain desired output, many a times. Moreover, the merged R&D set up could become too large to manage, impacting the R&D productivity very adversely.

2. Extension of the Product Life Cycle and Effective Product Life Cycle Management:
Many global pharmaceutical companies are now engaged in ‘product life cycle management’ of their existing products by extending the ‘product life cycle’, effectively. In that process they are trying to maximize the brand value of these products in the international markets. For example, AstraZeneca has developed once daily treatment with their anti-psychotic drug Seroquel XR. This extended-release formulation of the same drug will help patients avoid 5 to 7-day titration required with the immediate-release version.
Towards similar initiative, Pfizer has also recently set up a dedicated “Established Product Business Unit” within worldwide pharmaceutical operations, to hasten business growth in the international markets.

3. OTC Switch:
Prescription to ‘Over the Counter’ (OTC) switch is another business strategy that many innovator companies are now imbibing, at a much larger scale.

This strategy is helping many global pharmaceutical companies, especially in the Europe and the U.S to expand the indication of the drugs and thereby widening the patients base.

Recent prescription to OTC switches will include products like, Losec (AstraZeneca), Xenical (Roche), Zocor (Merck), etc.

4. Emerging of Preventive Therapy, like Vaccines:
Many large global companies, like GSK, Sanofi Aventis and Merck are getting attracted by the emerging opportunities in the fast developing vaccines market. This trend has been triggered primarily by heightened awareness and greater focus on preventive medicines almost all over the world. It is estimated that in 2011, the vaccines market will grow from U.S.$ 13 billion to U.S.$ 30 billion registering a growth of 18% each year during this period. PricewaterhouseCoopers (PwC) estimates vaccine market to be U.S. $ 42 billion by year 2015 based on data of 245 pure vaccines and 11 combination vaccines currently under clinical development. It is interesting to note that 90 of these are therapeutic vaccines for cancer.

5. Entry into highly contentious market of Biosimilar drugs:
The Generic Pharmaceutical Association (GPhA) has estimated that it is possible to save US$ 10 billion – 108 billion over a period of 10 years with biosimilars in the top 12 categories of biological drugs. Some of these biological are already off patent and for others the patents will expire shortly.
Only a few biosimilar drugs have reached the global markets as on date because of their regulatory restrictions in most of the developed markets of the world. Even those biosimilar drugs, which have since been launched in Europe like, human growth hormone (HGH) Somatropin and Epoetin alfa for anemia, are yet to make a mark in the market place.

IMS Health reports that Omnitrope (somatropin) of Sandoz, the first biosimilar drug launched in the developed world, has registered less than 1% of the U.S. $ 831 million HGH market in Europe. Moreover, the launch of 3 more biosimilar versions of epoetin alfa in 2007, made almost negligible impact in the market. Such a low acceptance of biosimilars in the western world, so far, could well be due to lingering safety concern of the medical profession with such types of drugs.

Currently, Japan and USA are working on formal guidelines for biosimilar drugs, whereas Health Canada has already issued draft regulatory guidelines for their approval in Canada.

In April 2010, Reliance Life Science has already announced its intent to enter into the Biosimilar market of the EU in not too distant future.

6. Entry into Generic Markets:

Some large global pharmaceutical companies have already made a firm commitment to the generics market. Novartis paved the way for other innovator companies to follow this uncharted frontier, as a global business strategy. Last year the generic business of Novartis (under Sandoz) recorded 19% of their overall net sales, with turnover from generics registering U.S$ 7.2 billion growing at 20%.

Keen business interest of Sanofi Aventis to acquire Zentiva, the generic pharmaceutical company of Czechoslovakia; it’s very recent acquisition of the generic pharmaceutical company Laboratorios Kendrick of Mexico and Shantha Biotech in India and acquisition of Ranbaxy Laboratories of India by Daiichi Sankyo, will vindicate this point.

Pfizer has also maintained its generics presence with Greenstone in the U.S. and is using the company to launch generic versions of its own off patent products such as Diflucan (fluconazole) and Neurontin (gabapentin).

7. Collaboration with the Indian Companies:

Another emerging trend is the collaboration of MNCs with the Indian pharmaceutical companies to market generics in the global market, like, Pfizer with Aurobindo and Claris, GSK with Dr. Reddy’s Laboratories (DRL), Astra Zeneca with Torrent. I guess that similar trend will continue, in future, as well.

Conclusion:
Another ‘new pharmaceutical sales and marketing model’ is gradually emerging in the global markets. This model emphasizes partnership by bundling medicines with services. The key success factor, in this model, will depend on which company will offer better value with an integrated mix of medicines with services. PwC indicates that in this ‘new pharmaceutical marketing model’, besides required medicines, the expertise of a company to effectively deliver some key services like, patient monitoring and disease management could well be the cutting edge for future success.

By Tapan 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.