The Virtual Drugstore1 Jun, 2008 By: Jacqueline Renfrow Response
Pharmaceutical companies are projected to generate $10.6 billion in sales through direct marketing in 2008. That number is expected to reach as much as $15.2 billion by 2012, according to a study from the Direct Marketing Association (DMA).
In recent years, DR marketing has become essential to all those in the industry — from small research and development companies to large pharmaceutical retailers — as an effective way to reach physicians and consumers. The pharmaceutical DR marketing budget for 2008 is estimated at more than $1 billion, meaning that DR will represent an ROI of $10.27 for every $1 spent.
On top of these huge expenditures, the pharmaceutical market is changing in other ways. Patents on drugs are expiring and therefore more generics will be released in the next few years, granting a major opportunity for smaller companies to compete with the "Big Pharma" leaders. So for those manufacturing generics, it will be up to the marketers to create value for the drug, target individuals, follow buying patterns and reach out to fully engage the consumer.
"We're now seeing the effectiveness of the 60-second spot waning and failing to engage the patient because of the way media is changing," says Jay Bolling, president of Montgomeryville, Pa.-based Roska Healthcare. Doctors and patients are turning to digital outlets — such as the Internet, PDAs, mobile phones and electronic clipboards — for education.
Broader economic constraints have also impacted the pharmaceutical industry. Therefore, general advertising spend is down and targeted, more accountable DR efforts are up. Not to mention, advertising pharmaceuticals involves adhering to Federal Drug Administration (FDA) requirements.
"There has been a steady increase in direct response marketing, largely because it is a great marriage between the needs of the healthcare consumer, the regulatory requirements of the industry and the accountability and effectiveness requirements of pharmaceutical manufacturers," says Keli Bennett Walbert, a partner at W2 Healthcare Consulting.
However, the strictness of conveying "fairness" and educational information can actually benefit the DR space. "FDA requirements for the distribution of patient information in media also results in the inclusion of response vehicles in all media — either an 800 number or Web site — thereby allowing manufacturers to meet network requirements for DR media rates," says Bennett Walbert.
The success of DR marketing pharmaceuticals in 2008 and well beyond lies on the Web. Individuals learned in the past decade that the Web could actually contribute to human relationships rather than detract, as is evident from online dating sites and social networks like Facebook. Now the pharmaceutical companies are learning that the same can be done for physicians and patients.
The Internet plays a major role in today's marketing and selling of pharmaceuticals, especially in specialty pharmacies and biotech manufacturers. But its role in educating consumers and physicians is still growing. The Web is a place for manufacturers to introduce a drug that just received FDA approval, for consumers and doctors to chat, and for both consumers and marketers to save money.
The initial focus of Progenic s Relistor DR campaign was product education through the Web, journals, conferences and sales force.
One product that found success in recent years using DR is erectile-dysfunction medication Cialis. Mario Neto, the medical marketing manager for Cialis from 2004-07, was in charge of creating highly targeted ads that got males 18 to 75 years old to ask their doctors about the drug. The campaign also targeted healthcare professionals using the company's sales force, TV ads, medical journals and medical conferences. In fourth-quarter 2006, Cialis got more than 1.7 million impressions in one week. Neto reports that 50 percent of Cialis' marketing dollars were spent on DR marketing — a large jump over most pharmaceutical campaigns that range between 10 and 30 percent.