World of DTC Marketing.com
It's time for the pharma industry to remember that we're here to help patients
Recent rants...
Links
- Rich's
Blog
Pontifications and observations on life -
World of New Marketing
Welcome to a world where consumers have more and more power -
free web counter
Mar 2007
Should pharma get naked?
Mar/31/2007 08:14 Pharma Business
Permalink
The philosophy behind getting naked is simple:
Smart companies are sharing
secrets with rivals, blogging about products
in their pipeline, even admitting to their
failures. The name of this new game is RADICAL
TRANSPARENCY, and it's sweeping boardrooms
across the nation. Even those Office drones at
Dunder Mifflin get it. So strip down and learn
how to have it all by baring it
all.What would this look like for the pharma industry and what can the companies do to become more transparent? Well for a starter pharma could update their product websites on a regular basis with the results from ongoing clinical trials. In fact there should be a page on every product.com website entitled "results from continuing clinical trials". Rather than report the scientific results however the results should contain a simple to read abstract so patients can understand the data. Is this risky? You bet but I would imagine that the litigation commercials for Zelnorm, now that it's been taken off the market, are only a few weeks away from airing.
Pharma needs to inform the public that even though the FDA has approved a drug that continuing clinical trials may indicate that there are other side effects and risks. Might this scare people away? Hell yes but transparency is a philosophy that in the long run can enhance a brand or company.
New products are often talked about at investor meetings but unless consumers are willing to dig real deep it's hard to find within a companies website. Yes pharma is restricted in what it can say (claim) about new products but allowing the public access to the initial data can lead to customers becoming working partners. Before we received approval on Cialis in the US for example there were a number of websites talking about the new products benefits among men with ED. Just look at all the insights that are surfacing on the Internet about political frontrunners Rudy Gulianni and Barrak Obama.
Every manager needs to learn how to manage risk but the CEO and senior managers need to set the trends of what is acceptable risk and what is not acceptable risk. Pharma needs to start opening up more to customers and especially the media who has been extremely critical of the industry. It's time to understand that secrecy is dead and the sooner that pharma understands this the sooner they will be able to become better companies that are customer focused.
|
Spend $110 million for $76 million in sales?
Mar/25/2007 03:03 Current DTC
Permalink
We need more accountability from DTC marketers if DTC advertising is going to continue to get funded at the $100 million level. The goal of DTC is after all to drive share but the execution is usually the responsibility of middle management. How a marketing manager could not throw their agency out the door when they pitched these spots is beyond me. They don't focus on the product differentiation (the first product that you can't get hooked on) and somewhere there is someone who believes that people understand that Lincoln represents honesty and the beaver hard work.
This is a prime example of wasted money and REALLY bad advertising. $110 million and only $76 million in sales..sound like the same accountability we have with the claim of weapons of mass destruction in Iraq.
So how is pharma doing compared to the S&P 500
?
Mar/25/2007 08:32 Pharma Business
Permalink
Let's start with Eli Lilly & Company. Sidney Taurel pulled down a total package worth more than $15 million yet look at Lilly's performance vs. the S&P 500.....
Lilly has never recovered from the loss of patent
on Prozac and now Zyprexa sales have reached a
peak.
Pretty dismal ha ?
If this is a scorecard for the CEO's performance
then I think it's a pretty sad shape of things
overall. The stock options that I received at Lilly
over 7 years ago are worthless and Lilly has never
recovered from the loss of patent on Prozac (the
contingency plan was called Year-X and was not
strategic at all) and now Zyprexa's days as a
blockbuster are numbered.
What about Pfizer? Surely a company that markets
Viagra and Lipitor can beat the S&P ! Think
again... The recent clinical trial setback for
their new cholesterol drug and generic competition
looming for Zoloft and Lipitor have hurt the pharma
giant while Jeffery Kindler pulled down a
compensation package of more than $9
million.
Pfizer's performance has been
dismal
Amgen is another
company, that until recently, had been doing very
well. The recent coverage of Aranesp has really
hurt their performance and the FDA has informed
Amgen to halt all DTC advertising (they weren't
doing any ?). Kevin Sharer the CEO of Amgen had a
lot of money to play with for the high cost of
living in California. His package was over $24
million !
Amgen has really been hurt by the recent
Aranesp problems
There have been
some companies that have managed to do well against
the S&P 500. Wyeth, whose CEO made a whopping
$32.9 million was one of those companies. However,
one has to ask if a compensation package over $32
million is worth this
performance?
Wyeth has had some bumps in the road but
is performing well.
Kudos go to Mr
Cornelius of BMS. His compensation was more
reasonable in all this madness at only $1.5
million. I can tell you that in New Jersey that's a
good salary but not one that could let you live as
a king. It all comes down to a philosophy of
shareholders and the board:
"Are we here to
please Wall Street and increase shareholder value?
Or are we here to provide patients with medicine
that can extend lives and ensure that we live a
better quality of life?"
I for one believe that there is too much focus on trying to keep Wall Street happy and not enough focus on people. These two philosophies can coexist but it requires someone with foresight and vision to lead the charge. You would think for the money these guys are pulling down they could at least try and lead...
CEO compensation out of control
Mar/24/2007 12:14 Pharma Business
Permalink
It's not easy to be a CEO of any big company today. There are always people who are second guessing what you do and Wall Street can be relentless in its pursuit of earnings. But how many people who are senior level managers would gladly take on the challenge of leading a major company for a lot less money? My guess is there would be a lot of volunteers.
What are the qualities needed to be an effective pharma CEO? Here is a list of some attributes I believe every CEO needs to be successful:
-Lead don't follow: Set a clear direction for your company and don't bow to pressure from the outside. Strategic direction is an important framework for the health of the company.
-Listening: Listen to the life's blood of your company; your employees. Listen to what they are saying and implement changes to allow them to succeed.
-Implement with speed: Pharma is moving at 20 mph while customers are moving at 100 mph. Pharma has a huge competitive disadvantage here.
-Be a great salesperson: sell your ideas to your senior managers, ensure they understand and get rid of the ones that are resistant to change. Sell your vision to Wall Street and to the Board. Make sure they are willing to support your decisions.
-Be a marketing driven organization: The days of the big pharma sales force are coming to an end. Physicians don't trust pharma messages and consumers are taking control of their healthcare decisions. This all means that you had better learn to change your business model from a sales driven company to a marketing driven company quickly.
-Embrace the Long Tail: Blockbusters are going to be few and far between. Diversify your portfolio to include a lot more products that produce sales of $200-$700 million rather than one product that may account for a big part of your revenue.
-Prepare for coming storm: Lead your company through the coming storm that is being generated by the media and Congress. Have plans in place to so that they can be executed at a moments notice.
-Mingle: Sit down with your employees at the cafeteria. Talk to them, listen to them, get them to open up.
Sounds simple but it's not. There are way too many CEO's who sit in their big offices and have a "town hall" meeting with employees and believe that is all they need to do. When I was at Lilly I tried to follow Sidey Taurel's book on leadership and ran into brick walls again and again. If your vision is not communicated and enforced at every level of the organization your spitting into the wind. It's time for changes in compensation and a new face for pharma CEO's to emerge.
A world without DTC
Mar/22/2007 06:38 DTC
Environment Permalink
A bill
currently in the house would prohibit pharma
companies from doing DTC for three years after a
drugs initial approval. But what are the
implications of this? Far reaching I'm afraid. DTC
advertising drives consumers into physicians to ask
about medications and raises awareness of disease
conditions that, left untreated, could lead to
major health issues. Has the House and Senate
thought of these issues? Of course not because it's
easier to get on the bandwagon then to approach
prescription drug advertising with reason and
logic.
If this bill were to become law consumers would be the losers. Rather than learn about new drugs through innovative advertising (of course there is very little of that in DTC today) they would have to rely on their physicians to inform them of choices. They would not be able to research prescription drug choices because they would not be aware that there were in fact choices. Click stream analysis in our industry clearly shows that consumers are comparing medications because they want to have choices when it comes to their healthcare choices. Congress would have us believe that consumer are too dumb to make their own choices and are influenced too much by DTC ads. What a bunch of garbage !
TV networks will also be big losers if this bill becomes law. The only increase in TV advertising has come from the pharma industry. The majority of the billions of dollars spent on DTC is on TV and if a moratorium went into place networks would lose a valuable source of revenue.
Then of course there are the pharma companies. At a time when costs are increasing to develop and bring drugs to market they would essentially be handcuffed from maximizing their ROI for 36 months. That's a big bite out of the revenue pie and one has to wonder if in fact less drugs would go through the pipeline because the ROI model would change.
What will happen? That's anyone guess but like I have said all along the environment for pharma marketing is changing. The pharma industry needs new blood in the DTC marketing departments and more importantly a new leader who can lead the industry into the next era of challenges.
Once again the Times has pharma in the crosshairs
Mar/21/2007 02:46 Pharma Business
Permalink
I have worked with a lot of physicians and I can tell you that for most of them unless there is some type of compensation for their time they don't want to get involved. Take online detailing for example, most research clearly shows that a majority of physicians will only participate in online detailing if there is some type of compensation involved. When we don't offer compensation the response rates are minimal.
Is the article one sided? Well look at this quote...
“Drug companies are like lions,” Dr. Grimm said of his sponsored talks. “For lions, it’s their nature to kill zebras and eat them. For drug companies, it’s their nature to make money. They’re not really trying to improve anybody’s health except if it makes them money.
So according to the NY Times they are to ask doctors to speak on their behalf about medications for no compensation. Drug companies have already stopped the practice of spending sprees on lavish resorts but the truth of the matter is that physicians want to hear from other physicians. Can they be impartial when they receive payments from pharma companies? My guess is no but don't you think that they have to believe in a product to pitch it or does the Times believe that all physicians are for sale?
A prescription for bias
Mar/18/2007 08:51 Pharma Business
Permalink
Among the key findings of the report:
Industry Ignored: While covering everything from medical “controversies” to breakthroughs, nearly 80 percent of the stories excluded the viewpoint of the pharmaceutical industry, failing to include either a company statement or a company spokesman.
Media Overemphasize Cost to Consumer: The broadcast networks mentioned costs to consumers or drug company revenues 11 times more often than they mentioned drug development costs.
Networks Leave Companies Unnoticed: Only 22 percent of the stories even named the company that developed the drug or drugs featured in the story.
What Development Costs?: A mere 2 percent of stories dealt with the cost of developing drugs, and even those costs were downplayed by industry skeptics.
Special Treatment for Left-Wing Causes: Nineteen stories focused on drugs that were popular liberal causes such as the morning-after pill or HPV vaccine Gardasil. The networks didn’t apply the same scrutiny to those drugs and their makers as they did to others.
Surprised? You shouldn't be. What should surprise you is that the pharmaceutical companies will spend millions of dollars and thousands of man-hours to research positioning statements or DTC messaging but when it comes to communicating the challenges the industry faces to the general public the lack of noise if deafening. How many millions of people are leading better quality lives because of prescription medications? How many people are adding years to their lives because of prescription medications? A diagnosis of HIV is no longer a death sentence. People who have cancer are living longer and beating back this horrid disease because of the prescription drug industry. Yet papers like the New York Times continue to report one sided stories which is scary because too many people believe what they read without challenging information.
Again I believe that a leader needs to emerge from the pharmaceutical industry to state the facts and defend the industry. He, or she, needs to remind people within the industry that we are here to benefit patients and to never lose sight of that. But more importantly this leader needs to tell the instant gratification people on Wall Street that the industry will continue to devote resources to new product development and if short term profits could take a hit at the expense of strategic or long term company health. Help Wanted ...now !
For copies of the report send me an email
Good talent is hard to find in eMarketing
Mar/14/2007 06:50 DTC
Environment Permalink
IT people are great for actually implementing Web initiatives but to develop an integrated online Internet strategy you need someone who understand marketing, the Internet and more importantly Web analytics. Too often I still hear that pharma companies are building websites as an after thought putting all their time and effort into developing DTC strategies and testing and retesting messages. The fact that so little effort is being allocated to the Web tells me that most DTC marketers are still living in the past and don't understand the Webs unique ability to deliver targeted messaging and connect people with each other.
This week I had a chance to go to one of the ED boards on Yahoo! and Web MD. What I found really surprised me..there were men talking about Levitra, Cialis and Viagra. One person said "stay away from Levitra it gave me a really bad back ache and my nose was so stuffy I had to use nasal spray for 2 days". Another talked about Cialis and said "I like the fact that Cialis lasts 36 hours but after I have sex I don't want the drug in my system". There were also numerous posts from women asking how other women got their husbands to go to the doctor and ask for ED medications. Then there were numerous posts asking about the comparison of the side effects between the three medications. What a gold mine of information yet DTC marketers have no idea how to harness the power of consumer generated media and still are not aware that people are talking to one another on the Web.
Given that most pharma companies are matrix organization that require a ton of meetings to do ANYTHING the continued ignorance of the Internet is nothing short of abysmal. Cialis had returned to TV yet their website is stagnant. Levitra, after doing some extensive testing, is also back on the air with the same spots they used before while their website remains as a 'push information" site. Ohhh by the way I love the video of the old guy on Cialis.com under "talk to your doctor". I am sure a LOT of 40 or 50 somethings can relate to someone who looks to be in his mid to late 70's.
I guess I am one of the exceptions because I have a passion for the Internet and its capabilities. I know that the balance of power has shifted from marketers to consumers in a wired 24/7 world. Maybe there are just too many DTC marketers who see their jobs as jobs rather than a chance to make a difference in patients lives or maybe its because there is no lifeguard on duty in the DTC marketing talent pool.
Of course you know this means war !
Mar/13/2007 06:11 Pharma Business
Permalink
There is a fine line between cooperating with the FDA and tucking your tail between your legs and kissing someone's ass. If the FDA mandated that CEO's wear clown suits I believe they would comply ! The battles looming with the FDA are all politically motivated and the new head of the FDA has shown that he is going to play along with Congress and do whatever is necessary to get in their good graces even if, in the long run, patients are hurt. Make no mistake about it patients will be hurt. Amgen alone lost $18 billion in market capitalization when the black box warning was issued. That means less money to investigate new drugs and less products in development.
There have been accusations that the FDA is too cozy with big pharma. I frankly don't buy that for a second. The FDA is understaffed and overworked and has to rely on a good relationship with pharmaceutical companies to streamline work loads. Drugs that may have received approval through the normal NDA process are now being held up because the FDA wants "more clinical studies". Most pharma companies work with the FDA while a drug is in development to ensure that protocols and studies are set up correctly. The problem is that once the data is submitted via a NDA the FDA can use subjective criteria and tell the company that it now wants more studies. The pharma economics of this long process means higher development costs, less revenue and will lead to higher drug costs across the board.
Rather than point fingers it's time for pharmaceutical companies to ban together and come up with a plan to better work with the FDA, Congress and the media. Lobbyists are not the answer pharma needs to remind everyone of the value they provide to society in the form of better health and lower health care costs. Pharma will spend billions on DTC message development but not one leader will step forward and reach out to other industry leaders with a plan that clearly addresses the challenges facing the pharma industry today. Help wanted....
Customers don't get respect
Mar/11/2007 05:28 DTC
Environment Permalink
I now work with a target audience consisting mostly of Type-1 diabetics. We uncovered some great information such as..
-Don't try and "sell us" give us the good and bad about your product.
-Physicians know a lot about diabetes but not about the different treatment options.
-Don't compare us with Type-2 diabetics. We can't control whether we get this disease through diet and exercise.
They told us in simple terms "don't sell me", give me the good the bad and let me decide if your product is right for me. It all comes down to a simple concept: respect for your customers. You see in this wired information age people talk to each other via consumer generated media (BLOGS, VLOGS, Chat Rooms, Message Boards) and have a wealth of websites to get information on health choices. Most DTC marketers haven't learned this. They would rather use their websites to over promise and sell rather than treat customers with respect and acknowledge that they have choices and a wealth of knowledge at their fingertips.
This is a major problem with pharma product websites. It seems that in order to do anything online marketers have to justify their dollars via an ROI and if they can't then they don't get the money. That's too bad because that mentality negates corporate slogans like "answers that matter". It should read "answers that matter if you can cut through our promotional messages".
I got into DTC because I believe it empowers people to make better health care choices. I want to treat my customers wit respect because I know they have choices. You only get one chance to make a first impression unfortunately too may DTC marketers are business people first and patient advocates second.
The FDA overeacts to anemia drugs and issues black
box warnings
Mar/10/2007 08:14 Pharma Business
Permalink
The move comes as the FDA is under pressure from Congress to show that it is focusing on drug safety, in the wake of a series of incidents including the market withdrawal of the painkiller Vioxx. FDA officials said the black box was sparked by recent studies that have pointed to risks tied to the drugs, particularly when doctors used them for very aggressive treatments. Karen Weiss, deputy director of the agency's office of oncology drug products, said the "bulk of the data that has raised concerns" came when patients were given higher-than-recommended doses, whether they were suffering from anemia tied to kidney problems or cancer treatment. The evidence is that "this type of strategy is not beneficial and in fact has some evidence of harm," she said.
Pushing hemoglobin to levels as high as 13, 14, or 15 -- done by physicians acting on their own against label recommendations or by researchers testing benefits of more intense treatment -- carries a heightened increased risk of death, or serious cardiovascular events. It also may lead to faster tumor progression of head and neck cancer in patients on radiation, as well as shorter survival and increased deaths of advanced breast cancer patients receiving chemotherapy.
So what we have here is is:
1: The FDA trying to please Congress by showing it is proactive in a potential issue.
2: The FDA overreacting because the majority of this off label use is done by physicians acting on their own against label recommendations.
Have the pharmaceutical companies benefitted from this off-label use? The answer to that of course is yes but unless there is undeniable evidence that Amgen & J&J promoted off-label use why are they being held accountable for the actions of physicians? This is what is happening to the pharmaceutical industry and is in the end is going to lead to higher drug development costs as well as higher costs for prescription drugs. The original study that started this whole debate was a study in which Amgen's drug was given at higher doses than recommended and for indications for which the drug label did not support.
If this is the new leadership of the FDA than God help us all. This is not what a leader does this is what a politician does. This action is shortsighted and politically motivated and one has to wonder if this is going to be the new direction for the FDA.
Rozerem bitch slapped by the FDA
Mar/10/2007 08:05 Current DTC
Permalink
According to the yesterday's Wall Street Journal:
The agency posted on its Web site a "notice of violation letter" to the company detailing the problems with the advertisement.Matt Kuhn, spokesman for Takeda Pharmaceuticals North America, said the company isn't sure how the ad was released. "To date, a preliminary review of the situation is that no one internal to Takeda was involved in the approval to release" the ad, he said. Mr. Kuhn said the ad is no longer running and that the company will respond to the FDA.The ad stated, "Rozerem would like to remind you that it's back-to-school season," and included images of a school bus, computer and children walking with backpacks.The FDA said the images of children and school-related objects "suggest that Rozerem is indicated for and can be safely used in the pediatric population." A copy of the advertisement posted on the FDA's Web site suggested the ad ran on MSNBC in September.
"Nobody knows how the ad was released?" Uhhh..you really expect the FDA to believe that and if it is in fact true then Takeda has a hell of a lot more to worry about than an NOV, your business processes are in a serious need of a colonoscopy and someone needs to be held accountable. Frankly in today's business environment this is unacceptable and totally unacceptable for a highly regulated industry like prescription drugs. But hey ? Isn't this the company that uses a beaver and Abe Lincoln for its ads? Never mind...anyone thinks these ads are good obviously can't be someone we would expect to implement a process for its DTC.
Lilly to enter already crowded insomnia market
Mar/07/2007 06:05 Pharma Business
Permalink
An insomnia drug would compliment Lilly's portfolio of neuro drugs but with Ambien the clear market leader I just don't see any new product making a substantial gain into this market. Lilly has never been known as a marketing powerhouse and in fact they are more a sales driven than marketing driven company. Lilly has spent more than $300 million in DTC for Cialis yet it's market share here in the US remains below 30%. Could Lilly have reached the conclusion that there are no more blockbusters and it's better to have a broad range of products bringing in $200-$300 million than one product bringing in $1-$2 billion ? Diversification would certainly make sense. Lilly has never quite recovered from the loss of patent to Prozac and Zyprexa's sales may have reached its peak.
So in addition to a crowded markets for treating cholesterol we will soon have a very crowded market for insomnia drugs with a range of products to chose from. Hypnion only employs 25 people and I am sure that this is not a major acquisition for Lilly like the recent purchase of Icos but in order to make this produce even moderately successful Lilly is going to have to hold onto some marketers who have been leaving the company in droves for greener pastures.
Pharma sales experience is not of value anymore
Mar/04/2007 08:44 Pharma Business
Permalink
Someone I worked with at Lilly, with a very strong consumer marketing background, is now working as an Associate Sales Director. When I asked why, all I head was "well he realized that in order to advance his career he needed to do a rotation in sales. Bullshit ! That is mindless thinking and should be a warning that the company does not value marketing. I have seen the Lilly salespeople at work and I can see why the sales force is becoming less effective. Sure let's send someone right out of college to a talk to a physician who has spent over 10 years of her/his life learning medicine. Let's keep them waiting in the lobby for 30 minutes so that they can drop off the samples and tissue boxes.
The fact is that doctors just don't have the time anymore to meet with pharma reps. "Just give me the samples" is the rule now rather than the exception. Doctors do so much research on the Internet now that both Google and Microsoft are developing search engines just health care professionals. Still senior managers want that sales experience because they just don't understand the changing environmental factors. It may take 10 years before a "new crop" of CEO's takes the helm at the top pharma companies and is able to change the business models but for now we have a lot of very good marketers out in the field because it's the right thing to do not because it's the right way to address the coming changes. That's too bad because it shows how insulated senior managers are from the reality.
The times are a changin'
Mar/04/2007 08:06 DTC
Environment Permalink
Baby-boomers, the biggest demographic segment, are reaching that point in their lives when they are going to start having health problems. The psychographics of this generation is quite different than other segments. They are quite skeptical of "the establishment" having grown up with scandals and war. Now it seems that nothing has changed; we are in another war that is dividing the country and more corporate scandals are in the headlines everyday. How does this translate to the current state of DTC marketing? Many ways...
First, customers are going to be skeptical about your message. They are going to go to your competitors site and talk to others to determine which product is right for them. Second, if their doctor doesn't truly engage them in their health care discussion they may look elsewhere for treatment. Now this is a change ..we have heard before that the "doctor" is in fact the gatekeeper of health treatment recommendations but the landscape is changing. I heard it loud and clear in my research last month with Type 1 diabetics: their doctor is a good choice of information on the disease but not on treatment options.
Why is this happening? Well let's look at from the patients point of view. I asked my research participants "how many actually sit down with their doctor to talk about different treatments or review their current overall health?". The answer was very few. One person in fact said "I'm lucky if I get more than 5 minutes with my doctor I seem to spend more time than that with the nurse". Another said "I came in with a host of questions about my medications and my doctor told me to go to one of the health websites for more information". I knew this was coming but the comments from my research subjects caught me by surprise. I expected this trend to be evolutionary but now it seems that it maybe more revolutionary.
It's tough to be a doctor today. In addition to overhead like staffing the costs of malpractice insurance has skyrocketed with the increased litigation. In order to make a practice profitable physicians have to see as many patients as possible, they just don't have the luxury of spending a lot of time to hear patients concerns anymore. Let's also remember that insurance companies limit what physicians can charge for most medical procedures as well.
I predict that the changing of the guard, the power shift from marketers and physicians, to patients is going to continue and grow faster than we anticipated. Here are some things that DTC marketers can do to meet these challenges:
1. The good and the bad- Patients want to know the good and bad about taking your medication. Be upfront clearly explain the side effects and more importantly what percentage of patients get these side effects. The higher the value equation the more mistrustful your audience is going to be.
2. Connect your patients to each other- People want to talk to other to see what their experiences are like. Experience marketing is about connecting patients to each other so that they get a feel for what it's like to chose your therapy and answer questions that marketers may not have thought of.
3. Move away from mass marketing to mass customization- TV is great for increasing awareness of your brand but once that awareness is at a certain level target specific patient segments with specific messages via the Web using behavioral targeting.
4. Refine the message- As your product moves through the life-cycle refine your message as you identify triggers for treatment. Learn all you can about people who are your customers; "why did they chose your product?", "what advice would they give to others who were searching for treatment choices?"
5. Finally, take off your marketers hat and think like your customers. Understand that there is way too much clutter out there and it's going to be hard to get your message to your audience. Do more with less !
Yes the times are a changing but the problem is that DTC marketing is still relatively in it's infancy. DTC marketers are still learning but the lessons maybe outdated before they are taught.