THE CYCLE OF TRUST

I GOT THE ABOVE IMAGE RELATING TO BIOSIMILARS FROM HERE.

The key word in economic transactions is TRUST

CONSUMPTION depends on TRUST. When a person buys a strip of a pain reliever like Crocin or Dart, there is a factor of trust involved in the transaction. The customer trusts that the product will meet a certain level of performance – ie., will relieve his headache (also known as cephalgia). When a person purchases a financial product like say an insurance product, the customer trusts that the product will meet a certain performance level in terms of services and money-back. When the performance claims are not authentic – when untruths are promised, and/or the promises are reneged, the cycle of trust is broken, and consumption comes down.

There are many factors affecting consumption – purchasing capacity, credit availability and support, need for the product or service, price of product or service etc. However, the root of all the reasons for consumption is TRUST. The basic trust – HERE – is that the product or service will fulfill the consumer’s need or want or desire. The trusted product should deliver the expected value or make the customer FEEL GOOD. If a customer is going to feel conned and feel bad about a transaction –ie., he does not trust the transaction, the consumption will not take place. The core of marketing is increasing consumption of the marketed product or service. Thus, it is logical to conclude, that the root job of marketers is constantly building trust between target audience and the brand.

Recession

When the economy becomes sluggish, ie., when consumption comes down, demand stifles, and production stagnates… recession sets in. There are a lot of triggers for recessionary forces to gain speed; however, the major catalyst is MISTRUST, lack of faith. The cycle of trust gets broken down – consumption comes down, consumption growth retards and recession sets in. And every one runs for cover. Spending habits become conservative because you do not know what is waiting round the corner, and there is a negative cycle of mistrust.

Just like trust can be infectious, mistrust too has a butterfly effect. After all economic behavior of people is basically human behavior, and is guided by emotions and not logic alone. When the housing mortgage crisis started in US, it generated a lot of mistrust - about the actual demand - consumption patterns in society. And when people realized one cannot trust situations, financial figures and statements, and CXOs - stock markets started melting and economic recession gained speed.

The rofecoxib story & mistrust

When rofecoxib 'failed' (in terms of safety) causing a huge financial loss to Merck, the reverberations were felt in the entire pharma field. Managements and US FDA became conservative with respect to 'go-to-market' decisions on new drugs.

Mind you, introducing a new drug is not easy. It requires the new chemical entity (NCE) to go through a battery of preclinical and clinical tests before getting commercialized.

It is rare for a NCE in modern times to fail on the grounds of safety. The reason is the clinical trial process. Any promising NCE cannot enter the human clinical trials unless safety is established in the pre-clinical animal testing stage. In the US and EU, clinical testing in humans is given a high level of importance.

In Phase 1 clinical trial stage, of 1 to 3 years duration, the drug's safety profile is mainly vetted on about 100 patients.

In phase 2, which is of 2 years duration, the safety of the drug is established in a larger pool of patients (about 100 to 300) suffering the disease targeted by the drug. In phase 2 clinical trials, the efficacy of the drug is also checked if it is statistically significant.

In phase 3, which is of 3 to 4 years duration, not only is the effectiveness checked for the target indications, the safety profile is continuously built and the side effects monitored. Phase 3 studies involve several hundred to several thousands patients. Two pivotal trials are required to be positive in this phase, for the drug to get marketing approval.

When in phase 4, the marketing of the drug can be taken up, however, post marketing surveillance studies are continuously done to check for the safety and efficacy of the drug. It is at this stage that rofecoxib's cardiovascular side effects became public. And caused the burial of the drug.

IT IS AMAZING THAT DESPITE A ROBUST CLINICAL TESTING PROCEDURE, AS DESCRIBED ABOVE, ROFECOXIB BECAME A COMMERCIAL FAILURE. The root cause for such failures resulting in a massive loss of trust on pharma R & D, is that managements' are forever on the hunt for patented blockbusters. This means one can make a lot of money by ruling a LARGE market. Each blockbuster product launch should fetch at least 500 million USD with 70% net margin - that is the game plan.

Why is pharma said to be relatively recession proof?

The main reason is that one needs medicines come what may - recession or no recession. But it also indicates that there is a lot of trust on those medicines - physicians trust them, patients trust them and the society trusts the pharma products. If this trust was not there, during a period of recession, when money is scarce, people would think twice to spend on medicines too. If pharma in any country feels a big pinch during recession, it is indicative that people there do not believe the medicines are value for money and they are waiting for alternatives.

Trust: the reason for Baba Ramdev's success

Baba Ramdev's Yoga, healthcare, functional food and Ayurvedic pharmaceutical strategies are successful, because his programs and story telling are authentic - they are winning the trust and word-of-mouth of people. Trust is the foundation of his success.

Biosimilars and trust

Biosimilars is the buzzword of the pharma industry, today. This amazing field is seeing a lot of trust and hope. Pharma CXOs trust that a lot of growth in sales and profits is possible through launch of biosimilars. Merck and Pfizer are getting deeper in to the biosimilars and biopharma game. However, if any company has to succeed here, again it is TRUST that needs to be won. Biosimilars is a premium game in the pharma business today. Any biosimilar should prove itself as worthy as the innovator brand - and it requires a lot of robust clinical trials - or the brand will lose trust - even if a small side effect occurs that does not occur with the innovator brand. While the financial pot of gold is alluring to the biosimilar entrepreneur, there are a lot of risks that can cause the initiative to go bust. IN A RECESSIONARY WORLD, WHERE MISTRUST REIGNS SUPREME, WINNING TRUST IS THE KEY. In the case of biosimilar marketing, the mindset of the marketer needs to be different, as compared to marketing of chemical generics.

Striking the right chord

Obama is proving to be a leader of high mettle, he has directed the US govt to find out about the monies lying in Swiss banks. His intention is to get the idle cash in to the system in USA - this will certain build confidence and TRUST. IMAGINE IF THE INDIAN GOVT. DOES THIS - IT IS ESTIMATED THAT INDIANS HAVE STASHED RS. 50 LAKH CRORES OF RUPEES IN SWISS BANKS. THE CENTRAL ANNUAL BUDGET IS RS. 20 LAKH CRORE RUPEES ONLY! IF ALL THIS MONEY FROM THE SWISS BANKS GETS IN TO INDIA, IT WILL CREATE AN ECONOMIC AND HEALTHCARE MIRACLE OVERNIGHT BECAUSE THE TRUST ON THE ECONOMIC SITUATION WILL INCREASE, THE PURCHASING CAPACITY AND DEVELOPMENT WILL ALSO RADICALLY INCREASE!

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THE MELTING POT PRODUCT PORTFOLIO STRATEGY

The above image is that of Indian sweets. Variety is not only the spice of life, Indian sweets are also available in a rich variety! (I got this image from here). If a customer visits an Indian sweet stall, he will be so impressed by the variety, a sort of melting pot of sweets, he or she is bound to purchase something - a prospect will get converted in to a customer because of the variety, and a customer will purchase at least one item. The wide variety is responsible for the success of the sweet shop. The ability to cater to a wide variety of tastes and different customers is important. We pharma marketers can learn from this concept!

When we were kids we used to read a lot of Asterix and Obelix comics. There was this interesting character, Getafix – the druid in these comics. This wise old man used to create potions in his cauldron – a melting pot – with diverse herbs. One of his unique products was the magic potion that gave the drinker immeasurable strength. Today pharma giants are in search of such a potion that can give immeasurable strength to their product portfolio!

John Mack, the pharma consultant and blogger from America, has written about this product portfolio dilemma in a humorous way where he brings to focus the drying product pipeline of big pharma companies.

Product portfolio challenges

Products are the bread and butter of companies. Products are the identities of a company in the market. It is through the product range that a prospect or customer gets to know the company – the products are a point of contact between the target audience and the company. So product portfolio management is a most critical task of any company as all revenues are hinged on it.

With respect to new products, traditional pharma has been single minded: Identify a molecular target, synthesize/extract and screen a new drug candidate to modify the molecular target for patient benefits; establish the safety and efficacy of the new molecule through clinical trials. That is, see if the new molecule can be established as more effective and safer than contemporary medicines, patent the product, and market it. Basically, the new product should have projected annual sales (from the first year) of at least 500 million US dollars and fetch at least 70% net margin. This was the well trodden R & D path, which cost the pharma company for new product R & D (including clinical testing costs) at least 880 million dollars and the time- to- market being about 14.7 years. Traditionally pharma companies either invent the new molecule, or license it from innovator pharma companies or buy up the innovator company or outright purchase the technology. This traditional approach has been based on molecular biology and understanding the biochemistry of the disease process. True, this approach provides fodder for the new product cannon.

However – rofecoxib changed this product pipeline strategy forever. Rofecoxib was touted by Merck as the revolutionary highly selective Cox 2 inhibitor, which was very effective for pain relief; it was promoted as a drug that did not have any side effects on the tummy (ie. creating hyperacidity) or on the respiratory tract (ie. causing broncho spasm). But the celebrations were short lived. Phase 4 clinical trials established that rofecoxib caused deaths due to adverse effects on the cardiovascular system. Rofecoxib was withdrawn. Perhaps after the thalidomide tragedy no other pharma event has shaken the pharma industry to its very roots.

The rofecoxib product market tragedy was followed by the 800 million USD torcetrapib failure AND Exubera – the world’s first inhalable insulin was also withdrawn from the market. No new blockbusters were visible on the new product horizon. (The benchmark for any new product introduction is that it should have a minimum annual sales projection of 500 million USD from the first year. And there were no products fitting this criterion. ) Risks were too too high. The product pipeline strategy of many a company was at peril.

The biopharmaceutical product pipeline

However, biopharma companies like Amgen and Genentech are in a better shape. These companies have new introduction products that generate annual sales of at least 300 million USD. So a glimmer of hope has come from the biopharma segment. Hence, Merck is betting big on its vaccines range and Pfizer is reinventing itself as a biopharmaceutical company. In fact, the acquisition of Wyeth has been on these grounds.

Remember, Pfizer is a symbol of America. If it had not purchased Wyeth, one more icon of America would have weakened. So the purchase of Wyeth gives Pfizer a new hope.

The latest fad of product pipeline strategy is to have a set of biopharma products

Biopharma has gained traction due to an interdisciplinary approach to new drug R & D. New biopharma products have a connection to the field of genomics (identifying, understanding, and functional characterization of genes), proteomics (study of proteins in the body) and in turn computational biology (applying IT in biology - the leader company here is IBM).

The biopharma game started with the Human Genome Project (2001). This project and Celera (a private company) characterized the 30000 genes in the human body. Thus, it was now possible to identify defective genes and create new therapies that correct the genetic problem. Genes also contain coded information for protein synthesis. Proteins are ubiquitous and are made up of amino acids. Enzymes, antibodies, and most hormones are proteins. Proteins are involved in the structure of cell, inter-cell communication and functioning of cells. Proteins also undergo a process called protein folding which is important and is considered while creating therapeutic proteins. Biotech companies reseach and manfacture therapeutic proteins that correct disease processes. For instance, lack of erythropoietin (which is synthesized by the kidneys) is responsible for anemia in kidney failure patients. Amgen launched a biotech product - alpha erythropoietin. This is now a blockbuster pharma brand.

This goes to show biopharma products are important for a robust product pipeline and product portfolio.

Ranbaxy is acquired by Daiichi Sankyo

The Ranbaxy purchase by Daiichi Sankyo is a marriage of convenience to both parties. The challenge of having a robust product portfolio can be met by having a strong generic portfolio. This is the bet by Daichii Sankyo. Many companies buy competitors to strip off their resources and weaken them. However, this Ranbaxy purchase appears to be an important synergistic acquisition for Daichii Sankyo. On the other hand, Ranbaxy's promoters were having some debt and the company did not have any promising blockbuster molecule(s) that would take it to greater heights. Hence, the marriage took place. And mind you this integration is a very strategic one. There are no sobs of job cuts - pure harmonius synergy - like a Japanese poem - HAIKU!

Having a generic drug portfolio is important to have a melting pot product portfolio that can withstand technological stresses.

Wellness product portfolio is an evergreen one

A product portfolio that is evergreen - is one that can seemingly sell forever without the fear of technological obsolescence. There are such lucky products. For eg., Ayurvedic brands belong to this class. Liv 52 (#5 in the Indian pharma market ) a decade back was about Rs. 18 crores sales per annum, and now it is about Rs. 100 crores sales per annum. Revital - a nutritional supplement from Ranbaxy with its OTX (prescription plus over-the-counter) product promotion is such an evergreen product. Becosules Z a vitamin brand from Pfizer is also an evergreen wellness brand - and is a constant topper brand of Indian pharma market.

The moral: a strong wellness product portfolio is a must to strengthen pharma companies. This is one reason that pharma biggies in India like Merck, Piramal Healthcare, and Mankind are having electrolyte energy drinks with patient value in their product portfolio.

P & G has an interesting product portfolio

Procter and Gamble is one interesting company that does not believe in gambling in the product marketing game! They have put their eggs in many baskets!! This interesting company has detergents, personal care, fast moving health goods like Vicks, fast moving consumer goods - soaps etc, and even PRESCRIPTION PRODUCTS in its product portfolio. Yes - they address the exciting chronic orthopaedic prescription markets like osteoporosis and osteopenia through its brand Actonel (risedronate). Actonel is positioned to increase BMD in postmenopausal women (even with a once-a-month therapy - that is something that no woman would grumble about and surely one can convince a woman to buy it!). There are lots of lots of things to learn from P & G's product portfolio game. It has products from FMCG point to FMHG point and even a prescription range. Talk of bulletproofing! Johnson and Johnson is a similar company. Some companies that come close to P & G in their business approach is the Ayurvedic major of India, Himalaya; Zydus Cadila - of course has some products in its FMHG segment and many in the prescription segment. Mankind is trying to grow and gain market share in the Ayurvedic and FMHG segment - it is already strong in the prescription segment.

By the way, the herbal and Ayurvedic pharma market is now catching the attention of pharma marketers. One reason is Patanjali Chikitsalaya and its success. This institution created by Swami Ramdev has about 800 doctors all over India, and they see some 50000 patients every day (all over India). Their sales turnover even though the products are very economical is near abouts Rs. 20 crores plus per annum and growing steadily (not bad for a new company).

Pharma marketing is tricky

Let us say you have Rs. 100 to spend on pharma marketing. Now, how will you divide and where will you focus these monies? On which product and which strategy? This is the question that constantly grapples pharma marketers. On which product will you bet on - so you get the best ROI? That question haunts many a pharma marketer. One guide is to have a MELTING POT PRODUCT PORTFOLIO STRATEGY for best bulletproofing from unfavorable market conditions.

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HOT BUTTONS OF A CONVERSATION: the e-imbroglio

TRY CONVERSING WITH A GROUP OF DOCTORS! IT IS TOUGH CUTTING THROUGH THE CONVERSATIONAL CLUTTER!! THE ABOVE IMAGE COMES FROM HERE. The fact is, we are in the age of conversations - enhanced by social media and the internet. Both the - loud and whispered conversations - are defining our attitude, emotions, and activities.

I was waiting to meet a dermatologist, some time back with a MR colleague, at a hospital. We overheard a conversation between two doctors:

Doc 1: So how is patient Ankita doing?

Doc 2: She is better, no doubt it was mainly a exacerbated hypersensitivity of the skin...

Doc 1: OK, but don't forget to put her on Augmentin ... there is always a possibility of secondary infection!

This is a conversation - and it reflects the word-of-mouth popularity of Augmentin. There are thousands of such conversations going on in target prospect or customer segments. The point is how can pharma and healthcare marketers benefit from conversations?

One to one conversations

Pharma marketing is characterized by highly personalized relationships between pharma company medical representatives and physicians. This is one reason pharma has not been fast in embracing digital marketing concepts (as fast as other industries).

During one-to-one conversations between a doctor and a MR, knowing the profile of the doctor with all the fine details helps in discovering the hot buttons to engage in a fruitful conversation:

Dr. Manohar MD, a bearded Malyali gentleman, practicing in Marathhally, Bangalore was one of my favorite calls during my independent field work days. While talking to him I realized he had a fond hobby - he loved aeroplanes. In fact, his knowledge was so vast, he knew the wing span and horse power of various military and commercial airplanes.

With this background knowledge, I happened to meet him at his clinic for a call one day. I wanted to launch a new product - SUPERGESIC CREAM - to him.

As an ice breaker, I started talking about aeroplanes and the Aero show (for which Bangalore has now become famous - in fact, this year's aero show is to start in a week's time). After some talk about planes, I took out the launch visual aid, and started, "Dr., planes are known for their swiftness, and here I am pleased to launch a new SWIFT ACTING, topical approach to pain management, introducing, (pause) Supergesic cream... "

The call went on well. During my next visit after 15 days, a pleasant surprise awaited me from the chemist - he said, Dr. Manohar was prescribing good quantities of Supergesic cream, at least 3 to 6 tubes a day!!

So the hot button here was the aeroplane talk, this was effective in having a productive conversation and good storytelling on Supergesic cream to Dr. Manohar MD. This incident is still fresh and vivid in my memory, thanks to the success.

Thus, the point is that one has to discover the hot buttons of a person and strike a conversation based on the likes and dislikes.

In fact, I had learnt this point from my dad - Late Suresh G Chiplunkar, a PSR with Wyeth. He would share with me (when I was still going to college), how based on the tastes of a doctor, like say, films, one has to start the doctor call with that point.

Mr. Vivek Balse, a good family friend and an exceptionally gifted PSO with Pfizer, would share with me his experiences too. I believe Pfizer called this approach of effective conversations with doctors as SOCIAL STYLE SELLING TECHNIQUE. The technique was to basically align the in - clinic activity with the personal interests of the doctor and finally put across the product message.

Digital marketing and pharma

Digital marketing and pharma have a sort of love-hate relationship. On one hand, all pharma marketers agree to the immense potential of the internet and digital media for marketing activities. However, all wonder why the adoption of these digital technologies is not as swift as it could be.

One reason is that pharma marketers still swear by the conversations (including story telling & messaging) between the field force and the doctors - as the foundation of pharma sales. Pharma marketing does not envision any other form of effective conversations with the target doctor community. There is an important reason for this belief. The reason is: EFFECTIVE PHARMA SELLING IS A HI-TOUCH EXPERIENCE. There is an intimacy between the MR and the doctor, which is in fact responsible for prescription generation. Digital marketing on the other hand, is not personalized. It is standoffish and there is a thinking that digital marketing may not result in better sales. Hence, pharma marketers feel it is better to play with the time- tested & trusted winning business model - and that is invest on MRs (more and more of them), and more on in-clinic activities between doctors and MRs - to ensure prescription generation.

Is there a way out of this e-imbroglio?

E-imbroglio is a pharma marketing phenomenon characterized by inertia to adopting digital marketing concepts and techniques.

The main reason for the e-imbroglio in pharma marketing is that digital marketing avenues are not positioned as effective for conversations that can result in doctor conversions and enhanced prescription generation. Digital marketing is visualized as a costly add-on to traditional sales and marketing through MRs. The ROI from digital marketing campaigns is anybody's guess - hence, pharma marketers continue to invest in the MR based pharma product promotional formats.

The best way out to increase adoption of digital media for effective sales and marketing is to use a HI TOUCH-HI TECH approach.

THE HI TOUCH - HI TECH APPROACH

Hi-touch refers to the human touch of marketing, represented by MRs. Hi-tech refers to use of high tech gadgets and techniques to enhance sales and marketing activities. In the Hi-touch and Hi-tech approach the MRs, field personnel and Head Office personnel use digital media in a co-ordinated way to have enhanced conversations with doctors.

Example 1: Background: India has one of the world's highest mobile phone penetrations. In fact, every doctor has a mobile phone. Every MR has a mobile phone.

Let us say we want to create a campaign for electrolyte energy drinks in prescribing practice.

Step 1: Provide a mobile phone to each MR with which one can record a doctor's medical opinion with some clinical patient photos on how electrolyte energy drinks have delivered patient value.

Step 2: MR sends the same to Head Office, through email, and this is posted on the product portal.

Step 3: MR informs his doctors about the posts, and the doctor community visits the product portal to view and understand the medical opinions of other doctors.

Step 4: A poll is conducted to find out which are the most interesting clinical videos and the most voted one is given a good gift. The doctors can also discuss issues relating to the videos on message boards available in the portal. They can also be enticed to listen to e-detailing.

Example 2: Background: The pneumococcal vaccine is sometimes in a bind - some pediatricians feel it is not a very valuable vaccine as it provides protection from invasive pneumococcal disease only - and not from the common types of clinical pneumonia.

The pharma marketer's problem here is to enhance consumption of this vaccine. This can be done by reiterating that this is a necessary protection to some susceptible groups (to begin with).

The marketer launches a mobile phone based case study photographing campaign of invasive pneumococcal disease in diabetics. The case studies are collected by MRs in collaboration with the doctors on whom they call.

These medical opinion case study videos are uploaded on the product portal and doctors are informed of the same. These doctors will not only see their video but will engage in conversations on the website message boards and they can view the videos of their colleagues too.

Such doctors can also be encouraged to listen to e-detailing podcasts on the importance of pneumococcal vaccine in diabetics. They can also order for samples or purchase vaccines at discounted prices or print out a discount voucher for gifting to patients who opt to get vaccinated.

The above approaches can be used for any campaign - like liver disease case study campaign, antibiotic resistance clinical study campaign, etc.

THROUGH THE ABOVE E-CAMPAIGN BASED DIGITAL APPROACHES, THE PHARMA MARKETER GETS THE DOCTORS HOOKED ON TO THE NET, CREATES AN EXCITEMENT AMONG MEDICAL LIAISON FIELD PERSONNEL, AND MEDICAL REPRESENTATIVES. The end result is that there is an INTEGRATED MARKETING COMMUNICATION APPROACH, with out dismantling or altering the traditional MR based approach to doctors in clinical settings.

When such e-CRM (customer relationship management) approaches are adopted not only will pharma marketers get out of the e-imbroglio, they will also see enhanced product adoption. Besides, patients and doctors too will get to enjoy the benefits of the digital revolution leading to better patient care and healing.

The digital medium is a great enabler for pharma marketers to create a selling environment, to the patients it is an empowering medium, and for doctors the digital medium facilitates instant and real-time communication. The digital medium helps overcome geographical barriers.

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