The Future of Pharmaceutical Marketing
Dundalk Institute of Technology
Submitted on 19th February 2009
‘Inflection point’ is a term used in multiple disciplines including mathematics, engineering and business strategy to describe a point on a curve at which the curvature changes from convex to concave. In business strategy, an inflection point is frequently used to describe a scenario where the dynamics of today’s business situation shift significantly. Here, the term inflection point indicates the point at which the business requirements needed to compete significantly shift. It is important to clarify that this does not mean to imply that the fundamentals of today’s model no longer work, but rather that there is a transition occurring, when a new set of rules is being defined to set the stage for a new and different competitive landscape. Managing this transition is the ultimate challenge for industry leaders. The experience of a wide array of industries, from airlines to entertainment to retail, shows that new leaders emerge when companies are able to recognize that an inflection point provides the opportunity to create performance differentiation in the future. In making the transition, though, organizations must continue to operate in the world of today, while preparing for the world of tomorrow. 1 Pharmaceutical marketing executives know all about inflection point. It is something that has been on the corporate horizon for many years. Inflection point for the pharmaceutical industry will mean a paradigm shift in the way the business is modelled. This paper attempts to examine some of the issues that this reshaping will have on current marketing practices within the sector and how the future marketing strategy may have to evolve to tackle what is likely to be a much more intricate and segmented business model.
These are challenging times for Pharmaceutical marketers. The industry as a whole exists on the cutting edge of scientific and technological innovation where the cost of participation is colossal and the price of failure almost incalculable. Escalating research costs and declining drug discovery success rates are causing productivity levels to fall throughout the global pharmaceutical industry. To compound the issue pharmaceutical sales and marketing executives are finding that bringing information about new treatments into the healthcare system is now a more expensive and convoluted process that at any time in the past. As a result “Big Pharma” is looking more and more outside of its traditional corporate territory for the expertise and ideas that it will need in order to survive what is essentially the collapse of a long business cycle that has seen immense growth in its revenues and profitability. As the largest global net exporter of pharmaceuticals Ireland will not be unaffected, over 24,000 people are directly employed in the industry in roles from manufacturing to marketing, from research and development to patient education. By no means is the pharmaceutical industry going broke, but it has reached a nexus in its evolution and the next 15 years is likely to bring enormous change that will reshape the industry on a global scale.
SALES & MARKETING OVERVIEW
In order to understand traditional pharmaceutical sales and marketing strategy we should look at the industry’s recent past. During the past 30 years pharmaceutical companies have developed and brought to market a series of pioneering medications that are now fundamental to the healthcare of tens of millions of people around the world. This combination of innovation and consumer demand created a flood of revenue leading to an unprecedented period of prosperity for pharmaceutical companies and their employees. Anti-Depressants, SSRI’s, Statins, ARB’s, ACE Inhibitors, PPI’s and Sexual Function Disorder treatments are just a handful of the new classes of drugs that have...