Novo Industri Case Analysis

Topics: Insulin, Marketing, Eli Lilly and Company Pages: 4 (1082 words) Published: October 22, 2010
Why has the competition in the insulin been on a nation-by-nation basis? Will this change? Why? The global diabetes market was worth around $350-$400 million in 1981, and was expected to grow at the rate of 5-8% per year. Competition in the insulin industry occurs and differs on a nation-by-nation basis due to the differing nature of the drug's prescription category, the level of government regulation, the type of people influencing the patient's insulin brand choice (including the extent of their influence), and attitudes regarding treatment.

The U.S. has the dominant share in the global diabetes market, with 40-50% of the world’s total sales. Insulin is sold without prescription in the U.S.; on the other hand it is generally considered a prescription drug in Europe. As such, marketing to end-users and pharmaceutical distributors is an important marketing strategy in the U.S.

The major forces behind a patient’s choice of insulin brand also differ. For instance, around 18,000 specialists and physicians account for majority of insulin sales in the U.S. This contrasts with Europe, where the source of insulin prescriptions is a small group of approximately 300 doctors.

Government regulations and price restrictions also affect the insulin company's market strategy. For example, in U.K., the government is known to mandate low pharmaceutical prices; while in the U.S., West Germany, and Switzerland, the government has lower restrictions. U.S. and Japan are known to have the strictest regulations. Government policies mandating that the pharmaceutical firm should produce locally also figure in a firm's position in a particular market.

Prevailing attitudes within nations also account for the nation-by-nation competition within insulin producers. While it is the norm to inject oneself with insulin in Western countries, it is a common practice to get their shots from doctors or medical practitioners in Japan. This practice gives medical practitioners plenty...
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