Marketing Spending Models - Innovation and Marketing in the Pharmaceutical Industry - page 575

a strong prescription drug brand? For whom is it relevant, the physician, the patient,
or other stakeholders? Which media channels are most productive in establishing a
pharmaceutical brand? Are there differences to common consumer markets?
Closely related with the challenge to better understand the branding issues is the
field of digital marketing. As pointed out in Sect. 19.1.1 , the increased use of the
Internet and other digital media appears to be a major shift in information gathering
for physicians, patients, and other stakeholders. What is the impact of these new
media? To what extent should pharmaceutical firms reallocate their budgets to these
channels? How should firms deal with social networks and interest groups in the
Internet? What is the value of a cross-media campaign that integrates offline and
online media to migrate customers to new digital information sources?
New allocation approaches . The availability of new instruments of pharmaceutical
promotion also raises the questions of how to determine the optimal budget for
them. It requires new modeling approaches because investments into a website, as
an example, are nonrecurring, and their benefits in terms of market response are
difficult to measure. Since the value of DTCA is likely to manifests in brand build-
ing and not so much in direct sales response, it would be good to adapt allocation
models to this characteristic of DTCA expenditures.
Given that relationship marketing towards physicians and HMOs is gaining fur-
ther importance, it would be interesting to have allocation models that allocate
resources for acquiring and retaining customers. How can customer lifetime models
from other industries be adapted to the specifics of the healthcare industry?
Finally, evidence-based marketing that actively uses results from clinical trials to
improve the positioning of the brand appears to be a powerful tool for the future
(Azoulay 2002 ; Venkataraman and Stremersch 2007 ). To use this instrument, firms
need to conduct phase IV studies including drug surveillance studies. What is the
optimal budget allocation that takes these investments into account?
Product and spending decisions . Decisions about the level of product quality are
typically made early in the development process long before the launch of a new
chemical entity. Product development has to follow a predefined process of clinical
trials termed Phase I-III studies where product managers can set objectives to
achieve a certain planned medical profile. However, given the stochastic nature of
clinical trials, chances that a planned ideal product profile will be met are low.
In addition, drug regulatory authorities such as the Food and Drug Administration
(FDA) are mainly interested in the demonstration of the effectiveness and safety of
a new chemical entity leaving little room for marketing to shape Phase I-III trials.
Marketing usually has high impact on the design of Phase IV studies that are initi-
ated after the launch of the drug. An important objective of such trials is to demon-
strate the applicability of the drug to new indications that expand the market.
It would be interesting to know how the design of a Phase IV study impacts the
quality of its outcome that is further used in positioning and communication strate-
gies. Is it a significant moderator of the marketing success? What is the value of
comparative product promotion based on comparative Phase IV studies relative to
non- comparative promotion?