Pharmaceutical Branding | Drug Lifecycles

Remember Prozac? Not long ago it was one of those pharmaceutical superheroes -- glittering revenues over many years, high patient acceptance, and a name known around the globe. Those heady days of fame and fortune are gone for good. In 2001, the drug lost its US patent protection. Generic fluoxetine flooded the market and Prozac sales plummeted by about 80 percent. The name lives on, but is this all that good marketing can achieve -- 10 short years of maximum sales before a terrible fall?

"It's the old bugaboo of patent expiry," comments David Wood, CEO of Interbrand Wood Healthcare. " 'Gee, what am I going to do when I lose the patent?' people ask. Today it's the same old monster except bigger -- the brands are bigger and therefore they have more to lose.

"The attitude is still 'Let's make the most out of this product, then walk away.' " Wood claims. He believes that companies (understandably) try to maximize sales during the brand’s protected life. Marketing executives have warmed to the idea of branding, but still more or less abandon products a few years later once generic competition arrives. "When patents expire, most often companies do nothing or fight competitors in the courts rather than the marketplace," he says.

Brand equity is precious; it now seems to be an integral part of company valuations. Is the pharmaceutical industry foolhardy in its fickle attitude to its burgeoning brands? Surely they can live beyond their patent life, not just in name but in the bottom line too.

Squeezing extra value from drugs as they near the end of their protected life is far from easy, although companies have numerous possible tactics. Reformulation is perhaps the most common. A relatively small investment (compared to developing a completely new drug) could buy a technology that offers a new lease on life to the drug as an "enhanced" version: longer lasting, stronger action, easier dosing.

Many products have gone this way, incorporating controlled release or other drug-delivery technologies: Procardia became Procardia XL, Prozac became Prozac Weekly. Strong branding paves the way as people happily switch to a more effective version of the product.

Reformulation offers great opportunity for drug delivery specialists to piggyback on the branding too. "When Biovail bought the Cardizem brand from Aventis, it had around US$ 250 million in sales. Aventis didn't attach much value to it. Yet for 10 years the sales force had so established the brand that no one called it by its generic name," says Brian Morrissey from the Frankel Group, a pharmaceutical consulting firm . "Biovail made a controlled release version of the product and called it Cardizem XL so it could no longer be substituted for a generic. They didn't need to go out and sell Cardizem, just the ‘XL.’” The brand value, created by Aventis, is now captured by Biovail.

Sometimes companies choose to seek new indications for their drugs. The FDA approved Eli Lilly's Prozac, for instance, for the treatment of premenstrual dysphoric disorder in women. However, the approval of new indications creates as many problems for marketers as it generates more sales. First, the FDA insists that products for new indications must have a new name. Thus Prozac became Sarafem and GlaxoSmithKline's antidepressant Wellbutrin is called Zyban in its alternative indication as a smoking cessation drug. In short, while new indication approvals help sales, the established brand equity has little role to play.

David Wood argues for more creative thinking, and points to consumer goods for inspiration. "The delivery vehicle for products is something that the industry needs to get better at. In the US you get drugs in amber vials given by the pharmacist. That's like Coca-Cola delivering in bulk and the retailer putting it in whatever bottles they like. Using packaging as part of the branding makes it harder for generic companies to copy."

But a simple fact remains: Pharmaceuticals are not consumer goods. And the consumer does not pay for drugs directly. Moreover, beyond patent expiry, drugs compete on price alone. Pharmacists can substitute cheaper generic products for name brands on a patient's script (unless otherwise stipulated by the prescribing doctor).

Yet even if the product dies, the brand still lives. "It is not possible to roll the brand over to a new product unless it is a reformulation, but you can keep certain elements of previous brands," says Oliver Sexton, an analyst with Datamonitor. He cites AstraZeneca as an example. Heartburn medication Prilosec -- "the purple pill" -- lost its main patent in 2001. Next-generation Nexium had a hard act to follow. But AstraZeneca took one of Losec's most distinctive features and gave Nexium a useful shorthand: it looks like Losec, and probably does just as good a job. The color lives on and announces that "The purple pill is back. Nexium is Losec Mk.2!"

"Similarly Schering-Plough didn't want to gamble on an entirely new brand. It would be kind of foolish to lose all that brand awareness," says Sexton. "Clarinex is a new brand but with similarities to Claritin.

"The problem with this is that companies may have spent 10 years convincing people that their first branded product is best, then they have to somehow get people to switch," explains Sexton.

But Schering-Plough has fallen foul of its own success. Claritin is a major consumer brand, now successfully competing with other over-the-counter (OTC) products since the US Federal Drug Administration approved its OTC status in November 2002. Why try Clarinex, the consumer must ask, when Claritin is right there in my local drug store?

"It's always a benefit of strong brands that you might be able to carry over to OTC, where it becomes more like FMCG branding," notes Sexton. "Branding with OTC may then help to have a higher price point."

"Ideally the years of building brand equity as a prescription product should be designed to make it easy to go into OTC world," adds Wood. "Today with direct-to-consumer advertising, we have a virtual OTC market. There are lots of opportunities to practice and have expertise in developing brands which appeal to the non-professional audience."

Yet despite the growing use of consumer advertising, Wood remains skeptical about the power of most pharmaceutical brands to hold out beyond patent expiry. "Frankly I don't think the industry is good yet at creating powerful brands. It's good at creating products with massive sales. These massive multinationals should be able to generate huge brands, but when blockbuster products lose protection the brand usually goes with them. People don't walk away from Coca-Cola or Shell gasoline quite so readily, so pharma obviously hasn't got there yet."

[24-Mar-2003]

Edwin Colyer is a science and technology writer based in Manchester, UK.


commenting closed	bookmark	print
suggest topic	recommend ( 6 )	email

brandchannel home archive

2013 | 2012 | 2011 | 2010 | 2009 | 2008 | 2007 | 2006 | 2005 | 2004 | 2003 | 2002 | 2001

Dec 22, 2003	Are We Still Lovin' It? -- A.K. Cabell
	What is McDonald’s strategy for getting back to the business of international success?

Dec 15, 2003	Will E-Government Click with Its Constituents? -- Stephen Gardner
	Electronic services cannot grow without attracting the public on more than just functional benefits.

Dec 8, 2003	Products that Rise Above Their Corporate Brands -- Edwin Colyer
	How important is the corporate brand compared with the product brand? We may request our Prozac by brand name but do we care who makes it?

Dec 1, 2003	When Imposters Knock Off Profits -- Diane O’Brien
	From street corners to websites, knock-offs rip off fashion brands.

Nov 24, 2003	Low-Carbs: Are Brands Losing It? -- Dale Buss
	Food and beverage brands deal with the latest trend to hit the industry: the low-carb frenzy. Is it time to throw your entire product line down the trash disposal over a trend?

Nov 17, 2003	Hip Marketing: Targeting a New Audience -- Randall Frost
	Medical product brands are skipping trials and heading straight for a jury of their patients.

Nov 10, 2003	Is Bologna Bologna if It's Not from Bologna? -- Michael Standaert
	The EU brings trademark law to the table as it cracks down on the generic use of terms such as Parmesan, Burgundy, Chablis, Bologna, and Feta.

Nov 3, 2003	The Fundamentals of Branding -- Vincent Grimaldi de Puget
	A definitive breakdown of what branding is, why it is, and what it has to do with you.

Oct 27, 2003	Navigating the Economic Upturn -- Dale Buss
	Baby steps or giant leaps? As the economy slowly improves what’s the best strategy for your marketing plan?

Oct 20, 2003	Taking Advantage of Women -- Edwin Colyer
	Would you like a loyal customer from cradle to grave? Pharmaceutical companies are missing out on opportunities for a long-term product line for women.

Oct 13, 2003	Are French wines screwed? -- Emilie Boyer King
	Is France’s reputation enough to sell a brand of wine? Or is this strategy causing French wines to slip behind in global sales?

Oct 6, 2003	Made where? -- Ron Irwin
	English roses grown in Kenya, American skis built in China, Italian shoes made in Romania? Home brands insist offshore production is the only route for survival.

Sep 29, 2003	Turning Over a New Leaf? -- Edwin Colyer
	We care about our staff and the environment… right? Are businesses really improving their records on environmental responsibility? Or is this cynical marketing at work?

Sep 22, 2003	Who Is Securing Your Identity Online? -- Randall Frost
	Brands from Amazon.com to IKEA have exposed sensitive customer information on their websites. Are these events hindering the growth of e-commerce?

Sep 15, 2003	Pharmaceuticals Go to the Dogs -- Edwin Colyer
	Do consumers want the same drugs as their dog? Some like Pfizer offer animal and human products all under one brand. Others like Merck and Eli Lilly prefer to keep man and beast separate.

Sep 8, 2003	Can Bosch spark its OEM brand? -- Brad Cook
	Could OEMs in the automotive industry apply the Intel Inside approach to their products?

Sep 1, 2003	Are Your Employees the Solution? -- Edwin Colyer
	Is branding a waste of your company’s money?

Aug 25, 2003	Viral Marketing: It's Infectious! -- Randall Frost
	Is your brand contagious? Some brands promote through viral marketing and let their customers do the talking.

Aug 18, 2003	Promoting Brand Allegiance Within -- Edwin Colyer
	Can your employees behave on brand? Brand management is nothing without internal buy-in.

Aug 11, 2003	Marketing Beauty Products From the Inside Out -- Dale Buss
	Brand owners dig deep to bring skin care to the surface of consumers’ minds.

Aug 4, 2003	Me Incorporated: Your Own Magnetic Brand -- Randall Frost
	Is there power in a personal brand?

Jul 28, 2003	Samsung Shows its Strength -- Robin Rusch
	Five years ago Samsung Electronics was a cheap Korean brand; today it’s a quality name that climbs to number 25 in Interbrand and BusinessWeek’s top global brands survey.

Jul 21, 2003	Taking a Closer Look at Your Customers -- Edwin Colyer
	Ethnography breaks the boundaries of conventional branding.

Jul 14, 2003	PR Stirs it Up -- John Karolefski
	Move over advertising and marketing, the spotlight's on PR.

Jul 7, 2003	Will the Wireless World Connect? -- Vivian Manning-Schaffel
	Cellular service providers vie hard to ring your bell.

Jun 30, 2003	Delivering Global Brands -- Edwin Colyer
	Global express distribution operators, like TNT and Exel, are consolidating supply chains to better service and win contracts with brands like Deutsche Post, FedEx and UPS.

Jun 23, 2003	Battle of Biblical Proportions -- Dale Buss
	Zondervan revises the New Testament and faces a challenging marketing effort to convince readers that it’s still a Good Book.

Jun 16, 2003	Can Hip Hop Cash In? -- Abram Sauer
	Courvoisier, Burberry and Mercedes have all gotten the hip hop treatment. What if that placement were planned and paid for?

Jun 9, 2003	Pushing Pills to Those Who Pay the Bills -- Edwin Colyer
	Since most patients don’t choose their drugs, pharmaceutical brands typically target physicians, but should these brands be targeting healthcare payors as well?

Jun 2, 2003	Celebrity Endorsements Reach for the Stars -- A.K. Cabell
	Can celebrity endorsements knock out the competition?

May 26, 2003	Membership Has Its Privileges -- Brad Cook
	The epitome of brand loyalty can be seen in a phenomenon called "brand communities."

May 19, 2003	Can Tobacco Brands Extinguish Their Bad Rap? -- Elen Lewis
	Do tobacco companies have any hope of shedding their evil image?

May 12, 2003	Brands That Go Places -- Patricia Tan
	Forget the passports and plane tickets, did you pack the guidebook?!

May 5, 2003	Who's Filling Gen-Y's shoes? -- Dr. Pete Markiewicz
	Surprising developments among the so-called Gen-Y or Millennial market in the US could point to future trends worldwide.

Apr 28, 2003	All Sweeteners Are Not Equal -- Dale Buss
	The substitute sugar wars are not sweet.

Apr 21, 2003	Crash Course in Auto Branding -- John Karolefski
	Is safety a compelling brand attribute when it comes to car purchase decisions?

Apr 14, 2003	Brand Leader -- Edwin Colyer
	How closely is the CEO linked with the company's brand?

Apr 7, 2003	Happily Ever After? -- Dale Buss
	Looking to ally forces in a co-branding relationship? Match-making is a skill fraught with pitfalls, but done right it can expand market and grow opportunities.

Mar 31, 2003	The Brands We Love to Hate -- David Liss
	What can we learn from the brands we just can't stand? WWE, Jerry Springer and NASCAR aren't as far from Tiffany's or BMW as we may like to believe.

Mar 17, 2003	Do Online Ads Boost Brands? -- Fiona Harvey
	Combine web advertising with tv and radio, and you've got an effective brand-building tool.

Mar 10, 2003	The EU Marks Its Territory -- Ed Meikle
	The European Union now offers trademark protection across its member states for managing your intellectual property.

Mar 3, 2003	Estonia and Belarus: Branding the Old Bloc -- Stephen Gardner and Mike Standaert
	Estonia's exercise in nation branding kick-started tourism and investment. How does Belarus compare and what can it learn?

Feb 24, 2003	Advergaming Scores -- Dale Buss
	Brands break through online clutter with games and contests to engage the consumer.

Feb 17, 2003	Life Saving Brands -- Edwin Colyer
	Are branded medical devices the next must-have accessory?

Feb 10, 2003	Google Ranks First: 2002 Readers' Choice Award Results -- Robin Rusch
	Our readers choose Google.com, Nokia, Target, LG and Corona as global and regional brands for Brandchannel's 2002 Readers' Choice survey.

Feb 3, 2003	Brand USA: Tarnished? -- Patricia Tan
	How is it that American brands do so well in Muslim countries, while Brand America itself is so tarnished?

Jan 27, 2003	Big Brand on Campus -- Dale Buss
	Smart brands head back to university, where a captive audience awaits them.

Jan 20, 2003	Down to the Core: Branding Not-for-Profits -- Patricia Tan
	Why should not-for-profits concern themselves with branding?

Jan 13, 2003	Is Advertising Effective in Brand Building? -- Robin Rusch
	Could it be that advertising is a very expensive waste of time in building a brand?

Jan 6, 2003	Urban Consumers Get Phat -- A.K. Cabell
	Can mainstream brands like Motorola tap into urban youth market through co-branding with brands like Phat Farm?

RSS

| Privacy Policy | About Us | Contact Us | FAQ