|
|
 |
|
Viewing report
|
|
|
|
eDetailing: A Strategic Analysis of Implementation and ROI
Eularis, June 2011, Pages: 84
The Scope Of This Report:
In eDetailing: A Strategic Analysis of Implementation and ROI, Eularis provides a comprehensive insight into the subject of pharmaceutical detailing using the Internet. As the vast majority of eDetailing pilots have taken place in the US, the report looks at the likelihood of European pharmaceutical companies following suit. Return on Investment (ROI) is also important. This report discusses the available evidence on ROI and illustrates some models that can be used.
Eularis made extensive efforts to provide the most insightful information about this fast moving subject. This involved:
- Surveying over 200 UK-based general practitioners about their attitudes to pharmaceutical sales representatives and eDetailing,
- Carefully assessing the current regulatory environment in the UK and how eDetailing programmes could be affected,
- Sourcing case studies of ROI from the USA,
- Extensive research into vendor companies and their market positions,
- Strategic considerations and advice.
Overview and Background to the Report:
Increasing Cost and Effort of Marketing Medicines:
It is estimated that in the US, the pharmaceutical industry spends about $15 Billion a year promoting its products to the medical profession. By contrast, the industry spends a further $2.6 Billion targeting patients. The top 40 pharmaceutical companies alone employ over 80,000 sales reps. Within Europe, the pharmaceutical industry employs an estimated 200,000 people in marketing and sales.
There are an estimated 11,700 hospitals, 115,400 pharmacies and 1,090,000 doctors in Europe.
The sums the industry spends are huge and is on the increase. Some key reasons for this are:
Large Numbers of New Products:
The pipelines of companies are healthy, with over 30 completely new medicines hitting the market each year. In the fast moving therapeutic areas of gastroenterology and cardiovascular medicine, for instance, five or six new medicines are added each year. The result of this proliferation is that they all face the same sales and marketing problem: how to create differentiation for their offerings.
Blockbusters Mean Profitability:
Companies stand to make the most profit from big product launches and ultimately achieve the elusive blockbuster (sales of over $1 Billion) status. Intensive marketing and sales is the key to successfully reaching this objective.
Reduced Market Exclusivity:
Many new products only have a few months of exclusivity before competing products threaten their sales. This contrasts to the past where an innovative product could dominate the marketplace for years. Therefore, it is essential for companies to exploit the product to its maximum for this exclusive period.
New Biotech Players:
Biotech companies are adding new products, which often need significant investment to compete head-to-head with big pharma's products. As detailing is the main method used by companies to gain market share companies are interested in methods that increase detail effectiveness.
Traditional Methods Converge with the Internet:
The pharmaceutical industry has lagged behind other technology-driven sectors in the adoption of the Internet as a business tool. However, most companies now have an eBusiness department and Eularis expects to see a more aggressive approach towards eMarketing.
Eularis has identified four drivers of use of the Internet in pharmaceutical sales (eDetailing):
Technology Adoption:
Most people within business and the professional sectors now use the Internet daily and it has become an integral part of working life. Virtually all doctors are connected to the Internet and are in a position to partake in online detailing programmes. As connection quality improves, with the introduction of Broadband technology, Eularis expects the Internet to be used for increasingly complex functions.
Nature of the Internet:
One the most successful uses for the Internet is information dissemination. It also encourages responsiveness and allows companies to receive direct feedback from their customers. A good example of this is the newspaper/magazine industry where journalists can publish an e-mail address (usually on opinion pieces) and can get immediate feedback from the readers. Similar relationships can be built between pharmaceutical companies and the medical profession.
Sales Reps at Saturation:
Certainly within the US, it is now perceived that the number of sales representatives has reached near saturation point. Companies are reporting increasing difficulty in reps actually being able to see doctors and time of details is shrinking.
Cutting Costs and Increasing ROI:
Running a large sales force is expensive. Internet-enabled detailing may be cheaper. eDetailing should also offer increased doctor interaction time and increased prescribing rates. [Chapter 5]
The report looks at the environment surrounding eDetailing in the US and Europe.
United States Leads The Way:
eDetailing was pioneered in the US. Virtually all the supplier companies are based in the US. Eularis estimates that all of the world's top ten companies are using some form of eDetailing.
What Is Being Offered?:
Eularis examined which companies are offering eDetailing services. In the US there are some fairly well established players already, but the market is becoming increasingly competitive as marketing service companies and doctor portals enter the foray. Whether US eDetailing companies can cross the Atlantic and sell their services to European big pharma remains to be seen.
Will Europe Follow?:
It seems likely that European pharmaceutical companies will follow the US and implement eDetailing programmes. Eularis believes the majority of the top ten companies in Europe are assessing its potential and a couple are already trying it.
Regulatory Restraints:
There are barriers that hinder the development of eDetailing along the US model, in particular, regulatory restrictions that prevent sponsoring companies from offering doctors financial incentives for taking part in eDetailing. Whether European doctors are less accepting of eDetailing remains to be seen.
Understanding Return On Investment (ROI):
The main purpose of a detail is to increase prescribing rates for the relevant product. However, eDetailing may also offer a lower operational cost necessitating the need to measure return on investment (ROI). Eularis has analysed the various models used to calculate ROI and also the variables that must be considered.
Future Perspectives:
Eularis assessed drivers and external factors that will influence the development of eDetailing.
Strategic Recommendations:
Eularis has made a series of recommendations for companies considering whether to employ an eDetailing system.
Product samples
A sample for this product is available. Please Login/Register to download this sample.
|
|
|
|
