PHARMACEUTICAL EXECUTIVE
MAY, 2001

From Product To Name brand management

PHARMACEUTICAL EXECUTIVE

Brand Management

The role of a brand name manager in today’s marketplace is constantly evolving. In response to updated FDA guidelines, brand name managers must now not only focus on the traditional prescription marketing channels, they must also respond to a new dimension that has surfaced….DTC (direct-to-consumer) advertising. DTC advertising has changed the face of pharmaceutical name brand management. The FDA’s 1997 guideline changes have not only been overwhelming to consumers being bombarded with media messages, they have also opened eyes of manufacturers in the pharmaceutical world. Name name brand managers now not only focus on physicians as a critical target audience; they also focus on consumers. It is the responsibility of name brand managers to deliver an offering that appeals to consumers, and one that creates a quality experience. Pharmaceuticals are much more than pills to consumers, they are life enhancers. Communication is key when marketing pharmaceutical brand names to consumers. The goal of marketers is to communicate benefits in an easy-to-comprehend fashion, thus eliminating potential confusion. In order to communicate effectively, name name brand managers must be able to identify their healthcare brand’s identity (the outward manifestation of brand essence), as well as how the pharmaceutical brand impacts the consumer. The primary step in this process is for marketers to understand the fundamentals, such as how a product is different from a brand.

A brand name is much more expansive than a product. A name brand encompasses scope (Xerox makes copiers), attributes (Poland Spring water is refreshing), quality/value (BMW produces a quality product), and uses (Totes umbrellas shield you from the rain). Though this seems like a lot to embody, the surface is barely uncovered. A brand name strategy digs deeper to include product characteristics, plus more. Included are name brand users (the Chanel woman), country of origin (Volkswagen is a German vehicle), organizational associations (Microsoft is an innovative company), brand name personality (Urban Decay is a name brand with an edge), symbols (the Xerox digital X), brand-customer relationships (Saturn cares about your car purchasing experience), emotional benefits (a DeBeers diamond shows that he cares), and self-expressive benefits (a Godiva user only consumes the best chocolate).[1] It is the job of name brand managers to build the complete brand name strategy. After all, the brand name is more than simply what the product communicates to the consumer; it also tells others about the individual using the brand name.[2]

There are three interdependent fundamentals for brand name management: positioning, performance, and perception. Positioning defines the core values or consumer benefits of the offering. These benefits assist in differentiating the offering from that of the competition, establishing performance cues in the consumer’s mind. These cues then evoke a brand name personality that is unique to the offering, and ultimately establishes share of mind. The perception, or brand identity, will be the foundation for inducing trial. Upon initial trial, the consumer will evaluate whether or not the offering lives up to the image upon which the trial was based. The promise, which was made with initial positioning, must be delivered upon. Performance of the offering will determine whether or not the consumer will purchase it again. The goal is to get consumers to keep purchasing the brand name, and become brand loyal. Such fundamentals not only apply to consumer goods, but to pharmaceutical branding as well.

When the FDA issued new guidelines on August 17, 1997, the ruling represented a breakthrough for pharmaceutical companies involving consumers in healthcare. Since that time, certain blockbuster pharmaceutical brand names have become household brand names, one of which is Claritin.[3]
Brand Management

Brand Management

One of the best and most-widely recognized media blitzes on behalf of pharmaceutical companies was produced by Schering-Plough for Claritin. In 1998, Claritin was the most-advertised drug (exhibit 1). Schering spent $182.9 million on targeting consumers, and another $75 million on targeting medical professionals, yielding $1.7 billion in sales.[4] How does media spending evolve into sales? Mariola Haggar, pharmaceutical analyst for Deutsche Bank Securitites, attributes advertising to Claritin’s rapid growth.[5] The “Blue Skies” advertisements are everywhere. Consumers relate with Joan Lunden and her seasonal allergies. She is a believable celebrity endorser who appeals to the target market. Claritin has what all marketers strive for – brand name recognition.[6] Consumers not only know that this pill makes their lives more livable by relieving allergy symptoms, they know to ask for it by brand name. Schering-Plough has done something right. Claritin is a marketer’s dream. Claritin, along with other formulations or brand architecture/line extensions (new products that are related to the existing brand, yet are offering a different benefit) including Claritin-D 24 Hour, Claritin-D 12 Hour, Claritin Syrup, and Claritin RediTabs, has made the entire healthcare brand best in class, and sales figures keep on climbing.[7] Why? Brand name recognition, faith in the product/proven results, and believable advertisements stem from superior marketing efforts. Schering is looking long term, and continues to push their healthcare brand to the limit by constantly backing advertising dollars to their name brands. Why has Claritin been so successful while other pharmaceutical brands have lagged behind? Claritin name brand managers have a grasp on the identity of their brand, and are able to effectively communicate with their target audience.

Many name brand managers have been promoted to their positions from sales capacities and are focused on the “hard sell.” Often the name brand manager position is a temporary one, a stepping stone, leading to further advancement within corporate ranks or back out in the sales force. Pharmaceutical companies have come to realize that it may be beneficial to recruit employees with consumer backgrounds for name brand management positions. An employee trained in consumer behavior and research adds a lot to the marketing mix since many of these individuals have chosen marketing/name brand management as a career path, as opposed to a position leading to something else that they would rather do. However, managers recruited from advertising agencies and consumer goods companies that are typically hired to work at pharmaceutical companies are not in the ranks of senior management. Pfizer has attempted to combat this problem by setting up an in-house consumer marketing department. This is a fabulous idea, however, consumer marketing departments such as this are usually advisory.[8] Advances must be made to include consumer marketers in implementing ideas since they are well versed in consumer behavior, and focus on consumer attitudes earlier in the process, such as deciding on a trade name for their offering. Naming is important because it is the “frosting on the cake” of a brand. – it is what consumers ask for, and it is to what they are loyal. A brand name can often make or break an offering, even a pharmaceutical brand. There can be great fury when a patient has used a pharmaceutical product for an extended period of time, only to be told one day that their insurance company will no longer cover it. Consumers will go to great lengths to get their favorite products – calling the insurance company and doctors, writing letters, trying other products to find that they simply do not work the same – loyalty is something that is an extremely important part of pharmaceutical branding. Results can be long term, as consumers fill certain prescriptions for years, or perhaps their entire lives.

Pharmaceutical executives have begun to look at the consumer products industry for case studies of everlasting brands with high degree of customer loyalty (leading to long-standing profitability), and have started to dissect what in the marketing strategies of these brands have made them so profitable. Take for instance a name brand such as Coca-Cola.
Brand Management

Brand Management

Coca-Cola was first introduced in 1886, and has revolutionized the way people think of soda. The pharmacist who concocted the caramel-colored syrup in a brass kettle in his backyard had no idea that it would someday be the number one beverage in the United States and Europe (exhibit 2). Through proper brand-building and introduction of extensions/related offerings such as Diet Coke, Fanta, and Sprite, the Coca-Cola Company has made a worldwide impact. The Coca-Cola Company has catapulted a beverage with sales exceeding one billion servings per day. What separates Coca-Cola from other brands is its name, identity, and loyal following, all attributed to brand name architecture marketing in some form. The Coca-Cola Company’s comprehensive business strategy revolves around the fact that Coca-Cola is the core of the business, and that consumer demand drives all.[9]

Marketers, such as those at Coca-Cola with a consumer background, tend to have an overall understanding of the links between all areas essential to brand name development, including product development and marketing research. From a pharmaceutical perspective, it is imperative that individuals involved in the marketing process work together, and share ideas early on. It is understood that each counterpart thinks differently from the next, however, working together is key. Each individual involved in the process has something unique to contribute. Product developers know all there is to know about the actual tangible product. Market researchers have an insight into consumer behavior and the statistics to back their findings. Those in regulatory affairs look into the eyes of the FDA and legal components. Not only are we dealing with separate and distinct personalities in this instance, there are several other obstacles involved in maximizing brand name potential. Product brand development, the evolving regulatory approval process, pharmaeconomics, and pricing are a part of this enormous web that has been woven, along with colliding factors in response to several to different target audiences. Coordination is needed to ensure that brand name assets are the outcome of intellectual property created in this process.[10]

When initially deciding whether or not a DTC strategy is applicable for an offering, many market elements should be explored. The market can be expanded when the new offering is distinct from other products currently existing in the marketplace, and it meets/treats needs that have not yet been met or recognized. To integrate a DTC strategy, all elements of the marketing mix must be addressed, including public relations. Bristol-Myers Squibb extensively promoted Pravachol with a DTC program, but did not fully promote the offering to doctors. So when patients asked doctors for prescriptions for lowering cholesterol, doctors prescribed Lipitor instead of Pravachol.[11] This was not exactly the result that BMS was anticipating. As a result, Lipitor has gained incredible share of mind in the marketplace in a short period of time (exhibit 3). Lipitor, marketed by Warner-Lambert (a wholly owned subsidiary of Pfizer), surpassed the $1 billion worldwide sales threshold in just eleven months since its launch in the United States, making it the first pharmaceutical product ever to achieve $1 billion in worldwide factory sales in its initial year on the market.[12] Pfizer has generated great success in testing consumer marketing messages during the brand name development phase with physicians by routing feedback through the sales force. This process builds brand awareness early on, and physicians are not surprised by consumer inquiries.[13] Pharmaceutical brand name recognition is extremely important in the marketing process, and name brand managers must recognize that a one-time advertising blitz is not going to build long-term brand recognition. Many times perceptions of consumers have to be changed and consumers must be inspired to behave differently.
Brand Management

Brand Management

Eli Lilly launched an advertising campaign for Prozac via Leo Burnett Co. (an agency generally known for selling consumer goods such as cars and cereals) urging people possibly in need of treatment for depression (or people not receiving the strong medication that they need) to seek it. Advertising for antidepressants is a tricky task. The advertisements that were generated had to address negative public perceptions of benzodiazepine tranquilizers. To accomplish this, the slogan “welcome back” was incorporated, translating to “achieving a normal state.” Leo Burnett Co. used this advertising text to communicate the non-tranquilizer properties of the offering, thus saying that this brand name drug will not take away from your personality. Eli Lilly spent $15 million on print advertising in 1997 to transmit this message.[14]

Life-enhancing products such as these are important facets to baby boomers who want to feel and look better. Such “lifestyle drugs” have flourished as a result of the FDA opening the door to DTC brand name marketing. As much as 83% of the marketing budget for Propecia (Merck’s hair loss treatment), and 69% of the budget for Claritin has been allocated to consumer advertising.[15]

The key to advertising pharmaceutical branding strategies is to obtain new customers while also attempting to increase customer loyalty – this is a large undertaking for pharmaceutical companies. With the patent protection issue constantly lurking in the background, it is important that brand name development and marketing development teams create a brand name strategy quickly, and create it right. You can bet that although Claritin, the largest-selling antihistamine in the world, is going off patent soon, Schering-Plough will continue to build on the brand equity that represents that product with the introduction of desloratidine. It would be a shame to let this asset, representing 30% of Schering-Plough’s revenue, fizzle with no replacement in sight.[16] With some of the largest-selling pharmaceutical brand names in the world coming off patent soon, the investment community is watching pharmaceutical companies closely. Companies such as AstraZeneca are counting on brand name drugs like Nexium (replacing Prilosec) to deliver earnings strength.[17]

Merck, facing the expiration of patents on two of four of its most successful products in the next two years, catapulted a blockbuster marketing launch for Vioxx (the COX-2 inhibitor treating arthritis). Sergio C. Traversa, Analyst with Mehta Partners LLC, states that “Vioxx is building a bridge to bring the company into good shape beyond the patent expiry period.”[18] Merck launched a large-scale direct-to-consumer advertising campaign for the COX-2 in 1999. The Vioxx marketers were the first to run a full-length television spot including both brand name and indication in it. The tagline, “Vioxx. For everyday victories.” Danielle Halstrom, manager of US human health public affairs at Merck, says that “the campaign is not about doing unrealistic things like climbing Mount Everest or running a marathon, the campaign is about doing simple things like bending, stooping, walking up the stairs, and playing with children and grandchildren.”[19] Marketers at Merck have not only done a great job with instituting a believable message, but they have made it consistent in their television and print ads. According to Beth Miller, director of CME Health, this continuity is critical in reinforcing image. “The brand with the image can win”, she says. “Marketers are finding that the image and brand name can make a difference with consumers.”[20] The Vioxx launch was huge, fast, and effective – certain ingredients for success (exhibit 4). Analysts predicted that Vioxx would break the $1 billion sales mark in 2000, making it the fastest growing arthritis medication in America. At this time, four out of every ten new prescriptions for COX-2 inhibitors are for Vioxx.[21] Refills are growing steadily, indicating that patients are satisfied with results.
Brand Management

For consumer marketing to be effective, consumers must want to have the brand name product prescribed, and doctors must also have an understanding of why the product should be prescribed. Appealing to both medical professionals and consumers is not always easy, especially given that each audience is searching for different information. Consumers do not necessarily care about the medical jargon, they just want something that solves their problems and improves their quality of life. Merck hit a home run with Propecia by consistently presenting the pharmaceutical brand name in advertisements. An integrated approach is used in which physicians and consumers see the same visuals in ads, however, the wording is just slightly enough to cater to each audience. A consistent message is presented, and it works for Propecia.[22].

To build a branding model or platform that includes all audiences takes much analysis and market research, along with a great name brand manager leading the group. It is the job of the name brand manager to pull all information together for overall analysis. While several members of the brand-building team work on a micro scale, the name brand manager works on a macro scale. The brand is the name brand manager’s baby in a sense. The name brand manager knows all there is to know about their brand, and keeps a watchful eye over its well-being. He/she cares for the baby and leads it into adulthood. Each step by a name brand manager should be taken with care, especially when a product first goes to market. Brand and message consistency should be solidified prior to product launch through DTC and direct-to-physician advertising efforts.

Many times pharmaceutical companies are under the gun to get their product to market, and they end up launching before all research has been conducted, or all marketing options have been explored. Take Xenical for instance. While many products are extremely consumer-driven, Xenical is not. Marketers at Hoffmann-La Roche anticipated that consumers would go to their doctor asking for this new “fat blocker” once they had heard about it. However, marketers later realized that this was not the case because health systems and physicians were not embracing the brand-value message. Thus, a new brand name strategy needed to be implemented. Xenical required a much higher level of account planning and customer interaction than originally anticipated.[23]

New DTC product launches generally require $10 million to $100 million of advertising investments.[24] A sustained and consistent marketing effort is then required each time a new budget is set. The best supported DTC campaigns have tended to become the blockbuster brands, reaping the greatest benefits from advertising support. Return on investment is difficult to measure at this point. Pharmaceutical companies launching DTC campaigns are struggling to determine appropriate performance metrics. The focus of each DTC campaign is different. Some attempt to persuade their target audience to visit their doctor or ask for a new product, while others are promoting brand awareness within a certain target segment. ROI (return-on -investment) from a single DTC effort, or increases in prescriptions sales from a single DTC effort, is difficult to calculate for these reasons.[25]

We have only just begun to see the effects of DTC marketing. By demonstrating a commitment to name brand management, companies can take advantage of this new wave of marketing. The brand is at the center of a complex movement, and one that has proven to be a challenge to pharmaceutical companies. Consumers are searching for a complete experience when shopping for brands, even pharmaceutical brands. Through successful name brand management, including focusing on DTC marketing without losing sight of traditional prescription marketing, pharmaceutical companies can provide a quality experience that will keep physicians and consumers loyal to their brands.
Brand Management

James L. Dettore, President & CEO, Brand Institute, Miami

Alison B. Carter, Director, Name brand management, Brand Institute, New York

Suzanne C. Hoppough, Senior Name brand manager, Brand Institute, New York

--------------------------------------------------------------------------------

[1] Aaker, David A, Building Strong Brands, 1996, p.72-75

[2] Ingold, M, “The Indispensible Brand- Why Pharmaceutical Companies Can No Longer Live Without Name brand management,” Pharmaceutical Executive, March 1999

[3] Aitken, M and Holt, F, “A Prescription For Direct Drug Marketing,” www.mckinseyquarterly.com, August 17, 1997

[4] Middleton, O, “BioCognizance Forum,” Pharmaceutical Advertising, February 12, 1999

[5] IBID

[6] IBID

[7] IBID

[8]Aitken, M and Holt, F, “A Prescription For Direct Drug Marketing,” www.mckinseyquarterly.com, August 17, 1997

[9] www.thecoca-colacompany.com

[10] Bashe, G, “Recasting The Pieces Is The Only Way To Solve The Puzzle Of Pharmaceutical Marketing,” Pharmaceutical Executive, June 1, 2000

[11]Aitken, M and Holt, F, “A Prescription For Direct Drug Marketing,” www.mckinseyquarterly.com, August 17, 1997

[12] “Parke-Davis Announces Lipitor Sales Surpass $1 Billion In Just Eleven Months Since Launch,” www.warner-lambert.com/info/press_january_28_98_2.html,

[13] Aitken, M and Holt, F, “A Prescription For Direct Drug Marketing,” www.mckinseyquarterly.com, August 17, 1997

[14] “Promotion Targeting Consumers,” www.haiweb.org

[15] Miller, M, “DTC Pharmaceutical Spending Tops $1.3 Billion in 1998,” Response TV, May 1, 1994, p.24.

[16] Engel, S, “Irreplacable,” www.medadnews.com, October 2000

[17] IBID

[18] Brown, J, “Vioxx the Victor,” www.medadnews.com, March 2000

[19] “Image Makes the Difference,” www.medadnews.com, March 2000

[20] IBID

[21] Brown, J, “Vioxx the Victor,” www.medadnews.com, March 2000

[22] “DTC Brand Consistency Should Be Set Pre-Launch,” The Pink Sheet, February 8, 1999

[23]Bashe, G, “Recasting The Pieces Is The Only Way To Solve The Puzzle Of Pharmaceutical Marketing,” Pharmaceutical Executive, June 1, 2000

[24]Aitken, M and Holt, F, “A Prescription For Direct Drug Marketing,” www.mckinseyquarterly.com, August 17, 1997

[25] IBID