The Promotional Landscape in US and Europe: Benchmarking promotional ROI and optimizing detailing and journal spend

The Promotional Landscape in the US and Europe
Benchmarking promotional ROI and optimizing detailing and journal spend relationships

Promotional activities within the pharma industry operate through various sales and promotional channels with the aim of convincing physicians, patients and payors about the value and efficacy of products. Return on investment (ROI) is the critical measure of success for such initiatives. However, a clear understanding of the ROI generated across various market and lifecycle settings is essential for companies attempting to optimize their detailing and journal advertising strategies in the future.

‘The Promotional Landscape in the US and Europe’ is a new report published by Business Insights that provides detailed strategic guidance for the preparation and execution of successful promotion strategies. This report examines a number of case studies of recent high profile promotional strategies and their associated sales data to provide a comprehensive analysis of the key success factors for detailing and journal advertising across various stages of the product lifecycle. The impact of market and product-level influences on promotional returns are assessed and the most effective methods of measuring promotional performance are also identified.

Improve the effectiveness of your promotional strategies by examining the key factors affecting associated ROI and compare the promotional activities of leading companies with this report...

Some key findings from this report

• US detailing spend has fallen from 4.4% of promoted sales in 2005 to 3.9% in 2007. The proportion of sales revenues allocated to promotional activities is relatively higher amongst EU5 countries than the US, amounting to 8.4% in 2007 compared with 4.2% in the US.

• Returns from detailing in the US have increased from 18.4 to 20.5 over the period 2005-2007. Returns from journal advertising have recorded greater gains, rising from 11.2 to 19.1 in the same period.

• Promotional spend during a product’s launch year typically constitutes over 50% of first year sales in the US. This proportion falls to less than 15% in year two and less than 5% by year seven.

• Merck & Co invested the greatest proportion of sales into promotional activities out of the top 10 pharma companies in 2007. This was largely due to new product launches, such as the vaccine Gardasil and diabetes treatment Januvia. Eli Lilly and Novartis were the next largest promotional spenders.

Top reasons to order your copy today
• Assess returns from pharmaceutical promotion in the US and EU5 with this report’s detailed breakdown of the ROI levels associated with detailing and journal spend on promoted retail sales by therapeutic category, relative innovation, price level and lifecycle stage.

• Compare how successfully leading companies have executed their promotional strategies with this report’s analysis of total retail sales and proportional promotional spend in the US and EU for major players including Pfizer, GSK, AstraZeneca, J&J and Merck & Co.

• Evaluate the most effective promotional strategies for new product launches with this report’s case study analysis that includes a high profile launch into a new product category, the introduction of a new drug class, the redefining of an established product category and the launch of a second-generation product.

• Identify the most effective promotional strategies for mature products with this report’s case study analysis of the promotional effectiveness of detailing and journal advertising spend for products facing patent expiry, including lifecycle management strategies involving reformulations, line extensions and fixed dose combinations.

Key issues examined in this report
• Effectiveness of detailing. Product detailing continues to be the most effective promotional channel despite increasingly restricted access to physicians. However, improving effectiveness and utilizing channels such as eDetailing will continue to offer incremental returns.

• Promotion across product lifecycles. Although it is necessary for companies to generate significant promotional activity in the early stages of the product lifecycle, the ability to balance these initiatives across various portfolios over time is of great importance.

• New product promotions. New products require significant educational promotion, particularly those launched into new treatment settings such as Gardasil or Champix/Chantix.

• Protecting products close to patent expiry. The classic game theory response to impending patent expiry involves maximizing sales prior to expiry through continued aggressive promotion before restricting all promotional efforts post patent expiry. Brand-level promotion in light of new competition with therapeutic equivalency and a significant price discount is rarely considered to be of value.

Your questions answered

• What is the most appropriate measure for pharmaceutical promotional returns?

• How do promotional strategies evolve across the product lifecycle?

• What key market/product characteristics have the greatest impact on promotional returns?

• Which companies are currently achieving above average promotional returns and why?

• How can promotional activities help to establish market share for new product launches?

• To what extent can promotional activities help to safeguard market share following patent expiry?

• What are the key benchmarks/guidance available from real life case studies that can be applied directly to my current portoflio?

Report Highlights

[Studien Infos ausblenden]

The promotional landscape in the US and Europe Executive summary 10
Promotional spend and return on investment 10
Product-level promotional benchmarks 10
The promotional landscape by company 11
Promotional strategies for new product launches 12
Promotional strategies for mature products 13
Chapter 1 Promotional spend and return on investment 16
Summary 16
Introduction 17
The importance of promotion in the pharmaceutical industry 17
Promotional sales channels 19
Promotional channels 19
Sales channels 20
Promo spend as a proportion of sales 21
Promotional return on investment 25
Regression 26
Are all promotional activities alike? 26
Are returns on promotion linear, increasing or decreasing? 27
Are returns similar for all drug categories? 27
Relative insights 30
Chapter 2 Product-level promotional benchmarks 32
Summary 32
Introduction 33
Leading products 33
Product-level characteristics 35
Therapeutic category 36
Relative innovation 36
Price level 36
Lifecycle stage 36
Therapeutic category 37
Promo spend 37
Return on investment 39
Relative innovation 40
Promo spend 41
Return on investment 42
Price level 44
Promo spend 44
Return on investment 46
Lifecycle stage 47
Promo spend 47
Return on investment 51
Chapter 3 The promotional landscape by company 54
Summary 54
Introduction 55
Leading companies 55
US 55
EU5 57
Pfizer 59
GlaxoSmithKline 61
AstraZeneca 63
Johnson & Johnson 65
Merck & Co 67
Chapter 4 Promotional strategies for new product launches 70
Summary 70
Introduction 71
New product category: Gardasil 71
US 71
Germany 73
New drug class: Januvia 74
US 74
Germany 76
Redefining a market: Chantix/Champix 77
US 77
Germany 78
Second-generation product: Yaz/Yasminelle 80
US 80
Germany 81
Chapter 5 Promotional strategies for mature products 84
Summary 84
Introduction 85
Patent expiry: Zoloft 85
US 85
Germany 87
Reformulation: Stilnox/Ambien 88
US 88
Germany 89
Line extension: Fosamax Plus D 91
US 91
Germany 92
Fixed dose combination: Zocor/Vytorin 94
US 94
Germany 95
Chapter 6 Appendix 98
Research sources 98
Sample size and coverage 99
US 99
France 100
Germany 101
Italy 101
Spain 101
UK 101
[Inhaltsverzeichnis ausblenden]

Table 2.1: Leading pharmaceutical products by US retail promotional spend, 2007 34
Table 2.2: Leading pharmaceutical products by EU5 retail promotional spend, 2007 35
Figure 1.1: Retail sales and promotional spend in the US and EU5, 2005-07 21
Figure 1.2: Promotional spend as a proportion of retail sales in the US and EU5, 2005-07 23
Figure 1.3: Promoted retail sales and promotional spend in the US and EU5, 2005-07 24
Figure 1.4: Promotional spend as a proportion of promoted retail sales in the US and EU5, 2005- 07 25
Figure 1.5: Return on investment for promotional spend on branded retail sales in the US and EU5, 2007 28
Figure 1.6: Return on investment for promotional spend on promoted retail sales in the US and EU5, 2005-07 29
Figure 2.7: US promotional spend as a proportion of promoted retail sales across leading therapeutic categories, 2007 38
Figure 2.8: EU5 promotional spend as a proportion of promoted retail sales across leading therapeutic categories, 2007 39
Figure 2.9: Return on investment for detailing spend on promoted retail sales across leading therapeutic categories, 2007 40
Figure 2.10: US promotional spend as a proportion of promoted retail sales by relative innovation, 2007 41
Figure 2.11: EU5 promotional spend as a proportion of promoted retail sales by relative innovation, 2007 42
Figure 2.12: Return on investment for detailing spend on promoted retail sales by relative innovation, 2007 43
Figure 2.13: US promotional spend as a proportion of promoted retail sales by price level, 2007 44
Figure 2.14: EU5 promotional spend as a proportion of promoted retail sales by price level, 2007 45
Figure 2.15: Return on investment for detailing spend on promoted retail sales by price level, 2007 46
Figure 2.16: US promotional spend as a proportion of promoted retail sales by lifecycle stage, 2007 48
Figure 2.17: EU5 promotional spend as a proportion of promoted retail sales by lifecycle stage, 2007 49
Figure 2.18: US average retail sales, detailing and journal spend by lifecycle stage, 2007 50
Figure 2.19: Return on investment for detailing spend on promoted retail sales by lifecycle stage, 2007 51
Figure 3.20: US promoted retail sales and promotional spend as a proportion of sales by leading company, 2007 56
Figure 3.21: US promotional spend as a proportion of promoted retail sales by leading company, 2007 57
Figure 3.22: EU5 promoted retail sales and promotional spend as a proportion of sales by leading company, 2007 58
Figure 3.23: EU5 promotional spend as a proportion of promoted retail sales by leading company, 2007 59
Figure 3.24: Distribution of retail sales and promotional spend as a proportion of sales at Pfizer, 2007 60
Figure 3.25: Distribution of retail sales and promotional spend as a proportion of sales at GlaxoSmithKline, 2007 62
Figure 3.26: Distribution of retail sales and promotional spend as a proportion of sales at AstraZeneca, 2007 64
Figure 3.27: Distribution of retail sales and promotional spend as a proportion of sales at Johnson & Johnson, 2007 66
Figure 3.28: Distribution of retail sales and promotional spend as a proportion of sales at Merck & Co, 2007 68
Figure 4.29: US retail market share and share of voice for Gardasil, 2006-07 72
Figure 4.30: German retail market share and share of voice for Gardasil, 2006-07 73
Figure 4.31: US retail market share and share of voice for Januvia and Janumet, 2006-07 75
Figure 4.32: German retail market share and share of voice for Januvia, 2007 76
Figure 4.33: US retail market share and share of voice for Chantix, 2006-07 78
Figure 4.34: German retail market share and share of voice for Champix, 2006-07 79
Figure 4.35: US retail market share and share of voice for Yasmin and Yaz, 2005-07 81
Figure 4.36: German retail market share and share of voice for Yasmin and Yasminelle, 2005-07 82
Figure 5.37: US retail market share and share of voice for Zoloft, 2005-07 86
Figure 5.38: German retail market share and share of voice for Zoloft, 2005-07 87
Figure 5.39: US retail market share and share of voice for Stilnox/Ambien, 2005-07 89
Figure 5.40: German retail market share and share of voice for Stilnox/Ambien, 2005-07 90
Figure 5.41: US retail market share and share of voice for Fosamax and Fosamax Plus D, 2005-07 92
Figure 5.42: German retail market share and share of voice for Fosamax and Fosamax Plus D, 2005-07 93
Figure 5.43: US retail market share and share of voice for Zocor and Vytorin, 2005-07 95
Figure 5.44: German retail market share and share of voice for Zocor and Vytorin, 2005-07 96
[Tabellenverzeichnis ausblenden]