Pharmaceutical Marketing at Merck

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Pharmaceutical Marketing at Merck
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Marketing at Merck

• Merck Human Health Divisions
• Asia Pacific
• Europe, Middle East, Africa
• The Americas (US Human Health, Canada, Latin
  America)
• Worldwide Human Health Marketing
• Merck Vaccine Division
• U.S. Vaccine Marketing
• Merck Vaccine International

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Pharmaceutical Industry Characteristics

• Highly Competitive but Fragmented industry
• Complicated business model with numerous
  stakeholders
• Very Technical/Scientific products
• Major RD expenditures and High Risk product
  development environment
• Long Product-Development Timelines

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Pharmaceutical Marketing Characteristics

• Long Marketing-Planning horizons
• Highly regulated industry and highly regulated
  marketing communications by FDA
• Primary targets Healthcare Professionals and
  Consumers
• Numerous customers with variety of information
  needs requires multiple approaches to creating
  marketing campaigns and communications
• Evolving selling environment
• Use of e-channel still in its infancy in our
  industry

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STAGES OF PRODUCT DEVELOPMENT
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Merck Marketing Principles

• Understand the customers perspective
• Anticipate and outmaneuver the competition
• Concentrate on selected audiences and behaviors
• Define the products distinctive value to
  selected audiences
• Plan for sequenced growth throughout the
  products life-cycle
• Shape customers perceptions
• Ensure that execution is efficient, consistent,
  and well integrated
• Track results and re-evaluate decisions

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Brand Management is the HUB of pharmaceutical
marketing
Market Research
Professional Sales
Marketing Communications
Business Development
Customer Marketing
Pricing Analysis
Medical Services
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Pharmaceutical Branding
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Currently Limited penetration and use of
e-channel

• Unclear regulatory guidance
• Limited e-commerce opportunity except with major
  wholesellersEDI works fine
• Difficult ROI measurement with consumers
• Commitment to personal selling model with
  physicians
• Challenging privacy issues
• Physician role as learned intermediary has to
  be considered and respected

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Consumers are increasingly being asked to take an
active role in managing their healthcare

• Numerous treatment options and decisions to
  consider. Consumers are expected to partner
  with their physicians to consider risks and
  benefits and make choices.
• Third-party payers and employers are adopting
  cost-sharing models of healthcare coverage.
  (Spending accounts, 3-tier co-pays, etc.)

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Healthcare information is a Primary destination
on the web

• The Web Offers
• Speed
• Convenience
• Robust Resources
• Anonymity

• BUT brings concerns about
• Credibility/Accuracy
• Privacy Protection
• Relevance

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Studies estimate between 73M-100M US Adults have
gone online to look for health information

• 73M or 62 with internet access using the Web to
  look at Healthcare information
• 68 of health seekers say the material affected
  their decision about treatments and care for
  themselves or a loved one.
• 61 of health seekers said the internet has
  improved the way they take care of themselves
• Top Reasons
• 93 looked for info about a particular illness or
  condition
• 65 look for nutrition, exercise, weight control
  advice
• 64 looked for info on prescription drugs
• 55 gathered info before visiting a doctor

Source The Online Health Care Revolution,
Vital Decisions Pew Internet American Life,
11/26/00, 05/22/02
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The internet provides new Opportunities for
Pharmaceutical Companies

• We have complex, highly technical products
• The empowered consumer needs information they can
  learn from and use in discussions with their
  physician
• Educated customers have always been our best
  customers and we have a significant offline
  commitment to education
• We are now bringing that commitment online to
  better meet our customers needs through the web
  channel
• This new channel requires us to evolve from a
  push to a pull model as consumers demand
  greater control and convenience in how they
  access online healthcare information

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What has Merck Done? Create Online Websites with
Merck Product Information

• Integrated part of our marketing campaigns that
  provide additional information online
• Can be accessed directly (www.product.com) or
  through links at our corporate site, 3rd party
  sites, or from banners throughout the web
• Originated as Brochureware
• Evolving towards greater robustness,
  interactivity, customization and permission-based
  marketing approach
• Primarily Consumer Focused
• Developing an educational/ less advertising
  oriented approach to healthcare professionals

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Some Examples of Websites
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What else has Merck Done? Create Online Medical
Education Resources for physicians and patients

• MerckMedicus is a health-information portal
  designed to support the medical-education needs
  of physicians
• MerckSource is a health-information resource for
  patients

• Both sites offer objective, credible,
  evidenced-based resources to support the
  doctor-patient dialog
• They deliver online on Mercks commitment to
  support the medical-education needs of customers
• Merck Manuals of the 21st Century

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Issues for our Industry

• The web promises instant access to all
  information, yet our regulated environment poses
  limits on how we can use this channel to meet
  customer expectations
• Our traditional product-centric approach vs the
  customer-centric web environment requires
  adjustments in how we create and offer
  information to customers
• Supporting and respecting the doctor-patient,
  payor and employer relationships while adequately
  serving the consumer is a challenging balancing
  act
• Privacy Protection is critical. Healthcare
  status impacts employment and social
  relationships.

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Where are we headed in the future? Towards
more integrated offerings
PUSH
PULL