Five Disruptive Forces Shaking Up Indian Pharma

Times are tough for pharma marketing and they will get tougher. Increasingly, industry executives are of the view that pharma’s age old marketing models are no longer returning predictable outcomes as they did in the past.

In the past, marketing teams worked to create eye-grabbing communication while sales teams sweated it out to attract customers to the top of the physician funnel. For ages, pharma marketers excelled at managing systems that ensured messaging consistency and in-clinic foot-falls.

The take-home message is that pharma marketers are going to fail if they continue to make decisions based on intuition that was acquired a decade back. A clear need of the hour is to go back to the drawing board and redesign business models so that they give us a unique advantage to sustain growth in the future when these disruptions reach maturity.

The take-home message is that pharma marketers are going to fail if they continue to make decisions based on intuition that was acquired a decade back.

Disruptive force NUMBER 1: The Digital Demolition

It took about 75 years for the telephone to connect 50 million users but the Internet achieved this figure in four years and Facebook in just two. Today apps like Gmail, Google Maps, YouTube, Angry birds and Candy Crush have already been downloaded on more than a billion handsets.

The fact is, ‘Androidization’ of products and services is virtually demolishing every previously held belief and business intuition. Mobile is connecting the world in a manner and at speeds beyond human imagination. ?

Physicians today are relying far less on Medical Reps and receiving more customized and quality healthcare information on their hand-held devices. Android services and start-ups are not just helping physicians connect with their peers but also increasing their referrals and consultations.

Physicians today are relying far less on Medical Reps and receiving more customized and quality healthcare information on their hand-held devices.

If our customer acquisition blue-prints still lack digital engagement strategies, we may well be burying our heads in the sand. The android platform opens up infinite possibilities for creating new marketing capabilities and execution platforms that can leverage efforts in implementation, awareness, diagnosis and treatment in times to come.

Disruptive force NUMBER 2: The changing regulatory regime

Let’s face it. Healthcare has always been a highly regulated industry the world over and it is bound to remain so in future. India being a developing nation, it is only natural that time-and-again we find ourselves in the docks with the regulators.

The government imposed an overnight ban on fixed-dose combinations, slashing a whopping 3,000 crores at one go. The intention is good but the manner of implementation of the legislation is questionable.

The Kokate committee shortlisted 963 combinations but only 344 have been banned at present. One can expect more bans to come sooner or later, likely sooner. For a healthcare marketer, the writing on the wall is clear: be proactive so as not to get caught off-guard.

Pharma marketers need to ponder on how they will cushion the loss when brands are forced to vanish from shelves overnight and what it will take to mitigate the risk of losing valuable customers and patients.

Pharma marketers need to ponder on how they will cushion the loss when brands are forced to vanish from shelves overnight and what it will take to mitigate the risk of losing valuable customers and patients.

The Indian industry has seen a phenomenal adoption of combination drugs in contrast to developed nations. But as we increasingly align ourselves to global healthcare standards, the focus may well shift back to the use of single molecules or primary therapies over a period of time.

Disruptive Force Number 3: A sudden ethical detox

For diverse reasons, the implementation of an ethical code in pharma has been continuously post-poned. It is learnt that the government is now busy giving final touches to a set of binding principles to check malpractices in healthcare.

UCPMP will be one of the biggest disruptive forces in modern times and ‘transactional’ sales models will witness a sudden-death syndrome. Companies will be forced to seek alternate strategies to keep their customers engaged. Without a doubt, business is bound to suffer in the near term but the onus is on marketing and sales teams to redefine the rules of customer engagement and continue to deliver long-term growth.

UCPMP will be one of the biggest disruptive forces in modern times and ‘transactional’ sales models will witness a sudden-death syndrome.

Disruptive Force number 4: The Chronic illness out-break

India is sitting on a cadio-metabolic time bomb. With increasing longevity and awareness of life-style diseases, the diagnosis of such diseases is aiding growth much more than the acute segment. Companies who identified the chronic opportunity early on are reaping the benefits today and now occupy formidable positions in these segments.

However, competition is intensifying at the top of the pyramid. Further growth in these segments needs to be driven by moving down the customer pyramid to the mass markets by creating awareness, aiding diagnosis and impacting outcomes.

A case in point is Gliptins. They have already shattered long held dogmas and myths. In terms of value, Gliptins have become the top group of drugs beating the age old Glim-met combinations to the second place. And this despite the fact that A1C reduction achieved by Gliptins is less than half of a Glim-met combination. The Diabetes treatment algorithm stands reshaped by an intelligent game plan.

Disruptive Force Number 5: SFE ineffectiveness

Traditionally, pharma has remained focused only on the physician as the single-point decision maker for generating demand. However since 2010, the rising power of alternate stakeholders in healthcare is opening up newer targets in a Multi-Channel Marketing (MCM) environment.

For instance, about 85 per cent of the market value is contributed by the retail segment today. However, they will be severely challenged by the phenomenal rise of the corporate and chain hospitals who are aggressively making plans to penetrate at least 100 cities in the near term.

Creating a differentiated space in the future would now involve acquiring new skills to partner and negotiate with a variety of agencies and service firms who are impacting drug consumption.

Undoubtedly, the sales force that would win battles in the future will be the ones who bust their own myths and open-up to face competition in the disrupted landscape. Of course, the training leaders will have to play the enabling role in injecting and nurturing a new SFE culture and rejig teaching modules to give the sales force new skills:

• Shift the focus of training from managing ‘transactions’ to implementing long-term scientific engagements.
• Train the field force to create new markets through a business development approach.
• Re-train for partnering and negotiating skills with a wide set of new stake holders.
• Reset managerial KPIs from chasing month-end target numbers and start measuring activity-based customer enrolments.
• Redesign compensation and reward systems based on multi-channel complexities and talent requirements.

…training leaders will have to play the enabling role in injecting and nurturing a new SFE culture and rejig teaching modules to give the sales force new skills.

Conclusion

There are no magic bullets to win in the new disrupted landscape. However, a few fundamental actions will set the ball rolling to your advantage.

First, it is important to recognize existing strengths and then begin to innovate and prepare for disruptive times. Understand that the focus of innovation will have to shift from messaging and coverage excellence to how brands can prove to be innovative solutions to an existing need-gap.

Second, attracting customers to the top of the sales funnel will no longer serve the purpose of creating a loyal prescriber. Unless customers are kept engaged throughout the solution value chain, they will be lost to competition mid-way.

Third, stop looking at the world through a rear-view mirror. Decisions based on intuition and gut-feelings of the past will lead to costly mistakes. In the new world, executives, leaders, and individuals will need to boldly reboot their hard-drives and upgrade to the latest operating systems. This will become undebatable for organizations that have enjoyed great success so far and aim to do so in the future as well.