Pharma Marketing to Consumers Faces Continued Pressure from Generics

Generics and the Economy continue to add pressure to Pharma Brand Marketing.  The most recent data released by Wolters Kluwer Health continues to support that even the Pharmaceutical industry is not immune to the economic downturn.  In fact, by the close of 2009, 2/3’s of all prescriptions filled will be for a generic…

 

Summarized in a recent WSJ article “Many Drug Prescriptions are Going Unfilled”  the data suggests that the numbers of Americans not filling branded prescriptions is continuing to rise.

“Due to cost, U.S. patients failed to fill 6.8% of the brand-name prescriptions their doctors requested in the 2008 fourth quarter, a 22% increase from the first quarter of 2007. Patients also abandoned prescriptions for generic drugs at a higher rate, failing to fill 4.1% of generic prescriptions,” according to the WSJ.

Wolters Kluwer also also reports that “abandonment increased as the amount of the co-pay increased, especially for new prescriptions. For example, new prescriptions with co-pays of $100 or more carry an abandonment rate of just over 20%; while with co-pays of $10 or under, the abandonment is only 4 percent.”

“Patients are becoming far more comfortable with the concept of using a generic in place of a brand. This, in part, is due to patient education programs and enthusiasm forged by marketing vehicles such as $4 generic drug programs,” said Mark Spiers, President & CEO, Wolters Kluwer Health, Pharma Solutions.  “We’re close to the point, certainly by the end of 2009, where two-out-of-every-three prescriptions filled will be generic” continued Spiers. “These trends are going to become even more pronounced moving forward as there are many blockbusters in major therapeutic areas like cholesterol reducers due to come off patent in the coming three years.”

To counter the economic downturn and increased retailer incentives for generics, such as  Walmart $4 prescriptions ($10 for 90 days) or the Walgreen Prescription Savings Club (Generics for < $1 a week), it’s no wonder that we’re seeing so many FREE prescription offers being run in DTC mass and web advertising, and even richer offers, such as the recently introduced Orencia Promise: a 6 month free trial offer for Rheumatoid Arthritis patients.  Continuity offers to retain patients are also popping up more frequently…

But the best defense for brands to win over generics is to continue to develop ‘better’ products with meaningful advantages to doctors and their patients…and to have clinical support for differentiated messaging around these added benefits…and here in lies one problem facing many pharmaceutical marketers today…

Thoughts?

2 thoughts on “Pharma Marketing to Consumers Faces Continued Pressure from Generics

  1. I think it’s going to take more than ‘better products’ and clear benefits. Many companies will not make it through this downturn. Those who do will be the ones that look the monster in the eye. And the monster is trust.

    If consumers have good reason to believe that you 1) know their concerns and 2) care about their concerns and 3) are honest about your strengths and weaknesses, they MAY consider your products. If those 3 criteria are not met, products will not be considered – no matter how clear the benefits.

    • Marsha, thanks for your comments. I hear you about trust and demonstating that pharma knows its consumer– but I think that your point 3) is honestly the more important one in this case for pharma products vs let’s say consumer products- reflecting that medications treat illnesses that consumers need relief from…so I fully agree about the importance of showing honesty and “clarity” for consumers around the strengths and weaknesses…to me this supports why products with PODs that are demonstrable, perceivable and able to be communicated will help consumers and their MDs to make the best choice for their patient that balances effectiveness vs just cost…

      To that end…PhRMA organization is now supporting industry effort to provide more comparative studies as they recognize that this is now a “market expectation”…but PhRMA’s point, which i agree with, is that the comparison should focus on effectiveness- with cost a part- and not solely on cost alone… I think this could go along way for building trust… http://blogs.wsj.com/health/2009/04/06/comparing-drugs-is-real-world-demand-new-phrma-head-says/

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