Changing scenario in the pharmaceutical sector
by Dr R K Srivastava
History
and Current Trends
The pharma industry
is one of the most talked about industries around the world
and India is no different. Even though the total size of the
pharma industry is approximately equal to the turnover of Reliance
Group, the industry has much hype around it - public controversies,
government controls, and media coverage and more. The pharma
sector has transformed a great deal over the past few decades.
The top five companies, which were vibrant 20 years ago, are
hardly so anymore. Glaxo, Sarabhai, Pfizer, and Hoechst, which
were leaders, in 1980s are not even in the top five. Table I
demonstrates this shift. One glance at this table makes it amply
clear that the pharma sector, once the domain of multinational
companies, is now being led by professionally managed Indian
companies. The downfall of many erstwhile pharma leaders can
be attributed to their rigid marketing practices. The quick
analysis of Indian companies reveals that their progress is
basically from the new products. Cipla and Sun Pharma are two
companies that grew tremendously primarily due to their focus
on new products. (See table II and III) However, recently the
success rate of new products has also been on a decline because
companies are more interested in introducing new products primairly
to generate volume sales and therefore ignore brand building.
In fact, with the passage of time, there has been steady deterioration
of the success of new products. These days, the trend is to
launch a new product, capture market share and if the response
is good, then build the brand in subsequent years. This strategy
has reaped dividends for companies like Ranbaxy, Cadila, Cipla,
and Sun Pharmaceuticals. (See Table IV)
Doctors
and Medical Representatives
A recent study conducted by the author
reveals that more than 86 per cent of the doctors mentioned
that the visit of medical representative is nothing but waste
of time as they do not contribute much to the knowledge of doctors.
This is a very serious shift. See Table V There is trend among
the doctors to do super specialisation. This spurt in super
specialisation has resulted in proliferation of many nursing
homes and hospitals, which were of less importance in earlier
days. Emergences of nursing homes and hospital have led to emergence
of new market segments of hospital/nursing home consumer and
has increased the importance of retail chemists attached to
hospital, which can influence the prescription behavior of doctors.
This had led many companies to take a re-look at the sales force
deployment. In fact a few companies have already started hospital
development in a big way. Many companies have have introduced
multiple divisions to capture different customer segments.
Promotion
Problems
The falling standards of medical representatives
have led to development of external agencies (akin to the IT
sector) to promote the products. The emergence of agency-led
promotion, which is fairly common in the US, is becoming more
and more popular in India with companies like Lupin and Pfizer
making use of it. The once highly unionised and militant representatives
have now mellowed down. But it is very difficult to get good
talent for medical representatives as the youth have many more
options today. This has been further complicated by doctors
who do not give adequate time to medical representatives. (See
Table VI) It is difficult for a medical rep to detail multiple
products in about three to five minutes. Advertisements in pharma
journals continue to be the last option. Samples, which were
once a promotional too, have declined in importance (See Table
VII). These days, many doctors prefer gifts instead of samples
and top doctors expect better gifts than mere key chains, pens
and so on. However, “customer focus” activities are
emerging as an important tool in promoting the product. Take
for instance events, which give direct access to the customer/doctor.
As a result, the concept of symposiums, CRM activities, clinical
meetings are becoming important
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