CHAPTER

3ZD:

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Summary, Conclusions And

Recommendations

280

After the exhaustive study of product management

departments in different companies following conclusions have been put

forward for effective role of product management in pharmaceutical

marketing.

7.1 ) Summary :

Chapter I -

"Art of War" written by the great philosopher Sun T24 800 BC

has observed the smartest strategy of war is not to have a war. The

meaning of that you should make yourself so powerful that your

competitors loose moral force to fight you after taking a look to you. The

goal of any marketing strategy is to beat competitors, and for a

company even small competitors are also important. According to

"Peter Drucker " there will be two kinds of CEOs who will exist in the

next 5 years, those who think globally and those who are unemployed.

The pharmaceutical industry is a lifeline industry, that plays

a very crucial role in building strong human capital of country and is

very essential for economy growth and development but foreign

investment is creating the challenges as well as an opportunities to this

industry. Therefore effective marketing strategy is most important to this

industry. The changing scenarios both economically and industrially

may bring about the changes and policies in relation to licensing, co-

marketing and so on. It will change the prevalent attitudes of a

customer based Doctors, Patients, Retailers, Wholesalers and Hospitals

etc. Product management assists in these areas through the application

of scientific methods.

Selection of the Topic-

Following are the different reasons for the selection of the topic.

1) Product Management -department plays a vital role in the

success of the product therefore its study is most important.

281

2) The profit making capacity of the product depends upon

the effective product management.

3) Product management deals with the formulation of marketing

strategy therefore its study is most important.

4) The study of the expenditure of products is important.

5) Identification of the fast moving Products is important.

Pharma Industry profile-

Pharma Industry is showing the fast growth rate all over the

world. MNCs and Non MNCs are playing an important role in this

industry. At present Indian Pharmaceutical Industry is economical

industry in the world. The drugs available in India are 2 to 3 times

economical than the other countries. But as India has signed WTO

agreement, the prices of Indian drugs will increase by 2 to 30 times

after 2005. Thereafter there will be least value for DPCO. Research and

Development are most important in this industry.

Exports-

Major Pharma exporters are Ranbaxy, Lupin Laboratories and

Orchid chemicals. In 1996-97 the export of major 42 pharma companies

wasRs.2136Cr.

Mergers and Acquisitions-

The Indian pharmaceutical industry has been a spate of Mergers

and acquisitions of companies as well as brands leading to

consolidation and reshuffling of position.

The Future Prospects-

The Indian pharmaceutical industry is getting foreign market at

large scale. Indian Government is allowing 100% foreign investment in

this industry. This industry is taking the advantages of the recent

development in Biotechnology and Information technology. Therefore

282 the future of this industry is very good. There are global opportunities

for this industry.

Increased focus on R and D, Product Rationalization, Brand

acquisition and company acquisitions are the recent trends in this

industry.

Pharma MNCs and Domestic Pharma Players in India-

MNCs have turned skeptical on the Indian market and are willing

to introduce only a very limited number of drugs in the Indian market.

The leading pharma players in India in the Multi-national segment are-

Glaxo India Ltd., E Merck India Ltd., Parke Devis India Ltd., Pficer Ltd.,

and Fulford India Ltd. While the prominent players among the domestic

segment are Ranbaxy, Dr. Reddy's, Cipla, Sun Pharma, Nicholus

Piramal, Cadila and Lupin. Companies are playing an important role in

rural market also.

Patents and the Indian market -

At present in India there is a process patent but according to

WTO obligations after 2005 India will honor product patents. It will affect

adversely on Indian Pharma Industry. But if Indian Pharma Industry

takes the keen interest in research and development and produces the

qualitative product at low cost then there are number of opportunities to

Indian Pharmaceutical companies to prosper. SWOT analysis,

Innovations, recruitment of skilled professional and improvement in

productivity definitely will help in this direction. In short there are lot of

chances for the development of the industry.

Pharma Business a changing Scenario-

The pharma Industry is changing day by day. There are number

of factories influencing the changes in the pharma industry. Some most

important factors are: The influence of Bio-technology, Genetherapy,

Tumour vaccines. Adoptive immunotherapy, Haemopoietic growth

283 factor, A shift from the blockbluster concept and Novel drug delivery

system.

Chapter -II

Objectives of the Study-

Following are the objectives of the present study:

a) To study the role of product management personnel in decision

making about the product.

b) To study the procedure of formulating the marketing strategy.

c) To study the effectiveness of the product manager while

impressing the doctor.

d) To study the relationship between product manager and field

staff.

e) To study the various promotional strategies adopted by the

product management department in pharma marketing.

Statements of Hypotheses -

Following are the Hypotheses of The Present Study

a) The ideal number of products handled by each product manager

and effective pharma marketing are not related to each other.

b) Price plays a vital role in pharma marketing.

c) The functions of product management department and field staff

are supportive to each other.

d) Promotional inputs do not play an important role in pharma

marketing.

e) The effectiveness of the product manager depends upon his

education and experience in the field.

f) The period of launching of the product and success of the product

are interrelated.

g) Brand name, Quality aspect and raw materials are least

important in the formation and execution of marketing strategy of

pharmaceutical products.

h) In the determination of Brand plan, SWOT analysis, prescription

analysis and allotted budget are least important while market

conditions are more important.

i) The success of the marketing strategy is depend upon it's

effective implementation by the product management department.

Research Methodology-

Fifteen Pharmaceutical companies were selected for the study on

Non-Probability sampling basis. Under Non-Probability Sampling

Following two sampling methods were used:

A] Convenience or Accidental sampling

B] Purposive sampling.

While selecting the samples proper representation was given to

large, Medium and small scale Pharmaceutical companies. There after

through Interview Schedule primary data was collected. While

secondary data was collected through Refrence books periodically,

News papers, Documents of the company and Internet. The data

collected through primary and secondary sources was tabulated,

Analysed and interpreted in meaningful manner. Chi-squar statistical

method was utilized for this purpose.

The study is limited for 15 Pharmaceutical companies

in Maharashtra from 1985 to 2000.

285

Chapter-Ill

Following fifteen Pharmaceutical companies were selected for the

study.

Table No. 7.1

Pharma Companies and their Sales Sr.

No

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

Name of the Company

AJANTA

ARISTO

BAYER

CIPLA

ELDER

GERMAN REMEDIES

GLENMARK

MARPA

NICHOLAS PIRMAL

NOVARTIS

PANACEA BIOTEC

RANBAXY

SUN

U S V

WOCKHARDT

Brand Value

(Rs.Cr.)

407.18

378.98

54.05

936.02

148.11

190.62

218.36

23.39

610.13

354.7

91.98

841.12

531.21

298.47

385.17

ORG Rank

111

12

70

2

33

29

24

106

4

14

45

3

5

18

11

Growth

20.3

14.4

0.7

20.1

6.7

2.6

15.3

-3.6

8.4

0.3

27.2

10.7

27.4

11.4

7.4

In the company profile the concentration was made on following

points;

1] Research and Development

2] Joint Ventures

3] Top ten brands of each pharmaceutical companies

286 4] Philosophy mission, vision culture and social activities of

the pharnnaceutical companies

5] Awards, Achievements, Exports and drawbacks of the

pharmaceutical companies

Chapter-IV

Right away from mankind human beings are suffering from

various diseases. In ancient time all "Vaidyas" were used to treat the

diseases with household remedies and various jadi-buti found in the

forest. As we are advanced in the various field now human being knows

all diseases and they have various remedial measures to treat them

effectively. But still on some of diseases like AIDS, Cancer etc. still no

remedy is available. Let's have look on the some of the basic things

towards the same.

Infection- When a parasite is growing and multiplying with in or

on host, then the host is said to have an infection.

Drug- Drugs are chemical compounds which are used in the prevention

diagnosis, alleviation, treatment and number of pharma companies

but thirty companies are most important. Out of there thirty

companies fifteen were selected for the study. These pharma

companies are producing various brands but thirty brands are

playing a dominent role in the pharma production.

Top 30 Pharma Companies: In this big market there are various

companies are present. Glaxo-Wellcome combine continues to maintain

the 1 rank. Following are the Top 30 Pharma Companies

287 Table No 7.2

Top 30 Pharma Companies

Rank

FY99 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30

FY98 1 2 3 4 9 12 8 6 10 5 7 18 14 11 20 17 16 13 15 24 19 32 21 22 27 25 23 28 26 29

Major players

Glaxo-Wellcome

Cipla Ranbaxy Hoechst Marion Wockhardt Zydus Cadila Lupin Labs Alembic Chemicals Pfizer Torrent Pharma Knoll Pharma Nicholas Piramal Cadila Pharma Novartis India Alkem Labs Sun Pharma Aristo Pharma Wyeth Lederle Smithkline Beecham Dr Reddy's Labs Parke Davis USV E Merck Unichem Labs Rhone Poulenc German Remedies Himalya Drugs IPCALabs Sarabhai Chemicals FDC

Market share (%)

FY99 6.3 4.2 3.5 3.1 2.4 2.3 2.3 2.3 2.2 2.2

' 22 1 2.1 2.0 1.9 1.9 1.9 1.8 1.7 1.6 1.6 1.5 1.4 1.4 1.4 1.2 1.2 1.2 1.1 1.0 1.0

FY98 7.0 4.2 3.5 3.2 2.3 2.0 2.4 2.4 2.2 2.4 2.4 1.8 1.8 2.0 1.5 1.6 1.7 1.9 1.8 1.3 1.5 0.9 1.5 1.4 1.2 1.3 1.3 1.1 1.5 1.0

Growth

%yoy^ (10.0)

-

-

(3.1) 4.3 15.5 (4.2) (6.3)

(9.2) (10.4) 15.6 8.9

(4.0) 28.0 16.9 4.1

(11.1) (11.7) 20.8

-

58.9 (6.7)

-

(8.5) (10.0)

-

(33.3) (3.0)

Top 30 Pharma Brands: In this big market there are many brands that

created history. Now these brands are sold on the counter. Maximum

population is well aware of all these brands. For minor ailments they are

not going to the doctors that are taking self-medication. This made

288 many brands so popular those there sales figures are going on

increasing and on. Following are the Top 30 Pharma Brands -

Table No 7.3

Rank 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30

Top 30 Pharma Brands

Brands Becosules Althrocin Corex Sporidex Taxim Betnesol Cifran LIV-52 Voveran Glucon D Dexorange Plus Mox Digene Phexin Zinetac Combiflam Ciplox Ampoxin Ceftum Septran Polybion R-Cinex Quadriderm Revital Evion Ciprobid Norflox Brufen Neurobion Roxid

Company Pfizer Alembic Chemical Pfizer Ranbaxy Alkem Labs Glaxo Ranbaxy Himalaya Drugs Hoechst Marion Heinz Franco Indian Rexcel Knoll Pharma Glaxo Glaxo Hoechst Marion Cipla Unichem Labs Glaxo Glaxo E Merck Lupin Labs Fulford Ranbaxy E Merck Cadila Pharma Cipla Knoll Pharma E Merck Alembic Chemical

Growth 7o yoy 6.0 3.4

20.8 10.2 20.4 17.8 18.6 11.6 15.6 3.9 0.4

23.7 7.0 0.7 14.2 6.3 2.3 4.8 16.7 15.5 9.5 1.2

11.1 1.3 3.2 16.4 4.1 10.8 1.4

24.6

Major Therapeutic Segments- There are different classes of the drugs,

which are available for the treatment of particular diseases or

deficiency. Depending on there ability to treat the diseases or deficiency

they are classified in different segments and those are termed as the

Major Therapeutic Segments. Following are the major therapeutic

segments-

Table No 7.4

Major Therapeutic Segments

289

Sr. No

1 2 3

4 5

6 7 8

9 10 11

12 13

14 15 16

17 18 19

20 21

22 23

Therapeutic segments

Anti-infectives Cardiac care Vitamins NSAIDs Anti-parasitic/ anti-fungal

Cough preparations Corticosteroids Central nervous system

Anti-anaemic Anti-ulcerant Analgesics

Anti-diabetic Anti-asthmatics

Nutrients Harmones/ stimulants Anti-histamine

Antacids/ anti-fiatulents Anti-emetic/ anti-nauseant Cold preparations

Enzymes Rubs and inhalants

Vaccines Anti-malarial

Sales (Rs mn)

28,550.0 7,760.0 7,350.0 6,125.0 5,625.0

4,900.0 4,575.0 4,175.0

3,250.0 3,050.0 3,000.0

2,675.0 2,675.0

2,500.0 2,300.0 1,975.0

1,975.0 1,850.0 1,800.0

1,300.0 1,250.0

1,000.0 850.0

Market share (%)

22.0 6.0 5.7

4.7 4.3

3.8 3.5 3.2

2.5 2.3 2.3

2.1 2.1

1.9 1.8 1.5

1.5 1.4 1.4

1.0 1.0

0.8 0.7

Growth % yoy

13.3 16.1 14.0

15.0 12.0

12.0 15.2 16.3

12.5 13.0 14.5

25.0 14.5

15.0 16.0 16.5

8.7 20.0 12.5

8.5 10.0

25.0 10.0

CHAPTER-V

The pharmaceutical industry in India provides excellent

facilities to the patients. Regulatory Authorities in USA AND UK

have approved many Indian pharma companies. There are

290 number of mediation in this industry . Doctors and Medical

Representatives are most important among them.

Concept of Product Management-

Product. management includes Planning, Organising,

monitoring and controlling the marketing activities of the product

and advice the management in devlopment introduction of new

products and services will enable it to achieve its objectives for

growth in sales , market share and prohibality.

Functions of product Manager-

Product Manager performs number of functions. All

there functions may be classified under two heads.

AJBasic Functions- These functions includes Planning, Organising,

Monitoring and controlling the marketing activities of the product.

B]Other Functions- They include formation of policies, market

intelligence, planning and controlling activities of the pharma

companies.)

IFPMA Code of Pharmaceutical Mari<eting Practices-

IFPMA plays a vital role in pharma industry. It restricts the cut

throat competition of the industry and assists for its development.

Products and Brands-

Product is a complex cluster of value satisfactions. It is not the

same as the generic drugs. Value is added in proportion to the

perceived ability of the product to meet the needs of the doctors.

The brand includes a distinguishing name and symbol to identity

and differentiate the goods or services from those of competitors.

CHAPTER VI

In this chapter tabulation, analysis and interpretation of the

research data in meaningful manner was made. Chi - Square test was

also utilized for the interpretation. While interviewing Product Manager

following data was collected from them-

291

1) No. of products handled.

2) Ideal number of products to be handled.

3) Ranking of 4 P's in the Product Strategy.

4) Importance of price.

5) Important factors in Strategy making.

6) Importance of promotional inputs.

7) Importance of Visual Aids and Samples.

8) Supportive functions of pmt and field staff(MR).

9) Essentially of training program.

10) Reasons for failure of strategy.

11) Importance of the Gift and scientific Information.

12) Ranking of points on which gifts are decided.

13) Importance of CRM, DGM and Sponsorship.

14) Age, Education and Experience of Product Manager.

15) Ranking of objectives of fieldwork.

16) New Product Launching.

17) Product Promotional Strategy.

18) Deciding on Brand Plan.

7.2) Conclusions:

On the basis of the study we can conclude the following

conclusions.

1) At present six (40%) Product Managers individually are handling

five products while four (26%) Product Managers individually are

handling more than five products. But according to 9 (60%)

Product Managers only 4 Products should be allotted to each

Product Manager. It is an ideal proportion between Product

Managers and number of product for effective pharma marketing

only one (6.67%)product manger was in favor of five product to

each product manger and nobody was in favor more then five

292

product to each product manger in this case the computed

chi-square value (6.4) is also higher then the table value at 5%

significance level i.e. 5.991. It means there is the relationship

between ideal number of products and product manger. Therefore

the ideal number of products handled by each product manger

and effective pharma marketing are related to each other. If we

allot more than four products to each product manger then

effective pharma marketing is very difficult for him.

In short the first hypothesis i.e. The ideal number of

products handled by each product manager and effective pharma

marketing are not related to each other is rejected. They are

related to each other.

2) Our second hypothesis is price plays a vital role in pharma

marketing. But according to all 15(100%) product managers

product it self plays a vital role in pharma marketing and price is

in the third position in four P's of pharma marketing. The

computed value of chi-square in this case is (11.40) more than

the table at 5% significance level i.e. 7.815. Therefore this

hypothesis is rejected. In pharma marketing products and

persons are more important than price

But when we consider price independently then it is also

important. According to 11(73.3%) product managers price is

important in product strategy while according to 4(26.7%) product

managers it is not important.

3) According to 14(93.30%) product managers field staff plays a vital

role in pharma marketing. If field staff is superior then product

management department performs its functions effectively and

efficiently. The computed Chi-square value in this case is

(11.2666) higher than the table value at 5% significance level i.e.

293 3.841. Therefore the hypothesis: The functions of product

management department and field staff are not supportive to

each other is rejected. They are supportive to each other

In strategy making scientific information and gifts are at

second and third position repetitively

4) According to all 15(100%) product managers promotional inputs

from visual aids to sponsors are playing an important role in

pharma marketing. Their ranking is different but role is important.

Therefore the hypothesis: Promotional inputs do not play an

important role in pharma marketing is rejected. The role of

promotional inputs is most important

5) Education and experience both are most important to product

managers in pharma marketing. Generally product managers are

qualified. Their minimum qualification is B.Pharm and

postgraduate degree in management.

In case of experience according to 9(60%) product

managers minimum one year experience is required for the

product managers while according to 5(33.3%) product managers

minimum two years experience is required for product managers

in the light of the effective working in the pharma marketing. But if

the experience increases product manager performs his functions

effectively and efficiently. It is clear with the help of table no 6.5.1.

The computed value of chi-square in this case is (6.08) less than

the table value i.e. 7.815.

Therefore the hypothesis: The effectiveness of product

managers depends upon his education and experience in the field

is accepted.

6) According to seven (58,3%) Product Managers January to March

this last quarter of the Pharma year(financial year) is suitable to

294

launch a new product in the market. While according to 4

(33.3%) Product Managers April to June this first quarter of

Pharma year (financial year) is suitable to launch a new product

in the market. The computed value of Chi - Square in this case is

(4.5) less than the table value at 5% significance level i.e. 5.991.

Therefore the hypothesis: The period of launching of the product

and success of the products are interrelated to each other is

accepted.

7) Out of Fifteen (100%) Product Managers Twelve (80%) Product

Managers have given the first preference to Brand name while 9

(60%) Product Managers have given Sixth and Seventh

preferences to Quality Aspect and raw materials respectively. But

when we consider Brand name, Quality aspect and Raw materials

separately then they are definitely important in the formation and

execution of marketing strategy of pharmaceutical products. The

computed Chi - square values of all these three are higher than

their table values at 5% significance level. Therefore the

hypothesis: Brand name, Quality aspects and Raw materials are

less important in the formation and execution of marketing

strategy of pharmaceutical products is rejected.

8) According to Eleven (33.3%) Product Managers, SWOT Analysis

of product has the first preference in the determination of Brand

Plan Seven (46.6%) Product Managers preferred Market

conditions at second, preference, Nine (60%) Product Manager

preferred Prescription Analysis at third preference while allotted

budget is at fourth preference. It is preferred by10 (66.6%)

Product Managers. But when we consider these four criterion

separately, we found that SWOT Analysis, Prescription Analysis

and allotted Budget are most important though their preferences

295

differ from each other their computed Chi - square values are

higher than the table values at 5% significance level. While

market conditions are least important as the computed value of

Chi - Square is lower than its table value at 5% significance level.

Therefore the hypothesis: In the determination of Brand Plan,

SWOT Analysis, Prescription Analysis and allotted Budget are

least important while market condition is most important is

rejected. Because the actual position is opposite to the

hypothesis.

9) The success of marketing strategy depends upon its effective

implementation by the Product Management Department. It is

crystal clear. If we formulate and execute marketing strategy

effectively and efficiently then the chances of its success is

assured. Therefore the hypothesis: that the success of marketing

strategy depends upon its effective implementation by the

Product Management Department is accepted.

10) Gift articles play an important role in getting the business from

Doctors. When gift articles are on the tables of the Doctors they

remind their names and need to the Doctors properly.

11) The feed back given by the field staff influences the marketing

strategy of Pharma Company. Because the Product Manager can

change his marketing strategy according to the feed back given

by the field staff.

12) According to 15(100%) Product Mangers training is most

important to medical representatives. Because education

improves the knowledge while training improves the efficiency of

the employees. Therefore for the improvement in the efficiency of

the medical representatives training is most important.

296

13) Interaction with the doctors assists in the formation and

execution of effective marketing strategy.

14) Technological advancement is always beneficial to the business.

It is also true In pharmaceutical industry. When we develop the

technique of production and distribution then definitely it

contributes in the efficiency and finally in the profit of the pharma

company.

15) Patients are taking the dosages of medicines according to the

instruction given by the doctors. Medical representatives and

other staff of the Product Management Department guide the

doctors in this direction. Therefore in product promotional strategy

importance is given to the dosage.

16) Many medicines require special preservation to protect them from

heat, moisture etc. Therefore concentration is to be made on the

proper packaging of the products.

17) In case of pediatric products flavor is one of the most important

aspect of product promotional strategy. Therefore pharma

company should produce the pharmaceutical products in flavor

which can be easily preferred by the patients.

7.3) Recommendations :

After the detailed study, the following recommendations have been

put forward for effective product management in pharmaceutical

management.

1) As Ideal number of products handled by each Product Manager

and effective pharma marketing are related to each other,

minimum number of products should be allotted to each Product

297

Manager. Their number may vary from 1 to 4. More than four

products should not be given to one Product Manager.

2) Product itself is most important in pharma marketing. Pharma

Companies therefore should produce the qualitative and

standardize product at minimum cost. At present the drugs

available in India are 2 to 30 times economical than the other

countries. But after 2005 because of WTO agreement the prices

of drugs will increase by 2 to 30 times than the prevailing prices

today. Pharma companies are advised to try their level best to

control the prices of pharma products through effective product

management. It would be definitely beneficial to the pharma

industry in India.

3) Field staff plays a vital role in pharma marketing. Therefore

pharma companies should try to recruit qualified and experienced

staff in the Product Management Department.

4) In pharma marketing promotional inputs like Visual Aids, Gifts

Samples, MR Visits, DGM, CRM, Scientific information and

sponsors etc. are most important. Pharma companies should also

concentrate on these promotional inputs and should utilize them

for effective pharma marketing.

5) In case of product managers' only education and / or experience

is insufficient. Both are needed for effective pharma marketing.

Therefore pharma companies may appoint qualified, experienced

and professional personnel as Product Managers.

6) Pharmaceutical companies may launch new products in the last

quarter of the financial year i.e. January to March. The experience

of this period is beneficial to the pharma companies in the next

298 financial year. Through this experience they can achieve the

targets of their production and distribution in the next year easily.

7) Brand Name, Quality Aspect and Raw Materials are most

important in the formation and execution of marketing strategy of

pharmaceutical products. Therefore pharma companies should

give the proper attention to this aspects.

8) While framing the Brand Plan proper attention is to be given to

SWOT Analysis of the products, Prescription Analysis and allotted

Budget as they contribute more in the success of Brand Plan.

9) Pharma companies should try at their level best to organize

Product Management Department effectively and efficiently. Only

effective and efficient Product Management Department can

easily formulate and execute successful marketing strategy.

10) Pharma companies should give the appropriate gift articles to the

doctors. Such gift articles they display on their tables. The

existence of these articles on the table remind them of the name

and need of such pharma products.

11) In the formation and execution of new marketing strategy Pharma

Company should give the proper attention to the feed back given

by the field staff.

12) While recruiting the employees in Product Management

Department preference is to be given to the trained and

experienced personnel.

13) Pharmaceutical companies should always interact with the

doctors through their Product Management Departments. Feed

back from doctors is beneficial to Pharma Companies for the

formation and execution of effective marketing strategy.

299 14) Technological advancement is beneficial to pharma

companies. Therefore companies should under take technological

advancement.

15) Product Management Department assists doctors to prescribe

proper dosage to the patients. This proves to be beneficial to the

Pharma Companies to expand their business.

16) Pharma companies should take care of packaging of the

products. Such packaging assists in the protection of pharma

products against heat and moisture.

17) Pharma companies should produce pharmaceutical products in

pleasant flavor. There is hardly any patient who consumes

medicine with a pleasure unless it has good flavour.