SECOND OPINION

Three years ago, Tamiflu was king of promotion. Nutley, NJ-based Roche kicked off the anti-flu brand with a ground-breaking mobile tour (designed by St. Louis-based Momentum North America) featuring an actor going about his business while enclosed in a glass box with the tagline, “One person in this town can probably feel safe from the flu. For the rest of us flu sufferers, there’s Tamiflu.”

The tour generated 100 million impressions and snagged 58 percent market share (despite the fact that its competitor, Glaxo-Wellcome’s Relenza, had already been available for a year). The campaign also won Best Overall Promotion in PROMO’s 2000 PRO Awards (November 2000 PROMO), and helped trigger the resurgence of experiential marketing.

Today, however, Roche has slashed marketing budgets for Tamiflu and Glaxo has done the same with Relenza. “You need ground and air coverage to market a product like this continuously,” says Momentum President Mark Shapiro. “[The tour] made a big splash but the client didn’t want to invest in it anymore.”

That commitment to promotion is the dilemma. Make no mistake, direct-to-consumer (DTC) is huge with pharmaceutical marketers, and it’s going to get even bigger. New brands are filling the pipeline almost weekly and with Pfizer’s Claritin making the unprecedented switch from prescription-only to over-the-counter, expect a whole new round of promotional fisticuffs from knockoffs introduced by deep-pocketed rivals. “Ten years ago, there weren’t many brands doing this,” says Anne Devereux, president at Morristown, NJ-based DVC ActiveCare. “Now the need for communication between the pharmaceutical company and the consumer is both obvious and mandatory.”

However, a variety of market conditions (some general, some specific to the pharma category) are forcing marketers to reevaluate their commitment to DTC promotion, rather than just throw money at it. New to promotion and feeling an unfamiliar economic pinch in recent years, pharmaceutical brands are demanding proof of ROI, and some aren’t convinced.

When the Food & Drug Administration cleared the way for DTC marketing in 1997, spending exploded. By 2000, DTC advertising was already a $2.5 billion industry. In 2001, ad spending swelled to $2.8 billion. Almost overnight, DTC marketing was the fourth-largest media category behind automotive, fast food and entertainment, and ahead of alcohol and telecommunications, according to New York City-based Competitive Media Reporting. “Categories like arthritis, allergens and cholesterol have engaged in ‘Coke vs. Pepsi’-type spending wars,” says Cory Kallet, senior partner at Paramus, NJ-based Einson Freeman.

In 2002, however, the pace of DTC spending growth fell for the first time in five years. To some degree, that was to be expected. “I don’t think there are any inherent problems with DTC,” says George Neal, president and COO of Catalina’s Health Resource, which distributes patient newsletters at pharmacies. “When you see a market go from $1 billion to $2 billion in the blink of the eye, it’s hard to sustain that momentum.”

The lack of a commissioner also seemed to make the FDA more cautious about drug approval. Several new products, including competitors to Viagra, weren’t released in 2002 as originally planned. More importantly, the tightening of the HIPAA (Health Insurance Portability and Accountability Act) privacy guidelines and marketing gaffes by companies such as Eli Lilly (see sidebar) made some pharmaceutical brands leery of DTC in 2002.

However, views differ widely on the readiness of pharmaceutical companies to complement mass media with promotion. “Pharmaceutical companies are experimenting with all the traditional consumer CPG marketing techniques,” says Scott Berman, VP at Boston-based marketing consultants Bowne DecisionQuest. “They’re becoming more adventurous as they find new ways to differentiate themselves from their competitors. Basically, they’re going through the same life cycle as everyone else, they’re just doing it 20 years later. And moving faster because they know what comes next.”

Other industry observers aren’t so sure. “We’re seeing some real polarizing decisions being made by both clients and agencies when it comes to direct-to-consumer,” says Shapiro. “Some agencies are making significant commitments to become specialists in this category, while some clients are beginning to think the cost may not justify the impact that these programs have. We haven’t prioritized healthcare as one of the categories we want to focus on in 2003.”

Some say pharmaceutical companies are playing it safe. “As the pressure mounts to get tangible results, pharmas don’t want to experiment,” says Kallet. “They’re going back to what they did before: mass media and med-ed [medical education]. Pharmaceutical marketing is still in its infancy and there is some resistance to promotion. The measurement methodology is different than mass media, and they’re just not as accepting of it at this point.”

Retailers feel the need to do some convincing as well. “[Pharmaceutical brands] are thinking, do I take a couple million from my national campaign and do something a little more targeted in-store,” says Mark Matthews, director of pharmaceutical brand marketing for drugstore chain CVS, Woonsocket, RI, and a former pharma executive. “There’s a double standard. I’ve been on that end of the business and it’s fun and glamorous to see your product on TV. But in the end, is that any more effective or measurable than doing some promotion?” CVS works with PromoEdge’s RX Edge in-store marketing service and an industry researcher to set up a group of test and control stores, looking at pre- and post-marketing prescription volume.

Other agencies are banking on DTC for the future. DVC is not only doing pharma work with its ActiveCare division, it’s bringing its event marketing unit, DVCX, into the act. In mid-2003, DVCX will launch a mall tour for a cardiovascular brand targeting mall walkers.

Events agency GMR Marketing, New Berlin, WI, not only set up a healthcare services unit, it received medical certification. The agency brought a registered nurse on staff and obtained a federal CLIA (Clinical Laboratory Improvement Act) permit that enables staff members to conduct medical laboratory tests for its work with Pfizer Men’s Health Tune-up for Life tour, which provides health screening units at NASCAR events.

It’s been on-the-fly learning for GMR since the agency began working with Viagra in early 2000. “At the time, nobody really understood the language,” admits Joe Mutranowski, director of GMR’s healthcare services and a former sales exec at Bristol-Myers Squibb brought in to get the agency up to speed on DTC. “We had a lot of people just nodding their heads and saying yes.”

Today GMR is focused on both the brands and their audiences. To promote Novartis’ Visudyne, which treats the eye condition macular degeneration in seniors, GMR considered the audience first. Research showed that seniors would be most responsive to a pitch done in a game show style. GMR developed a tour bus and a husband and wife host team. Seniors could participate through game pads mounted around the truck, which mixed entertaining questions with information about the product.

New priorities

The uses for DTC are shifting as well. The original advantage of DTC was to inspire the consumer to bring a medication to the doctor’s attention, rather than vice versa. Take Ortho Biotech’s Procrit, which helps people suffering from anemia. The brand recruited NBA star Alonzo Mourning (who has chronic kidney disease) as spokesperson. “Doctors usually aren’t worried about side effects; they’re focused on curing the life-threatening problem, as they should be,” says Kallet.

Novartis is shifting to DTC for Elidel, a treatment for eczema. “DTC will alert those eczema sufferers who are not in active treatment mode or who are tired of going to the doctor because a steroid-based product was their only option,” says Novartis spokesperson Megan Humphrey. “The challenges to DTC are to make sure the ad can break through all the clutter and motivate the consumer to seek treatment for their condition.”

Early-stage DTC was also dominated by consumer-friendly categories. Today, serious, life-sustaining drugs are now joining the Claritins and Viagras. “Now it’s the real serious brands,” says DVCX president John Palumbo. “You’ve got to take stuff that’s very technical and make it accessible.”

“You’re seeing more brands that used to carry a stigma,” adds Berman. “Those type of brands might benefit the most from DTC. Not in overall dollars but in incremental sales for brands that may not have done it before.”

DTC is also shifting from pure brand building to influencing consumer behavior, such as sticking with treatments.

Recognizing that its Peg-Intron treatment for Hepatitis C is a very difficult process that involves needles and constant discomfort (but offers a better than 50 percent chance for a cure if patients stick to the regimen), Schering-Plough is marketing to patients according to different phases of the treatment. During the first stage, in which patients might feel isolated from friends and family, they’re given a phone card. In another stage, patients become very dehydrated, so they receive coupons for Poland Spring Water. DVC handles. “We’re doing DTC to make patients aware of breakthroughs in therapies and of the significant commitment required for the treatment,” says Craig Granowitz, senior director of hepatitis innovations at Schering Labs.

Pharmaceutical brands are also incorporating more mainstream brands into their promotion. In December, the Minute Maid Co. teamed up with MayoClinic.com to feature Healthy Living Tips on more than 100 million containers of Minute Maid products. “People are used to looking on the back of cereal boxes for health information, why not orange juice?” says Minute Maid managing director Charles Torrey.

Pfizer has agreements with consumer brands ranging from NASCAR to Sesame Street. “[Pfizer] has always been into programs that are one step removed from mainstream promotion,” says Stu Klein, president of The Quantum Group, another member of the CommonHealth network. Teaming with NASCAR was a way for Pfizer to reposition Viagra. “Pfizer wanted to reach men 35 and up,” says Mutranowski. “NASCAR was a great way to reach that crowd. Once they get over that ‘Oh my God’ about walking into a Viagra tent, they find a lot of great health information they never considered before.”

That’s a prescription for convincing pharmas to commit to promotion after all.

Of pills and profits

Top 10 products by total cost of direct-to-consumer advertising; April 2001 to March 2002

DTC gone bad

More often than not, direct-to-consumer marketing benefits the public.

But 2002 also saw some examples of DTC gone wrong. Eli Lilly & Co. came under scrutiny on two different occasions. A mailing of unsolicited samples of Prozac sparked an invasion-of-privacy suit against the pharmaceutical company and drugstore chain Walgreens, which mailed the samples (September 2002 PROMO).

Many pharmaceuticals are also coming under scrutiny for “off-label marketing,” where products are being promoted without FDA approval for uses beyond their original intention. In summer 2002, the Department of Justice began investigating Indianapolis-based Lilly for off-label marketing of Evista, an osteoporosis treatment.

Meanwhile, Pfizer has inherited some off-labeling headaches of its own with a long-standing lawsuit over the epilepsy drug Neurontin produced by Warner-Lambert and its Parke-Davis division (which Pfizer acquired in 2000). Originally filed in 1996 by a former Warner-Lambert employee, the suit contends the company began positioning Neurontin for migraines and psychological disorders, despite research that found it performed no better than placebos for those conditions. The suit also contends Parke-Davis bypassed clinical trials for the product because the patent would have expired during the testing period and the market would have been flooded with cheap competitors. Pfizer says it is cooperating with investigators and that it does no off-label marketing of its own.

Close to home

The Goltz Seering Agency, Green Bay, WI, has a more personal take on marketing to medical conditions. In 1997, founder Bob Goltz committed suicide after a long battle with depression. “Very few of us knew he was even struggling with it at the time; he never showed any signs,” says Goltz spokesperson Janet Bonkowski. “In one of our meetings later, the question was posed, ‘Why do people know so little about this?’”

The agency took it upon themselves to develop PSAs to build awareness about depression and suicide prevention. While driving down the highway one day, Bonkowski happened to see a billboard from SAVE (Suicide Awareness Voices of Education), based in nearby Minneapolis. The two organizations quickly partnered to develop a national campaign titled, “Prevent Suicide. Treat depression.”

The campaign, tentatively scheduled to launch nationally this spring, features TV, radio, newspaper, outdoor PSA and a suicide intervention resource book. At presstime, Goltz Seering and SAVE partnered with the Entertainment Industry Council to secure a celebrity spokesperson for the campaign. “For years we’ve heard about heart conditions; it’s wonderful that we can now educate people on the symptoms for depression too,” says SAVE program director Patty Johnson.