 "Patented drugs find it tough to get branded")
Multinational pharmaceutical companies own the best-selling medicine brands in India, according to market research reports released last month. However, their marquee brands are almost always their heritage brands, with their recent drug discoveries never making it to top rankings.
Corex, Augmentin, Phensedyl Cough, Revital and Combiflam are all-too familiar MNC brands. Some of these comprise the five best-selling brands,with each clocking revenue of over Rs 250 crore in the year ended March, 2013, according to IMS Health, a leading market research firm.
Why is branding recent discoveries so difficult for these MNCs, who already own blockbuster drugs that Indians use regularly?
That is because patented drugs are no cakewalk. Yet, MNCs can't ignore branding them as they need to pave the way for their newer drugs in a market like India. "In spite of the regulatory challenges surrounding patents in India, MNCs will remain keen on launching their research products here, as developed markets continue to shrink or become static," says Kumar Hinduja, senior director (strategy planning, business development, pharma and payer solutions) at IMS Health.
Experts say pricing is a hurdle. The top-50 drugs list is dominated by products that are affordable. But most of the recent patented medicines, catering to complex therapies, are expensive. For pharma companies, newer therapies for complex ailments are the need gaps to focus R&D on.
"It is natural that branded generics will score better than patented medicines as best-selling drugs. Therapies for cough and cold are segments of mass consumption, whereas patented medicines are mostly for complex treatments such as oncology, which does not have one drug for all types of cancer," says an official of an MNC which sells patented medicines in India.
Choosing the right area for therapy is the key. "A lot depends on what is the therapy, how important is the drug and its efficacy. Simple pain and common ailment medicines score more in terms of sales because customer decisions are easier," says Susan Josi, Managing Partner of Sorento Healthcare Communications. It is a healthcare advertising agency which works with major domestic as well as MNCs such as Novartis, Abbott, Merck and GlaxoSmithKline.
Areas such as anti-diabetics, gynaecological and cardiovascular drugs are also getting their share of recognition, apart from painkillers, vitamins and cough syrups.
Novartis' Galvus Met and Merck Sharp and Dohme's (MSD) Janumet, both anti-diabetic medicines, are the only two patented products that feature among the top-50 best-selling medicines in India, by dint of their annual sales in the year 2012-13, as per IMS Health and another research firm PharmaTrac. While Galvus Met clocked an annual sales of Rs 142.4 crore, Janumet garnered Rs 118.4 crore.
Multiple audiences further complicate branding. While many customers buy medicines for common ailments on their own from chemists, patented products are always prescribed by doctors. "Unlike other consumer brands, for prescription brands, the influencers are doctors and in some cases, the chemists," says Josi.
According to Josi, identifying the five Cs helps in brand-building of medicines. "Whenever a new drug comes to us for branding, we examine the product on five key dimensions - compound, company, competition, condition and consumer," she explains. This involves understanding the compound or drug first, identifying its unique selling proposition, and then devising the strategy for the client. To build a successful brand, the alternative products available in the market are evaluated too. Highlighting the condition which is going to be treated by the drug is indispensable. Only then is consumer behaviour - in this case, both of doctors and patients - analysed.
"The companies will have to align with local conditions - be it (choosing) the right therapy (or ailment), affordable pricing, patient (contact) programmes or marketing tie-ups (for distribution). This will enable the brands to widen their reach and gain acceptance. Januvia and Galvus are perfect examples of patented brands that have been successful in India," says Hinduja.
For instance, apart from being anti-diabetic products, MSD's Januvia and Janumet are also marketed with an India-specific pricing, that MSD claims is one-fifth of their US prices (at Rs 42.8 and Rs 22 per tablet, respectively). Various patient access and disease awareness programmes have popularised such patented drugs.
Even though the share of patented medicines in India is marginal, the IMS Health data reflects a year-on-year growth for the past four years. Patented drugs, which were just 0.3 per cent of the total Indian pharmaceutical market in the 12 months ended February, 2010, has grown to 0.9 per cent in the corresponding period ended February 2013. In this period, the total pharma market has increased significantly from around Rs 48,000 crore in 2009-10 to over Rs 72,000 crore in 2012-13.
FIVE LARGEST-SELLING MEDICINE BRANDS
Corex, Augmentin, Phensedyl Cough, Revital and Combiflam are all-too familiar MNC brands. Some of these comprise the five best-selling brands,with each clocking revenue of over Rs 250 crore in the year ended March, 2013, according to IMS Health, a leading market research firm.
Why is branding recent discoveries so difficult for these MNCs, who already own blockbuster drugs that Indians use regularly?
That is because patented drugs are no cakewalk. Yet, MNCs can't ignore branding them as they need to pave the way for their newer drugs in a market like India. "In spite of the regulatory challenges surrounding patents in India, MNCs will remain keen on launching their research products here, as developed markets continue to shrink or become static," says Kumar Hinduja, senior director (strategy planning, business development, pharma and payer solutions) at IMS Health.
Experts say pricing is a hurdle. The top-50 drugs list is dominated by products that are affordable. But most of the recent patented medicines, catering to complex therapies, are expensive. For pharma companies, newer therapies for complex ailments are the need gaps to focus R&D on.
"It is natural that branded generics will score better than patented medicines as best-selling drugs. Therapies for cough and cold are segments of mass consumption, whereas patented medicines are mostly for complex treatments such as oncology, which does not have one drug for all types of cancer," says an official of an MNC which sells patented medicines in India.
Choosing the right area for therapy is the key. "A lot depends on what is the therapy, how important is the drug and its efficacy. Simple pain and common ailment medicines score more in terms of sales because customer decisions are easier," says Susan Josi, Managing Partner of Sorento Healthcare Communications. It is a healthcare advertising agency which works with major domestic as well as MNCs such as Novartis, Abbott, Merck and GlaxoSmithKline.
Areas such as anti-diabetics, gynaecological and cardiovascular drugs are also getting their share of recognition, apart from painkillers, vitamins and cough syrups.
Novartis' Galvus Met and Merck Sharp and Dohme's (MSD) Janumet, both anti-diabetic medicines, are the only two patented products that feature among the top-50 best-selling medicines in India, by dint of their annual sales in the year 2012-13, as per IMS Health and another research firm PharmaTrac. While Galvus Met clocked an annual sales of Rs 142.4 crore, Janumet garnered Rs 118.4 crore.
Multiple audiences further complicate branding. While many customers buy medicines for common ailments on their own from chemists, patented products are always prescribed by doctors. "Unlike other consumer brands, for prescription brands, the influencers are doctors and in some cases, the chemists," says Josi.
According to Josi, identifying the five Cs helps in brand-building of medicines. "Whenever a new drug comes to us for branding, we examine the product on five key dimensions - compound, company, competition, condition and consumer," she explains. This involves understanding the compound or drug first, identifying its unique selling proposition, and then devising the strategy for the client. To build a successful brand, the alternative products available in the market are evaluated too. Highlighting the condition which is going to be treated by the drug is indispensable. Only then is consumer behaviour - in this case, both of doctors and patients - analysed.
"The companies will have to align with local conditions - be it (choosing) the right therapy (or ailment), affordable pricing, patient (contact) programmes or marketing tie-ups (for distribution). This will enable the brands to widen their reach and gain acceptance. Januvia and Galvus are perfect examples of patented brands that have been successful in India," says Hinduja.
For instance, apart from being anti-diabetic products, MSD's Januvia and Janumet are also marketed with an India-specific pricing, that MSD claims is one-fifth of their US prices (at Rs 42.8 and Rs 22 per tablet, respectively). Various patient access and disease awareness programmes have popularised such patented drugs.
Even though the share of patented medicines in India is marginal, the IMS Health data reflects a year-on-year growth for the past four years. Patented drugs, which were just 0.3 per cent of the total Indian pharmaceutical market in the 12 months ended February, 2010, has grown to 0.9 per cent in the corresponding period ended February 2013. In this period, the total pharma market has increased significantly from around Rs 48,000 crore in 2009-10 to over Rs 72,000 crore in 2012-13.
FIVE LARGEST-SELLING MEDICINE BRANDS
- 1st - GlaxoSmithKline's Augmentin
- 2nd - Pfizer's Corex
- 3rd - Abbott's Phensedyl Coug
- 4th - Abbott's Human Mixtard 30/7
- 29th - Novartis' Galvus Met
- 45th - Merck Sharp and Dohme's Janumet