Paradigm Shifts: Pharmaceuticals Marketing

PARADIGM SHIFTS: PHARMACEUTICALS MARKETING

A Case Study: ELDER HEALTH CARE LTD MUMBAI (EHCL)

OVERVIEW

The traditional model of pharmaceutical marketing has undergone a sea change. Companies have moved on from being primarily sales-oriented to now realizing the significance of services marketing with the focus on cross selling.

Apart from their regular distribution channels, which end with the Retail Chemist, Companies involved in pharmaceutical sales & marketing operations have to deal with doctors, and to some extent, patients too. With this recognition of the importance of services marketing, most top companies have set up separate Customer Relations Departments, and ELDER HEALTH CARE LTD (EHCL) is no exception to the trend. Such a department is usually responsible for providing an above average level of service to Doctors and Patients, who are both the actual customers, giving business.

With a diversified business approach to its products, EHCL has a team of Marketing Executives (ME) with the Area Business Manager(ABM) supporting them by coordinating, directing and trying to solve their problems related to service for doctors located in their respective markets.

In 2004-2005, the Customer Relations Department of EHCL invested a disproportionately large amount in the market on both Doctors as well as Retailers through the launch of a totally new Division ELKIDZ in January 2005. This was done with a great deal of trepidation, since hitherto, such expenses unfortunately, did not translate into improved bottom lines and the Return on Investment was far below expectations.

The Company already had a record of loss in the financial year 2001-2002. Assorted ABM’s invested on Doctors trip abroad, their clinical equipments and in some cases even under the accounting head of education; as a Company strategy the concerned ME’s followed up closely with such identified Doctors in terms of business. However, the game was completely one-sided and the Doctors just did not reciprocate positively.

At the next annual review of the Customer Relations Department, the Company felt that bagging the business failed since the gathering and using of information on the customer and his loyalty before any investment was an art as well a science. To succeed in their CRM Program, the Company needed to match the products on offer with the campaign to prospects –in other word, to manage the customer’s ROI intelligently.

The Management saw the point and decided to invest only after the completion of a full information-gathering exercise. In addition, Regional Business Managers (RBM) would henceforth be responsible for any investment towards the CRM Program. The new financial year of 2004-2005 had become a crucial year to the extent that losses again, after two years of profit could put on hold all current and future expansion plans.

COMPANY PROFILE

Elder Health Care Ltd came into existence in 1988. Its first manufacturing facility dedicated to manufacture capsules, tablets and liquids got into production in April 1989 at Vashi, 35 kilometers from central Mumbai. It went on to create facilities for manufacturing inject able ampoules and vials in a separate location at Patalganga, an industrial town 30 kilometers away from the factory at Vashi. Adjoining Patalganga, at a place called Nerul, a unit to manufacture balms/ointments was established. Close to the Nerul plant, a facility was commissioned to manufacture semi-synthetic penicillin’s and cephalosporin’s largely to support its export activity. EHCL later also acquired a similar unit to manufacture larger volumes. Very recently, it has commissioned an API plant to cater to both, the regulatory and non- regulatory market.

The Company started its operations largely identifying products in specific disease categories and has succeeded in creating a therapeutic category in the Indian market in which it category it enjoys a leadership status. The main emphasis of EHCL is to identify molecules specifically for disease treatment and today it has three products in the leading category in the Indian pharmaceutical market starting from Shelcal (oyster shell calcium), Chymoral (a proteolysis enzyme for hastening traumatic and post operative wound healing),and Eldervit (a multivitamin with B-Complex Capsules and injections).

The strength of the organization is in pursuing to launch molecules claiming to be the first in the country. Besides the above three, products to follow were those for treatment of hypertension, carnitine deficiency, and other products the Company could