Commentary: Why Drugmakers Prescribed an Ad Blitz
It's the drug industry's version of Star Wars: Episode I--The Phantom Menace. The most widely heralded new drug of 1999 is Celebrex, an arthritis treatment from Monsanto Co. Press reports are playing up the torrid demand--881,000 prescriptions in seven weeks. Indeed, these days hot drug launches get as much buzz as opening weekend box-office receipts. Says HSBC Securities analyst Jack Lamberton: "It's no different than a movie."
That push for a sizzling debut is having a profound effect on the industry. In just a few years, drugmakers have gone from creating sober pitches for doctors to pumping out consumer marketing blitzes that fuel the must-have mentality once reserved for the likes of Furby. "They are starting to act like retailers," says Frank Delano, head of brand consulting firm Delano & Young Inc.
It's easy to see why the rush to turn prescription drugs into mega-brands is happening. The Food & Drug Administration played a key role, relaxing rules on TV ads for drugs in 1997. Consumers are increasingly hungry for health-care news.
But perhaps more important, the economics of the industry have been completely shaken up by the ability of drugmakers to slash drug development times. As recently as the '80s, a drugmaker with a potent new product could hope for eight to ten years of exclusivity before a rival drug was ready for launch. But improvements in technology and a more accommodating FDA allow rival drugs to hit the market much faster today. Merck & Co. experienced the crunch with Crixivan, an HIV drug launched in March, 1996. It quickly became the most-used drug in its class. But Agouron Pharmaceuticals Inc. brought out Viracept in March, 1997--and in just over a year it was No. 1 in the U.S. Celebrex will have even less time. Competing drugs are likely to be on the market in just three months.
The result: New drugs now need to hit peak sales rapidly or risk a competitive bite. Facing a far shorter window in which profits are high, drugmakers have every incentive to push for an instant hit. Says Richard J. Findlay, a pharmaceutical consultant with A.T. Kearney Inc.: "You have to have that product line going up like a rocket."
That's why consumers are getting plenty of carefully crafted marketing messages even before a drug arrives on the market. A year ago, as a first salvo in the Celebrex marketing effort, Monsanto helped finance a public relations campaign to raise awareness of the sometimes dangerous gastrointestinal side effects of nonsteroidal anti-inflammatory drugs (NSAIDs). Often used to treat arthritis, these are the drugs Monsanto wants to displace with Celebrex, which is part of a new class of drugs that is expected to be easier on the stomach. The campaign seems to have worked. "Every patient came through my office with a copy [of a story on Celebrex] asking for this new drug," says Dr. Peter E. Callegari, a rheumatologist at the University of Pennsylvania Medical Center.
The TV and print ad blitz follows. In just three years, direct-to-consumer ad spending has more than tripled, to more than $1 billion. And drugmakers used to wait six months after launch for consumer ads, giving physicians time to become comfortable with the drug. Now, that window is narrowing. Many companies also now use high-profile spokespeople--from Joan Lunden for Claritin to Bob Dole for Pfizer Inc.'s ads on erectile dysfunction.
But the all-pervasive marketing can have a downside. New drugs have usually been tested in just a few thousand patients, a reality consumers may overlook in a much-hyped launch. That means many people may be taking the drug before unknown side effects crop up. Viagra, the most sensational drug debut in recent memory, was tarnished when reports told of deaths among patients who had taken it. Rezulin, a diabetes drug that had a solid debut in 1997, is under FDA review over safety concerns.
Still, consumers can also benefit. As powerful new drugs, such as those to treat HIV, move at a speedier clip through the approval process, aggressive marketing gets that news to consumers quickly. And doctors say ads can inspire patients to come in and talk to them about symptoms. But consumers will increasingly need to learn to sift the health news from the hype. As with all consumer products, not everything is as it seems on TV.By Amy BarrettReturn to top