The analysis of the

pharmaceutical market

1.Alaoty Faisal
2.Stefanescu Alexandra
3.Stoica Anamaria
4.Suruparu Anca
5.Tocaci Anamaria
 Major topics that can be found in this project:
• Demand analysis (volume, value, dynamics)
• Main market segments
• Supply analysis
• Description of Main Competitors
• Marketing and Positioning strategies used on this
market
• Conclusions and Recommendations for future
marketing strategies
 1.Introduction
 The pharmaceutical industry:
- is praised as one of the nation’s leading
industrial sectors.
-the fruits of its extensive research and
development are sold world wide and have
improved the length and quality of life
-a pharmaceutical company, or drug company,
is a commercial business whose focus is to
research, develop, market and/or distribute drugs
 2.History
 the late 19th and early 20th century: the
beginning
 1920: key discoveries
 1970:cancer drugs were developed
 1990: market changed dramatically because of
a new consumerism
 Nowadays : more than 200 major
pharmaceutical company
 3.Market Segmentation

 Pharmaceutical market segmentation is

invariably done by pharmaceutical companies
in order to understand their target market and
target customers.
 Target Market
 Physicians are perhaps the most important
players in pharmaceutical sales. They write the
prescriptions that determine which drugs will
be used by the patient. Influencing the
physician is the key to pharmaceutical sales.
 Pharmaceutical companies are developing
processes to influence the people who
influence the physicians.
 a)Segmentation by Customers
 The pharmaceutical market is divided in many
segments but the most important segmentation
is the segmentations by customers:
• Patients
• Dostors
 Patients distinguish themselves by:
 a. kind of illness
b. stage of illness
c. age group
d. gender (male and female)
 Doctors distinguish themselves by:
 a. Age
b. Speciality
c. Place of Practice
d. General Practitioners
e. Type of Practice
f. Usage rate of products
There are other types of segmentation like:
a)Segmentation by products
b)Segmentation by demography
c) Segmentation by region
b)Segmentation by region
 c)Segmentation by Products

 Segmentation by Products:
-Institutional market products
-Industrial market products
-OTC (Over the counter) or non prescription products
-Consumer or prescription products
 d)Segmentaion by Demography
 Segmentation by Demography:
• elders( the biggest part)
• others
 4. The 4 P’s
 The 4 P’s of a market are:
• A. Product
• B. Price
• C. Place (distribution)
• D. Promotion
 A.Product
 Pharmaceutical products
 -more commonly known as medicines or drugs
 -it is essential that such products are prescribed
and used rationally
 -it is vital that improved and/or new drug
regimens are continually developed through
product/drug discovery(vitro studies, in vivo
studies,clinical trials)-research and
development
Category Value market Share %
Anti-Infective 16.4
Gastrointestinal 10.9
Cardiac 10.3
Respiratory 10.2
Vit./Minerals/Nutrient 9.6
Pain/ Analgesics 9.5
Dermatologics 5.4
Gynaecology 5.3
Neuro psychiatry 5.3
Antidiabetics 4.4
Opthologicals 1.7
Others 11.0

Total 100
 B. Price

 Once a patented drug enters the market, its

producer has some degree of monopoly power.
 Few drugs lack any substitutes at all
 Differentiation occurs because different drugs
have diverse therapeutic effects and
contraindications
 C. Promotion
 Promotion by the pharmaceutical industry
grew substantially, rising 70 % from 1996 to
2000.
 The pharmaceutical industry has allocated
substantial resources to detailing and convey
information to patients.
 In order to promote pharmaceutical products 2
ways that are very often used:
 i)physicians-targeted promotions
 ii)direct-to-consumer advertising
1. Physicians-targeted promotions
 In 2002,the pharmaceutical industry spent
$15.63 billion on promotions, which include
free office supplies,all-expenses-paid events,
sales representatives, and awards to physicians
 In 2001 a study reach the conclusion that :
“Doctors who had contact with pharmaceutical
representatives were 13 times more likely to
ask that a particular drug be added to an
insurance plan’s list of approved drugs”
 2.Direct-to-consumer advertising
 If DTC advertising only motivated certain patients
to see their doctors more often, its harmful effects
would be debatable. The larger and more important
problem of DTC advertising concerns potential
health risks posed by new drugs. New drugs are
not time tested; their long-term effects are
unknown; many patients who can be just as
effectively treated with less expensive, older drugs
are risking their health when using newer drugs
 D. Place(distribution)
 A direct distribution system for its products in
the making them available only from the
company’s sole appointed distributor rather
than from a choice of wholesalers.
 Key stakeholder groups—wholesalers,
pharmacists, hospitals, dispensing doctors, and
government.
 Demand
 The demand for pharmaceuticals derives from
the demand for health.
 The demand for health care is determined by
producer, consumer and also by third-party
intermediaries, as the insurers.
 Health services are traditionally selected by the
physician who neither consumes the service
nor pays for it.
 Supply
 Firstly, pharmaceutical companies compete
among themselves.
 Secondly, they experience significant profit
losses due to competition from the generic
drug manufacturers.
 Finally, the whole pharmaceutical industry
competes with other health care industries.
 PFIZER
Pfizer Incorporated is a major pharmaceutical company
, ranking number one in sales in the world. The
company is based in New York City, and its research
headquarters is in Groton, Connecticut.
 Products:
Ben-Gay.
Viagra
Xanax
 GlaxoSmithKline
GlaxoSmithKline a United Kingdom-based
pharmaceutical, biological, and healthcare company. GSK
is the world's second largest pharmaceutical company and
a research-based company with a wide portfolio of
pharmaceutical products.
Products:
Aquafresh
Augmentin
Panadol
Sensodyne
 Sanofi-Aventis
 Sanofi-Aventis , headquartered in Paris, France, is a
multinational pharmaceutical company, the world's third-largest
by prescription sales. Sanofi-Aventis engages in the
research and development, manufacturing and marketing of
pharmaceutical products for sale principally in the prescription
market, but the firm also develops over-the-counter medication.

Products:
Lovenox
Lantus
Actonel
 Novartis
Novartis International AG is a multinational
pharmaceutical company based in Basel, Switzerland. With
revenues of over $42 billion, it is one of the largest healthcare
companies in the world and a leading giant among
pharmaceutical companies. Novartis owns Sandoz, a large
manufacturer of generic drugs. The company formerly owned
the Gerber Products Company, a major infant and baby
products producer, but sold it to Nestlé on 1 September 2007.
Products:
Voltaren
 Market Strategies
 Because the competition on the market is at a
high level, the advertising needed in order to
attract customers’ attention should be original
and convincing. Some examples of companies
that adopted different marketing strategies are:
• Abbott
• Eli Lilly
• Pfizer Inc.
 Abbott
 Mission statement:
 "To improve lives by providing cost-effective
health care products and services".
 Strategy:
 to remain competitive, by expanding and
continuing to develop innovative products that
will deliver better health care.
 Eli Lily
 Mission:
 "Ensure that all internal and external stakeholders
have the information resources..., to support
Lilly's innovation strategy, to provide health care
solutions, and to build shareholder value“
 Strategies(for growth):
• increase its R&D investments by 27%, to $1.7 billion
• expand sales forces in key markets and increased their
direct consumer advertising in the United States
 Pfizer Inc
 Mission:
 "At Pfizer, life is our life's work".
 Strategies:
• to deliver shareholders value, in the past 5 years Pfizer
shares have generated a total return of more than 690%
• to narrow their focus to only produce what they do
best, pharmaceutical products
• to build powerful partnerships in order to come up with
breakthrough medicines.
 Main Competitors
 Alternative Medicine
 5 Categories:
 Traditional Chinese medicine and Ayurveda
 Mind-body medicine
 Biologically based practices
 Manipulative and body-based practices
 Energy medicine
 The pharmaceutical market of Saudi market
 The Saudi pharmaceutical market is one of the richest in
the Middle East.
 In recent years, the government has had to overcome a
number of problems in improving the healthcare system,
including volatile oil prices, the Asian economic crisis
and political instability in the Middle East.
 Companies:
• Tabuk
• Dallah Pharma
• Spimaco
 Tabuk
 Tabuk Pharmaceutical Manufacturing Company is a fully
owned subsidiary of Astra Industrial Group- AIG (one of
the biggest industrial groups in the Middle East region).
 Today, TABUK is the second largest Saudi pharmaceutical
manufacturer and one of the top five in sales in the
Kingdom of Saudi Arabia (IMS June 2007)
 A number of Tabuk's products are approved in Denmark,
Finland, France, Portugal, Sweden, and Turkey.
Additionally a number of other products are under
approvals in international markets such as Czech Republic,
France, Hungry, Poland, Turkey, UK and USA
 Dallah Pharma
 The activities of Dallah Al-Barakah Group are
spread throughout the world to cover most of
the Arabic and Islamic countries with 260
companies working in various fields with
annual turn over of 7billion $.
 Dallah Pharma supervises the company
investments in the field of Pharmaceuticals,
Naturals Products and Medical Supplies.
 Bibliography
 1.http://www.iitk.ac.in/infocell/announce/conv
ention/papers/Changing%20Playfield-06-
Saurabh%20Kumar%20Saxena.pdf
 2.http://undergraduatestudies.ucdavis.edu/expl
orations/2005/chiu.pdf
 3.http://en.wikipedia.org/wiki/Pharmaceutical_
company