Parallel Session 2
Five Pillars to succes – A framework for approaching market research in
Emerging Markets
Steve Kretschmer, Ipsos, Turkey and
Beyza Ozel, Novartis, Turkey
5 Pillars to Success:
A Framework for Approaching
Market Research in Emerging Markets
Steve Kretschmer & Beyza Özel
…even over the past 10 months!
The world we live in has changed radically
over the past 10 years…
Over the past few years,
we have been adjusting strategies
to leverage the RISE of
Emerging Markets in Pharma
5
http://www.imshealth.com/deployedfiles/imshealth/Global/Content/IMS%20Institute/Static%20File/Global_Use_of_Medicines_Report.pdf
IMS Institute for Healthcare Informatics
The Global Use of Medicines: Outlook Through 2015
Compound Annual Growth Rate (CAGR) 2010-15
MATURE MARKETS 1-4%
PHARMERGING 13-16%
Tier 1 Pharmerging
China 19-22%
Tier 2 Pharmerging
Brazil 10-13%
Russia 11-14%
India 14-17%
Tier 3 Pharmerging
Mexico, Turkey, Poland, Venezuela, Argentina, Indonesia, South Africa, Thailand, Romania, Egypt, Ukraine, Pakistan & Vietnam
10-13%
Rest of World 3-6%
Pharmerging countries are defined as those with >$1Bn
absolute spending growth over 2011-15 and which have GDP per capita of less than $25,000 on a purchase-price parity basis (PPP).
Growth Drivers: 17 Pharmerging Markets
Our world is transforming!
Each emerging market is UNIQUE
DYNAMIC
AND CHANGING
QUICKLY!!
You are asked to assess the opportunities across 5, 10 or even 17 Pharmerging Markets
WHERE DO
YOU START?
You need a structure to guide the evaluation
Pricing & Reimbursement
A framework for organizing information &
achieving understanding and insight
5 Pillars to Understanding Emerging Markets
The Opportunity Government Influence Stakeholder Influence Marketing
The Opportunity –
Who are the patients who can benefit & what are
their needs?
The Opportunity
I. The Opportunity
The obvious starting points…
Population Demographics
What are the trends? – particularly for age & SES
Disease Burden
What are leading diseases, and why?
But often overlooked…
Attitudes & Behaviors toward Healthcare
These can differ significantly between markets
They are often major factors influencing brand opportunities or challenges
Who are the patients?
I. The Opportunity
Don’t’ rely too heavily on any one source
Population Demographics & Disease Burden statistics are best triangulated across sources
Assess risk factors e.g., smoking
Global Sources:
WHO, CDC, etc.
Local Sources:
MoH, Govt. Stat.
Offices, Physician Associations
…and what are their needs?
I. The Opportunity
Perceptions, attitudes and behaviors about healthcare are critical and need to be measured with market research
Cross-market comparisons make it easier to identify key unique barriers / opportunities
I. The Opportunity
According to FSSS: Federal State Statistics Service, 2009
Key Risk Factors Undiagnosed chronic diseases
Heavy abuse of tobacco and alcohol
Unhealthy diets & low levels of physical activity
For example…
Preparing launch for the only oral MS drug therapy
• Many global MR studies were completed, including Turkey, prior to launch
• Expected oral formulation would be viewed as benefit by physicians, based on research results
• Local Wargaming research revealed physician concerns about patients’ compliance with oral formulation
• Many lower SES patients view oral meds as for low- risk diseases
Government Influence –
How does it impact the market?
Government Influence
How does it impact the market?
II. Government Influence
Assess the following:
Assume the perspective of the ruling party
What are their goals? What are their challenges? Who are their key constituents?
What’s happening with the healthcare system?
What is the state of the system and what changes are planned?
What is the level of democracy?
More democratic = lower risk of sudden and/or significant change
Get to know the local market…
II. Government Influence
Follow the news!
Most major emerging markets have English newspapers, blogs, etc. that are easily accessible
People’s Daily & China Daily (China)
The Moscow Times (Russia)
The Turkish Daily News (Turkey)
With today’s communications and media access, it’s possible to “virtually” live in a country
This doesn’t replace strong local contacts – get to know them and use them!
For example…
Turkish Govt’s price discounts in 2009
• Need to understand the needs & expectations of govt.
without underestimating importance of access for patients
• Govt’s Priority: Stabilize their drug coverage costs
• Novartis’ Approach: Partner with govt., and provide alternative cost reductions that don’t remove drug access
• Have now improved business and increased # of launches every year
Pricing &
Reimbursement –
What are the mechanisms and drivers?
Pricing & Reimbursement
First – overcome any mental block!
III. Pricing & Reimbursement
In emerging markets, P&R is often the #1 under- researched & under-resourced area…yet it has become THE LEADING HURDLE in some markets
This appears to stem from several misconceptions:
1. A belief that market research in P&R is not feasible or must belong to niche consultants
2. A view of P&R as a zero sum negotiation process, rather than an opportunity for long-term collaboration to benefit the patients/citizens, the govt. and the
marketers
3. View the process as ad hoc for each product, rather than an ongoing partnership
Overcoming these misconceptions opens the door to expanding your perspective:
III. Pricing & Reimbursement
View your brand from their perspective – seek to truly understand the viewpoints and objectives of the P&R authorities
Their goal is not usually to just reduce cost – they seek savings in total cost of care and the greatest overall VALUE for patients/citizens
BE PATIENT DRIVEN…not product focused
You must identify and understand the mechanisms of P&R in each market
For example…
Establishment of Novartis Turkey Brand Access Mgrs
• Needed to better engage govt. in access, pricing &
reimbursement
• Established Brand Access Manager role & added “BAMs” to brand teams to manage product in pre-launch phase
Goal = Create Win-Win-Win for patients, govt. & Novartis
• First priority of BAM – provide access to new treatments for patients
Stakeholder Influence–
What is the balance of influence?
Stakeholder Influence
What is the balance of stakeholder influence?
IV. Stakeholder Influence
Physicians Regulatory Groups
Pharmacists
Patients’ Family and Friends
Payers
Government organizations
Patient advocacy groups
Public Health
People
Other Healthcare Professionals
Dr. Watson??
Follow-Up - Is treatment successful; does the problem still exist?
Compliance – Treatment taken as prescribed?
Delivery – Prescription reimbursed? Filled? Switched?
Treatment - What treatments are available?
Diagnosis - How is the problem identified and confirmed?
Evaluation - Who evaluates the problem?
Perception – Is a health problem perceived?
Origination – Who initially consulted about the problem?
Patient Flow
Physician
PERSON
Pharmacist
Other HC Provider or Caregiver
Access & Reimbursement Authorities
…at each stage in the patient journey?
Where are the centers of influence?
IV. Stakeholder Influence
Who are the thought leaders? Centers of excellence?
How does this balance of influence differ regionally?
Particularly urban vs. rural settings?
Which stakeholders are “hubs” of influence
For example, rural PCPs treating higher patient volumes
How do you economically meet the unique needs of these centers of influence?
What dynamics might be changing the balance?
IV. Stakeholder Influence
Implementation of PCP gatekeepers?
Loosening or tightening of advertising laws and retail access?
Increased HCP access to information via new channels?
Increased patient access to information via the Internet or advertising?
For example…
Impact of Family Practitioner program in Turkey
• PCP gatekeeper system just implemented fully in Turkey
Patients must go to FP first or visit not covered
• Govt’s goal is to lower total costs of healthcare through more effective use of specialists
• FPs’ awareness is crucial in order to refer patients to the correct specialty for diagnosis & treatment
Since prescribing for many drugs is limited by specialty
• Novartis focuses special efforts to understand FPs as key stakeholders
Marketing –
How do you most effectively influence the stakeholders?
Marketing
Now you know who to market to…next you need to know how to best market to them
V. Marketing
Three factors are important:
1. Identify cultural differences
in language,
in relationships and their influence,
in perspective of health and healthcare
2. Identify individual differences in attitudes and needs (customer segmentation)
3. Identify which channels are available, and which work best for each stakeholder?
Comparison of top two box purchase intent by database ranking
Identifying cultural differences
This is often best done through a combination of intra- and inter-cultural primary research
The channels available for marketing are changing rapidly
V. Marketing
Patients’ accelerating access to information and
increasing self advocacy offers unique opportunities for direct communication
IF direct communication is not restricted!
Penetration of the Internet and mobile technologies varies across emerging markets and HCP groups
These also offer unique opportunities to leverage alternative channels for targeted messaging
BUT, it’s necessary to know which channels are preferred by the stakeholders, and why?
V. Marketing
Use stakeholder segmentation to prioritize and target efforts based on needs, attitudes and behaviors
For example…
Alternative detailing channels in Turkey
• Market research has identified differing attitudes and behaviors toward technology and pharma marketing that allow for targeted use of alternative channels
• Turkish physicians carry among the highest patient loads, e.g. BUSY HEALERS
• Now the hours for Sales Rep visits at hospitals has been limited by new legistation
• Efficient physician detailing is even more crucial
Pricing & Reimbursement
A framework for organizing information &
achieving understanding and insight
5 Pillars to Understanding Emerging Markets
The Opportunity Government Influence Stakeholder Influence Marketing
Shanghai 1990
The pace of change is unrelenting…
2010
Istanbul in 2020?
It’s now increasingly being LEAD
by emerging markets
When will China become the largest economy in the world?
We will need to invest the necessary
• time
• energies
• resources
• and budgets
to really understand these markets
But we hope these 5 Pillars are a useful framework to guide you…
The path to understanding these markets is
not simple…
Thank you for your time and attention!
Steve Kretschmer
& Beyza Özel
