Marketing Anti-Depressants – Prozac & Paxil
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The value Proposition of MAOIs and TricyclicsClinical depression was estimated to affect about 5% of the American population or about ten million people in the early 80’s. The main value proposition of MAOIs and Tricyclics was that these drugs alleviated symptoms of depression 60-80% of the time. Both these type of chemicals aimed at increasing the levels of serotonin and norepinephrine in the consumer’s system thereby altering his or her mood. These drugs catered best to those patients that exhibited the most severe cases of depression.The value Proposition of ProzacMAOI’s and Tricyclics suffered from two major drawbacks. Firstly, the difficulty in administering the drugs- too small a quantity tends to have a negligible effect on the patients and too large a quantity would potentially be lethal. The second major drawback was that there were severe side effects associated with the use of these drugs such as headaches, high blood pressure and occasional brain hemorrhage as well. Prozac’s main value propositions were in addressing these serious shortfalls of MAOIs and Tricyclics: Prozac pills were easy to administer, relatively much safer in larger doses and far more difficult to over dose. The second big value proposition of Prozac was that it had relatively milder side effects as compared to that of MAOIs and Tricyclics. In fact, Prozac’s marketing efforts centered on the tagline “Prozac won’t take away your personality, Depression does that”. The difference between Paxil and ProzacThe key value proposition of Paxil was that it was positioned as an alternative to Prozac, aimed at patients who were intolerant to Prozac (particularly in the long term), and who had concerns regarding the long term side effects of taking Prozac – one major contributing factor to support this proposition was that the half-life of Paxil was only 21 hours as compared to 384 hours for a user of Prozac. Later, Paxil positioned itself as the drug of choice in a new segment called SAD (Social anxiety disorder), and at the time was the first and only medication to get approval from the FDA to treat SAD, giving Paxil a lot of tractability in the segment of clinical depression. Praxil was marketed under the tagline “Your life is waiting”.Failure of MAOIs and Tricyclics to penetrate the marketThere were several reasons behind the failure of MAOI’s and Tricyclics to garner wide spread acceptance in the market.Firstly, as the patents for these types of drugs had expired by 1988, the companies manufacturing them decided not to allocate enough of a budget for marketing these products.Secondly, these drugs were quite tricky to administer and an overdose in Tricyclics in particular amounted to severe consequences, leading psychiatrists and doctors to be reluctant to prescribe these drugs except in the most extreme of cases. This rendered the market size for this segment of users to be relatively low. Lastly, these drugs tended to have severe side effects and thus had a negative perception among its current and potential users.Factors that contributed to the success of ProzacProzac addressed several shortcomings of MAOIs and Tricyclics, such as difficulty in administration and severe side effects. The Prozac pills were relatively difficult to overdose on and had far milder side effects.Savvy marketing techniques were another chief contributing factor to the success of Prozac. Lilly trained its workforce extensively and initially targeted only psychiatrists, then general practitioners and finally at the right time to consumers (post relaxation of DTC norms by the FDA). The highly trained sales force were better able to explain the advantages of Prozac as compared to Lilly’s competitors.
Positive press coverage also helped boost the sales of Prozac as they managed to mitigate much of the social stigma associated with the use of anti-depressants and it became far more socially acceptable to use anti-depressants. Thus Prozac gained a reputation for not only treating depression but also for transforming personalities.Reasons for Paxil’s successFirstly, Paxil positioned itself as an alternative to Prozac users who were intolerant towards the drug and had concerns about the long term side effects of Prozac. By having a half-life of only 21 hours (as compared to 384 hours in Prozac) and relatively milder side effects, GSK was able to capture this market segment. (However it is to be noted that sales of Paxil was still far less than that of Prozac). Secondly, SmithKline Beecham was the first company to win approval from the FDA to treat social anxiety disorders, which opened up a whole new market segment for the company and gave its sales a big boost. The marketing plan revolved around educating reporters, consumers and physicians about SAD, thus increasing demand for its pills.Thirdly, there was improved public awareness through concentrated marketing efforts such as hiring a PR agency to promote Paxil and partnering with the SAD coalition to further strengthen the company’s grip in the SAD segment. The marketing efforts in essence resonated with the customer’s requirements.Lastly, the merger with Glaxo Wellcome to form Glaxo-Smith-Kline (GSK) gave a huge filip to the marketing budget and the company launched extensive direct to consumer (DTC) ad campaigns apart from leveraging other operational and managerial efficiencies from the resulting merger.Strategies to capture product valueProzacLilly and SKB/GSK also used several innovative tactics to capture value from their drugs. Lilly in particular, pioneered the use of an ingenious “detailing tactic”, one which involved educating their sales force about modern psychiatric practices and psychopharmacology, which their sales force could use to effectively direct their efforts towards psychiatrists. Despite not being any better than the older anti-depressant drugs in treating severe depression, the educated sales force were primed to highlight the several relative advantages of Prozac to the psychiatrists. As these psychiatrists were the most crucial factors to the prescription of Prozac and in turn, sales of the product, this was a highly effective strategy. Lilly was also able to reap the benefits of the nationwide effort by care providers to cut costs. Although unintentional, Lilly’s strategy to direct their detailing efforts towards general practitioners worked wonders as Prozac was now positioned as an alternative for general practitioners who were reluctant to send patients to expensive specialists. Within a year of its release into the market, this segment contributed to more than 60% of the prescriptions. Lilly recognized the potential contribution of these general practitioners further and deepened their engagement with them by directing massive educational efforts to educate these general practitioners, helping them make the correct diagnoses and also remove the social stigma attached to psychiatric disorders prevalent at the time. One can say that Lilly captured more than maximum value from this effort as Prozac was being dubbed as the “Wonder Pill” and received widespread positive press.