22 Nov 2004  Research & Ideas

Side Effects: The Case of Propecia

Selling Propecia was a difficult marketing task for Merck & Co., and was recently the subject of a case study debated by Harvard Business School alumni.

 

You are the marketing director of Propecia, a new drug for hair restoration that's about to hit the market. But the drug can only be purchased via a physician's prescription. So do you advertise directly to balding men? Do you concentrate on targeting physicians? How about attempting to influence the wives or barbers of balding men?

All these issues and more faced Tom Casola, who in 1997 was heading the Propecia marketing effort for the drug maker Merck & Co. The case was discussed by audience members at the 5th Annual Alumni Healthcare Conference on November 6, 2004; HBS assistant professor Marta Wosinska led the conversation.

The Propecia launch came at a time of regulatory change, which made advertising of prescription drugs to consumers more feasible. But Casola had to consider three limitations on such advertising:

  1. A "product claim" ad could mention both the brand name of the drug and the problem it could correct, but would also have to include a list of major side effects. Trying to put side effects into context in a 30-second TV spot was next to impossible.
  2. "Reminder" ads could mention the brand of the drug, but not mention what the drug was for.
  3. "Help-seeking" ads allowed for un-branded ads that would encourage men to seek a doctor's advice if they were concerned about hair loss.

In addition to marketing directly to consumers, Casola would also consider strategies for Merck's more traditional marketing channel of selling direct to physicians, using the company's army of field representatives. The problem of so-called "detailing" to physicians was that the sales reps have literally a few minutes or even seconds to pitch directly to the doctor, and are selling three Merck drugs at a time.

Direct to consumers

Given the Food and Drug Administration's advertising restrictions, what kind of advertising should Merck pursue, Wosinska asked the audience: product claim, reminder, or help-seeking?

Most attendees thought the product claim approach was the way to go, creating a strong brand awareness motivation for consumers to approach their doctors for a prescription. After all, it was not likely the doctor on his or her own would bring up the subject of hair loss with a patient. "Hair loss is not a disease, but you need to make it a credible condition for the physician," one audience member said. Physicians could be enticed with promises of increased business.

Another advantage to the product claim route: Merck could boast greater success with patients than its chief drug competitor in the market, Rogaine.

One audience member noted that up to 40 million men in the U.S. have male pattern baldness, but only 2.5 million had used Rogaine at that time, leaving a large market to be addressed. "My approach would be, 'If you have never tried [a hair replacement drug] before, here is your first step.'"

But several speakers thought the requirement to include side effects in product claim ads—in Propecia's case, a less than 2 percent possibility of sexual dysfunction—was too big a turnoff to address in a 30- or 60-second ad.

Another dilemma facing Merck was the fact that patients most likely to be helped by the drug were men just starting to lose their hair—and the greater the hair loss, the less effective the drug. The problem for Merck, Wosinska said, was that this group was not likely to realize they have a problem. They are only compelled to action after the hair loss is obvious. So the consumer most likely to buy the product would see fewer benefits.

Thus, a marketing plan to go after "trusted advisers," namely wives and hair stylists who can see problems early on, could be an option. "It's a waste of time to try and get men to go to their doctors," one female audience member said. Instead, Merck should target wives. "Women are the healthcare managers" in families, she said.

The doctor is in

And if a balding man could be persuaded to pay a visit to the physician's office, would the doctor necessarily write a prescription? Doctors are comfortable treating medical conditions, not vanity problems, said Wosinska. How could Merck convince doctors to support Propecia?

One audience member said Merck has to sell the efficacy of the drug to physicians; doctors have to believe it's going to regrow hair and that the potential side effects are small, he said.

Hair loss is not a disease, but you need to make it a credible condition for the physician.

But there was disagreement with that tactic. The goal should be to create brand awareness with men and get them into a doctor's office. "Seventy to 80 percent of physicians will write a prescription if a drug is requested by name by the patient, unless there are overriding health concerns," said an audience participant.

Is a doctor really going to write a prescription for something as medically non-serious as hair loss if there is a chance, admittedly a small one, of sexual side effects?

Propecia hits the market

So what did Merck in fact do? Its consumer ads did pursue a product claim strategy, risking the question of side effects in favor of attempting to convince men that they had a problem and Propecia was the answer.

Wosinska said that even before marketing began, the drug had high ambient awareness—35 percent. And by the end of the first year there was a "staggering" 90 percent brand awareness, she said. The problem: some of that awareness was driven by the much-publicized side effects issue. It was difficult for the drug maker to convey the true risk information necessary to blunt the side effects buzz.

The company did not go after hair stylists or wives, believing such campaigns would not be cost effective. As Wosinska put the problem: "How does a pharma talk to barbers?"

In the end, first-year sales beat internal estimates, thanks to pent-up demand. Propecia is now a $250 million brand: It is a good number, but lower than expected by the company, Wosinska said.

As to the question of whether direct-to-consumer advertising (DTCA) ultimately works to sell prescription drugs, Wosinska said studies indicate it creates market growth for all players, but not much market share improvement for any particular company. To do that, detailing is 5 percent to 7 percent more effective in driving share growth, she said.

And what about that claim that 75 percent of doctors will write a prescription if the patient asks for it by name? "Not really," Wosinska said. DTCA creates drug awareness in physicians as well as patients, so doctors are probably already aware of the drug by the time a patient comes into the office. There is a correlation, not a causation, Wosinska said.