Case Summary
Company Background
Merck & Co. Inc is a pharmaceutical powerhouse now that develops,
manufactures and markets a broad range of human and animal health products.
It was the world's largest pharmaceutical company, employing 70,000 people
worldwide. In 1997, Merck expected to exceed $23 billion in sales, two-thirds of
which were for human drug therapies.
Propecia
Finasteride, the active compound originally developed by Merck to treat enlarged
prostate was found to be effective in treatment of Male Pattern Hair Loss (MPHL).
Key points to note about the product -
A hormone called dihydrotestosterone causes miniaturization of the hair
follicle and shortening of the growth phase of the hair shaft - Finasteride
blocks the conversion of testosterone to DHT thereby stopping the
deterioration of hair follicles.
Clinical trials show 83% of participants at least maintained their current
hair count i.e. no net hair loss.
66% of men who took Propecia experienced visible hair growth within the
first year.
Side effects include - sexual side effects in men, birth defects in male
foetuses if ingested or absorbed through skin of pregnant women
Market
Hair loss market accounts for $1.5 billion in annual sales.
Competitor
Rogaine, the only option approved by FDA to treat hair loss, a lotion to be applied
to the scalp. 50-60% market share as compared to generics. 95% brand
awareness. It is soon going to launch an extra-strength version of the therapy.
Marketing Prescription Drugs
Prescription Drugs can be marketed in 2 ways -
i)
Marketing Directly to Patients - this uses advertisements. The Ad copy
is restricted as per FDA regulations. There are 3 possible routes the ads
can take.
ii)
Marketing to Physicians - this involves medical reps who are
responsible to detail the physicians about the products.
Issues to be Resolved
Hair Loss is a consumer-activated problem and thus, there lies a huge
opportunity for direct-to-consumer marketing. Merck, a physician marketing
expert, however, has no experience in consumer marketing and thus, a lot rides
on the success of the strategy.
1)
What type of advertising to use?
2)
How should the product be positioned?
3)
How much detailing support is needed?
