Chapter - 4 LITERATURE REVIEW: To update, educate and provide samples of the drugs that their companies produce,

Transcription

1 Chapter - 4 LITERATURE REVIEW: Doctor s prescription behavior: To update, educate and provide samples of the drugs that their companies produce, pharmaceutical companies use medical representatives to visit doctors & other healthcare practitioners in hospitals and clinics. Medical representatives present their products confidently as they are experts on these drugs, with the ability to answer questions on their dosage, indications, side effects and much more. It becomes necessary to ask about how much influence these firms have on health care practitioners prescribing habits due to the active roles played in marketing by pharmaceutical firms for their products. The review of literature for this study was conducted from books, journals, etc. Research on physician prescription behavior has exhibited considerable growth over the last few years (e.g Gonul et al; Iizuka and Jin; Chin- tagunta and Manchanda; Rossi, Manchanda and Chintagunta; Xie, Manchanda and Youn; Jacobson and Mizik; Manchanda and Narayanan; Stremersch and Venkataraman) Most of the referenced studies as mentioned above, have focused on the effects of physician-directed marketing communication activities like sampling or detailing (e.g. Chintagunta and Manchanda, 2004; Jacobson and Mizik 2004), patient requests (Stremersch and Venkataraman 2007) and contagion (Xie, Manchanda and Youn 2008). But physician response to prices has been

2 examined by a relatively limited number of studies. However, prices in emerging market like India is important as medical treatment is not insurance linked. There is paucity of research on pricing. Physicians are generally thought to focus on the efficacy of a drug rather than its price (e.g. Kolassa 1995; Law and Yu 2003; Leffler 1981; Scherer 1993; Temin 1980). Gonul et al (2001) - found that the price effect was usually positive on prescription decisions - drawing from a sample of one hundred and fifty-seven physicians and one thousand, seven hundred and eighty-five patientvisits that led to a prescription for a drug of a non-disclosed therapeutic class. The authors attributed their findings to the severity of a patient s condition (which could potentially require a more expensive medication) and the preference for drugs with higher efficacy. However, there is paucity of research on influencing factors on prescribing behavior of Indian doctors. At the same time studies of Coscelli (2000) and Lundin (2000) at the same time concluded that that a physician s habit definitely has an influence on brand-name versus generic choices. Global brands and national brands may influence the prescription behavior too. Impact of one to one selling in pharmaceutical sector: These marketing methods were classified under five promotional strategies namely i) Advertisements, ii) Sales promotion, iii) Public relations, iv) Personal selling and

3 v) Direct marketing. Good rapport with the doctor, launch conferences, reputation of the company, quality of the drug and brand names considerably influenced prescription behaviour, whereas direct mailers, advertisements in journals and giving letter pads and other brand reminders were less effective. Pharmaceutical marketing influences the choice of brands by a physician. Public relation, especially the rapport with the doctor, was the most effective strategy while advertisements in journals and direct mailers were the least effective strategies. Personal selling by sales persons and giving letter pads and even samples were rated less effective strategies. Prescription behavior of physicians is influenced by pharmaceutical marketing. The more expensive strategies involved in public relations are more effective. The pharmaceuticals resort to many ways in marketing their product. Giving away free lunches, gifts, sponsoring holidays and education have all been criticized as inducements that compel a doctor to prescribe without scientific basis. A study from Canada showed that the association with pharmaceuticals leads to less than appropriate prescribing behavior by the doctor. Many physicians, however, do not feel that their prescriptions are influenced by gifts and other incentives provided by pharmaceuticals.

4 Strategy Ratings of Physicians Ratings of Sales Personnel Combined Ratings on scale of 7 Direct marketing 3.88 Advertisements 4.29 Personal Selling 4.41 Sales Promotion 4.77 Public Relations 5.15 Table 14: Mean Ratings of marketing strategies by physicians and Sales Personnel. Narendran, R. & Narendranathan, M. (2013) (University of Wollongong Research Online 2013) There is strong linkage to sales person call (Parsons and Vanden Abeele, 1981, Lodish (1971, 1976), the effect of samples provided by the salesperson & the effectiveness of a sales call is fashioned as a function of a baseline outcome. Copious amounts of money are spent on sales force activity by pharmaceutical firms. The primary source of promotion for the pharmaceutical industry is sales force activity. A primary source of information on new and existing drugs for physicians depends on the interaction between the salesperson and the physician ( Ziegeler et al; Lexchin). It has long been regarded that detailing activities of pharmaceutical firms

5 influence the prescription behavior of physicians (Lurie et al., 1990; Lexchin, 1989). Though, the effects of physician prescription behavior due to the detailing effort of sales personnel were not explored. The number of prescriptions that a physician writes is significantly impacted by the positive effect of detailing (Manchanda and Chintagunta, 2004). The antibiotics were used more by older doctors. Doctors who prescribe a lower proportion of generic drugs have more training on rational drug use, additional education, and better acquisition of medicinal knowledge (Wang et al, 2013). Similar study in India will improve the quality of prescriptions. Weihul et al (2007) say that The prescription behavior of Doctors can be influenced by the increasing importance of retail chemists attached to hospitals due to the rise of new of hospital/nursing home consumer market segments as a result of the emergence of hospitals & nursing homes. Eric De Laat et al (2009) says that Doctors prescription behavior can be strongly influenced by the promotional activities of the pharmaceutical companies. Dr. R K Srivastava (2005) in his article - Changing scenario in the pharmaceutical sector - says that the prescription behavior of Doctors can be influenced by the emergence of nursing homes & hospitals that have led to the emergence of new market segments of hospital/nursing home consumer & has increased the importance of retail chemists attached to hospital. According to Theodorou et al (2009) in prescribing medicine, the most important factor considered is clinical effectiveness. Several factors influence a doctor's prescription behavior, some of them are price, promotion by pharmaceutical companies & advertising to name a few. However, a doctors perception towards Indian and global drugs were not studied by these

6 authors. Country of origin is important in influencing the prescriptions. Global brands may play a role in influencing a doctor s prescription due to huge brand equity. Demand can be affected by promotion in two ways, in one way - as doctors prescribe more of the advertised drug it may shift the demand curve outward, and the other way is that - as the demand becomes relatively price- flexible than before, it may turn the demand-curve. Social welfare can be damaged if higher prices result from a decline of the price battle due to a reduction of price sensitivity owing to product promotion. It could be socially desirable when the demand curve for a drug has an outward shift, if health is really improved at a reasonable cost by this drug. Impact of global (MNC) brands: Much country of origin research points out that in developing countries consumers generally prefer products from developed countries to their own products (Jingjing Ma,Shi (shir) Zhang,2009). Influencing the resulting beliefs and attitudes of consumer perceptions of product quality is a form of image variables of a product s country of origin (Srivastava, 2013). Particularly among developing countries consumers, local brands cannot compete with the glamour of foreign image appeals. (Batra et al. 2000) In choosing a brand, the main sources of information that influences physicians includes: : medical textbooks, proceedings of conferences that are peer-reviewed, medical journals and pharmaceutical sales representatives (Theodorou etal,2009).there can be difference in projecting the image between local and global brands due to usage of these inputs. Eva Moberecker & Adamantios Diamantopoulos (2011) say that important role of positive affect in shaping consumer behavior, thus

7 complementing prior research that focuses exclusively on the behavioral implications of negative affect (most notably consumer animosity) Aaker, David A et al (2009) say brand builders everywhere assume they require international brands. However global brand leadership, not global brands, ought to be the priority - even though most global brands are not absolutely identical from one country to another. Eva Moberecker &Adamantios Diamantopoulos (2011) talk about the important role of positive affect in shaping consumer behavior, thus complementing prior research that focuses exclusively on the behavioral implications of negative affect (most notably consumer animosity) George Balabanis & Adamantios Diamantopoulos (2010) say that strong brands are not immune to misclassification and stress the importance of ensuring that consumers are aware of a brand's true country of origin. There is a paucity of research related to pharmaceutical products. Role of Indian companies in pharmaceutical industry in influencing prescribing behavior of Physicians: Indian pharmaceutical companies have grown tremendously over the last four decades & currently are in consolidation phase. Among the top ten pharmaceutical companies, currently seven are Indian pharmaceutical companies and only three are MNCs. By 2020 the Indian pharmaceutical industry is likely to multiply by four times. Dr. R K Srivastava (2009), in his article Changing scenario in the pharmaceutical sector says that emergence of nursing homes & hospitals have led to emergence of new market segments of hospital/nursing home consumer & has increased the importance of retail chemists attached to hospital which can influence

8 the prescription behavior of Doctors. Entrepreneurial resilience, nothing else, assisted in part or sometimes, by well-meaning government officials and bewilderingly compounded Indian pharmaceutical policies, apparently drafted in National interest, keeps the Indian pharmaceutical going & growing. Ever since the eighties, Indian pharmaceutical gained expertise in good quality and management practices by such alliances and contract manufacturing (loan license) relationships. ( Researchers explored in a cross section of survey that doctors who are frequently in contact with drug representatives are more willing to prescribe newer drug. Such doctors don't like ending consultations with advice solely and are more likely to prescribe a drug that's not clinically indicated (Chris et al, 2003). A study conducted in Haryana (a state of India), explored that doctors considered regular visits by medical representatives with good personality as the best tool of promotion. Good quality literature, journals and sponsorship for conferences or personal tours were considered preferable promotional tools by doctors in comparison to organization of personal gifts, free camps, medicine samples or any other incentive (Arora and Taneja, 2006). The mean ratings of the constructs indicated that the doctors slightly agreed that pharmaceutical firms offer gifts to doctors to influence their prescribing, moderately did not agree that they do so as a form of professional recognition of doctors, and strongly disagreed that their prescribing behavior might be influenced by the gifts they receive. (Madhavan et al, 1997) ( Ethics in prescription behavior:

9 What is the ethical acceptability of physicians receiving gifts from drug companies? Large industry gifts are considered as inducements while small gifts such as pens, paperweights and note pads, considered acceptable by many. Evidence from social science research suggests that gifts of negligible value can influence the behavior of the recipient and the recipient may not always realize this. (Narendran, R. & Narendranathan, M. (2013) (University of Wollongong Research Online 2013) In India same molecules are sold by different pharmaceuticals under different brand names. To cite an example: there are over hundred and forty brands of omeprazole, a proton pump inhibitor, available in India. How does a doctor choose a brand? What are the factors that influence the prescription behavior of the doctor? What is the influence of pharmaceutical marketing on prescription behavior? There are not any recently published studies that have addressed the factors that influence the prescription behavior of physicians in India. This study aims to spot the factors that influence the prescription behaviour of physicians in the choice of brands. Chren and associates feel that whenever a doctor accepts a gift, an unspoken relationship is created between the doctor and the company or its representatives and there's an obligation to respond to the gift. The gift usually reminds the doctor about the brand-name of the drug and results in a prescription. However, gifts cost money which is ultimately passed on to the patients without their explicit knowledge. The physician-patient relationship may be threatened if prescribing practices are affected. Certain educational gifts e.g. books, journals or case record forms and trivial gifts such as pens and calendars may be considered acceptable. The ABPI code had advices companies to distribute gifts which are inexpensive and relevant to practice of medicine. The American Medical Association and US Pharmaceutical Manufacturers

10 Association guidelines suggest that the gifts should involve a benefit for the patients and should not be of a substantial value and should not be accepted if there are "strings" attached for prescriptions. There is a need for a discussion between the professional medical associations and the industry to define acceptable norms for gifts. (IOSR Journal of Business and Management (IOSR-JBM) e-issn: X. Volume 8, Issue 1 (Jan. - Feb. 2013), PP CRM by companies in pharmaceutical sector: Apart from the providing samples, visual-aids and product detailing, corporations additionally carry out CRM Activities to point out their respect and gratitude to the Doctors. MR Reporting manages the entire CRM activities through a robust and easy to use module that takes care of all processes and provides measurable output too. Typical IDIC model is followed in CRM by pharmaceutical companies. Medical representatives make a must see list after gathering information from stockist, chemist, peers, conferences and medical associations. Doctors are later differentiated into core, important and other based on the amount of business they give to the company. The whole differentiation is based on subjective term of the MR. In interaction process; the idea is to know the likes, dislikes, hobbies and family details etc. Customized process is used to provide customized services based on the data collected. The success of whole CRM depends upon how well the companies pass on the data to its sales force and train them on how to use that. (

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