CHAPTER III RELATIONSHIP MARKETING ROLE OF MEDICAL REPRESENTATIVES, DOCTORS AND PHARMA COMPANIES 3.1 INTRODUCTION In this chapter an attempt has been made to doctors relationship with pharma company. Pharma company is concerned, its marketing channel requires a minimum of two parties. In particular, as far as manufacturer of prescription drugs is concerned, the law requires that at least one intermediary stands between the manufacturer and the customer, that is the doctors. It is illegal for the manufacturer to sell prescription drugs directly to the patient. Therefore, the doctor plays a pivotal role in pharmaceutical marketing channels and indeed in pharmaceutical marketing activity, as a whole. Without the prescription of a doctor no ethical drug can be dispensed by the retailer to the patient. The doctor is the decision maker and his role in the distribution channel is vitally important to promote the sale of pharmaceutical products. Hence, an attempt has been made to analyse the relationship marketing with the doctors, medical representatives and pharma company. The analysis has been classified into the following heads:
82 (i) (ii) (iii) (iv) (v) (vi) Concept of Relationship marketing Organizational prospective from the Doctors Doctors prospective from the pharmaceutical company Relationship between Medical representatives, and Doctors Relationship between senior managers and Doctors Dimension-wise comparison between doctors and medical representatives perceptions on relationship with pharma company. 3.2 RELATIONSHIP MARKETING Marketing is a social and managerial process by which individuals and groups obtain what they need and want through creating, offering, and exchanging products of value with others 1. This definition of marketing rests on the following core concepts: needs, wants and demands; products (goods, services and ideas); value, cost, and satisfaction; exchange and transactions; relationships and networks; markets; and marketers and prospects. These concepts are illustrated in the Chart. 1 Philip Kotler, Marketing Management, 13 th Edition Prentice Hall of India, New Delhi, 2009, p.14.
83 CHART 3.1 THE CORE CONCEPTS OF MARKETING Needs, Wants and Demands Products (goods, services and ideas) Value, Cost and Satisfaction Exchange and Transactions Relationship and Networks Markets Markets and Prospects
84 Marketing is the process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational goals 2. Relationship marketing is the practice of building long-term satisfying relations with key parties customers, suppliers, distributors in order to retain long term preference and business 3. Relationship marketing is the focus of marketing activities on establishing, developing and maintaining cooperative, long-term relationships. Firms today are devoting considerable attention to building sustainable competitive advantages by developing and maintaining close cooperative relationships with a limited set of suppliers, customers and channel members. The attractiveness of this approach for building competitive advantage has led many marketing scholars to suggest that relationship marketing is the new marketing paradigm. 2 Peter D. Bennett, Dictionary of Marketing Terms, 2 nd Edition, Chicago: American Marketing Association, 1995. 3 Martin Christopher, Adrian Payne, David Ballantyne and Regis Mckenna, Relationship Marketing, Reading MA: Addison Wesly, 1991, Relationship Marketing: Bringing Quality, Customer Service and Marketing Together, Oxford, England Butterworth Heinemann, 1991.
85 Relationship marketing appears to be the backbone of the pharma company, as evidenced by the continual increases in the number of Medical representatives. 3.3 ORGANIZATIONAL PROSPECTIVE FROM THE DOCTORS THROUGH RELATIONSHIP MANAGEMENT The ultimate aim of relationship marketing in pharmaceutical is, to get prescription from the doctors and the purpose is to treat the patient s illness. In the pharma company prescription can be defined as follows: A prescription has many functions both apparent and latent. The different definitions of a prescription are: Art of compounding defines a prescription as an order written by the doctors, dentist, veterinarian or any other licensed practitioner directing the pharmacist to compound and dispense medication for a patient and usually accompanied by directions for its administration or use. Prescription, in its verb form may also refer to the act of issuing the order by the licensed practitioner. A doctor may prescribe rest, diet and exercise without giving any medicines on, certain occasions.
86 Dictionary definition of prescription may refer to the directions for administration. In deed of prescription serves a broad spectrum of functions. The most familiar functions of a prescription are that it serves as: A means of communication between the doctors, patient and pharmacist. Legal authorization for dispensing legend drugs. Therapeutic record source. A method of therapy. A means of clinical trial. Thus, we can see that prescription is more than an exchange process. For quite some time, prescriptions have been used to study treatment patterns and predict and analyze markets for various therapeutic categories in a number of countries. In today's highly competitive pharmaceutical marketing arena, discerning marketers are increasingly concentrating on studying prescription trends and the prescribing behaviour of doctors.
87 The organization expectations from the doctors through relationship management are: To generate and increase good numbers of prescription. To generate and increase good numbers of prescriber base. Brand establishment. Satisfying customers need and developing Loyal Customers. Growth in sales. To establish the company as well as product image at market place. Profitability and Service to human welfare. (i) To Generate and Increase Good Number of Prescription In pharma company doctors are the back bone of the their business. In this context, their major objective is to generate more number of prescriptions from each and every doctor whom they are meeting. Through relationship marketing, they want to increase demands for their brands obtained through the patronage of the doctors.
88 (ii) To Generate and Increase the Prescriber-base In relationship marketing, all Pharma companies would like to increase their prescriber-base through various marketing activities by their Medical representatives. The steady increase in the number of doctor s prescriptions enhances the sale value of their medicine. (iii) Brand Establishment Through relationship marketing, they can popularize their brands by increasing the number of prescriptions and prescribers base. Thereby they get good business returns as well as better brand image at market place. (iv) Satisfying Customers Need and Developing Loyal Customers Relationship activities, if successful in propitiating the doctors in all aspects, he will recommend their company brands continuously and will become Loyal customers leading to good business returns. (v) Growth in Sales If a company develops a large number of Loyal customers for their brands, automatically the sales of that brand will go up.
89 (vi) To Establish the Company as well as Product Image at Market Place Through relationship marketing pharmaceutical companies want to establish their company image as well as products image by increasing sales volume at market places. (vii) Profitability A business organization's ultimate aim is to make profit. Through relationship marketing only they can achieve their goals. (viii) Service to Human Welfare In general all pharmaceuticals products should help the human beings' welfare. Most of the pharmaceuticals companies market good quality products with affordable prices to serve the human needs. marketing. All these activities happen only through doctors relationship
90 3.4 DOCTORS PROSPECTIVE FROM THE PHARMA COMPANIES The following factors are very vital expectation from the Pharma companies by doctors. Scientific Information and Educations Quality products Solution to their Patients problems Patients' benefits Regular visits by Medical representatives and senior managers Satisfying their needs or Sponsorship (i) Scientific Information and Education Doctor s practice in today's environment, scientific information and education are vital one to update their knowledge, thereby they will be able to serve their patients in a better way. So all doctors are expecting good scientific information (like leave behind literatures, reprints, clinical trails data) or scientific education like Continuing medical education and Continuing Technical education (like laser, cosmetic surgery), from the pharmaceutical companies.
91 (ii) Quality Products Generally all doctors expect good quality products and product range to satisfy their patients' need from the pharmaceutical companies. (iii) Solution to their Patients' Problems Doctors always look forward to good practical solution from the pharmaceuticals companies to solve their patients' problems through innovative products or services (like patients' education programme). (iv) Patients Benefits Doctors are more keen on patients' welfare. So they expect from pharmaceuticals companies to market the products that give good results quickly at affordable prices. (v) Regular Visits by Medical Representatives and Senior Managers Doctors always look forward to the visit of the medical representatives and managers to their clinics or hospitals at regular intervals.
92 (vi) Satisfying Their Needs or Sponsorship Doctors are expecting good support from pharmaceuticals companies to satisfy their clinics or hospitals or personal needs or sponsorship to attend national and international conferences. Doctors. These are the expectations from the pharmaceuticals companies by The doctors consider two major factors while they prescribe the drugs which are scientific benefit or commercial and both benefits. Scientific information includes editorial contents of medical journals, articles published in medical journals, other doctors' experience, clinical pharmacologists and research publications, product information monographs, and literature published by pharmaceutical companies, advertisements in medical journals detailed talks by medical representatives, clinical trail reports, seminars and symposia conducted by drug companies. Commercial benefits include products offer, clinical supports, Gifts and sponsorship.
93 3.5 RELATIONSHIP BETWEEN MEDICAL REPRESENTATIVES AND DOCTORS Medical Representatives plays a key role in the formation of longterm relationship between company and Doctors. In this context, personal selling is the most important and effective of all the elements of promotional mix in pharmaceutical marketing. It can increase awareness, create interest, lead the doctors to evaluate, induce them to try their products and after successful trial persuade them to use and reassure them to use repeatedly. Personal selling, to be effective, should have the support of advertising, sales promotion and publicity. These other elements of the promotional mix create a favourable climate and get the Medical representatives of a company the much needed welcome at the enhance. Doctors want more from pharmaceutical sales representatives than just a quick sales pitch and drop-off of samples. They want a collaborative relationship with sales representatives (medical representatives) as trusted partners to gain access to relevant information and tools that will help their practice. Developing a collaborative approach can result in increased access to doctors and increased sales representative productivity.
94 In the pharma company, sales representatives are charged with providing credible product information to doctors, in an increasingly constrained environment, that is PhRMA (Pharmaceutical Researcher and Manufacture Association) guidelines, reduced doctors access, increased numbers of sales representatives and so on. The end result is that doctors are spending less time with pharmaceutical sales representatives. (It is applicable in specially US market) Whereas in India due to Fringe Benefit Tax (FBT) and more number of Medical representatives visiting to the doctors clinics, thereby doctors are frustrated (some times) and reduce their interview times with pharmaceutical Medical Representatives. However, doctors, as prescription gatekeepers, have historically been the primary audience for pharmaceutical companies. This role has been eroded by ongoing changes in how health care is paid for and who influences, and to what degree they influence prescribing decisions. We put this issue to the think tank, since it is reasonable to address it as a first step in thinking about investing in doctor s relationship. The doctor's most direct point of contact with a pharmaceutical company is the pharmaceutical sales representative medical representatives,
95 many of whom provide these types of benefits. It is reasonable, therefore, to expect that the benefits gained from interacting with pharmaceutical sales representatives would translate into doctors holding positive perceptions of these representatives. However, any negative element in the customer-client (doctors-representative) relationship lays the groundwork for negative outcomes: refusal, denial, or passive aggression. Because sales representatives are a significant source of information in an area fraught with the potential for harmful consequences, it is important for doctors to hold positive perceptions regarding a pharmaceutical sales representative's drug, company, knowledge, values and so on. These positive perceptions are necessary in order for the doctors to see the information provided as being credible and to have confidence in prescribing the drug. 3.6 RELATIONSHIP BETWEEN SENIOR MANAGER AND DOCTORS In pharma company senior managers' role are very vital in every aspect. Moreover senior managers' visit will enhance the relationship with their customer like Doctors. This relationship will satisfy the ego of doctors.
96 During last 10 years medical practitioners also have undergone tremendous changes. They almost vacillated from professionalism to commercialism. Pharmaceutical companies are also equally responsible for making a number of small scale companies gullible. As many as 16,000 companies find their ways to reach practitioners in innovative ways. As a result 40, 50, 60 brands try to find out individual ways to get the prescriptions from these practitioners. After all survival is of the fittest. In this context, if Pharma Company wants to succeed in their business they must develop good relationship with their doctors. So relationship marketing is very vital in pharma company. Pharmaceutical companies are adopting so many strategies to develop good relationship with their customer. The purpose of this research is to understand which factors really influence them in the context of relationship marketing. 3.7 DIMENSION-WISE COMPARISON BETWEEN DOCTORS AND MEDICAL REPRESENTATIVES PERCEPTION ON RELATIONSHIP WITH PHARMA COMPANY Doctor relationship marketing is the establishment and enhancement of mutually beneficial long-term relationships between the Doctor and Organizations.
97 Pharmaceutical Promotional Mix The promotional mix in pharmaceutical marketing includes personal selling, advertising, sales promotion and publicity. These can be further segmented for the purpose of better understanding, (i) Personal Selling: Medical sales representative or Medical representatives detail the company s product to doctors, with the help of visual aids, leave- behind-literature, product monographs, samples, gifts, etc. which are the most important elements of pharmaceuticals promotion. (ii) Advertising: Preparation of visual aids, leave-behind-literature, product monographs to assist medical sales representatives in their detailing efforts, and advertising their products in specialized media like medical journals and souvenirs, seminars and medical symposia and mailers for doctor. (iii) Sales Promotion: Deciding on special bonus offers, free samples, gifts and sponsorship.
98 (iv) Publicity: Organizing medical symposia and seminars, conducting clinical trials, conducting exhibitions, designing and executing product publicity campaigns for truly innovative products. All these pharmaceutical promotional mix come under seven dimensions under three major factors which will influence the doctors to have relationship with pharmaceutical company. These are: Human factors Product factors Service factor Human Factors Product Factors Service 1. Medical representatives 1. Product Quality 1. Scientific Support 2. Senior Managers' Role 2. Product Price 2. Sponsorship 3. Company image This section analyses the various dimensions namely role of Medical representatives and senior manages under Human Factors, product quality, product price and company image under product factor, and Scientific support and sponsorship under service factors which influence the doctors relationship with pharma company in the study region. For this, personal interview method was adopted with a well designed comprehensive schedule that constitutes the statements under each dimension identified for the study.
99 3.7.1 Relationship of the Perception of Doctors Relation with Pharma Company Between Doctors and Medical representatives Table 3.1 clearly exhibits the relationship between doctors and Medical representatives regarding the components under the dimensions of product factors. Sl. No. TABLE 3.1 RELATIONSHIP BETWEEN DOCTORS AND MEDICAL REPRESENTATIVES IN THE PERCEPTION COMPONENTS UNDER PRODUCT FACTOR Components of Product Factors Doctors Medical Representative Mean score Mean score 1. Quality of Product 4.58 I 4.63 I 2. Product Faster Resolution 4.24 II 4.32 II 3. Product Dosage Convenience 2.78 V 3.79 III 4. Product Acceptance by Patients 3.87 III 3.28 IV 5. Product Side effects 3.16 IV 2.25 VI 6. Product strength 2.41 VI 2.34 VII 7. Product delivery system 2.12 VII 2.77 V Source: Primary data.
100 The analysis of data in Table 3.1 clearly indicates that both the doctors and Medical representatives are having the same perception regarding concern of quality of product and product faster resolution. These factors were ranked first and second respectively by doctors and Medical Representatives under the dimension of product factors. The other factors namely product acceptance by patients, product side effects, Dosage convenience of the product, product strength and product delivery system are ranked third, fourth, fifth, sixth and seventh respectively by the doctors. Medical representatives ranked these factors in fourth, sixth, third, seventh and fifth place respectively. In order to examine the agreement in perception between doctors and Medical representatives regarding their perception, spearman's rank co-efficient has been computed. The computed result (R = 0.75 P < 0.012) showed that both doctors and Medical representatives are having the same perception regarding the factors under product factors. The relationship between doctors and Medical representatives in the perception of components under product price is presented in the following Table 3.2.
101 TABLE 3.2 RELATIONSHIP BETWEEN DOCTORS AND MEDICAL REPRESENTATIVES IN THE PERCEPTION OF COMPONENTS UNDER PRODUCT PRICE Sl. No. Components of Product Price Mean score Doctors Medical Representatives Mean score 1. Premium Price 2.12 V 1.83 V 2. Moderate Price 4.41 I 2.41 IV 3. Economical Price 3.98 II 4.37 I 4. Product packing size 3.27 III 3.80 II 5. Product Presentation Look 2.79 IV 2.82 III Source: Primary data. It is understood from Table 3.2 that both the doctors and Medical Representatives have slightly differed in their perception regarding the different components under product price. The components namely: moderate price, economical price, product packing size, product presentation look and premium price are ranked first, second, third, fourth and fifth respectively by doctors. These components are ranked fourth, first, second, third and fifth respectively by Medical Representatives.
102 The computed spearman rank correlation co-efficient (R=0.39, P < 0.038) showed a poor relationship in perception between doctors and Medical representatives regarding product price. Table 3.3 indicates the relationship in perception between doctors and Medical representatives regarding the components under company image. TABLE 3.3 RELATIONSHIP BETWEEN DOCTORS AND MEDICAL REPRESENTATIVES IN THE PERCEPTION OF COMPONENTS UNDER COMPANY IMAGE Sl. No. Components of Company Image Doctors Medical Representatives Mean score Mean score 1. Multinational company 4.42 I 4.59 I 2. Large size Indian company 3.87 II 4.32 II 3. Medium size company 2.32 V 3.16 III 4. Research background 3.06 III 2.58 IV 5. Company image in the market price Source: Primary data. 2.81 IV 1.78 V The results revealed that both the doctors and Medical representatives are having the same perceptions regarding the components namely
103 multinational company and large size Indian companies under company image. These components are ranked first and second by both doctors and Medical Representatives. The other components under the dimension of company image namely research background, medium size company and company image in the market place are ranked third, fourth and fifth by doctors. Medical Representatives ranked these components in fourth, third and fifth place respectively. The computed value of spearman's correlation co-efficient (R = 0.69, P < 0.016) indicates that both are having same perception regarding the components under company image. Table 3.4 shows the relationship between doctors and Medical representatives in the perception regarding the components under the dimensions of role of Medical Representatives.
104 TABLE 3.4 RELATIONSHIP BETWEEN DOCTORS AND MEDICAL REPRESENTATIVES IN THE PERCEPTION OF COMPONENTS UNDER ROLE OF MEDICAL REPRESENTATIVES Sl. No. Components of behaviour of Medical Representatives Mean score Doctors Medical Representatives Mean score 1. Common sense 4.08 II 3.97 III 2. Effective Communication 2.47 VI 4.07 II 3. Influencing ability 2.75 V 2.27 IX 4. Regular visit 4.39 I 4.52 I 5. Product knowledge 3.05 IV 3.40 V 6. Committed person 2.06 VIII 2.35 VIII 7. Time management 1.74 IX 2.24 X 8. Value system 2.12 VII 2.74 VII 9. The company he works for 1.72 X 3.16 VI 10. Sincerity 3.73 III 3.62 IV Source: Primary data. It is observed from Table 3.4 that both the doctors and Medical Representatives are having same perceptions regarding the components namely regular visit, value system and committed person under the
105 dimension of role of Medical Representatives. These components are ranked first, seventh and eight place by both doctors and Medical Representatives. The other components namely common sense, effective communication, influencing ability, product knowledge, time management, the company he works for and sincerity have been slightly different in perception by both doctors and Medical Representatives. The result of spearman's rank correlation co-efficient (R = 0.84 P < 0.001) indicates that there is a high relation in the perception level between doctors and Medical Representatives regarding component under the dimension of role of Medical Representatives. Table 3.5 indicates the relation in the perception between doctors and Medical Representatives regarding the components under the dimensions of senior management personnel.
106 TABLE 3.5 RELATIONSHIP BETWEEN DOCTORS AND MEDICAL REPRESENTATIVES IN THE PERCEPTION OF COMPONENTS UNDER SENIOR MANAGEMENT PERSONAL Sl. No. Components of Senior Management Personnel Mean score Doctors Medical Representatives Mean score 1. Visiting Doctors Clinic 4.40 I 4.12 I 2. Fulfilling Doctors need in Time 4.24 II 3.17 II 3. Technical supports providing 3.14 III 3.04 III 4. Interacting frequently 2.68 IV 2.27 IV 5. Contact through phone 2.24 VI 1.81 V 6. Greetings during important days 2.01 V 1.79 VI Source: Primary data. The analysis revealed that both doctors and Medical Representatives are having the same perception regarding concern of visiting doctors clinic, fulfilling doctors need in time, technical supports providing and interacting frequently under the dimensions of senior management personnel these components are ranked first, second, third and fourth respectively by both doctors and Medical Representatives. The other components namely greetings during important days and contact through phone are ranked fifth
107 and sixth respectively by the doctors, Medical Representatives ranked these components sixth and fifth place respectively. The computed result of spearman rank correlation co-efficient (R = 0.94, P < 0.016) showed the perfect perception regarding the dimension of senior management personnel. Table 3.6 indicates the relationship in perception regarding the components under the dimension scientific factor. TABLE 3.6 RELATIONSHIP BETWEEN DOCTORS AND MEDICAL REPRESENTATIVES IN THE PERCEPTION OF COMPONENTS UNDER SCIENTIFIC FACTOR Sl. No. Components of Scientific Factor Mean score Doctors Medical Representatives Mean score 1. Product sample 4.26 I 4.37 I 2. Offering Literature 3.51 III 3.61 III 3. Conducting CME / CMTE 2.22 VI 3.14 IV 4. Support for higher Education/ Research 2.44 V 2.91 V 5. Patient Education Programme 3.18 IV 2.66 VI 6. Offering Medical Journals / Books Source: Primary data. 3.91 II 4.07 II
108 It is clearly understood from Table 3.6 that both the doctors and Medical representatives are having the same perception regarding the components product sample, offering medical journals/books; and supporting for higher education and research under the dimensions of scientific factor. The components are ranked first, second, third and fifth by both doctors and Medical representatives. The other components namely patient education programme and conducting CME/CMTE are ranked fourth and sixth respectively by the doctors. Medical representatives ranked these components sixth and fourth place respectively. The computed result of spearman's rank correlation co-efficient (R=0.93 P < 0.004) showed the same perception regarding the components under the dimension of scientific factor. Relationship between doctors and Medical Representatives in the perception level of components under the dimension namely sponsorship is shown in Table 3.7.
109 TABLE 3.7 RELATIONSHIP BETWEEN DOCTORS AND MEDICAL REPRESENTATIVES IN THE PERCEPTION OF COMPONENTS UNDER SPONSORSHIP Sl. No. Components of Sponsorship Mean score Doctors Medical Representatives Mean score 1. Sponsorship for clinical needs 4.58 I 4.18 I 2. Sponsorship for Indian Association of Dermatologists, Venereologists and Leprologists (IADVL) conference registration 3. Sponsorship for Indian Association of Dermatologists, Venereologists and Leprologists (IADVL) conference stay 4. Sponsorship for Indian Association of Dermatologists, Venereologists and Leprologists (IADVL) conference travel 5. Sponsorship for family members 6. Sponsorship for International conference 4.23 II 4.06 II 2.56 IV 3.20 III 3.27 III 2.79 IV 2.35 V 2.40 V 2.01 VI 2.21 VI 7. Sponsorship for value gifts 1.78 VII 2.10 VII Source: Primary data.
110 It is inferred from Table 3.7 that both the doctors and Medical representatives are having the same perceptions regarding, concern of sponsorship for clinical needs, sponsorship for Indian Association of Dermatologists, Venereologists and Leprologists (IADVL) conference registration, sponsorship for family members, sponsorship for international conference and sponsorship for value gifts under sponsorship. These components are ranked first, second, fifth, sixth and seventh respectively by both. The other components namely sponsorship for travel and sponsorship for IADVL conference stay are ranked third and fourth respectively by the doctors. Medical Representatives ranked these components fourth and third respectively. The Spearman's rank correlation co-efficients (R = 0.44, P < 0.018) indicated a perfect equal, perception regarding the components under sponsorship. Table 3.8. Dimension wise comparisons in the perception level are given in
111 Sl. No. TABLE 3.8 RELATIONSHIP BETWEEN DOCTORS AND MEDICAL REPRESENTATIVES IN THE PERCEPTION OF DIFFERENT DIMENSIONS Factors I. Product Factors Doctors Score value Medical Representatives Score value 1. Product Factors 3.24 II 3.42 II Similar Inference 2. Product Price 2.41 VI 2.18 VII Slight difference 3. Company Image 2.34 VII 2.38 V Slight difference II. Human Factors 4. Role of Medical Representatives 4.11 I 4.71 I Similar 5. Senior Managers Role 2.68 V 2.33 VI Slight difference III. Service Factors 6. Scientific factor 2.81 IV 2.95 IV Similar 7. Sponsorship 3.01 III 3.11 III Similar It is observed from Table 3.8 that the perception levels of both doctors and Medical Representatives are similar in majority of the dimensions namely role of Medical Representatives, product factors, sponsorship and scientific factor. A slight difference in perceptions was observed in other dimensions namely product price, senior managers and company image. Thus, it may be concluded from the analysis that both doctors and Medical Representatives are having the similar perception in relationship marketing between the doctors and Pharma Company in the study regions.