Nielsen Healthcare DTC Learnings & Benchmarks in Pharma
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1 Copyright ©2015 The Nielsen Company. Confidential and proprietary. March, 2017 DTC LEARNINGS AND BENCHMARKS IN PHARMA
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Transcript of Nielsen Healthcare DTC Learnings & Benchmarks in Pharma
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March, 2017
DTC LEARNINGS AND BENCHMARKS IN PHARMA
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DTC IN PHARMAFollowing the FDA’s DRAFT Guidance for Industry on Consumer-Directed Broadcast Advertisements release in 1997, the Pharmaceutical Industry has made significant investments in Direct to Consumer advertising each year
1998199920002001200220032004200520062007200820092010201120122013201420150.00
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2.00
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4.40 4.60
5.40 5.33
4.43 4.514.02 3.98
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Rx DTC Ad Spend*
Spen
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Billi
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*Source: IMS
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DRUG APPROVALS: SPECIALTY VS. TRADITIONAL2015 marked the highest overall number of drug approvals since 1996, with Specialty accounting for the majority of FDA approvals over the last 6 years
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 20150
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FDA Drug Approvals in the U.S.
Traditional SpecialtySource: FDA.gov and ExpressScripts
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TRENDS IN PHARMA DTC ADVERTISINGNielsen has evaluated of 800 pharmaceutical DTC concepts using our BASES DTC forecast model and shows a similar trend in the increase of specialty products for evaluation over the last 5 years
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 20160
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BASES DTC Rx Product Forecasts
Traditional Specialty
Perc
ent (
%) o
f Con
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WHY USE DTC? WHAT IS SUCCESS?The key metric for DTC is generally ROI. That is, if I spend $20MM, can I make that back?
Success, however, is not so easy to define and varies by company.• Anything above break-even?• 1-1.5 return?• Gross vs. Net?• “Keep up with competitors”?
DTC very rarely “saves your brand”, but can add an important lift as well as keep you relevant in a competitive category.
One thing that is certain is that although the target audience is much smaller (i.e. sufferers of a given condition), the price per Rx to the manufacturer is usually quite high ($100+), even higher for specialty products.
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BEYOND ROI AND REVENUE
In general, incremental volume from DTC is a small part of the overall franchise, ranging between 5-20% with most brands closer to ~10%
• Outliers can see as little as 3% to as much as 50%
• 30-50% contribution is rarely achieved and comes from categories where patients would not really be treated unless otherwise asking their physician (i.e. erectile dysfunction)
• A recent Nielsen BASES DTC validation in an auto-immune category saw a 10-15% lift 12 months post DTC launch
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Maximum: $3.39Minimum: $0.02
*from analysis of 48 live campaigns from 2001 to 2008
$1.00 is break even
Observed ROI’s from Nielsen Retrospective Analysis*
ROI NORMS IN PHARMAIn Nielsen’s experience DTC campaigns with ROI’s over 2:1 generally fall within the most successful 20% of DTC campaigns. The median return is 1:1, so a return greater than 1:1 for a campaign is good, relatively speaking.
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DTC PHARMA ADVERTISING: IMPORTANT CONSIDERATIONS
Population: The bigger the population, the more likely it is for broad scale advertising to pay out.
Consumer influence: When consumers have more say in their treatments or are more motivated to seek treatment for their symptoms, DTC is more effective.
Frequency of doctor visits: If a patient goes to the doctor often for their condition, that increases the opportunities for her to talk about medication options.
Persistency and annuity: Once you get a patient in the door, that patient is worth more if they are likely to continue on the medication at a regular pace versus a ‘one and done’ medication.
Price: Out of pocket costs matter to the patient, while a high WAC could off-set other limiting factors (like a lower population).
Uniqueness: Fulfilling an unmet need tends to motivate consumers more than a ‘me-too’ product.
Competitive environment: Harder to stand out in a crowded marketplace, but also risk being excluded from the conversation
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READY TO FIND OUT IF DTC ADVERTISING IS RIGHT FOR YOUR BRAND?
Our validated BASES DTC forecasting can provide the answers you are looking for
Contact Tom Richards, VP Marketing & Strategy for Nielsen Healthcare to learn
more at [email protected]
