Marketing Benchmark Series: Novartis Pharmaceuticals
For the first post in this big pharma marketing benchmark series, we look at Novartis.
Novartis, with its headquarters in Basel, Switzerland, is one of the biggest pharmaceutical organisations - in terms of market share and sales - in the world.
In this marketing benchmark series, we’ll look at some of the marketing activities conducted by Novartis Pharmaceuticals to get a glimpse into the organisation’s marketing strategies and tactics. The benchmark posts in this series will use the first section of the SWOT analysis to determine strengths and weakness, then we’ll use the 7Ps marketing mix model to look at some specific tactical components of Novartis’ marketing outputs before concluding with some speculative predictions of Novartis’ near future.
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STRONG PRODUCT PORTFOLIO
Novartis’ core strength is its product range - they are considered the second largest in the biotech field the second largest manufacturer of generic drugs worldwide reaching more than 150 countries. The organisation manufactures a range of pharma, generics, OTC drugs, vaccines amongst a large range of other products divided into three operating divisions: Innovative Medicines, Sandoz (generics) and Alcon (eye care). As of writing, the organisation is valued at $226.539 billion (CHF 224.178 billion) on the SIX Swiss Exchange.
On the whole, it seems that Novartis is slowly shifting its focus towards generic medicines along with patent expiries and volume-driven growth in the pharma sector.
ADAPTING TO NEW MARKETS
In recent times, Novartis has set its sights on growing its share in the Indian markets but has been met with some friction, presumably due to the brand’s inability to adapt its message and promotional channels to this new local market. Novartis has a presence in most of the developed countries, and have now shifted their focus on developing nations like China and India due to its product line of generic medicines.
CONTROVERSIES
The organisation has maintained a good reputation in recent years, but it is not without its past criticisms like many in big pharma. Such as in 2008 when it overstated the efficacy of their Focalin XR drug while marketing to the public and medical professionals. Or later in 2010 where Novartis were accused of paying illegal kickbacks to health care professionals through speaker programs, advisory boards and entertainment.
But as the past controversies mount, the image of the Novartis brand has taken a slight hit - which again, reminds marketers of the importance of ethics in pharmaceutical marketing.
PROMOTION
Novartis, like many pharmaceutical organisations, utilises various print media for public reach. But since it has decided to focus more on prescription drugs - rather than consumer healthcare - it has tended to shift its focus on to the physicians and would prefer to organise or sponsor events and conferences or using SMEs to provide information to its non-patient audience, for example.
Last year, Novartis held a global review of its marketing activities - which would include media planning and buying - and we are yet to see the full extent of the review outcomes.
NOVARTIS COLLABORATION WITH MICROSOFT
Last year, it was announced that Novartis and Microsoft were teaming up to apply artificial intelligence to some of the most intractable problems in healthcare, in one of the most expansive tie-ups so far between big pharma and big tech, as the Financial Times elaborated: “Under one part of the five-year agreement, which will be reviewed annually, Microsoft will work on new tools intended to make it easier to apply AI to all areas from finance to manufacturing. A second part of the work will focus on using deep learning — the technique that has brought the biggest recent advances in AI — to improve the speed and precision with which it develops new medicines.”
WHAT DOES THE FUTURE LOOK LIKE FOR NOVARTIS?
Novartis’ CEO, Vas Narasimhan, recently highlighted the organisation’s growth strategy, which includes a series of launches, limit M&A spend, further investment in gene therapy and oncology products. They also plan on increasing the focus on digital technologies where the organisation made a range of appointments, including the creation of a new position, chief digital officer. This could trigger more digital-led R&D (and potentially, marketing) initiatives, such as the AI project with Microsoft, in the near future.
Operationally, Novartis has shifted its focus on R&D and created focused divisions by shifting its pharmaceuticals portfolio from Alcon to the Innovative Medicines segment and shifting its mature products to the Sandoz segment. Such categorisation helps each of the operative divisions develop a targeted marketing strategy most suitable to its customers and stakeholders and “use science-based innovation to deliver better patient outcomes” at the same time, expanding their presence in the emerging markets of Asia, Africa and Latin America.
