Maximising the value of a pharmaceutical line extension using discrete choice modelling, secondary data and market segmentation
Abstract
Pharmaceutical marketing is an industry that differs from consumer marketing in many ways. Pharmaceutical marketers must consider many factors when making product development choices. This study utilises a discrete choice model to make a recommendation for maximising the value of a cough syrup product line extension by an established pharmaceutical company, Celltech. Two cough syrups — Tussionex®, a hydrocodone polistirex extended release suspension product, and Delsym®, a dextromethorphan polistirex extended release suspension product — were already marketed by Celltech. Primary data in the form of a telephone survey of 160 primary care physicians and 140 paediatricians and secondary data from the IMS National Prescription Audit were utilised to inform the research process and generate tradeoff and cannibalisation analyses. Those analyses were done and FDA approval was obtained for the product (Codeprex®, a codeine polistirex extended release suspension product) in 2004, but the product was abandoned after Celltech was acquired by UCB-USA. The value of FDA-approved Codeprex™ was shown to be maximised by the tradeoff and cannibalisation analyses, but corporate strategy trumps applied marketing analytics in this case.
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Author's Biography
Michael Latta has held pharmaceutical marketing positions at AstraZeneca, Boehringer Mannheim, DuPont and Wyeth. He is currently a consultant to pharmaceutical and medical device companies and a professor of marketing at Coastal Carolina University, teaching and researching the use of statistics and marketing strategy at the Wall College of Business Administration in Conway, South Carolina. Michael has published applied research in Atlantic Marketing Journal, Quirk’s Marketing Research Review, Marketing News, Marketing to Health Systems and Alert! magazine, among others. He is a member of American Marketing Association, Marketing Research Association, American Statistical Association and American Association for the Advancement of Science. Michael’s PhD is in I/O psychology from Iowa State University.
Melissa Clark is an associate professor of marketing at Coastal Carolina University in Conway, South Carolina. She teaches and researches in social media marketing and has additional research interests in conscious capitalism, relationship marketing and pharmaceutical marketing. Melissa has published work in the Journal of Digital and Social Media Marketing, Journal of Retailing and Consumer Services and the Journal of Medical Marketing, among others. She is a member of the American Marketing Association and the Society for Marketing Advances. Melissa’s PhD in marketing is from the University of Mississippi.
Citation
Latta, Michael and Clark, Melissa (2016, February 1). Maximising the value of a pharmaceutical line extension using discrete choice modelling, secondary data and market segmentation. In the Applied Marketing Analytics: The Peer-Reviewed Journal, Volume 2, Issue 1. https://doi.org/10.69554/LWBV6606.
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