DocBuzz, Inc., offers e-detailing of pharmaceutical products and augmentation of pharmaceutical companies sales forces. According to the IMS Health Report, pharmaceutical detailing is a 50 billion dollar a year industry. Detailing is the portion of the pharmaceutical sales organization that provides information on new pharmaceutical products, face-to-face meetings with physicians, physician assistants, and nurse practitioners. Detailing is vital as new products are introduced, because the pharmaceutical companies must then make the medical professionals aware of the products, the method of administration, side effects and a myriad of other information. DocBuzz, Inc. offers the pharmaceutical companies the ability use e-detailing, which offers all of the benefits of the standard method of detailing, but with this difference: DocBuzz, Inc., uses the Internet, websites, personal referral networks, conferences, and Web conferences to achieve effective results at a lower cost to the pharmaceutical companies.
3.1 Service Description
DocBuzz, Inc., provides physician assisted marketing and sales of pharmaceutical products. Our service is vital during the pharmaceutical companies’ introduction of new products, the prelaunch of those products and increasing the present market share of existing products. Our company is physician owned, therefore, we have the understanding of the physicians’ needs in the current medical environment. In addition, physicians are more inclined to make a positive commitment when speaking to another physician as opposed to a pharmaceutical sales representative.
DocBuzz, Inc., provides a support infrastructure to pharmaceutical companies’ sales representatives nationwide by offering 24 hour, seven day a week service through our online literature and sampling requests.
Our company represents client companies, as an extension of its already established pharmaceutical sales force, not as a replacement. As a physician owned company, we understand first-hand our client’s endeavor to reach the busy, hurried medical provider, and the frustration and failure of missed contacts. We offer an additional tool to insure that the pharmaceutical company’s message is delivered and that the expenditure time with the medical professional is more productive. The physician will not have the time to listen to pharmaceutical sales representative but will make the time to talk to a trusted member of the medical community. More importantly, the product recommendations are considered more credible since the recommendation is coming from a physician. By using our Internet sampling request, physicians will make their needs known to us, and in turn, we pass that information directly to the sales representative. This increases the productivity of both the sales representative and the physician.
One of the tasks of a pharmaceutical company is to provide educational descriptions of their products to targeted physicians. This is most cost effectively achieved by the Internet’s 24/7 access availability, and our unique incentive program (VIRP). By associating with DocBuzz, pharmaceutical representatives, a vital part of the industries marketing and sales, could offer email response or telephone the physician at a more convenient time 24 hours a day, seven days a week.
3.2 Sales Literature
Literature, articles, product descriptions for all of the companies products we represent, and all of the other information that a practicing physician or other medical professional needs to know, will be available for immediate access through our Internet site.
Introductory information about our company will also be placed on our website, but detailed information describing our company and its positioning will be mailed to the medical professional prior to a DocBuzz, Inc., representative telephone conference or visit to the client’s facility.
3.3 Competitive Comparison
The competition comes in several forms.
Eric Rule, a partner with Cooper & Lybrand’s Integrated Healthcare Consulting Services practice, said, “With competition intensifying in the world’s pharmaceutical markets, being the first to market is crucial to securing a product’s success”. In the article Survey: Strategic issues facing the pharmaceutical industry, printed in Pharmaceutical Representative, dated April 17, 2001, one hundred-fifty senior pharmaceutical and biotechnology industry executives in the United States and Canada rated time-to-market for new products and making strategic alliances successful as number one and three respectively out of a list of twenty-three of the most important issues that face the pharmaceutical, biotech and medical device industries. The pharmaceutical industry has been dependant on their own in-house sales and marketing representatives to insure that the introduction of new products is successful.
The pharmaceutical industry is using net techniques to keep the rising cost of marketing their products to the medical community under control. Pharmaceutical companies are actively seeking to form strategic alliances with physicians both individually and collectively. “When industry leaders tell you that timely development of new products is the top key issue for the fifth consecutive year, you can be sure they’re pulling out all the stops to get differentiated products to the market ahead of the competition,” said Erik Rule. Andersen Consulting produced the report How Much are Marketing and Sales Capabilities Really Worth? What Every Pharmaceutical Executive Should Know. This report illustrates that within the pharmaceutical market, product differentiation overall is very small, so any differentiation must be driven through marketing and sales. The report shows that “42% [of the difference in operating margin] is explained by marketing and sales capabilities performance.” The report continues, “There are lots of me-too products in the market with very little differentiation. It is the job of marketing and sales to drive the differentiation.” The pharmaceutical industry is feeling the pure economic pressure of the market place, their shareholders demand increased profits and everything the company does costs money. The pharmaceutical companies’ need to reduce sales and marketing expense, while increasing their sales, is forcing them to try new methods, which translates into additional competition for our company.
Andersen Consulting surveyed 68 senior marketing and sales executives representing 18 large pharmaceutical companies in North America. The finding illustrates the pressure that the industry is experiencing. The difference between an average performance operating margin and the high performance-operating margin is 42%. That is not much of a difference, until one realizes that this is a one billion dollar industry, and if DocBuzz could simply improve a companies marketing and sales capability by 30%, that would translate into an additional $135 million in operating margin. The pharmaceutical industry generates $93.6 billion annually.
Our greatest competition comes from the pharmaceutical industry itself. The competitive pressure within the industry provides the perfect climate for us to launch our services. The industry has to make marketing and strategic alliance decisions so quickly, that markets are being ignored and these markets, when combined, are huge. For example, currently there is no e-detailing to the thousands of Physician Assistants and Nurse Practitioners. Research indicates that there are approximately 650,000 physicians in the United States; however, there is at least twice that number of Physician Assistants and Nurse Practitioners in the United States. The DocBuzz, Inc., target market, in addition to physicians, is to the physician assistants and nurse practitioners.
DocBuzz, Inc., has identified four start-up companies that are in various stages of development. These companies are:
- Hankyung.com (Korea only);
These businesses are focusing on e-detailing to the physician, but are not actively marketing to the physician assistants or nurse practitioners. In addition, we are the only company that is physician owned and operated. This difference is significant because as practicing physicians, we have the ability to reach the medical decision maker. As physicians, we have strong credibility when making a recommendation to a colleague. This ability will translate into increased prescription pattern of pharmaceutical products that we recommend.
DocBuzz, Inc., will have complete e-detailing facilities with the ability to prepare and deliver interactive multimedia presentations. We will have the capabilities to provide live chat, and prerecorded video presentations on a private and secured site.
DocBuzz, Inc., facilities house complete e-detailing operations, including the ability to prepare and deliver customized multimedia presentations. The ability to provide this type of interactive service is vital since it is one aspect of our company that separates us from our competition. As technology improves, the services we offer to the pharmaceutical, biotech and medical devices companies will grow as we incorporate the new improved technology.
3.5 Future Services
Once we achieve adequate market share in the United States, we will expand our operations to include South America, Japan, Israel, and Europe.
DocBuzz, Inc., will provide consulting, sales and marketing service to the pharmaceutical industry. The pharmaceutical companies will pay an upfront fee for our consulting service. In addition, DocBuzz, Inc., will generate additional income streams by selling products that our clients produce; retaining the difference between the wholesale and the retail price of the product.
Additional detailed information regarding the sales forecast, unit price, sales, direct unit cost and direct cost of sales is found in the Sales Strategy section.