Upload
jameswdudley
View
2.752
Download
3
Tags:
Embed Size (px)
DESCRIPTION
Mail order and Internet Pharmacy presentation to the Annual Conference of the AESGP 2010 - based on James Dudley's ongoing study Mail Order and Internet Pharmacy in Europe
Citation preview
by James W. Dudley
Tel. ++ 44 1562 747705Fax ++ 44 1562 750275e-mail [email protected]
web site: www.james-dudley.co.uk
The Internet Pharmacy46th AESGP Annual Meeting
Dubrovnik 2010
Source: OTC Distribution in Europe 2010 edition
www.James-dudley.co.uk © James Dudley International Ltd 2010 218 April 2012
Agenda
Factors influencing Change in Medication Delivery
New Competitive Model for European Pharmacy Channels
Internet and Mail order Pharmacies
Germany
Internet and Mail Order Pharmacies - Threat or Promise
Conclusions
Source: OTC Distribution inEurope 2010 edition
www.James-dudley.co.uk © James Dudley International Ltd 2010
Factors influencing change in medication delivery
318 April 2012
Future Channel Strategies
New entrants –New Channels
Regulation –changing the law
Innovation and Technology
Transfer
Pharmacy Lobby
Healthcare provider
commitments economics and
capabilities
Patient/ consumer needs,
choices, experiences and
expectations
Supply chain existing
competitors and economics
Antimonopoly Agents
(European Commission)
Changing patient/ consumer needs, demographics, choices, experiences and expectations (cost, convenience, privacy and advice)
Healthcare provider commitments economics and capabilities
Supply chain existing competitors and economics
James Dudley OTC Distribution in Europe
www.James-dudley.co.uk © James Dudley International Ltd 2010
Factors influencing change in medication delivery
418 April 2012
Future Channel Strategies
New entrants –New Channels
Regulation –changing the law
Innovation and Technology
Transfer
Pharmacy Lobby
Healthcare provider
commitments economics and
capabilities
Patient/ consumer needs,
choices, experiences and
expectations
Supply chain existing
competitors and economics
Antimonopoly Agents
(European Commission)
Changing patient/ consumer needs, demographics, choices, experiences and expectations (cost, convenience, privacy and advice)
Healthcare provider commitments economics and capabilities
Supply chain existing competitors and economics
James Dudley OTC Distribution in Europe
www.James-dudley.co.uk © James Dudley International Ltd 2010
Factors influencing change in medication delivery
518 April 2012
Future Channel Strategies
New entrants –New Channels
Regulation –changing the law
Innovation and Technology
Transfer
Pharmacy Lobby
Healthcare provider
commitments economics and
capabilities
Patient/ consumer needs,
choices, experiences and
expectations
Supply chain existing
competitors and economics
Antimonopoly Agents
(European Commission)
Changing patient/ consumer needs, demographics, choices, experiences and expectations (cost, convenience, privacy and advice)
Healthcare provider commitments economics and capabilities
Supply chain existing competitors and economics
Innovation and Technology
New entrants
Changes to regulation
Conflicting influences of pharmacy lobby and European Commission
James Dudley OTC Distribution in Europe
www.James-dudley.co.uk © James Dudley International Ltd 2010
Factors influencing change in medication delivery
618 April 2012
Future Channel Strategies
New entrants –New Channels
Regulation –changing the law
Innovation and Technology
Transfer
Pharmacy Lobby
Healthcare provider
commitments economics and
capabilities
Patient/ consumer needs,
choices, experiences and
expectations
Supply chain existing
competitors and economics
Antimonopoly Agents
(European Commission)
Changing patient/ consumer needs, demographics, choices, experiences and expectations (cost, convenience, privacy and advice)
Healthcare provider commitments economics and capabilities
Supply chain existing competitors and economics
Innovation and Technology
New entrants
Changes to regulation
Conflicting influences of pharmacy lobby and European Commission
James Dudley OTC Distribution in Europe
www.James-dudley.co.uk © James Dudley International Ltd 2010
Factors influencing change in medication delivery
718 April 2012
Future Channel Strategies
New entrants –New Channels
Regulation –changing the law
Innovation and Technology
Transfer
Pharmacy Lobby
Healthcare provider
commitments economics and
capabilities
Patient/ consumer needs,
choices, experiences and
expectations
Supply chain existing
competitors and economics
Antimonopoly Agents
(European Commission)
Changing patient/ consumer needs, demographics, choices, experiences and expectations (cost, convenience, privacy and advice)
Healthcare provider commitments economics and capabilities
Supply chain existing competitors and economics
Innovation and Technology
New entrants
Changes to regulation
Conflicting influences of pharmacy lobby and European Commission
James Dudley OTC Distribution in Europe
Channel strategies at different levels in the supply chain and moving at different paces across Europe
www.James-dudley.co.uk © James Dudley International Ltd 2010 818 April 2012
Agenda
Factors influencing Change in Medication Delivery
New Competitive Model for European Pharmacy Channels
Internet and Mail order Pharmacies
Germany
Internet and Mail Order Pharmacies - Threat or Promise
Conclusions
Source: OTC Distribution inEurope 2010 edition
www.James-dudley.co.uk © James Dudley International Ltd 2010 918 April 2012
Dispensing alone is no longer a sustainable economic retail model - to compete
pharmacies need to brand their offer, get closer to consumers and reduce economic
and logistical inefficiencies
www.James-dudley.co.uk © James Dudley International Ltd 2010
Pharmacy Channel Strategies – Trend towards Groupings
1018 April 2012
James Dudley OTC Distribution in Europe
Main international distributors forming pharmacy chains in selected markets - Celesio, Alliance Boots, Phoenix, Mediq, Polska Grupa Farmaceutyczna (PGF)
Limited sized wholly owned groups sucking out economic inefficiencies - e.g. Germany recovery in pharmacy numbers and economic performance
Reductions in State owned pharmacies – CEE and Sweden
New entrants - Major International retail groups entering the pharmacy sector Leclerc, Carrefour, Auchan, Penta, Tesco, Sainsbury, WalMart. A.S Watson etc.
Restrictions on wholly owned groupings in Europe’s largest markets
Over half of chain owned pharmacies are located in the UK
www.James-dudley.co.uk © James Dudley International Ltd 2010
Virtual Chains – Reinforcing Competitive Position of Independents
1118 April 2012
James Dudley OTC Distribution in Europe
Over a quarter of Europe’s pharmacies are members of voluntary chains
Strengths of a chain, benefits of independent management
Branding, buyer power and patient/consumer services
Largely driven by main pharmacy distributors:Celesio
Phoenix
Alliance Boots
Polska Grupa Farmaceutyczna (PGF)- Poland
Galenica – Switzerland
Hungaropharma - Hungary
Major players embracing B2C Technologies
www.James-dudley.co.uk © James Dudley International Ltd 2010 1218 April 2012
Agenda
Factors influencing Change in Medication Delivery
New Competitive Model for European Pharmacy Channels
Internet and Mail order Pharmacies
Germany
Internet and Mail Order Pharmacies - Threat or Promise
Conclusions
Source: OTC Distribution inEurope 2010 edition
www.James-dudley.co.uk © James Dudley International Ltd 2010 1318 April 2012
Internet and Mail Order Pharmacies – bind the concept of discount home shopping into a virtual world through the technology of the Internet - but there is
still a major mail order cross over (Internet businesses provide catalogue mail, telephone and fax access and traditional mail order providers offer
Internet access)
www.James-dudley.co.uk © James Dudley International Ltd 2010 1418 April 2012
Internet and Mail Order Pharmacies – The Proposition
• Customer services are a combination of electronic and manual processes (physical goods have to delivered)
• Target audiences often comprise of special interest segment s – older (+40) need or seek discounts, seek privacy and convenience
• Health insurers tie in (USA) or capture repeat prescriptions through incentives and bonuses (fiercely attacked in the courts in Germany)
• The main players identify and target key audiences and use discounts to stimulate purchase but the main marketing drive is building customer loyalty
www.James-dudley.co.uk © James Dudley International Ltd 2010 1518 April 2012
What’s Driving Internet and Mail order PharmacyTechnology transfer and entrepreneurial pioneers (1999 – 2003)
- Pharmacy2U 1999 – rewrote UK law and kicked off the “pure play” Internet pharmacy- DocMorris 2000 – 2003 challenged German laws banning distance marketing in ECJ and won!
Specific audience and patient segment needs, experiences and fulfilment- Patients with chronic, debilitating and often embarrassing conditions seeking cost savings, convenience and
privacy- Consumer segments seeking specific non-prescription healthcare – tonics, prostrate remedies, circulatory
products and pain relief
Websavy consumer groups used to shopping on the Internet
Health insurance provider Model
- PBM influence USA
- Mediservice Switzerland 1996 first to make contracts with statutory health insurers in Europe
- Main Internet and mail order pharmacy players signed up statutory health insurers in Germany
Main pharmaceutical distributors strategies to market directly to consumers/patients:
- Celesio, Alliance Boots, Polska Grupa Farmaceutyczna (PGF) etc
www.James-dudley.co.uk © James Dudley International Ltd 2010
DocMorris ECJ Decision 2003
1618 April 2012
“The European Court ruling in favour of DocMorris has had a profound change in the government attitudes towards distance selling of pharmaceuticals across the region.
In effect the Court has ruled that distance selling of prescription only medicines can only be prohibited on the grounds of public health safety and not for the protection of the local
pharmacy monopoly.
The court found no reasons for prohibiting sales of OTC medicine through the Internet and mail order pharmacies.”
James W. Dudley OTC Distribution in Europe 2010 edition
www.James-dudley.co.uk © James Dudley International Ltd 2010
Legal Status of Internet and Mail Order Pharmacies - Europe
1718 April 2012
James Dudley OTC Distribution in Europe the 2010 edition
ECJ ruling opens doors for Internet and mail order for non-prescription medicines and healthcare
Netherlands, Poland, Switzerland and UK become key Internet and mail order markets after Germany
France, Italy and Spain laggards in terms of regulation, entrepreneurial drive and consumer participation
www.James-dudley.co.uk © James Dudley International Ltd 2010
Participation by the Major Pharmaceutical Distributors
1818 April 2012
• Celesio operates three mail order businesses Lloydspharmacy in the UK, Vitusapotekin Norway and DocMorris in the Netherlands and Germany
• In the UK Boots (Alliance Boots), Rowlands (Phoenix) and other retail chains have comprehensive online pharmacies
• Polska Grupa Farmaceutyczna (PGF) in Poland - Doz.pl PGF uses its 2,000 Apteki dbam Zdrowieaffiliated pharmacies to provide the delivery service for both OTC and prescription medicines.
• Galenica and Apotheke zur Rose operate the largest direct to customer prescription businesses in Switzerland
www.James-dudley.co.uk © James Dudley International Ltd 2010 1918 April 2012
What are Internet and mail Order pharmacies?
‘Pure play’ online pharmacies
Portal driven pharmacy co-operatives and franchise chains
Independent sites
Pharmacy chains home delivery services
Non-pharmacy channel partnership Pick-up-Points
James Dudley OTC Distribution in Europe 2010 edition
www.James-dudley.co.uk © James Dudley International Ltd 2010
Examples of Different Internet Mail Order Pharmacies
2018 April 2012
‘Pure play’ online pharmacies
Portal driven pharmacy co-operatives and franchise
chainsPharmacy chains home
delivery servicesNon-pharmacy Pickup
points
Internet Web Site Internet Web Site Internet Web Site
Catalogue Catalogue Catalogue Catalogue
Telephone/Fax Telephone
Call Centres Order in store or Call Centres
Order in store or Call Centres
Home delivery by mail or courier Collect at affiliate pharmacy Home delivery by mail or
courier Collect at Pickup point
Home delivery by pharmacy Home delivery by mail or courier
Internet Web Site
James Dudley OTC Distribution in Europe
www.James-dudley.co.uk © James Dudley International Ltd 2010
Top Spot Players - Germany, Switzerland, Netherlands
2118 April 2012
Primary European pharmacy mail order market is Germany
Other major players include leading Germany businesses Mycare, Aliva, Vitalsana
Apot zur Rose and Mediservicerepresent almost 80% of Swiss mail order pharmacy market
Top UK pure player is Pharmacy2U (€17 million)
Top Polish player is Doz.pl (€3 million)
James Dudley OTC Distribution in Europe
www.James-dudley.co.uk © James Dudley International Ltd 2010
DocMorris building the Multi-Channel Brand
2218 April 2012
DocMorris the largest Internet Mail Order Pharmacy in Europe founded in 2000
Sales double in 2004 following legalisation of distance selling of pharmaceuticals in Germany
Brand awareness at 40% in 2009 (latest is 60%)
Acquired by Celesio in 2007
Development of pharmacy franchise in Germany (currently 150 outlets) – Rollout to Ireland and Sweden
International Pharmacy Channel Brand
Germany
Ireland
Sweden
DocMorris
GfK 2009
www.James-dudley.co.uk © James Dudley International Ltd 2010 2318 April 2012
Agenda
Factors influencing Change in Medication Delivery
New Competitive Model for European Pharmacy Channels
Internet and Mail order Pharmacies
Germany
Internet and Mail Order Pharmacies - Threat or Promise
Conclusions
Source: OTC Distribution inEurope 2010 edition
www.James-dudley.co.uk © James Dudley International Ltd 2010
Germany – Internet and Mail Order Pharmacy
2418 April 2012
IMS Health/BVDA 2009
James Dudley OTC Distribution in Europe
Internet Mail Order Pharmacies represent a little over 3% of the German retail healthcare market
Non-prescription OTCs represent 41% of Internet Mail Order Pharmacies’ sales and prescription medicines 32% (IMS).
www.James-dudley.co.uk © James Dudley International Ltd 2010
Non - Prescription Internet and Mail Order in Germany
2518 April 2012
James Dudley OTC Distribution in Europe
Internet and Mail Order pharmacies representaround 8% of the German Non-prescription Market
Sector grew +30% in 2009 according to IMS Health
Biggest categories are pain relief, cough cold, digestive remedies and pain relief
IMS Health
www.James-dudley.co.uk © James Dudley International Ltd 2010
Germany Non-prescription Categories Purchased by Mail Order
2618 April 2012
Important categories for Internet and Mail Order healthcare shoppers are tonics, circulatory products, NRT and pain relief
IMS Health
www.James-dudley.co.uk © James Dudley International Ltd 2010
Germany - OTC Healthcare Buyers - Age Profile by Channel
2718 April 2012
2010 Axel Springer AG, Bauer Media Group Internet and mail order shopper profiles are different to those of pharmacy, druggist and discounter shoppers
www.James-dudley.co.uk © James Dudley International Ltd 2010
Germany OTC Healthcare Buyers – Mail Order v Internet
2818 April 2012
Analysis of consumer access by Internet or Mail Order shows different age profilesInternet user profile 20 years to 59 years = 86% of all Internet shoppers
At 60 years plus user profile is lower than sample
Mail order user profile 30 to 69 years = 80% of all mail order shoppers
2010 Axel Springer AG, Bauer Media Group
www.James-dudley.co.uk © James Dudley International Ltd 2010
Germany - Leading the European Internet & Mail Order Pharmacy Market
2918 April 2012
ServiceBarometer AG – Forschungsauftrag
Almost 3,000 German pharmacies have applied to run a mail order business (since 2004)
Between 300 and 500 are to varying degrees active
60 dispatch more than 1,000 packages a day (average order =€19.0)
10 companies have achieved more than €20 million turnover
Leading players have formed their own trade association
Federal Association of German Mail-order Pharmacy (BVDVA)
www.James-dudley.co.uk © James Dudley International Ltd 2010 3018 April 2012
Agenda
Factors influencing Change in Medication Delivery
New Competitive Model for European Pharmacy Channels
Internet and Mail order Pharmacies
Germany
Internet and Mail Order Pharmacies - Threat or Promise
Conclusions
Source: OTC Distribution inEurope 2010 edition
www.James-dudley.co.uk © James Dudley International Ltd 2010
Internet and Mail Order Pharmacy – Threat or Promise
3118 April 2012
Internet /mail-order pharmacy is a:
Paradigm change for medication delivery
(Internet/mail order pharmacy industry)
Plague on patients, pharmacists and prescribers
(Pharmacists and manufacturers)
Economic, private and convenient way of accessing prescription and OTC medicines
(Various consumer/patient studies)
www.James-dudley.co.uk © James Dudley International Ltd 2010 3218 April 2012
Agenda
Factors influencing Change in Medication Delivery
New Competitive Model for European Pharmacy Channels
Internet and Mail order Pharmacies
Germany
Internet and Mail Order Pharmacies - Threat or Promise
Conclusions
Source: James Dudley: Mail Order and Internet Pharmacy in Europe
www.James-dudley.co.uk © James Dudley International Ltd 2010
Brand Management Perspective
3318 April 2012
• Internet creates a transparency both at a national and international level
• Discovery of very specific target audiences with special needs and experiences
• Concentrated assortment and private label for non-prescription categories e.g. Germany:
- DocMorris reports own brands with 15% to 20% market share
- IMS Health reports that while 100 top brands achieve a third of mail order sales it takes 200 in pharmacy sales
Definitions of threats and opportunities need to be made on a brand by brand basis
www.James-dudley.co.uk © James Dudley International Ltd 2010
Conclusions
3418 April 2012
• Internet and mail order pharmacies have exposed the differences in legal restrictions, prices and product availability between EU member states and also countries outside the EU
• Clarification of the legal position of Internet pharmacies resulting from the DocMorris case has already produced the catalyst for expansion for online trading in pharmaceutical products especially in Germany and de-restricted mail order vending of non-prescription products
• Pace of adoption is greater in some States e.g. Germany, Switzerland, UK, CEE etc. compared to others such as France, Spain and Italy
• Different Internet mail order retail models are evolving but are moving in the direction of multi-channel retail brands
www.James-dudley.co.uk © James Dudley International Ltd 2010 3518 April 2012
About Mail Order and Internet Pharmacy in Europe 2012 edition
A Study of Mail Order and Internet Pharmacy in 17 European Countries plus key Learnings from the USA.
This is the second edition of the only strategic marketing report describing the emerging trends for mail order and Internet pharmacies in Europe’s main markets together with comparisons to developments in the USA.
Mail Order and Internet Pharmacy in Europe is an important report that not only explores the development of an emerging channel; it draws on studies of the US market to show how the channel has evolved and describes how leading retailers are integrating online technologies using PCs, Tablets, Notebooks and Mobile Apps into the creation of a powerful multi-channel pharmacy experience.