MacMedia - Tollgate 1

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MacMedia - Tollgate 1

  1. 1. IntroductionsAdvisory BoardDr. David Potter : Entrepreneurial Project AdvisorMs. Sharon Meeke : Business MentorDr. Kamran Sartipi : Technical MentorTarek Sadek : Enterprise DeveloperTeamLuis Quiroz : Project ManagerMohammed Amjad : Business Partner 1
  2. 2. Today’s AgendaThe OpportunityThe MarketThe Customer / End UserThe CompetitionThe Technology Development 2
  3. 3. MacMediaInnovative Media Channel for Pharma & Physician Tollgate One Presentation Luis F. Quiroz quirozlf@mcmaster.ca 3
  4. 4. Defining the term “detailing”Promotion activity to explain to physicians features and benefits of products.Carried out by sales representative who use face-to-face interactioneDetailing”Use of any digital technology in the detailing process. Example, Internet orVideo Conferencing 4
  5. 5. BackgroundThe Selling Model of the Pharmaceutical Sector "Right now, the selling model for pharmaceuticals is reach and frequency. Reach as many customers as you can as often as you can,“… "Thats why we have these armies of salespeople out there.“ John Constantine, director of global learning support at GlaxoSmithKline According to the statistics… Annual Total Spending in Professional Advertising Estimate Number of Sales In the U.S. (Millions USD) Representatives in the U.S 1995 2000 2005 1996 2007 $4,318 $5,996 $7,206 35,000 100,000 The New England Journal of Medicine, August 16, 2007 Prescription For Success in Sales. Feb 19, 2007. Chemical & Engineering News 5
  6. 6. However; reality is….35% of physicians are not seeing reps at allOnly 8% of the visits last for more than 2 minutes**Average sales rep field visit is USD 200*Physicians are doing their own search for product information and unbiasedsourcesE-detailing has not taken off as a real alternative due to lack of initiatives Lower Promotion High Promotion Efficiency Costs The Conclusion The pharmaceutical industry needs innovative technologies to reach healthcare professionals in a broad scale with high frequency by using more efficient, more cost-effective means and more unbiased sources to meet doctors’ information needs*Effective e-detailing. IBM Institute. 2006**Elling ME, Gogle HJ, MackhAnn CS et al 6
  7. 7. The Solution – A New Concept in E-detailingA channel for pharmaceutical products tailored to each physician’s needs by usingMultimedia Files delivered by a Push method over for standalone computers,laptops and notebooks.The product provides unbiased reference sources bundled with samples deliveryorders and sales reps appointment requests. A multimedia file The file is pushed over with unbiased the internet sources developed by MacMedia ReferencesThe file reaches thephysician’s PC Also Samples delivery andlaptop or notebook Sales rep visit can be requestedas an “update”” Pharmaceutical Samples Sales Representative Appointment Requests A Message Center icon indicates that a presentation is ready to be executed and displayed A detailing session supported by unbiased sources is delivered over PCs, laptops or notebooks 7
  8. 8. The Value PropositionThe pharmaceutical sector could cut costs in promotion per detailing visit between15% and 50% and raise its ROI up to 2.48*.The pharmaceutical sector will increase its business and reduce its excessivenumber of sales representatives.Advantages for Pharmaceutical CompaniesBetter reach in less timeMore cost-effectiveBetter relevance (ways to discover and retain records of doctors’ needs, preferences and aptitudes toward products)New tool to bring pharmaceutical detailing to doctors in remote placesAdvantages for PhysiciansConvenience - Detailing multimedia presentation comes along with unbiased sourcesRequest for pharmaceutical samples and sales reps visits at a click of a buttonSignificant time savingIncreased productivity *Lathian Seminar, June 2005 8
  9. 9. Business Model = KEY TECHNOLOGY PROVIDER Provide Summarizer Pay a license technology fee tools •Convert marketing info into Multimedia •Add unbiased sources using Xerox Summarizer technology Pharmaceutical marketing literature is handed out •Assemble package with services The package is pushed over MacMedia the network toPharmaceutical = SERVICE PROVIDER reach PCs, laptopsCompany = CUSTOMER or notebooks Detailing service is Physicians Charge ($) based on the number delivered = END USERS of packages received by each physician 9
  10. 10. Service Components Delivery / Execution Component Conversion Distribution component component Collection of Marketing literature/ Internet catalogues Physicians Information is converted into Multimedia File is pushed Interaction / Request component Summarized unbiased resources are appended Requests from users : •Samples •Appointments with The package is MacMedia Content sales representatives assembled with services Server 10
  11. 11. The Subscription Model – One Alternative Physician’sPharmaceutical Link to informationCompany’s MacMedia’s is recorded intowebsite website McMedia’s database Message Center Software download User will fill out a subscription according to his topics of interest. The subscription is submitted References Message Center Software is downloaded and ready Pharmaceutical Samples to alert the user on:Physician will Sales Representative Visit Bookings new drug releasesaccess to a pharmaceutical new drug versionscompany’s website drug recalls other topics or products related to their specialties 11
  12. 12. Medium Higher Performance Performance Unbiased sources of information Key Service Rich in value (key information) Features Available (24/7) Easy to use Content flexible to update and customizable for other applications Push Delivery (alerts or message centers) Entertaining (Appealing to the eyes)Multimedia e-detailing for Multimedia based includingPCs offered by MacMedia interactivity Compatible with internet browsing Combined with drug sampleCurrent Multimedia orderse-detailing Combined with sales repofferings for PCs appointment requests Tailored to each physician’s needs Ongoing creation of an intelligence system that feeds on doctors’ current needs, preferences and behaviors toward products 12
  13. 13. Drivers for e-detailingThree major trendsThe existence of similar products in the pharmaceutical industry makesmarketing the only tool to create a difference among themProduct changes due to modifications in formularies or switches fromprescription drugs to OTC versions requires a high speed channel fordisseminationCurrent needs of cost cutting 13
  14. 14. Projection of E-detailing Market Size – North America e-detailing Estimate for standalone computers 2008 - 2011 (Based on 1% of Total Promotion Costs) $700 $589 $600 $536 $485 $500 $440 Millions USD $400 $300 $200 $100 $0 2008 2009 2010 2011 U.S. $404 $447 $495 $545 Canada $36 $38 $41 $44 Total N.A. $440 $485 $536 $589 Secondary research indicates that pharmaceutical companies spend, on average, 1% of their total promotion cost on e-detailing for standalone computersThe New England Journal of Medicine, August 16, 2007 14
  15. 15. Projection of End-users in North America Projected Number of Physicians in North America 1,200,000 974,727 984,291 993,952 1,003,711 1,000,000 800,000 600,000 400,000 200,000 0 2008 2009 2010 2011 U.S. 901,937 910,357 918,855 927,432 Canada 72,789 73,935 75,098 76,279 Total N.A. 974,727 984,291 993,952 1,003,711 Physicians’ rate growth in the U.S. is on average 0.93% a year whereas in Canada the rate is about 1.57% a year.Euromonitor Report 2007 15
  16. 16. The CustomersMajor Pharmaceutical Companies in North America Advertising Multimedia Expenditure in Advertising Company USD included in Sales of major companies (2007)* Expenditure * Accounted for 45% or aboutLilly (Eli) & Co. $4,497,000,000 Y USD 290.1 billion of worldwidePfizer Inc $2,152,500,000 Y sales in 2006**Johnson & Johnson $1,900,000,000 YGenentech, Inc. $439,000,000 YAbbott Laboratories $227,882,000 YWyeth $130,000,000 Y Customer groupingAllergan, Inc $118,000,000 N based on priority to targetNBTY Inc. $104,000,000 N Type of customer PriorityKing Pharmaceuticals, Inc. $85,044,000 N Pharmaceutical 1stMerck & Co., Inc $27,000,000 Y without CRMWatson Pharmaceuticals, Inc. $9,400,000 N servicesSchering-Plough Corp. N/A N Pharmaceutical with 2nd CRM servicesHospira Inc N/A NForest Laboratories, Inc N/A N CRM: Customer Relationship ServicesBristol-Myers Squibb Co. N/A NBarr Pharmaceuticals Inc N/A N Source : Lexis-Nexis – ADVERTISERS 2008 * Mergent Online. November 2007** 16
  17. 17. The Competition in North America Major PCRM Companies in North America Allscripts Aptilon WebMD Health Corp inVentiv Health Inc Dendrite Lathian Systems Quintiles Trans-nationalCompanies that offer Customer Relationship Management Services (PCRMs)PCRM may cover a full range of solutions such as Customer-facing Operations,Internal Functional Operations, Performance Marketing Analysis, Customer SurveyAnalysis and others.MacMedia plans to target at the Customer-facing Operations service interfacingbetween pharmas and doctors to promote products 17
  18. 18. Classification of Competition Products Currently Available in the market to Macro Level grouping of Competitors from offer detailing the Competitive Strategy Perspective Electronic Sales Type of Strategy Company detailing representatives Low Cost Contract Sales Allscripts inVentiv Organizations Aptilon Quintiles (CSO) WebMD Highly fragmented Dendrite Contract Sales  Allscripts Lathian Organizations (CSO) Differentiation  Aptilon inVentiv  inVentiv  WebMD Video Phone conferencing Highly fragmented Focus  Lathian Aptilon Contract Sales (Combination of cost  Dendrite Lathian Organizations (CSO) and differentiation)  QuintilesCSOs are outsourcing companies in the low-end market . CSOs provide basicservices such as call-centers and hiring of sales representatives. NumerousDifferentiators offer comprehensive solutions such as Customer-facingOperations, Internal Functional Operations and others.Differentiators provide best services, create high value; and therefore, controlpricesFocus companies center in a few services. These companies take advantageof the expertise in their specialties 18
  19. 19. Skills Exhibited by PCRMs Skills in the PCRM Sector Pharmaceutical Market knowledge Marketing and Sales knowledge IT and programming expertise Public Relations Skills Systems Analysis & Solutions skills Strategic Management skills SWOT Analysis for the PCRM Sector Strengths Weaknesses Renown companies very well established Multi-business and big organizations that still in the pharmaceutical industry with need to combine independent information customer oriented cultures sources and other useful tools so as to fit them into their products Opportunities Threats E-detailingoffers potential growth Privacy issues Healthcare professionals use online Rapid change of technology resources nowadays Failure to wisely integrate multiple products Existence of serious inefficiencies in the and services pharmaceutical promotion Limited number of computer programmers/ designers with experience in the B2B sector 19
  20. 20. Motivations and Skills Tools MacMedia PCRM CompetitorPCRMs focus on pharma’s needs Multimedia Purchase Yesrather than on doctors’ needs Technologies Programmers /MacMedia’s product has potential to designers with Hire Yes experience inturn into an intelligence system so e-detailingas to ensure service repeat and Journal Subscribe Noloyalty Subscriptions Summarization Purchase/License NoMacMedia’s product will improve Technologiesmarket penetration Physicians’ DB Purchase/Hire Yes Service e-detailing Intelligence MacMedia Pharma Company Service = Loyalty Repeat Competitive Advantage 20
  21. 21. Incumbents’ likely ResponseMain PCRMs could counteract with own version (growth-driven strategy).If PCRMs cannot respond soon due to organizational issues, they would consider to integrate MacMedia’s detailing product into their offerings(co-opting strategy). Example: Inventiv Type of PCRM Threat of Attack Most Likely Response CSO Very Low None Focus Moderate to Low Buy out Compete with own Differentiator High version 21
  22. 22. The Technical Feasibility Technology Description Products/Brands Accessibility Criteria Combination of multiple AdobeFlash Features Multimedia content formats: Audio, AdobeDreamweave Purchasing video & sound Prices r License Software that produces Xerox Summarizer conditions Summarizer synopsis of a large Intellexer License fee Technology Features document Summarizer Prices Computer or device on Features Server a network that manages Numerous brands Purchasing network resources Prices Site location on the Numerous software Features Website Purchasing World Wide Web products Prices The New England Journal of Medicine Impact factor Medical Scientific journals The Lancet Subscription Journals devoted to the field of Journal of the Subscription conditions Database medicine American Medical Association Prices etcJIF: Frequency that an average article in a journal has been cited in a given period of time 22
  23. 23. The DB - The Heart of the Service Pharma_1 Pharma_2 Pharma_3 Pharma_4 Doctor_1 A1, B1,D1 A2,F2 B3,F3,G3 C4,L4,O4 Doctor_2 A1,C1 E2,G2,T2 C3,F3 C4,E4,S4,X4 Doctor_3 L1,M1 A2,P2,H2,I2 D3,F3,G3, P3 F4,M4 Doctor_4 P1, Q1,Y1 B2,C2 B3,M3,T3 C4,F4,M4, W4To start the service, a physicians’ DB must be purchased or hired from a thirdpartyTo obtain an extensive range of information on products, doctors mustsubscribe in as many pharmaceutical companies and choose as many topics intheir specialties 23
  24. 24. Architecture Alternatives First AlternativePharma 1 Version 1Products Requires access toPharma 2 DBs of pharmaceuticalProducts products.Pharma 3Products Statement of MacMedia confidentialityPharma 4Products MacMedia First Alternative Version 2 Create POS where physicians are referred toPharma 1 POS MacMedia’s website and thenProducts subscribePharma 2Products POS Requires access to Dbs of pharmaceutical productsPharma 3 Statement of confidentialityProducts POS= Point of Subscription 24
  25. 25. Architecture AlternativesPharma 1 Second AlternativeProducts Integrates with PCRMs’Pharma 2Products DBsPharma 3Products PCRM MacMediaPharma 4Products 25
  26. 26. Resources Plan and Estimate Time Allocation for the Technical Realization Estimate Skills/ Human Estimate Phase Timeline Tasks Time Profile Resources Cost Information Collection, CPA or SEU Jun 08 Processing and Delivery 1Systems Design Jul 08 Client/Server $34,200 3 months Aug08 Architecture CPA or SEU 1 Website Design Application Development CPA or SEU 1 Sep 08 Website DevelopmentPrototype Oct 08 $38,100 3 months Server Setup/Website CPA or SEU 1 Nov 08 Upload Server testingTesting Dec 08 CPA or SEU 2 $10,500 1 month Service testing CPA or SEU 2 Jan 09 Business CaseImplementation MEEi Candidate $21,000 2 months Feb 09 Business Plan 1 Mar 09 Presentation to Investors CPA or SEU 2Commercialization $27,000 2 months Apr 09 Road-shows MEEi Candidate 1 Grand Total $130,800 CPA: Computer Programmer Analyst/Designer SEU: Systems Engineer Undergraduate 26
  27. 27. Technical Realization Control of Product Components Physicians/ Medical Server/ Marketing Multimedia Summarizer Component Journals Intelligence Application Internet Technology DBs Domain DB Under MacMedia’s YES YES NO NO YES Control 27
  28. 28. Product Risk Analysis Measure to Type Source Risk Level Impact mitigate risk Summarizer Validation of Not efficient Low High Technology features Not Updated Validation ofTechnical Physicians’ DB Low High features Not Comprehensive Validation of Medical Journals Not efficient Low High Journal Impact Subscriptions Factor Index (JIF) Explore other Xerox technology Not exclusive Low High suppliers and Supplier license conditions Information is Select peer-Business End Users Low High biased reviewed journals Product End Users Low High Permanent VOC dissatisfaction JIF: Frequency that an average article in a journal has been cited in a given period of time 28
  29. 29. MILESTONE OVERVIEW Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr 08 08 08 08 08 08 08 08 08 08 09 09 09 09 Complete VOC Investigation & Market Financial Business Preliminary Market Plan Analysis Secondary draft VOC Secondary Research Completion Design Systems Tollgate Systems design One design draft completion Technical screening & Prototyping selection Prototype ready Tollgate Two Testing Testing completion Tollgate Implementation Business Three CaseCommercialization Road shows 29
  30. 30. Next Steps: look for expert advice at McMaster to have IP protection of the service idea and also advice on technology licensing apply for resources through the school for the prototyping phase look for technical expertise to develop the systems design 30
  31. 31. Thank YouQ&A Session 31

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