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Home Industry News Pharma marketing budgets shown to be similar despite product size

Pharma marketing budgets shown to be similar despite product size

8th December 2005

Marketing budgets at drug firms remain the same regardless of how successful a drug is likely to be, according to a report from Cutting Edge Information (CEI).

The analysts discovered that, from phase III through to the first year and a half of commercialisation, the proportion of marketing budgets spent on products is dictated by what stage the drug is in rather than whether it will be a blockbuster, a drug of mid-level popularity or a niche product.

During phase III testing pharmaceuticals often spend between 14 and 21 per cent of their marketing budgets. Registration through to subsequent launch causes drug firms to up spending to 37 to 41 per cent, whilst companies will shell out almost half of their budgets during the first 12-18 months of the drug’s public availability.

“We examined a number of brands, far ranging in expected revenue, but the
same principle held true across the board,” said Eric Bolesh of CEI.

CEI however added that, whilst the portion of funding is practically the same, the timing of financial allocation was dramatically different between different specific brands, owing to “external obstacles” faced by different drugs.

“Although each brand deals with its unique challenges, it is essential for all companies to provide adequate resources to promptly address any challenges that arise,” Mr Bolesh said.

track© Adfero Ltd

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