The Ministry of Health of Ukraine National University of Pharmacy MANAGEMENT AND MARKETING IN PHARMACY Textbook for Foreign Students of Higher Pharmaceutical Schools In two parts Part II Marketing in Pharmacy Edited by Professor Z. Mnushko Kharkiv Publishing center “Dialog” 2016 UDC 615.1:65.050:339.138(075) LBC 51.1(2)+52.82я73 M50 Approved by Ministry of Education and Science of Ukraine (letter № 1/11-16529 dated October 15, 2012) Authors: Mnushko Zoia M., Pestun Iryna V., Timanyuk Iryna V., Sofronova Iryna V., Aliekperova Nataliia V. Reviewed by: Grochoviy T. – Head of Department of Pharmaceutical Science of I. Ya. Gorbachevsky Ter- nopil State Medical University, Doctor of Pharmacy, Professor; Kabachna A. – Professor of Department of Management and Economics in Family Medicine of Kharkiv Medical Academy of Postgraduate Education, Doctor of Pharmacy, Professor; Toryanyk L. – Associate Professor of Foreign Languages Department of National University of Pharmacy, PhD in Pedagogy, Associate Professor. Management and Marketing in Pharmacy [Electronic resource] : the textbook for M50 foreign students of higher pharmaceutical schools : in 2 parts / Z. Mnushko [at al.], ed. by prof. Z. Mnushko ; National University of Pharmacy. – Electronic text data. – Kharkiv : Publishing center “Dialog”, 2016. – Part II : Marketing in Pharmacy. – 1 electronic opt. disk (CD-R). – 3,7 Mb. – System requirements: Adobe Acrobat Reader. – Title from the disk label. ISBN 978-617-7357-01-7 ISBN 978-617-7357-03-1 (Part II) The textbook presents the basic theoretical principles of marketing and characteristics of pharma- ceutical marketing, including marketing studies of medicines as a commodity, their development and market promotion, product and assortment policy of pharmaceutical companies and pharmacy, pricing, wholesale and retail sales and use of the complex of marketing communications at the pharmaceutical market. The nature and specificity of the international marketing in pharmacy is described. The textbook is recommended for foreign students of higher pharmaceutical schools. UDC 615.1:65.050:339.138(075) LBC 51.1(2)+52.82я73 ISBN 978-617-7357-01-7 © Z. M. Mnushko, I. V. Pestun, I. V. Timanyuk, ISBN 978-617-7357-03-1 (Part II) I. V. Sofronova, N. V. Aliekperova, 2016 3 CONTENT INTRODUCTION ....................................................................................................... 6 CHAPTER 1. FUNDAMENTAL RULES IN MARKETING ................................... 8 1.1. Value of marketing ..................................................................................................................... 8 1.2 The characteristic of the market .......................................................................................... 9 1.3. Characteristic, structure and organization of pharmaceutical market ........... 11 1.4 Nature, evolution, principles and functions of marketing ..................................... 13 CHAPTER 2. MANAGEMENT OF PHARMACEUTICAL MARKETING ........ 26 2.1. Process of marketing management ................................................................................. 26 2.2. Marketing management and its evolution ................................................................... 30 2.3. The organizational structure of services marketing................................................ 31 CHAPTER 3. MARKETING RESEARCH AND THE INFORMATION. MARKETING INFORMATION SYSTEMS .......................................................... 38 3.1. The purpose, objects and methods of marketing research ................................... 38 3.2. The value of the pharmaceutical information ............................................................ 44 3.3. Marketing information systems ........................................................................................ 47 CHAPTER 4. STUDYING OF PHARMACEUTICAL MARKET ....................... 55 4.1. Research of the market of medical products .............................................................. 55 4.2. Studying of quantitative characteristics of the market .......................................... 56 4.3. Market segmentation ............................................................................................................. 58 4.4. Research of consumers and a typology of medicines’ consumption ................ 61 4.5. Studying of the need for medical products .................................................................. 63 4.6. Studying of a supply and demand of medical products .......................................... 64 CHAPTER 5. THE PRODUCT IN MARKETING ACTIVITY. ASSORTMENT OF MEDICAL PRODUCTS. THE COMMODITY POLICY OF PHARMACEUTICAL ENTERPRISES AND PHARMACIES ............................. 71 5.1. Consumer properties of pharmaceutical goods ......................................................... 71 5.2. The product’s life cycle ......................................................................................................... 75 5.3. Positioning of pharmaceutical goods ............................................................................. 80 5.4. Competitiveness of pharmaceutical products and management of quality .. 82 5.5. Marketing strategies of pharmaceutical enterprises .............................................. 85 4 5.6. Assortment policy of pharmaceutical production enterprises and pharmacies................................................................................................................................................ 91 5.7. Commodity policy of the pharmaceutical enterprises ............................................ 94 5.8. Trade mark and goods packing. Brand .......................................................................... 96 5.9. Innovative activity of the pharmaceutical enterprises ........................................ 101 CHAPTER 6. PRICES, PRICING, THE PRICE POLICY OF PHARMACEUTICAL ENTERPRISES AND PHARMACIES ........................... 111 6.1. Theoretical bases of market pricing ............................................................................ 111 6.2. Prices classification ............................................................................................................. 112 6.3. Pricing factors ........................................................................................................................ 114 6.4. Demand, supply and the price ........................................................................................ 119 6.5. Establishment of the price for the goods ................................................................... 125 CHAPTER 7. PHARMACEUTICAL SALES UP COMPANIES ........................ 139 7.1. The concept of marketing. Sales policy ventures ................................................... 139 7.2. Channels, their function and structure ....................................................................... 140 7.3. Management of distribution channels ........................................................................ 147 7.4. Methods and systems of distribution. The system of distribution of product pharmaceutical .................................................................................................................................... 152 7.5. Wholesale. Features of the wholesale trade of medicines ................................. 159 7.6. Retail Trade. Pharmacies as retail outlets medicines .......................................... 165 7.7. Concept and types of logistics. Features of the logistic approach to the management of the supply activities in pharmacy .............................................................. 168 CHAPTER 8. MARKETING COMMUNICATIONS POLICY ........................... 181 8.1. Complex of marketing communications and its formation ............................... 181 8.2. Advertising and its role in the communication policy of the enterprises ... 190 8.3. The components of the process of advertising ....................................................... 195 8.4. The functions of advertising of medicines ................................................................ 197 8.5. Regulation of drug promotion ........................................................................................ 200 8.6. Planning and organization of advertising campaigns .......................................... 206 8.7. Sales promotion of pharmaceutical goods ................................................................ 209 8.8. Personal selling. Network and direct marketing. Branding .............................. 212 8.9. Public relations...................................................................................................................... 219 8.10. Exhibitions and Trade Fairs .......................................................................................... 221 8.11. Advertising on point of selling. Merchandising in pharmacies enterprises and institutions .................................................................................................................................... 224 5 CHAPTER 9. MARKETING CONTROL............................................................. 233 CHAPTER 10. THE INTERNATIONAL MARKETING .................................. 243 10.1. Essence and specificity of international marketing ........................................... 243 10.2. Environment of international marketing ................................................................ 247 10.3. Forms of entering of pharmaceutical companies on foreign markets ......