Showcase 2 : Business Optimization in Germany

Sales in the retail market were reported in the panels as higher than booked sales of the company. Sales in the hospital market were reported smaller than booked sales. Conclusion: product was "diffusing" from the low price segment into the high price segment resulting in a profit loss for the company.

The analysis of the situation showed that 3 hospital pharmacies were likely to sell product into the retail market. Within the retail market the product was used for one specific indication (21 days out-patient treatment of lyme borrheliosis). It was impossible to use the salesforce to promote any changes in product offer or to promote treatment options within the retail segment.

To overcome the problem a 7-pack was created to offer in one pack the medication for 1 week. This presentation reduced the co-payment for the patient by 83% vs. the offer of the hospital segment. The treatment regiment and the advantage in co-payment was brought to the attention of the patient advocacy group, who informed key opinion leaders and treatment centers.

Within 4 months the distribution of product within the market was redirected and the 7-pack was the dominating presentation within the retail market.

Product : 3rd generation cephalosporin, parenteral

Location : Germany

Market Situation :

• Market leader in hospital segment, biggest asset of company
• Product ‘leaking’ into retail segment, usage in out-patients not promoted
• No sales force support for GPs possible.

Timelines : 6 months

Strategy : Control the distribution channel with a specialized product.

Tactics :

• Create a special product adjusted to the treatment regiment
• Create a special product with a reduced copayment for the patient versus the hospital product.
• Offer the product only in the retial market.
• Sell to the hospital segment only on demand and with no price advantage vs. retail segment.
• Make patient advocacy groups aware of new offer advantages.

Measures of Success :

• Take back the retail segmentwithin 4 months
• 7 mio. Euro increase in profit