Case study on Human Genome Sciences Marketing Challenges of Benlysta


The Food and Drug Administration approved Benlysta as the first ever drug for the treatment of the lupus and the symptoms that are associated with this disease of the immune system. Before Benlysta, physicians depended on the use of a steroid called Prednisone for the suppression and treatment of the disease and of the severe wasting of tissues to the patients caused by the disease. However, this steroid was reported to have severe side effects to the sufferers, who in US alone are estimated to be over total 1.5 million. Due to this, more than 330,000 patients have reported that they were on the lookout for a new drug. This reported huge number of unsatisfied customers marks a huge market potential for the new drug. In fact, Human Genome Sciences Inc, who together with GSK, came up with Benlysta estimate that the drug will turn into a billion dollar investment by 2015 (Human Genome Sciences, Inc., 2010). Since it has been a number of decades before a drug for lupus was approved for medical use, the company faces the challenge of stirring demand for this new product and of convincing physicians that the new drug is worth the $35, 000 a year that patients will pay for it. The aim of this paper is to analyze the market potential of the drug and come up with proper recommendations of how to HGS should approach marketing for the new drug.

1.0.0. Current Situation Audit
1.1.0. Strategic issues
1.1.1. Mission
The mission of HGS is to become a fully commercial biopharmaceutical company with important drugs that can be able to offer the company sustainable growth and revenues. The company hopes that the drug will be the driver to its profits in the coming years. To achieve this, the company entered into a strategic agreement with GSK where HGS was given the responsibility of global supply of the drug, which it hopes to achieve using some of its production capacities, those of Lonza and GSK. In addition, the company hopes to increase the approval of the drug in EU and in other countries.
1.1.2. Environment, Market Size, and Competition
The market size in the US only is estimated at 350, 000 patients who have been diagnosed with systemic lupus. The primary market of the Drug in US is an estimated 200,000 patients whose conditions are moderate to severe who would benefit more from using the drug. Sales for the drug are estimated to reach more than $ 1 billion each year after it is successfully launched in the market.
However, the company is face by a number of environmental forces on top of which is regulatory competitive environment. One of the regulatory factors is the stringent approval requirements in the countries where the company aims to market its product. In the US, the main regulatory hurdle after the company obtained approval is the policy of the state to be the only buyer of the product with the option to terminate the contract of the drug at its convenience. The second environment force is competition. The main competitors in US include a variety of NSAIDs, Immunosuppressant and malarial drugs marketed by other companies.

1.2.0. Market Analysis
1.2.1. Market Strategy, Marketing Program, and Mix Issues
The company aims to be a product leader by focusing on the unmet needs of the consumers and selling them a product that meets these needs. The need among customers is a better alternative to the products in use for the treatment of lupus with no side effects. To achieve market leadership and growth, the company will use a number of strategies in its product, pricing, promotion, and placing (4Ps). For the product, the company will use product development where a company offers a new product to the existing customers. Secondly, the firm will do market expansion where it will sell the same product to other markets in Europe. The pricing strategy of HGS is that of price taking. It has priced its new product at a price that is closer to that which customers pay for other similar products. The customers will therefore pay up to 35,000 dollars for the treatment per year. These include biologics for multiple sclerosis, which are priced at $40,000 (Human Genome Sciences, Inc., 2010). Distribution will be achieved through the channels created by GSK and HGS in both USA and Europe where the company is looking to expand its product (Human Genome Sciences, Inc., 2010). Lastly, a team of 150 experts from both GSK and HGS will be engaged in the promotion (Human Genome Sciences, Inc., 2010). This team will communicate effectively the benefits of the new drug to create a demand for the product.

1.3.0. Key Financial Issues That Impact Marketing Situation
The main financial issue that influence the marketing campaign is the high cost per patient ($35,000) each year for the use of the drug. To ensure that the drug is accepted, the marketing team will have to portray to the stakeholders (patients, physicians, and interested consumers associations) that the costs are worth the potential benefits from using the new drug.
1.4.0. Industry Considerations that relate to marketing
The industrial considerations that will affect the marketing of the drug in USA include ethics relating to sale of drugs, labeling, and consideration of whether the drug is approved for reimbursement. Such issues will affect the marketing program because the contents of the drugs and potential side effects must be displayed in the package.
1.4.0. Management/corporate culture issues
The main management culture and cooperate issues that will affect the marketing campaign include the managerial effectiveness and culture that will influence the approach that the company will take in marketing its products.
1.5.0. Other marketing-relevant background issues
Both GSK and HGS have invariable experience in marketing pharmaceutical products that will influence on the success of the marketing campaign. In addition, they enjoy brand recognition that they can expend to the new product.
II. Problem/Decision Statement
Despite the large market for a product to treat the symptoms of lupus in US, the market potential of Benlysta remains relatively low. The main challenge that the company faces is poor uptake of the drug to lack of information about the potential benefits for the new drug. This is evident because the drug is yet to reach its sales and profit potential.

2.0.0. Strategies for Improvement
The best strategy for improving the sales of the product is direct selling. This would require a large force of sales persons who are well knowledgeable in the product to drive sales and for the product by working directly with client.
For this to be successful, a number of things will have to be done. First, the company should quantify the demand and secondly, a marketing campaign that addresses the informational needs of the key niche since information is the determining factor of adoption of drugs.
Based on the above, the following recommendations are given:
A knowledgeable marketing team be put in place to drive the direct marketing campaigns.
Educate the target population on the benefits of the drug.
Work closely with physicians to tell them the benefits of the drug to those who are already using the product through videos and testimonials to give them confidence in the drug.

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