A proposed study on consumer attitudes towards generic prescription medicines in Australia Johan Liang, Curtin University.

Ian Phau, Curtin University. Abstract This study investigates consumer attitudes towards generic prescription medicines in Australia. Specifically, it examines how a number of antecedents (e.g. consumer concern, consumer knowledge, consumer trust, perceived risk, subjective norms, and facilitating conditions) influence attitudes and behavioural intention towards buying generic prescription medicines. Some moderating (e.g. price differential) and mediating (e.g. attitudes towards generic prescription medicines) variables are also tested. The Theory of Planned Behaviour (TPB) and Neutralization Theory will be used to explain the underlying relationships between the variables proposed in the research model. A number of implications for businesses will be discussed, suggestions for future research are reviewed and the main contributions of the study will also be delineated.

Introduction Counterfeit medicines are becoming increasingly prevalent in the global market since the last decade (Liang, 2006; Lybecker, 2007). Although there is a small probability of counterfeit medicines in developed countries, Australia is not safe or excluded from illegal entries of such medicines (World Health Organization, 2008). The World Health Organization (WHO) estimates that up to 60% of drugs in some developing countries and up to 20% in some developed countries are counterfeits (Liang, 2006; WHO, 2010). According to WHO facts (2010), more than 50% of medicines that purchased from Internet are counterfeit. While there are many studies done in this area (e.g. Liang, 2006; Lybecker, 2007; Moken, 2003), there is a dearth of research from the consumers perspective (Bian and Veloutsou, 2007; Staake, Thiesse and Fleisch, 2009; Veloutsou and Bian, 2008). Moken (2003) conducted a study in China and found two overarching issues with respect to counterfeit medicines (Lybecker, 2008; Wyld, 2008). Firstly, consumers unknowingly purchase deceptive counterfeit medicines (Bloch et al., 1993; Liang, 2006). Counterfeit medicines can be defined as medicines sold under a pharmaceutical company brand / label, usually at a much lower price. Counterfeit medicines may (a) contain a lesser amount of the real medicines active ingredient (b) contain no active ingredient at all (c) compose of substances varying from talcum power to aspirin or poison (d) blatantly mimic the real medicines, inclusive of the manufacturers labels, pamphlets, and purity seals but are in fact fakes (Moken, 2003). Secondly, consumers are confused if generic brands of medicines are in fact counterfeits (dAstous and Gargouri, 2001; Lybecker, 2008) because generic medicines also sold at a cheaper price than original medicines and have identical labelling from the genuine drugs; even though generic medicines contain the same active ingredients (bioequivalent) of genuine medicines (McLachlan, Ramzan and Milne, 2007; Meredith, 2003; Roger, 2006; Therapeutic Goods Administration, 2009). Bioequivalent means that the medicines have the same active ingredients and the same dosage formulation to meet the standards for strength, purity, quality and identity of branded medicines (Lfgren, 2004; Meredith, 2003; Roger, 2006). The rate of absorption may differ but it is still considered as bioequivalent if the difference is intentional and there is no significant difference in the extent of absorption when the two products are assessed under similar experimental conditions (Lfgren, 2004; Meredith, 2003; Roger, 2006). However, generic medicines have to pass a preapproval good manufacturing process (GMP) inspection before it can be sold (Lybecker, 2008). Therefore, it is observed that the growing consumer concern and the lack of consumer knowledge about counterfeit medicines have led to less than favorable attitudes towards generic medicines (Bang et al., 2000; Liang, 2006; Marcketti and Shelley, 2009). In the context of this study, consumers in Australia will also share the same issues with respect to counterfeit medicines. This study will focus only on generic prescription medicines excluding over-the-counter (OTC) medicines. Existing literature revealed that most research in generic medicines have been studied from the perspective of practitioners or pharmacists (Chua, Hassali, Shafie and Awaisu, 2010; Hassali, Kong and Stewart, 2006). Little research has examined generic medicines from a consumers perspective. Specifically, there are no studies on consumer perspective towards generic medicines in Australia. It is extremely important to address consumer concerns regarding the issues and negative publicity surrounding counterfeit medicine. Hence, there is a dire need to first investigate and understand consumer concern and consumer knowledge towards counterfeit medicines. Furthermore, it will shed further insights into the consumer confusion between generic medicines and counterfeit medicines. In addition, most of the consumer perception studies about generic medicines are conducted
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using qualitative approaches (Chua et al., 2010; Sharrad and Hassali, 2010). Therefore, this empirical study will analyze consumer perception by developing a research model to explain the relevant causal relationships that are postulated in the research model (refer to Figure 1). Relevant Literature, Theory and Hypotheses What are the differences between generic medicines and counterfeit medicines?
Counterfeit medicines (Moken, 2003; WHO, 2010; Liang, 2006) Copy of generic or branded medicines without legal authorisation. Endanger consumers or patients who consume it. Blatantly mimic the real medicines, inclusive of the manufacturers label, pamphlet, and purity seals but are in facts fakes. Generic medicines (Meredith, 2003; Beecroft, 2007; Gill et al., 2010) Copy of branded medicines with legal authorisation after the patent of branded medicines has expired. Cost-saving for customers and the government. Create their brands and their own packaging, such as label, pamphlet and purity seals.

Perceived risk defined According to Gemunden (1985) and Roselius (1971), perceived risk is a multi-dimensional constructs that indicate different type or degree of uncertainty loss from the purchase and use of a product (Bauer, 1960; Cox, 1967). Dowling and Staelin (1994) defined perceived risk as the persons perception of the riskiness buying an average product in the product class (p. 119) for product category risk. In the context of this study, perceived risk towards generic prescription medicines will be the focus on this study. It is predicted that perceived risk towards generic prescription medicines will decline if the consumers have acknowledged the benefits of generic prescription medicines through repeated exposure (Baker et al., 1986; Obermiller 1985). Consumer trust defined Rousseau et al. (1998) defined trust as comprising the intention to accept vulnerability based on positive expectations of the intentions and behaviours of the others. Building upon Rousseau et al.s (1998) work, trust can be defined as positive expectations of generic prescription medicines that lead to intention to purchase generic prescription medicines and the actual purchase behaviour in the context of this study. Growth of generic medicine in Australia In 1994, pharmacists had the permit to substitute generic prescription medicines if they were listed on the Schedule of Pharmaceutical Benefits (Beecroft, 2007; Gill et al., 2010). In 2001, generic prescription medicines market share accounted for only 20%, and by 2004/2005 it had grown only 25% (Beecroft, 2007; Gill et al., 2010). When compared to other countries such as Finland or Italy, this percentage was relatively low (Gill et al., 2010; Lfgren, 2004). Most of the researchers found the price of generic medicines in Australia were more expensive than other countries such as USA, Finland, Italy, and New Zealand because of the lack of competition in the market. (Gill et al., 2010; Lfgren, 2004; Medications cost more in Australia, 2009; Searles, Jefferys, Doran and Henry, 2007). Hassali et al. (2009) found that affordability, access, and pharmacist communication skills were the key dimensions that affect customers attitudes towards generic medicines. In addition, Generic medicine is perceived as an inferior product, past experience (brand loyalty), safety risk and lack of knowledge of generic medicines are the reasons why consumers reject generic substitution
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despite the cost savings (Hassali et al., 2006; Hassali et al., 2009; Mason and Bearden, 1980; Shepherd, 1988;). Recent research shows that pharmacists and patients acceptance towards generic substitution medicines are quite high in Australia (above 90% for pharmacists and above 70% for patients) (Chong et al., 2010). Recent research also shows that the Australian government encourages the utilization of generic medicines to reduce expenditure in Pharmaceutical Benefits Scheme (PBS) and provide cheaper alternatives for consumers (Chong et al., 2010; McCarthy, 2010). Neutralization Theory - Originally, neutralization theory is developed by Sykes and Matza (1957) to justify individual illegal behaviours or actions by neutralizing their wrongdoing. In the context of this study especially in Australia, purchase intention on generic prescription medicines will be justified as a normal act. Five techniques are created by Sykes and Matza (1957): denial of responsibility, denial of injury, denial of victim, condemnation of the condemners, and appeal to higher loyalties (Hinduja, 2006). Hinduja (2006) also explored other four techniques to explain neutralization theory: metaphor of the ledger (Klockars, 1974; Minor, 1980), claim of normalcy, denial of negative intent, and claim of relative acceptability (Henry, 1990). Denial of responsibility, denial of injury, denial of victim, claim of normalcy, denial of negative intent, and claim of relative acceptability are the six techniques that will be implemented to explain the research model in this study. It will be divided into two perspectives. Firstly, pharmacists perspectives will act as social factors to influence customers to purchase generic prescription medicines. Generic medicines are cheaper than branded medicines, generic medicines are bioequivalent of branded medicines, buying generic medicines is helping the government to reduce healthcare expenditure, and other people also buy generic medicines are good examples of pharmacists perspectives towards generic prescription medicines that will influence upon consumers perception towards generic prescription medicines. Secondly, customers perspective will act as personal factors that lead their attitudes and intention to buy generic prescription medicines. There is no harm from purchasing generic medicine, nobody will get hurt if I buy generic medicines, it is not my fault for purchasing generic medicines because branded medicines are too expensive for me, I am helping government to reduce healthcare expenditure by purchasing generic medicines, everyone is purchasing generic medicines so it should be ok, I did not intend to cause harm to branded medicines manufacturers, and I am just buying generic medicines, other people engage in much worse activities than this are good examples of the attributes of neutralization theory that can explain customers perspective towards generic prescription medicines. Therefore, neutralization theory is appropriate to be used in this study as it can explain the research model by neutralizing the positive and negative impact on purchasing generic prescription medicines from pharmacists perspectives and consumers perspectives. Theory of Planned Behaviour (TPB) - The TPB is an extension of the TRA, introduced by Azjen in 1985 with the additional variable of perceived behavioural control as a predictor for intentions and behaviour to improve the main flaw of the TRA. According to Azjen (1991), behaviour is guided by belief about likely outcomes of behaviour and evaluations of these outcomes (behavioural beliefs), beliefs about normative expectations of others and motivation to comply with these expectations (normative beliefs), and beliefs about the presence of factors that may facilitate or impede performance of behaviour and the perceived power of these factors (control beliefs). Azjens Theory of Planned Behaviour (TPB) is a well recognized intention model because it is very useful to understand and explain behaviour in a wide range of topics specifically in the context of this study.

By utilizing TPB into the context of this study, consumer trust, perceived risk, consumer concern about counterfeit medicines, and consumer knowledge about counterfeit medicines will act as behavioural beliefs (personal factors) in the model that will influence upon attitudes towards generic prescription medicines and intention to buy generic prescription medicines. Social factors and susceptibility to interpersonal influence will act as normative beliefs (subjective norms) in the model that will influence upon attitudes towards generic prescription medicines and intention to buy generic prescription medicines. Facilitating condition will act as control beliefs (perceived behavior control) in the model. Therefore, the research model can be fully explained by using TPB. Based on the previous literature, neutralization theory, and TPB, the following hypothesis proposed: H1a: Consumer concern towards counterfeit medicines has a negative influence on the attitudes towards generic prescription medicines. H1b: Consumer concern towards counterfeit medicines has a negative influence on the intention to buy generic prescription medicines. H2a: Consumer knowledge about counterfeit medicines has a positive influence on attitudes towards generic prescription medicines. H2b: Consumer knowledge about counterfeit medicines has a positive influence on intention to buy generic prescription medicines. H3a: Perceived risk has a negative influence on the attitudes towards generic prescription medicines. H3b: Perceived risk has a negative influence on the intention to buy generic prescription medicines. H4a: Consumer trust has a positive influence on the attitudes towards generic prescription medicines. H4b: Consumer trust has a positive influence on the intention to buy generic prescription medicines. H5a: Social factors have a positive influence on the attitudes towards generic prescription medicines. H5b: Social factors have a positive influence on the intention to buy generic prescription medicines. H6a: Susceptibility to interpersonal influence has a positive influence on the attitudes towards generic prescription medicines. H6b: Susceptibility to interpersonal influence has a positive influence on the intention to buy generic prescription medicines. H7a: Facilitating conditions has positive influence on the intention to buy GPM. H7b: Facilitating conditions has a positive influence on the actual purchase behaviour. H8: Attitudes towards generic prescription medicines has a positive influence on the intention to buy generic prescription medicines. H9: Intention to buy generic prescription medicines has a positive influence on the actual purchase behaviour. H10: The price differential between generic medicines and branded medicines will moderate the relationship between intention to buy generic prescription medicines and actual purchase behaviour. Conclusion The preceding literature review provides the basis for the proposed theoretical framework highlighting the personal factors, subjective norms and perceived behaviour control will affect
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consumers attitudes towards generic prescription medicines that lead to intention to purchase generic prescription medicines. In addition, the model also shows the effects of price differential will affect the relationship between attitudes towards generic prescription medicines and intention to purchase generic prescription medicines. The next step of the study is to design a research methodology and test these proposed hypotheses. The study offers a number of significant contributions. Theoretically, this study introduces TPB, and neutralization theory to develop a framework in which to examine deeper insights from existing exploratory generic prescription medicines research. Specifically, it will explain how personal, subjective norms and perceived behaviour control influence attitudes towards generic prescription medicines that lead to intention to purchase generic prescription medicines. Methodologically, this study will develop the scale of attitudes towards generic products. Scales to measure the other remaining constructs will be adopted from existing literature to ensure that reliability and validity is ensured. From a managerial perspective, the effect of personal factors, subjective norms and perceived behaviour control that influence consumers attitudes towards generic prescription medicines that lead to intention to purchase generic prescription medicines will guide pharmaceutical industry and policymakers to resolve the issues attributed to consumer confusion between counterfeit medicines and generic medicines. In addition, policymakers have an accurate direction to create new policies to encourage consumers to purchase generic medicines in the future. This study also will contribute new ideas to brand managers on how to distinguish generic medicines from branded medicines in the market. Figure 1: Proposed Research Model

Consumer concern towards counterfeit medicines Consumer knowledge about counterfeit medicines

H1a H2a

Attitudes towards generic prescription medicines

H8

Price Differential
H10

H3a

H5a, H6a

Perceived Risk

Subjective Norms
H4a

Social Factors Susceptibility to interpersonal influence

H5b H6b H6b H7a

Intention to buy generic prescription medicines

H9

Actual purchase behaviour

Consumer trust Perceived Behaviour Control Facilitating Conditions

H7b

References
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