Product Team Cialis : Ready to Market A Case Study Presentation

May 1, 2012

Competition Strategies Which route to take?

Direct Compete Strategy

Pros Same Pie of Market share No initiation effort required for Current Viagra Users Cons More Funds needed to sustain competition Risk of Price-War with an established market leader

Niche Strategy
Pros Well-defined target space High competitive advantage Cons Risk of limiting market share; impact on long-term growth strategy

Beat Strategy
Pros Easy to market product differentiators to an experienced consumer mass Enables growth: Opens scope for a compete Strategy in future Cons Requires heavy reliance on product differentiators Requires dedicated effort to turnaround established market perceptions

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Product Team Cialis : Ready to Market

May 1, 2012

Buyer Behavior Model - Patients and Doctors

Age Groups Younger population: Embarrassed, Low awareness about ED causes Older population: Prevailing perception of relating ED symptoms to age. (10% to as high has 48%

Usage Group

Viagra Users/Viagra Dropouts: No initiation is required. More awareness towards ED New Users: High initiation/influence efforts. Purchase exclusively driven by doctors perception.

Product benefit

Benefits from particular product features drive purchase decisions Higher tendency of buyers to influence doctors decision for future prescriptions

Doctor

Safety and efficacy are prime drivers

Cialis : Ready to Market May 1, 2012

So which region/geography need we target?

National/Private Insurance ~ 45%

U S
Highest ED Market share (Revenue ~ 62%) High Education Level (Post-Secondary ~67%) High Income Level (35% > 60k annual) we ..And did 4

Europe/UK
Low ED Market share Low Education Level Low Income Level

find any similarities..???

Cost shared b/w individual and partner

(US: 33%; UK:15%; Rest of EU: Negligible)

More openness towards ED

(Individuals reaching out to a local drugstore US: 67%; UK: 74%)

Product Team Cialis : Ready to Market

May 1, 2012

So why not segment user groups and their needs?

Age

Younger population: Embarrassed, Low awareness about ED causes Older population: Prevailing perception of relating ED symptoms to age. (10% to as high has 48%

Usage behavior

Viagra Users/Viagra Dropouts: No initiation is required. More awareness towards ED New Users: High initiation/influence efforts. Purchase exclusively driven by doctors perception.

Product Perception

Benefits from particular product features drive purchase decisions Higher tendency of buyers to influence doctors decision for future prescriptions

Doctor

Safety and efficacy are prime drivers

Cialis : Ready to Market May 1, 2012

Segmentation
Geography based US UK

Usage behavior based

Current Users of Viagra (3 Mm)

New Users (20 Mm)

Viagra Drop Outs (7Mm)

Product Perception based

Satisfied (91%)

Dissatisfied (9%)

For the Market leader to chase

Dissatisfied with Viagra due to onset/duration time (55%)*

Dissatisfied with Viagra due to other reasons (45%)

Potential Revenues= Total Segment Size *Differentiation Attribute Factor * Avg. Prescription* Cost of the Drug Potential Buyers=0.16 * Refill Factor
Mm

Potential Buyers=7*.55=3. 85Mm

Potential Revenue= 0.16*390=62.12 Mm

Potential Revenues= 3.85*390= 1501.5 Mm

Total Potential Revenues = 1501.5 + 62.12 = 1564 Mm Approx.

Positioning Strategy: Cialis-A life style Drug

Cialis removes awkwardness in a relationship through

Greater Control, Flexibility and Freedom while ensuring greater safety

Communication with the Doctors - Enhanced Safety

Communication through key decision makers and experts in the medical community about the enhanced safety of the drug Exploit the strong association of the JV with the medical community, world wide opinion leaders.

Cialis : Ready to Market

May 1, 2012

Long Term Growth Strategy

Target the Current Viagra User Base through extensive advertising once costs are recovered and brand loyalty is established.

Cialis : Ready to Market

May 1, 2012