28/10/2020 Metabical: A New Weight Loss Drug » Case Solution

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Metabical: Positioning and

Communications Strategy
for a New Weight Loss Drug
Metabical is a revolutionary weight loss drug, which Cambridge Sciences
Pharmaceuticals expects to be finally approved soon. Upon FDA approval, Metabical
will be the only weight loss drug that is clinically proven to be effective for
moderately obese individuals. Barbara Printup, the Senior Marketing Director for
Cambridge Sciences Pharmaceuticals, is responsible for creating the positioning
strategy and marketing communications plan in preparation for the introduction of
Metabical. It is her task to carefully consider the decision-making process of
consumers as well as the interaction between the health care provider who
prescribes Metabical and the consumer who purchases Metabical. There is a high
risk of spelling disaster, if Metabical is – despite promising medical studies and
extensive research, poorly positioned in the highly competitive drug market for
weight-loss solutions.

Citation:
Quelch, John A. and Heather Beckham. “Metabical: Positioning and
Communications Strategy for a New Weight Loss Drug. HBS Brief Cases 4240, Jul
22, 2010.

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1. What are the key consumer characteristics of Metabical’s target market?
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28/10/2020 Metabical: A New Weight Loss Drug » Case Solution

2. Which end consumer segment(s) do you suggest the Metabical campaign

should focus on as a target market? Why?
3. Given the target market selected by you, how would you position Metabical
against its competitors?
4. Which communication channel strategies (i.e., push and pull approaches) to
promote Metabical seem appropriate to you?
5. Which communication program do you propose, that is, how would you deploy
promotional mix elements to advocate Metabical in the prelaunch, launch, and
post-launch phases?

Metabical – Case study analysis

Positioning and Communications Strategy for a New Weight Loss
Drug – Executive Summary

Cambridge Sciences Pharmaceuticals (CSP) is preparing the upcoming US-launch

for its newest prescription drug. Metabical is a weight loss drug that has been proven
to be safe and effective for moderately overweight individuals in clinical trials. FDA
approval is expected for January 2009, which gives the Marketing team around
Barbara Printup a little less than a year to develop an effective positioning strategy
for Metabical, as well as a full marketing communications plan to be ready for the
launch. It is clear that the product will have to amortize extensive R&D costs and
secure excess profits in order to be a success for CSP, all that in a market
environment characterized by diverse competition and low consumer trust. Based
on previous experiences and extensive research by Barbara Printup and her team,
the following actuality for target group, competitive situation and the product itself
is evident.

Target group

Two target groups have been identified to market Metabical to: consumers and
medical
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is targeted specifically at overweight individuals (BMI of 25 to 30) as end users of
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the drug. By the year 2000 34% of US adults (ca. 71 million) had been considered to
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28/10/2020 Metabical: A New Weight Loss Drug » Case Solution

be overweight according to research. While the percentage of overweights increases

with age, it prevails an equal phenomenon across all income-, and to a lesser extend,
education-levels.

To find out more about end consumers as a target group, CSP has commissioned a
survey amongst overweight individuals as well as a study to analyze psychographic
segmentation. According to the survey 70% of respondents are dissatisfied with their
current weight, while only 15% of those actively trying to lose weight are comfortable
with using drugs to do so. Women are considerably more active in weight loss
activities than men, more willing to change behaviors to live healthier, and
disproportionately unsatisfied with current weight loss options. On a similar note
the study about psychographic segmentation found women to be the most distinct
segment, while a focus group expressed demand for a proven and safe way to lose
weight. A decision on the targeted segments, promotional mix and messaging
based on these findings is however still pending. Health care providers, the second
target group that has to be addressed, are enthusiastic about Metabical according to
interviews conducted. Since excess weight is considered a public health crisis in the
U.S., the new drug is qualified to prevent direct effects like heart disease or diabetes
by a far extent. Health care providers remain concerned about the likelihood of
a short longevity of weight losses once the treatment has stopped. Medical
professionals will be targeted with a dedicated advertising campaign and CSP’s sales
force. Proposals for a messaging strategy have been developed but not yet decided
upon.

Competitive situation

The market for weight loss products and treatments in an extended sense is diverse
and characterized by a manifold of market participants. Although no prescription
drug specifically targeted at the weight-loss segment exists, many over the counter
(OTC) weight-loss drugs are available for purchase. Most OTC solutions are
being
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effects as serious as liver damage. Similar health
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risk issues with weight loss drugs (in one incident a unregulated “dietary
supplement” had been connected to cardiac death) and accusations of deceptive
marketing tactics hurt the credibility of the product category.

CSP has monopoly rights secured through a utility patent for its own prescription
drug and has a time window of at least 10 years before generics are likely to enter the
market.

The product

CSP believes Metabical to be far superior to any weight-loss solution currently on

the market. The drug is close to its FDA approval and has other advantages
compared to competitive offerings. It is combining an appetite-suppressant
compound with a fat-blocking and calorie-absorption agent and manages to produce
dramatic weight loss results. In trials a majority of patients reached their weight loss
goals within 12 weeks (losing in average between 26 and 15 pounds). For the
treatment to work, only one pill per day has to be taken, although it will only show
effect for individuals with a BMI of 25-30 (obese) and not above.

Metabical has fewer negative side effects than current weight loss drugs. Most side
effects are associated with intake of excess fat and calories, which facilitates the
adoption of healthier eating habits. Additional effectiveness and longer lasting
results are expected to be achieved by a complementing support program, consisting
of various educational content, like reference materials, community forums, meal
and exercise plans, as well as a number of weight-control tools. The program would
amount to $2.2 million fix costs in year one (just under 10% of the US-Marketing
budget for Metabical). It is intended to be available to customers for a duration of 24
months. The drugs pricing is however not finalized yet. Between $3 and $5 retail
price per day (avg. treatment 12 weeks) will most likely have to be paid “out of
pocket” by consumers, with only a few description drug plans expected to cover the
drugs’ cost.
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persuade health care providers to include Metabical in their programs (decision

after first 6-month sales review).

Marketing communication strategy

The marketing communication strategy for Metabical is aimed to focus on both

end consumers and medical professionals. Roughly 65% percent of the dedicated
marketing budget of 23.1 mio. USD is assigned to direct-to-consumer (DTC)
marketing measures. The budget is set based on CSP’s recent drug launch budget,
but is intended to be fine-tuned after actual campaign data is available.

Direct-to-consumer marketing is a relatively new phenomenon in the industry and

will be utilized via TV, online, radio and print media. Reaching a high product and
brand awareness is the number one priority for the launch. Metabical would be
marketed via social media, on blogs and through a contest with viral elements in
addition to more traditional channels. No internal experience exists about the
optimal utilization of these measures. The marketing agency had already prepared
three initial concepts for the DTC advertisements, which should serve as a basis for
further activities. Furthermore Printup is considering to get a female celebrity who
has struggled with her weight in the past as a prominent spokeswomen for the
product. This tactic is not recognized in the current marketing budget, but it had
been very effective for similar campaigns. One best practice suggests a positive effect
to counteract customer price sensitivity to some extent. To target healthcare
professionals CSP would rely on proven tactics from its past launch campaigns.
Direct mailings and extensive PR efforts, like press releases, medical
education events and a symposium would support the launch, as well as a dedicated
CSP sales team of 32 agents, responsible for the company’s gastrointestinal drugs.
Their task would be to visit doctors directly in their offices to discuss the drug and
provide samples. One sales representative is responsible for 100 medical offices. In
addition to usual sales materials they would work with promotional Lunch & Learn
seminars that were
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28/10/2020 Metabical: A New Weight Loss Drug » Case Solution

The team around Barbara Printup will have to work out its strategy in the coming
year to ensure a successful product launch of Metabical. The launch will have to
recoup R&D costs, ensure the longevity of the drug and shape Metabical into a brand
and product offering that resonates with the target group.

Key Challenges for Positioning and Communications

Strategy

For a successful launch and long-term return CSP faces multiple challenges that
would have to be addressed. Most of the project’s key challenges have already been
considered by the marketing team, while some other challenges can be derived from
the given facts.

Selecting segments to target – Identifying ideal customer segments amongst

consumers and/or health care professionals can’t be easily achieved with high
precision in a target group that is so diverse (34% of US Americans).
Choosing the right messaging – Positioning Metabical appropriately to the
segmented target groups will be equally complex and characterized by
uncertainty. Additional challenges arise by the need to communicate the drug’s
lack of effects on obese patients (BMI 30+) and a certain consumer distrust for
weight loss drugs in general.
Targeting efficiently through the right channels – Selection and fine-tuning of
the campaigns promotional mix will be crucial. Especially when using new and
untested methods like social media. The underlying problem here is to where
and how to reach the target audience.
Timing the different measures – An optimal roll-out schedule is depending on
multiple factors and assumptions. For instance the issue of when to start
targeting health care professionals (before, after or at the same time as
consumers) has to be solved. While one of the bigger challenges will constitute
the timing of social media activity. Moreover, it should be decided when to
carry out the research on support program’s impact.
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Pricing and marketing budget – The
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either render the best marketing campaign ineffective (when too high) or have a
negative but lasting effect on the company’s profitability.
Adjusting the organizational structure – How to utilize the allocated sales
team effectively will be vital to success amongst health care providers and affect
budget allocatable to DTC measures. In addition will the slight shift from
pharmaceuticals to service and content demand organizational adjustments.
External expertise – The lack of internal experience could be a big obstacle on
the way to a successful implementation. A cost-benefit analysis for using
external agencies for implementing a social media strategy might be adequate.

Challenges that do not influence the launch directly (e.g. due to their exclusively
long term relevance), but are still to be considered, are decisions about an
internationalization strategy and a plan to secure returns of Metabical after its
monopoly rights expire.

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