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May 8, 2005  
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Blockbuster Drug Companies Spend Big on Advertising While Mid-Level, Niche Brands Focus Elsewhere
February 8, 2006
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Research Triangle Park, N.C., -- Blockbuster brands on average spend nearly half of their budgets on advertising, while mid-level and niche brands focus more on brand activities according to a recent report from Cutting Edge Information, "US Pharmaceutical Launches: Marketing Spend and Structure".

Blockbusters shelled out 49 percent - more than $160 million in one case – on advertising alone.  This figure dwarfs mid-level brands' 29 percent and niche brands' meager 17 percent averages.  Why the spending disparity?  Is it due to larger budgets?  No, the difference is directly related to the size and nature of each group's market.  While blockbusters have to catch the attention of mass audiences, mid-level and niche products are usually geared toward specialty markets less responsive to traditional channels of advertising.

Mid-level and niche brands tend to spend a majority of their budgets, 41 percent and 55 percent, respectively, on brand activities, which are a critical part of any brand's commercialization.  Product profile development, promotional strategy development, packaging, and market research management are especially helpful to smaller brands trying to reach specialty markets.

Thought leader development also takes an honorable mention of mid-level and niche brands' spending.  These companies put a lot of effort into influencing brands' target medical audiences by seeking efficient and effective means of communicating with their physician bases.

"Each drug has its own unique fingerprint, complete with various brand challenges, yet distinct patterns emerge among brand classes," said Research Team Leader Eric Bolesh.  "Regardless of projected peak annual sales, all brands invest some baseline amount in a core set of activities required to move a brand toward market launch."

"US Pharmaceutical Launches: Marketing Spend and Structure," is available at http://www.uspharmalaunch.com/

 
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