SMECTA® - Integrated Marketing & Communication Analysis and Recommendations to rejuvenate the brand to be back the leader.

VIET NAM PHARMACEUTICAL MARKET OVERVIEW & CURRENT MARKETING & COMMUNICATION Figure 1 -1: Vietnam Pharmaceutical market size: Source: IMS report, MAT Q02 2009.. Source: IMS report, Q2-201

TRƯỜNG ĐẠI HỌC MỞ TP HCM

HO CHI MINH CITY OPEN UNIVERSITY

UNIVERSITÉ LIBRE DE BRUXELLES SOLVAY BRUSSELS SCHOOL ECONOMICS & MANAGEMENT MMA6

Author: TRAN TRUNG HAU

NGUYEN LE THAI HOA

Analysis and Recommendations

to rejuvenate the brand to be back the leader

MASTER PROJECT MASTER IN MARKETING & ADVERTISING

Tutor’s Name: SERGE BYWALSKI

Ho Chi Minh City

(2013)

COMMITMENTS

We, Nguyen Le Thai Hoa and Tran Trung Hau commit that we have done this project by ourselves based on the information collected either from

The public’s or IPSEN PHARMA VIETNAM’s sources

This paper is designed only for the academic purpose of the completion

of our Master in Marketing and Advertising It is not expected for any other uses

Finally, we must express our deep appreciation to all of my colleagues, friends, and our family, who have, as always, given us their support throughout

TABLE OF CONTENTS

COMMITMENTS 2

ACKNOWLEDGEMENTS 3

LIST OF ABBREVIATIONS 6

GLOSSARY 8

INTRODUCTION 9

CHAPTER I: VIET NAM PHARMACEUTICAL MARKET OVERVIEW & CURRENT MARKETING & COMMUNICATION ACTIVITIES OF SMECTA ® 1 - Overview of Vietnam Pharmaceutical market: 10

2 - Overview of Vietnam Pharmaceutical brands and branding: 11

3 - Ipsen Global History & Milestones 13

4 - Ipsen Pharma in Vietnam: 14

5 - SMECTA®: 15

6 - Target customer & segmentation 18

7- Marketing activities in last 03 years: 18

8-Project Objectives: 19

CHAPTER II: ASSESSMENT/CRITICAL ANALYSIS OF SMECTA ® ‟S MARKETING AND COMMUNICATION CAMPAIGN IN THE LAST THREE YEARS (2009 -2012) A.General Analysis 20

1 -Macro-Environmental Analysis (SLEPT): 20

2- Vietnam pharmaceutical SWOT analysis: 21

3- Market Analysis: 23

4 - Competitor Analysis: 27

5– Internal Sales Analysis: 29

B.Evaluation of SMECTA ® Marketing & Communication Activities 33

1.Doctors and hospitals: 33

2.Pharmacies: 34

3.Public communication: 36

CHAPTER III: RECOMMENDATIONS &IMPLEMENTATION PLAN FOR 2013-2015 1 - Recommendations in Hospital/doctors: 40

2 - Recommendations in Pharmacy: 42

3 - Recommendations in Public Communication/End-users/patients: 43

4 - Marketing & Communication plan in 2013: 44

CHARTER IV: CONCLUSION 46

REFERENCES 47

APPENDIX 48

APPENDIX A: Profiling Excellent Example: 48

APPENDIX B: The “9” Technique 54

APPENDIX C: Smecta® concept in 2003-2007 55

APPENDIX D: Brands Positioning by target patient 55

APPENDIX E: Questionnaire Sampleof mini research 56

LIST OF ABBREVIATIONS

A&P: Advertising and Promotion budget

BMS: Bristol - Myers Squibb Corporation

BOEH INGEL.: Boehringer Ingelheim

BoNT A: Botulinum Toxin Type A

CEO: Chief Executive Officer

CME: Continuing Medical Education

FDA: US Food and Drug Administration

FMCGs: Fast Moving Consumer Goods

GMP: Good Manufacturing Practices certification GSK: GlaxoSmithKline Corporation

GP: General Practitioners

KOLs: Key Opinion Leaders

IMS: International Medical Statistics

IBS: Irritable Bowel Syndrome

MR: Medical Representative

Rep Office: Representative Office of Pharmaceutical

R&D: Research and Development

SOP: Standard of Procedure

SWOT: Strengths Weaknesses Opportunities and Threats SFE: Sales Force Effectiveness

ZP: Zuellig Pharma (a distributor for SMECTA® products) UNDP: United Nation of Developing Program

WTO: World Trade Organization

Diarrhea: Diarrhea is defined by the World Health Organization as having three or

more loose or liquid stools per day, or as having more stools than is normal for that

person

Smecta ® : Diosmectite is a natural silicate of aluminum and magnesium used as an

intestinal adsorbent in the treatment of diarrhea and of painful symptoms associated

with esophageal-gastric and intestinal diseases It is insoluble in water

OTC: Over the counter products, or non-prescription products, that the drug can be

delivered, sold or used without prescription

Ethical: Prescription product can affect the life, health when use without following

up prescription from doctors Therefore, when using or delivering it, you must have

prescription from doctors

Brand name product: A drug that has a trade name and is protected by a patent

(can be produced and sold only by the company holding the patent)

Generic product: Generic drugs are copies of brand-name drugs (when the patent

protection for a brand-name drug expires) that have exactly the same dosage, intended use, effects, side effects, route of administration, risks, safety, and strength

as the original drug In other words, their pharmacological effects are exactly the

same as those of their brand-name counterparts

Active ingredient: An active ingredient (AI) is the substance in a pharmaceutical

drug or a pesticide that is biologically active The similar terms active pharmaceutical ingredient (API) and bulk active are also used in medicine, and the term active substance may be used for pesticide formulations Some medications and pesticide products may contain more than one active ingredient The traditional word for the API is pharmacon or pharmakon, adapted from pharmacos which

originally denoted a magical substance or drug

SMECTA® is a very famous Brand name drug for diarrhea treatment,

Pharmaceutical company

effective integrated marketing and communication campaigns at the time being,

considered as the first priority for diarrhea treatment for Vietnamese consumers/patients It becomes OTC product and a very familiar word to talk about diarrhea

in the market due to several reasons such as strongly competition among pharmaceutical companies, Vietnam new laws, changing trend of prescription

competitors to seize the market shares

marketing and communication activities and give out recommendations in order to

of diarrhea treatment

Some desk researches have been done and a lot of secondary information has been processed for market, competitor or internal sales analysis An in-depth

recommendation; brand awareness; self-treatment of diarrhea patients and so on Through some findings, the full evaluation of current marketing and communication activities has been made to show which ones are still effective and which ones are out of dated

Some suggestions, in this paper, are quite appropriate with modern marketing strategy They are grouped in accordance with three target groups:

to increase sales volume, brand awareness and especially to get back the leading position in the market

VIET NAM PHARMACEUTICAL MARKET OVERVIEW & CURRENT MARKETING & COMMUNICATION

Figure 1 -1: Vietnam Pharmaceutical market size:

(Source: IMS report, MAT Q02 2009 G: Growth (%) EI: Evaluation index)

Market growth:

In recent years, Vietnam's pharmaceutical market increased constantly On this picture, pharmaceutical market was growth impressive 28.4% in year 2007 which achieved the highest growth rate during the period of year 2003 and year 2009 (Figure 1 - 2) Based on this IMS report, the VN pharmaceutical market will reach $2B by 2011, with an annual growth rate of 17%-18% in next 5 years

(Source: IMS report, Q2-2012)

2 - Overview of Vietnam Pharmaceutical brands and branding:

Leading manufacturers:

Continuing on analysis of the IMS report in 2012, with the ranking of TOP-20 pharmaceutical manufacturers in Vietnam market, Sanofi - Aventis is the leader The revenue of this corporation is around US$ 68.5 million Second leader is Glaxo SmithKline with its revenue of US$ 59.9 million Among these TOP-30 manufacturers, Ipsen Pharma

is ranked at position 28 with its revenue of US $ 12.9 million (figure 1 - 3)

However, the TOP-20 shows that the leading pharmaceutical manufacturers in Vietnamese market are almost foreign companies and corporations They are called pharmaceutical multi-national corporations and predominant manufactures are from France

or European countries, of course, it is explained why French medicines are important to Vietnam market There are some Vietnam local firms, Hau Giang Pharma (DHG Pharma) with 3rd position (biggest in Vietnam) and Traphaco in the 13th position

550 Weighted Avg Price

Value Million US$

Pack Million

US$ Per PACK

Million US$ or PACK

(Source: IMS Meridian report, MAT Q02 2012, million US$)

Besides the analysis of the leading manufacturers in the market, the IMS has investigated on the leading ethical or OTC brands This is important view because the company will see not only the leading brands, the therapeutic class but also the trend of therapeutic treatment because ethical brands play a key role in market and its significant contribution for the revenue of the company

Continuing more deeply on OTC market only, follow the IMS report in 2012, we can see Ipsen Pharma is ranked in better position (position no.6) with its revenue of US $ 11.5 million (figure 1 - 4)

Figure 1 - 4: Leading manufacturer in Vietnam pharmaceutical OTC market in year 2012

(Source: IMS Meridian report, year MAT Q22012, million US$)

3 - Ipsen Global History & Milestones

Ipsen is a global specialty-driven pharmaceutical company with total sales

exceeding €1.1 billion in 2011 Ipsen’s ambition is to become a leader in specialty

healthcare solutions for targeted debilitating diseases Its development strategy is supported by four franchises: neurology / Dysport®, endocrinology / Somatuline®, uro-oncology / Decapeptyl® and hemophilia Moreover, the Group has an active policy of partnerships R&D is focused on innovative and differentiated technological patient driven platforms, peptides and toxins In 2011, R&D expenditure totaled more than €250 million,

above 21% of Group sales The Group has total worldwide staff of close to 4,500 employees

Figure 1 – 5: Sales by geographical area & R-D investment

4 - Ipsen Pharma in Vietnam:

Ipsen Pharma Representative Office in Vietnam was established since 1996 At the beginning, Ipsen marketed and promoted around ten core products with strategic products are Smecta® and Tanakan® The main mission of the Representative office is commercial operation in both sales and marketing activities One majority objective is profitable The strategy for long run business is developing the biotech products (such as Dysport® and Diphereline®) while consolidating the primary care products like Smecta® and Tanakan® Now, Ipsen Pharma Representative Office in Vietnam has covered in 54 cities and provinces with total 78 employees There are 16 brands including Primary care and Biotech products The turnover of the Ipsen Pharma Vietnam in 2012 was about US $12 millions

Product porforlio:

- Primary care product: Tanakan®, Smecta®, Gastropulgite®, Ginkor Fort®, Forlax®, Fortrans®, Actapulgite®, Intetrix®,Spasfon®

- Biotech product: Diphereline®, Dysport®

R&D INVESTMENT (IN M€) SALES BY GEOGRAPHICAL AREA

in € million - variation at constant currency (%)

Figure 1 – 6: Ipsen Leading products info

5 - SMECTA ® :

SMECTA® is a powder composed of very small particles ranging from 1 to 3 µm Each particle has a layered leaf-like structure, with one layer of alumina between two layers of silica The small size of the particles, their positioning, and stacked leaf-like structure provide SMECTA® with special physicochemical characteristics, a high adsorption capacity, and an exceptional covering power

According to pharmacological study, the particles of SMECTA® integrate within the mucus, to which they are chemically related, and persist over 6 hours after ingestion Through its interactions with mucus molecules, SMECTA® increases the cohesion, viscos-elasticity and lifetime of the mucus Therefore, SMECTA® reinforces the mucous barrier and protects the apical pole of enterocytes and intercellular spaces from aggressors present

in the intestinal lumen Another pharmacological property is the neutralization of aggressive microorganisms SMECTA® protects the mucosa from aggressions by pathogens, whether toxicogenic bacteria, invasive bacteria, or viruses With these characteristics, SMECTA® is suitable for both children and adult

• Under 1 year: 1 sachet per day

• Between 1 and 2 years: 1 to 2 sachets per day

• Over 2 years: 2 to 3 sachets per day

Contents of one sachet should be suspended in half a glass of water

With the baby: can add to the baby’s bottle containing 50 mL of water to be given during

the day or can be mixed with a semi liquid food: pap, compote, purée, baby food

SMEOR _ Value Mil Vnd

SMEOR_Value_Mil Vnd SMEOR_Value_Mil Vnd FC Linear (SMEOR_Value_Mil Vnd)

SMEOR _ Volume Box

SMEOR_Quantity Actual SMEOR_Quantity FC Linear (SMEOR_Quantity Actual)

-1 %

-3 %

+3 % +1 %

YTD Oct.:

Figure 1 – 8: Leading products in A07 Group

Figure 1 – 9: Market share of products in A07 group by channel

TRANG VI KHANG - HAI KHAU HAI NAM

BIO-ACIMIN - MELIPHAR CO.

PROBIO - DPF (IMEXPHARM)

LACTOMIN PLUS - REXGENE BIOTECH

LACTEOL - AXCAN PHARMA

HIDRASEC - ABBOTT PHAR

Q2 12

Panel - IMS

MARKET SHARE BY CHANNEL

6 - Target customer & segmentation

 Doctors & Hospitals

 Pharmacies

 Public or End-users

7- Marketing activities in last 03 years:

TARGET ACTIVITIES NO OF

DRS OBJECTIVE COST DESCRIPTION

Drs prescription is strong impact

to patients, increase impact endorsement of deputy GE KoL

by sharing experiences & using Smecta®

Drs scientific meetings & RTM

national wide

800 Drs (A & B)

Increase Rx & loyalty

to Smecta®

54,000

National Gastroenterology

Congress at BacNinh (sponsor

for congress & Drs to join)

75 Drs Increase relationship

&KoLs support

20,000 Enhancing relationship & loyalty

of Drs (GE& GPs) and GE Association

Hospital presentations 20 hos Increase Rx & loyalty

to Smecta®

7,000 Approached target doctors at

their working to increase the cover age

Pharmacy

Visibility (poster) at pharmacies

Top 200 pharmacies

Public awareness

Reinforce Smecta®

leading image

16,000 Need stronger message via new

image & key messages

Pharmacies meetings & RTM

700 sellers Reinforce Smecta®

leading image

78,000 Deliver key messages of

Smecta® with differentiate competitors & increase selling Smecta®

Mystery shopper

800 pharmacies

Encourage pharmacist’s

recommended Smecta®

14,000 Need follow up closely with

training to get the expected result

Public

Media Adv & advertorial

Public Increase Smecta®

image & lead patients

to buy Smecta® as auto medication

Public Increase Smecta®

image & lead patients

to buy Smecta® as auto medication

14,000

8-Project Objectives:

While the pharmaceutical market size and growth rate are increasing year by year the sales figures of SMECTA® are stand still and trend decreasing As a result, SMECTA® is encountering losing its leading position in recent years With SMECTA®’s current

obstacles, the aim of this project is to analyze in details all relevant sides of the market situation and especially its marketing and communication activities in order to find out reasons and then suggest some recommendations to rejuvenate SMECTA® brand and get back the leading position In other words, the objective of this paper is to help SMECTA®

to optimize marketing investment, to re-allocate resources for three main target audiences appropriately and to adjust communication strategy accordingly

CHAPTER II:

ASSESSMENT/CRITICAL ANALYSIS OF SMECTA®‟S MARKETING

AND COMMUNICATION CAMPAIGN IN THE LAST THREE YEARS

(2009 -2012)

A General Analysis

1 -Macro-Environmental Analysis (SLEPT):

Socio-Cultural factor: The rapid population growth with better education makes higher

demand for the branded medicine The more patients are able to do self-treatment for popular diseases such as headache, running nose or diarrhea As a result, Pharmacy will be

a very important channel for medicine distribution Furthermore, with better living standard, everybody is aware of hygiene in eating, drinking and living environment for disease prevention Trendy products/medicines are more favorable

Legal factor: Hospital tender gets difficulties due to protectionism policies for Vietnam

local products (See further at Inter-Ministerial Circular, Guidelines on Bidding for Purchase of Drugs in Health Facilities)

Economic Factor: The Gross Domestic Product (GDP) growth is declining in the last year

(2010: 6.78%, 2011: 5.98% and estimated in 2012: 5.43%), the inflation rate was so high last year, but this figure just slightly increase this year due to drastic cut in spending in the economic recession period

Political Factor: The government encourages the Vietnamese people use Vietnamese

medicines to boost national pharmaceutical sector Several decrees as well as circulars have been released to medical centers, hospitals especially Social Health Insurance Companies to make priority to use domestic medicines Also, doctors are encouraged to write prescription with “Made in Vietnam” medicines SMECTA® is, more or less,

effected by all these policies

Technological factor: There are several ways in diarrhea treatment including:

Anti-infective (antiseptic); intestinal adsorbent, microorganism (Probiotic); Motility Inhibitor SMECTA® belongs to Intestinal adsorbent Group SMECTA® helps to cover the Consumers of mucosa, and the mucus protein binding in terms of quality and quantity, the need to enhance mucus barrier; the injury may promote gastrointestinal mucosal epithelial regeneration; may gastrointestinal absorption of gases and various attacks factor; balance normal flora; to promote the absorption of intestinal cell function; local hemostatic effect

Currently, Probiotics is still trendy growing products thanks to their larger spectrum of indications like dyspepsia and the well-known combination with antibiotics and good positioning to treat in Children Diarrhea

2- Vietnam pharmaceutical SWOT analysis:

Regarding to define the right strategy and activities support for Smecta® marketing & communication, the following analysis will summary and add-in more factors in the strengths, weaknesses, opportunities and threats of Vietnam pharmaceutical environment

The strengths:

• As mentioned in previous parts, the strengths of Vietnam market for

pharmaceuticals are growing fast in the background of economic recession Nowadays, in the trend of economic integration, Vietnam pharmaceutical industry will continue growth in terms of more investment, more multinational enterprises come and plenty of medicines for better choice in treatment the diseases

• The fact that, the market predomination is foreign imported medicines This

situation will remain for a long time whenever local manufacturers are strong enough in terms of modernization and reform From now to this, foreign medicines will play a leading role in this market

• In Vietnam, Ho Chi Minh City is still leading market with the highest contribution

for GDP In the pharmaceutical point of view, Ho Chi Minh City market is also the important one Focus on this market and then stretching the activities to other cities

is the current strategies for many pharmaceutical Rep Offices and private enterprises

The weaknesses:

• The health care expenditure increase continuously at least 10% each year but this

level is still low so it will restrict the drug consumption, especially for expensive medicine

• Because local medicine brands are still small and lacking of powerful for

competitiveness, the government and MOH currently have many policies motivation for its growth In the National Essential Drug list and hospital drug list, Vietnam MOH would like to increase the percentage of presence and usage of local brands With these policies, the competitive of the market in listing in hospital is higher and higher It's not small impact on the foreign brands which also need to be present in the same list Besides that, government and MOH banned to stretch the import license for those products that local manufacturers can produce This makes more difficulty for current ethical brands in re-submit documents for getting the new visa Nevertheless, the advertising licenses and advertising fees for all local products are always lower than those apply for foreign brands

Opportunities:

• The first opportunity for all pharmaceutical is based on the good economic growth

rate This impacted much on the growth of pharmaceutical industry, of the care expenditure level As the result, the Vietnam pharmaceutical market growth continuously at least 12% each year as forecasted and drug expenditures will increase minimum 10% per year This environment is not only a good chance for

health-both local and foreign manufacturers but also for the growth of any ethical and OTC brands

• Vietnam with high population 86 million in 2009 is the huge potential market for

pharmaceutical growth As estimated, the market will increase at least 17% every year from now to 2013 one again to confirm the potential of this market With this good opportunity; the company with an adaptive strategy will be able to catch the chance for growing up in the near future

• In Vietnam, market predomination now belongs to foreign players That's a reason

why the TOP-20 manufactures showed the answer about this situation In this market trend, the Rep Offices with its foreign imported medicines especially ethical brands will be the essential medicines in the national drug list because of no substitute ones from local manufacturer

Threats:

• Price control is the most important task of MOH now when there are many

concerns from public about medicine price in the market Vietnam government and MOH have issued regulations to strictly control the price, particularly stressed on the foreign brands So, in this situation premium price issue of foreign pharmaceuticals is also their weakness in competition To compare with local products which are in the same therapeutic class, there is a price war within brands The local private enterprises have not affordable to apply the business ethics, so they have flexibility in promotional activities such as sales promotion, sales discount for prescribers These factors seem to synergize to increase the usage of local products by increased their prescriptions that both doctors and company have benefits together

• Vietnam on the way of integration world economy, of course it is the chance for

more pharmaceutical multinational come, however, the market is likely to be higher and higher competition Besides that, MOH have policies to focus much on the way

to promote the ethical brand in the market They allow for promoting these brands

to doctors and pharmacists but no accepted to communicate to public In this case, how to improve or increase brands awareness among public are the challenges for branding of ethical brands From now on, the company must think over to find the legal way to approach the end users The more getting involved this target company focuses the more improvement of brands Awareness Company get

3- Market Analysis:

Anti-Diarrhea Market has the growth of +7% in volume; + 6% in value according to IMS report - Q2.2012 Enterogermina – Sanofi is leading the market with 9.3% of market share,

SMECTA® is positioned the second of 8.8% of market share and Antibio – MSD is the

third with 6.0% of market share

Food infection, poor hygiene of living environment is one of the main cause of diarrhea was noticed by mass media created a favorable environment for anti-infective groups, especially Berberin which use for Adult diarrhea (50% Unit share), growth +11% in Unit Probiotics are both promoted by pharmaceutical & milk companies It is trendy product with some evidence in digestive disorders prevention mainly due to antibiotic (huge

consumption in Vietnam) Good performance of Int’l Branded as Enterogermina Sanofi

Furthermore, the market also has some following characteristics:

 Products which invest in OTC get good growth in volume vs others

 Opportunities of developing Adult market in early onset of diarrhea include

abdominal pain, nausea, light diarrhea due to food problem

 Market driven by local products & generics with low price in both Unit &

Value

 Adult diarrhea market have a good growth & market also show dynamism in

Child sector via good performance of probiotics

 Probiotics keeps growth in both unit & value with high market price

 In the 5 key cities which contribute 50% market share, Smecta® is market

leader in HCM, CanTho & Haiphong while Enterogermina lead in Hanoi & Danang

 Hochiminh & Hanoi contribute 41% market share

 There are only 50% pharmacies in Hanoi & Hochiminh buy Smecta® direct via

Zuellig Pharma Vietnam & 50% pharmacies coverage by our Sales Forces in HCM & Hanoi

In the diarrhea treatment market, there are five sub-groups with particular treatment for different symptoms Each sub-groups with specific characteristics makes the market more dynamic and competitive

Figure 2 – 1: Unit & value market share of Sub-group in A07-Anti-diarrhea

A07 A: Anti-infective (antiseptic):

* 50% MS in Unit, grow + 10%

* 5% MS in Value, grow +17%

- Berberin (an herbal antiseptic for Adult diarrhea treatment, well-known Vietnamese

traditional product) growth: +11% in Unit & + 23% in Value

- From TNS Study : Berberin have been reported as the most requested brand after

Smecta® by Adult patients

- More than 100 local Berberin brands with a very cheap price: 50 vnd/tab vs

Smecta® 3500vnd/sachet

- Behind the noticed diarrhea peak, buzz in media around food hygiene and safety +

the strengthen to usage local products might create a favorable environment for anti-infective groups, especially Berberin

A07 B: Intestinal adsorbent

* 13% MS in Unit, decrease -5%

* 16% MS in Value, decrease -9%

Smecta® is leader in this group in with 54% Value share & 19% in Unit

 Charcoal & Carbomin (50% MS in units)

 Smecta® 16% in Unit & -10% in Value in IMS Audit), Diosmectite generics

(-24%), Attapulgite (-38%)….except GRAFORT (a diosmectite Ready To

Use-RTU)

 However accurate data of Smecta®, as reported in PGI, on same period show a

slowdown at -3% in units, and + 3% in USD value, + 6% in VND (thanks to price increase in Oct 11)  Discrepancies might be explained by a bad performance of

Smecta® in Hanoi in 2012 and moderated in HCMC

A07 F: Microorganism (Probiotic):

* 22% MS in Unit, grow + 7%

* 58% MS in Value, grow +13%

Flat market in volume (+3% Q2.2011)

 Probiotics still trendy growing products :

 Thanks to their larger spectrum of indications like dyspepsia and the well-known

combination with antibiotics

 Good positioning to treat in Children Diarrhea

 High promotion supported by pharma and milk company

 Enterogermina (Sanofi) is a leader market with good growth +27% in Unit &

+34% in Value thanks to a strong promotion in Pharmacies

 Many other local products have good growth like Probio (Imexpharm) surfing on

the market tendency to use Probiotics and in line government policy to push local products

A07 H: Motility Inhibitor (Loperamide) :

* 7% MS in Unit, grow + 9%

* 3% MS in Value, grow -4%

Motility inhibitor (Loperamide group) focus on adult, perceived as fast action use in first

days of diarrhea, reach 7% MS in unit, +9% growth  Adult market growth

In this group, Imodium® of Janssen Cilag-market leader decrease (-43%) due to its production problem in Thailand from Mar.2011 due to flood, they have stopped their MKT promotion

A07X: OTHERS:

* 6% MS in Unit, grow + 38%

* 14% MS in Value, growth +46%

- Hidrasec, good performance with a focus on Children in Child Hospital (compare

Smecta® share vs Hidrasec in Child 1 & Child 2 hospitals and in National Pediatric Hanoi hospital)

- Other anti-diarrhea products, mainly local ones, has good growth thanks to focus

OTC activities

Trang Vi Khang is a herbal product, indicating in a large rang of symptoms from colitis to gastritis & dyspepsia (grow+ 24% Unit; +13% Value), due to effective TVC, PR website & newspapers advertising

Findings from market analysis:

- Although Probiotics is not direct competition, they are leading the market and

perceived as new tendency, strong usage of Probiotics thanks to some evidence in preventing digestive disorder due to antibiotic absorption and IBS for adult ; good performance of Int’l branded as Enterogermina.Sanofi Aventis and Antibio.MSD

- Market overcrowded by over 900 references, mainly local products, generics and

copies

- Some hospital tender difficulties due to protectionism policies

- Drs attracted by new products (Hidrasec.Abbott) rather than old ones

- Retailed Pharmacies remain the main channel, with strong competition and

aggressive commercial policies

- Opportunities by developing Adult segment (chronic diarrhea/ IBS) & Pediatric

segment (diarrhea)

- Not so many innovative products enter this market

- Penetrate to share market of probiotics in digestive disorder segment (chronic

diarrhea and IBS alike)

- Develop market potential in South which we can perform better in sales return

4 - Competitor Analysis:

a Strategy & key Ethical activities:

Strategy Target acute & chronic

digestive disorder due to

antibiotic using (child &

adult)

IBS symptoms (adult)

Intend to expand into

alcoholic people segment

(cause chronic gastritis,

Target acute diarrhea

• Good relationship with

key associations &

hospital through sponsor hospital meeting &

activities

Pharmacies:

• Trade Push more often

with 3% & 5% discount

on invoice

• Gold pharmacy members

program (with other products)

box, standees…)

• Organizing pharmacies

meetings

Hospitals: Do not have dedicated

team, manpower in combine other products

Pharmacies: Trade push 5%

discount on invoice (not often)

Hospitals: RTM with

speakers (head/vice head of department) Invest in KoLs for writing guidelines & advocacy

Pharmacies: Trade Push 5% discount on invoice

b Product factors, regulatory assets & sales force investment:

Figure 2 – 2: Factors which influence to Pharmacy‟s recommendation

Figure 2 – 3: Competitors regulatory assets and downsides

Figure 2 – 4: Sales Force investment

5 – Internal Sales Analysis:

a Smecta® Annual Sales – Units („000): Sales is on decline trend

Figure 2 – 5: National Sales Trend in 2010 – 2012 period