Pfizer Inc. is one of the largest and most well-known pharmaceutical companies in the world. The company offers a variety of drugs for oncology, cardiology, and immunology, with Pfizer’s Viagra being one of its most popular drugs. Although it is now available in numerous countries, Viagra’s introduction to the Indian market differed from its launch in the United States. This case study will consider Viagra’s presentation to the pharmaceutical market in India, focusing on Pfizer’s approach to the distribution and pricing strategy.
Substantial differences characterize the American and Indian pharmaceutical markets. Pfizer introduced Viagra to the U.S. market in 1998, with it being the first approved erectile dysfunction drug in the country (Purkayastha & Fernando, 2006). It should be noted that the company was actively preparing for mass manufacture of the drug before it was approved by the government to be the first company to offer it in the USA (Purkayastha & Fernando, 2006). Notably, the company outsourced drug trials to expedite the process. Thus, at the moment of launch, Pfizer had no competitors in the erectile dysfunction segment of the market. Meanwhile, the drug was launched in India in 2005, when different companies offered a variety of cheap alternatives. Although regulations required extensive drug trials in both markets, India permitted legal reverse engineering and the sale of patented drugs (Purkayastha & Fernando, 2006). Furthermore, the patent law passed later failed to protect Pfizer’s Viagra due to it being patented before 1995 (Purkayastha & Fernando, 2006). Overall, the U.S. 1998 and India 2005 markets differed significantly, requiring distinct approaches to the distribution and marketing of Viagra.
Due to the discussed differences in the markets, Pfizer’s responses to each one were fairly unique. In the United States, a large-scale PR campaign was launched to destigmatize the condition. For example, the term “erectile dysfunction” was coined by Pfizer to replace the often-used word “impotence,” which was considered highly embarrassing (Purkayastha & Fernando, 2006). The marketing campaign for the drug provided medical professionals and potential customers with various resources on erectile dysfunction while presenting it in a positive and celebratory way. In contrast, this approach was unlikely to work in India due to the topic of sex and erectile dysfunction being considered taboo (Purkayastha & Fernando, 2006). In addition, the market offered many over-the-counter alternatives inhibiting Viagra’s marketing as the definitive answer to erectile dysfunction. Therefore, a decision was made to market the drug as a premium product, which was reflected in the high price of Viagra tablets compared to local substitutes (Purkayastha & Fernando, 2006). Thus, the marketing campaign in India focused on positioning the drug as a better alternative to the existing products.
The decision to market Viagra in India as a premium product can be viewed as counter-productive due to it costing more than other available drugs for erectile dysfunction. According to Purkayastha and Fernando (2006), the target market for Viagra in the country was extremely niche, with the high price further narrowing it. Nevertheless, the premium pricing strategy can foster a more favorable product perception. Guitart et al. (2018) note that premium pricing can lead to increased sales and improvement in company equity. Although the strategy limits market opportunity and reduces price competitiveness, it presents the product as high-quality and more effective, improving the perception of the drug and the brand. Thus, it can be argued that the selected pricing strategy was the correct approach for the introduction of Viagra to the Indian market.
In summary, Viagra is one of the most well-known drugs manufactured by Pfizer. In the United States, it entered a pristine market with no competitors and set the course for other erectile dysfunction drugs. Whereas in India, it launched the product into a saturated market with numerous competitors offering affordable alternatives to Viagra. Overall, the selection of different strategies is justified, with the premium pricing approach being an unorthodox yet effective method of presenting the product to the new target market.
References
Guitart, I. A., Gonzalez, J., & Stremersch, S. (2018). Advertising non-premium products as if they were premium: The impact of advertising up on advertising elasticity and brand equity.International Journal of Research in Marketing, 35(3), 471–489. Web.
Purkayastha, D., & Fernando, R. (2006). Marketing Viagra in India. IBS Center for Management Research.