Strategic Market Intelligence in the Pharmaceuticals & Healthcare Industry to Increase over 2011-2013

October 3, 2011. Recent products introduced by pharmaceutical companies, such as Pfizer, Sanofi-Avensis or Eli Lilly, are not expected to generate enough revenue to make up for the loss of patent protection for blockbuster drugs such as Lipitor, Plavix and Zyprexa in 2012. The healthcare sector is also facing dramatic challenges of rapidly ageing populations in developed markets, insufficient public financing and more cost cuts - whilst the sector is experiencing a skills shortage. Many industry players have turned to expanding into India, China and Brazil, in order to take advantage of their average growth rates of 15% as compared with 5-6% in developed markets. What areas will they be investing in for market intelligence over 2011-2012?

A total of 81 large and mid-sized companies and organizations from the pharmaceuticals and healthcare industry responded to the 2011 Global Market Intelligence Survey conducted by M-Brain (formerly Global Intelligence Alliance) in March. We ask Johanna Haapanen, a consultant at M-Brain (formerly GIA) for some comments on the industry findings from the survey.

How efficient are pharmaceuticals and healthcare companies in their market intelligence?

“Pharmaceutical and Healthcare companies appear to have efficient market intelligence functions. More than 70% already have a systematic operation in place, according to the 2011 Global Market Intelligence Survey. Compared to some other industries, they have one of the highest satisfaction rates.

They have about 410 internal clients on average, with over 114 people regularly contributing insights and research, in addition to their core market intelligence team.

Pharma and Healthcare_organization annual market intelligence budget_web

Source: 2011 Global Market Intelligence Survey by M-Brain (formerly GIA)

*Click on image to enlarge


It is an industry that works closely with top management (44% with only one layer). In a few companies however, there are five or more layers between the CEO and the head of the market intelligence, demonstrating great inefficiencies. As the industry is at a major inflection point, the emphasis is on strategic intelligence for critical decision-making. It is important therefore, that the market intelligence function is tied closely to top management.

Pharma and Healthcare_Organizational layers between head of Market Intelligence and CEO_web

Source: 2011 Global Market Intelligence Survey by M-Brain (formerly GIA)
*Click on image to enlarge

The pharmaceuticals and healthcare industry is very similar to the Consumer and Retail industry in how market intelligence is organized. Market intelligence operations are typically set up under sales and marketing or strategic planning and business development.”

Pharma and Healthcare_Which function is market intelligence set up_web

Source: 2011 Global Market Intelligence Survey by M-Brain (formerly GIA)
*Click on image to enlarge

How might they have to review their market intelligence needs?

“With growth in competition and new markets, pharmaceuticals and healthcare companies will be looking for new and innovative ways to operate, grow and price products ““ particularly medicines that are already in the late stage of the pipeline in order to reduce funding requirements. The healthcare sector will require more efficient processes and the clever use of telecommunication technology. Advisory services for M&A and Partnering will be in demand, and so will competitive intelligence.

On average, the surveyed pharmaceutical and healthcare companies currently spend 1.75 million Euros on market intelligence (excluding HR costs), and say that over 21% of their needs are still not being met. It is not surprising that 73% of these companies intend to increase their market intelligence investments over these two years. Moreover, almost 40% of those without a systematic market intelligence operation have plans to launch one within 12 months.

With the current emphasis on new markets coupled with the economic uncertainties ahead of us, rather than hiring people with these new competences, the quickest solution would be to turn to external resources.”

Market Intelligence teams mostly work as a centralized resource_web

Source: 2011 Global Market Intelligence Survey by M-Brain (formerly GIA)
*Click on image to enlarge


Will social media intelligence play a larger part in market intelligence for pharmaceuticals and healthcare companies?

“As this industry is strictly regulated, real-time promotion of any product via social media is restricted.

However, the use of social media as communication channels for pharmaceutical companies, doctors and patients is evolving and growing, so using social media for customer intelligence in this industry will be an interesting area to watch.”

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