Franchise marketing

Part
01
of two
Part
01

Please explain Humira's switch from marketing a single indication to marketing the brand as a franchise.

Humira switched from marketing a single indication to being a franchise as it accumulated approvals for multiple indications. Abbott Laboratories started marketing Humira as a franchise drug focused on multiple indications between 2005 and 2008. As a result, Humira's sales and value rose in proportion to its number of FDA approvals.

Below you will find a deep dive of my findings.

HUMIRA APPROVAL HISTORY

According to Chicago Tribune, Humira has gathered 9 FDA approvals for different indications over the course of 13 years.

Rheumatoid arthritis, adults (2002)
Crohn's disease, adults (2007)
Chronic plaque psoriasis, adults (2008)
Crohn's disease, children (2014)
Therefore, Humira became a multi-indication drug beginning 2005 after psoriatic arthritis was added to its initial indication for rheumatoid arthritis.

SINGLE TO MULTIPLE INDICATIONS SHIFT

Back in 2003 when Humira was still a single-indication drug, Chicago Tribune reported that Abbott planned to try a direct-to-consumer TV campaign for the first time. One of its targets was The Lifetime Network, which has a following of female viewers aged 35 and above. The article painted a picture of low-profile marketing, adding that "The company said it's unlikely Humira will even be mentioned in the ads. Abbott wouldn't disclose specifics, but it's common for drugmakers to simply talk about diseases or conditions and urge consumers to contact their doctors, a toll-free number or a Web site that would link patients to the company's drugs."
However, after receiving its approval for a second indication, Abbott Labs switched to a franchise approach for its Humira campaign. While I could not find an existing ad for Humira in 2005, I found that the pharmaceutical company ran into trouble around 2008 for an ad that claims efficacy in treating multiple indications. (This is the earliest advertisement that I could find indicating a shift to a franchise approach for this drug. The 2006 and 2007 ads I found marketed the drug for separate, single indications.) Law 360 reported in late 2008 that Abbott Labs was slammed by US Food and Drug Administration (FDA) for a misleading Humira advertisement. The excerpt from the preview version of the article reported that the FDA accused Abbott Labs of suggesting "Humira is useful in a broader range of conditions or patients than has been demonstrated by substantial evidence..."

CBS also reported in early 2009 that Abbott Labs fired its advertising agency over the same commercial, which stated that the drug is approved for a technically different indication. The FDA pointed out that "broad, misleading statement of the indication and the accompanying graphic of the patient are presented very prominently and can be easily seen by viewers of the advertisement."

By 2010, Humira was already projecting itself as a strong franchise for multiple indications. MedAdNews reported that Humira was the 2010 Medicine of the Year, "showing its strength across all of its many indications, [while] new indications are being developed." PMEA also awarded Humira's campaign 'Count Me In' in 2010 as a franchise drug for multiple indications. PM Live commented that "Humira's opportunity was to demonstrate its broad range of efficacy in not only treating core disease but also in treating a number of common EAMs."

Between 2010 and 2014, Humira only increased its budget and spending on advertisement, coming in second to Cialis in 2014.

In 2016, FiercePharma reported that Humira (now owned by AbbVie, a spin-off of Abbott Labs) has maintained its spot as the highest ad spender. During 2015 to 2016, Humira was marketed for multiple conditions including arthritis, ulcerative colitis/Crohn's disease, and psoriasis. The drug franchise held the same top spot in 2017 followed by Pfizer's Lyrica and Xeljanz.

This 2018, The Street reported that AbbVie has taken steps to protect its Humira franchise from biosimilar competitors. Its latest actions included settling patent agreements with Biogen and Samsung.

HUMIRA ADS

iSpot.tv has tracked and compiled a total of 11 TV ads for Humira. Instead of individual screenshots, I have included a list showing thumbnail screenshots and title/core consumer message for each one.

• 'Chase What You Love' (2017)
• 'Body of Proof' (2016)
• 'Go Further' (2016)
• 'Food Drive' (2015)
• 'Body Improved' (2015)
• 'Volunteering' (2014)
• 'Dollhouse' (2014)
• 'At Work' (2013)
• 'Coach' (2013)
• 'Crushed In' (2012)

All these ads and commercials emphasize a central message: a return to normal life thanks to Humira.

Humira Revenue

Knowledge Ecology International published a table showing Humira's revenue from 2003 to 2017. A jump in earnings can easily be seen after Humira was approved and marketed as a franchise drug for multiple indications.

2017 Q2 - $280 million
2017 Q1 - $852 million
2016- $1.5 billion (Psoriatic arthritis )
2015 - $2 billion (Ankylosing spondylitis)
2014 - $3 billion (Crohn's disease)
2013 - $4.5 billion (Chronic plaque psoriasis, Juvenile arthritis)
2012 - $5.5 billion
2011 - $6.5 billion
2010 - $7.9 billion
2009 - $9.2 billion (Ulcerative colitis)
2008 - $10.6 billion
2007 - $12.5 billion (Crohn's disease)
2006 - $14 billion (Hidradenitis suppurativa)
2005 - $16 billion
2004 - $4.1 million
2003 - $4.7 million

Again, the rise in Humira's revenue is directly proportional to its accumulation of FDA approvals as a franchise drug for multiple indications. In addition, HeatInformatics reported Humira to be the 6th bestseller drug of all time from 1996-2015.

CONCLUSION

To wrap it up, Abbott Laboratories switched from marketing Humira for a single indication to being a franchise as it won FDA approvals for new indications. Abbott began marketing Humira as a franchise drug focused on multiple indications between 2005 and 2008 after it was approved for its second indication psoriatic arthritis. Humira's sales and value then rose in direct proportion to its growing number of FDA approvals.
Part
02
of two
Part
02

Please explain Enbrel's switch from marketing a single indication to marketing the brand as a franchise.

From 1998- 2002, Enbrel operated a single indicator rheumatoid arthritis prescription (RA) drug with sales of approximately $850 million. Immediately after successfully transforming into a franchise, the Enbrel brand generated $1.2 billion in 2003, and $3 billion in 2005. The brand has continued to grow revenue and holding marketplace leader status since making this transition.

To explore the effects of Enbrel’s franchise switch, we scoured related financial statements, SEC reports, and media resources. Since Enbrel’s additional indications were approved by the FDA from 1998-2004, the scope of this search has been extended to data older than our typical standard of 24 months. Since this request focuses on the timeline and results from when the decision was made, older sources from that period have been included to give a clear overview of this shift. Although the exact date of Enbrel's switch to franchising is not explicitly stated, related media and industry articles suggest that Enbrel switched from marketing a single indication to franchise marketing in 2002.

SCREENSHOTS OF CORE MARKETING MATERIALS

After an extensive search of articles, blogs, reports, financial statements, press releases, SEC reports, media reports, and the company website, there was no marketing material available from the 2002-2003 period when the switch to franchise happened. However, we have located screenshots from four Enbrel marketing campaigns in 2017-2018. Each screenshot listed below features a short note about the main point of the brand message.

Screenshot 1Enbrel HCP Banner Ads (RA Indication)

This ad campaign targets doctors with several messages at the same time. However, the core message is that Enbrel is a better choice for doctors to prescribe because it gives patients more options for flexible treatment, even after their patients stopped using the prescription.

Screenshot 2 — Banner Ads (Psoriasis Indication)

These two sets of banner ads target parents and present Enbrel as a “Chance for Relief” for their child. The goal is to reach parents who want to help free their child of pain and social embarrassment associated with plaque psoriasis. These ads link to a landing page that discusses plaque psoriasis in children. The core message is to provide hope for a parent, letting them know that there is a solution for their child. Screenshot 3 — Joint Damage Ad (RA Indication)

These Enbrel patient banner ads target moms by appealing to how their kids view their parent's RA condition and the potential fear it creates. The core message is that Enbrel eases joint pain and stops permanent joint damage. Screenshot 4 —Unbranded Enbrel Banner Ad (RA Indication) This unbranded Enbrel Banner Ad has the core message of stopping severe advancement for Rheumatoid Arthritis.

TIMELINE OF INDICATIONS

ENBREL became the first TNF inhibitor approved by the FDA to treat moderate to severe Rheumatoid Arthritis in 1998. Since then, it has been indicated to treat six autoimmune diseases. Here is a brief historical timeline of indications.

• Juvenile Idiopathic Arthritis — 1999 • Rheumatoid Arthritis — 1998Psoriatic Arthritis —2002. This is also the year Enbrel is acquired by Amgen and switched to a franchise model. • Ankylosing Spondylitis2003 • Plaque Psoriasis— 2004 • Pediatric plaque psoriasis — 2016

REASON FOR THE 2002-2003 SWITCH TO a FRANCHISE APPROACH: AMGEN'S COMMERCIAL STRATEGY

In 2002, Amgen purchased Immunex, the company behind Enbrel's original development. Amgen then initiated a commercial strategy of franchising for Enbrel. This deal was the primary catalyst for the brand's move to franchise. Revenue growth potential from franchising Enbrel was Amgen's main reason for completing the Immunex acquisition deal in the first place.
Pivoting the Enbrel brand to a franchise allowed Amgen to gain first-mover access into the inflammation pharmaceutical category. At the time, Enbrel already had more promising financial benefits than Kineret, the previous product that Amgen launched in November 2001.

ENBREL'S FRANCHISE APPROACH

Before the Amgen acquisition, Enbrel was marketed as a single indicator to healthcare providers such as doctors and hospitals, pharmacy benefit managers and managed care organizations through an enrollment program. Later, Amgen switched to a franchise strategy using: 1. Direct-to-consumer campaigns that prompted patients to discuss ENBREL with their doctor directly. 2. A consolidated sales force, which gave ENBREL a competitive share of voice 3. Consistent and simplified messaging that significantly improved customer perception of ENBREL 4. An expanded sales force structure that achieved optimal call reach and frequency Enbrel’s dual franchising approach is to continue to create “mindshare” among physicians and to continue to produce clinical trials that demonstrate Enbrel’s preeminence as the best in class industry standard for treating RA and additional indications. Since Enbrel is the leading biologic in the rapidly growing segments of rheumatology and dermatology, the franchise has successfully used it's first-market access gained in 2002 to continue to grow. Core strategies that Amgen has used to market Enbrel in it's growth-driven franchise approach are:

1. Long-time exclusivity 2. Leading market position
3. Fresh Direct-to-Consumer campaigns
4. Investment in ENBREL lifecycle management 5. New devices for patient-friendly experience

FINANCIAL RESULTS OF THE FRANCHISE MODEL

Overall, the franchising transformation for Enbrel has been a huge financial success. Enbrel's switch from marketing a single indication to marketing as a franchise happened in 2002 resulted in a sales increase from $850 million in 2002 to $1.2 billion in 2003 post franchise. The brand generated $3 billion in 2005. Enbrel's growth has continued with approximately $5.97 billion revenue in 2016.

CONCLUSION

Since, Enbrel was first approved by the FDA 20 years ago, it has become a financial jewel for parent company Amgen. Potential for revenue growth led Amgen to change market strategy for Enbrel. Since 2003, the brand has continued to operate as a franchise, steadily gaining market share in its various indications. In 2016, it’s sales totaled $5.97 billion.
Sources
Sources

From Part 01