Maximising the value of a pharmaceutical line extension using discrete choice modelling, secondary data and market segmentation

Pharmaceutical marketing is an industry that differs from consumer marketing in many ways. Pharmaceutical marketers must consider many factors when making product development choices. This study utilises a discrete choice model to make a recommendation for maximising the value of a cough syrup product line extension by an established pharmaceutical company, Celltech. Two cough syrups — Tussionex®, a hydrocodone polistirex extended release suspension product, and Delsym®, a dextromethorphan polistirex extended release suspension product — were already marketed by Celltech. Primary data in the form of a telephone survey of 160 primary care physicians and 140 paediatricians and secondary data from the IMS National Prescription Audit were utilised to inform the research process and generate tradeoff and cannibalisation analyses. Those analyses were done and FDA approval was obtained for the product (Codeprex®, a codeine polistirex extended release suspension product) in 2004, but the product was abandoned after Celltech was acquired by UCB-USA. The value of FDA-approved Codeprex™ was shown to be maximised by the tradeoff and cannibalisation analyses, but corporate strategy trumps applied marketing analytics in this case.