Offering Pharmaceutical Samples: The Role of Physician Learning and Patient Payment Ability

    Authors

    R. Bala; P. Bhardwaj;Y. X. Chen

    Comments

    Authors: contact us about adding a copy of your work at STARS@ucf.edu

    Abbreviated Journal Title

    Mark. Sci.

    Keywords

    pharmaceutical marketing; sampling; detailing; patient payment ability; Business

    Abstract

    Physicians may learn about prescription drug effectiveness directly from the firm via detailing or from patient experience. Patient-mediated learning is aided by the use of free drug samples. The effective use of samples is hampered by a lack of understanding of its exact return on investment implications. We seek to fill this gap by incorporating the physician's sample allocation behavior in the firm's decision making. We uncover the following implications for firms as well as policy makers. First, we find that the optimal sampling level for a drug category is a nonmonotonic function of patient payment ability and the price of the drug. Second, an increase in the cost of samples can lead to an increase in sampling and a decrease in detailing when the physician's propensity to provide sample subsidies is high. Third, when future market growth is expected to be high (early stage product life cycle and/or chronic drugs) and sampling efficiency is low, the use of sampling is profitable for the firm but leads to lower market coverage than when sampling is disallowed.

    Journal Title

    Marketing Science

    Volume

    32

    Issue/Number

    3

    Publication Date

    1-1-2013

    Document Type

    Article

    Language

    English

    First Page

    522

    Last Page

    527

    WOS Identifier

    WOS:000319507300009

    ISSN

    0732-2399

    Share

    COinS