Closing the Marketing Strategy-Tactics Gap: An Institutional Theory Analysis of Pharmaceutical Value Chain

M. Ding et al. (eds.), Innovation and Marketing in the Pharmaceutical Industry, International Series in Quantitative Marketing 20, DOI 10.1007/978-1-4614-7801-0_24, © Springer Science+Business Media New York 2014 Abstract This chapter identifi es a strategy-tactics gap in most previous studies of pharmaceutical marketing, and addresses it by systematically analyzing the marketing strategies used in practice with the help of a unique dataset of court discovery documents unsealed in a recent litigation. Adopting an institutional theory perspective, we examine the dominant logic that underlies pharmaceutical marketing strategies, and contrast it with the organizing logics of the value chain partners. Four distinct marketing strategies with carefully crafted interdependencies emerge from our analysis: (1) market penetration strategy involving a focus on segmentation and penetration, (2) evidence-based strategy involving production of science, (3) medical education strategy involving development and dissemination of standards of care, and (4) surrogate selling strategy involving leverage of peer-to-peer infl uence among target physicians. Together, the strategies uncovered in our analysis provide coherence to the observed marketing tactics and show that they are largely consistent with the logic of consequences which confl icts with the logic of appropriateness guiding the actions of the value chain partners. The institutional theory analysis shows that: (1) pharmaceutical value chain is characterized by confl icted logics, (2) that are amplifi ed by pharmaceutical marketing strategies thereby, (3) inviting regulatory intervention to constrain and restrict pharmaceutical marketing efforts. We propose an open systems framework that elaborates on value chain interdependencies and compare it with the economic framework that characterizes most current research. We close the chapter with an agenda for future research into the theory and practice of pharmaceutical marketing. Chapter 24 Closing the Marketing Strategy-Tactics Gap: An Institutional Theory Analysis of Pharmaceutical Value Chain