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As pharmaceutical marketers continue to spend record-breaking dollars touting their prescription drugs, database technology is becoming an essential element of the advertising mix.

Competitive Media Reporting puts total TV ad spending for prescription drugs near $550 million from January through November of 1998 -- about half of all DTC spending for that time period. Drug marketers -- like marketers in every category -- have been increasingly collecting consumer information and using it to build relationships and target new customers.

Pharmaceutical companies "are just now starting to understand enough to begin to build the database and take advantage of technology to understand clients they've got today, segment those clients, create relevant messages, and then find like-minded people," says Susan M. Wilson, VP-sales for healthcare insurance and mutual fund marketplaces at Experian, a database marketing company.


Ms. Wilson says many of the top pharmaceutical companies are in the "infancy stage of doing database marketing." She says they have not fully exhausted the concepts of segment marketing, targeted messages and the process of the follow-up. Experian works with several pharmaceutical companies, drugstores and mail-order drug operations.

Rite Aid Corp.'s pharmacy division employs the use of a database system to create direct-to-patient targeted information in the form of informational pamphlets that also carry targeted advertising.

"Every prescription filled generates the patient information piece," says Mike McClorey, president-CEO of Health Resource Publishing Co., a unit of Catalina Marketing, which began to install the Health Resource National Network at Rite Aid three years ago. Other chains using the network include Kroger Co., Pathmark Stores, Marsh Drugs, Meijer's and Discount Drug Mart.


In August, Rite Aid rolled out its system to 1,100 stores, with the expectation of adding 2,900 more.

Mr. McClorey says the information conforms to the consumer's specific needs. A consumer filling a prescription for a diabetes medication, for example, will receive a pamphlet with different editorial and advertising than a consumer filling a prescription for a hypertension drug.

"We currently have probably 50 or 60 different [advertisers] running any number of ads in the system right now," he says. "With the ability to target, we can vary the message based on the audience."

Advertisers include Bristol-Myers Squibb Co., Pharmacia & Upjohn, SmithKline Beecham, Boehringer-Ingelheim and Nestle USA.

The database is activated to produce the newsletter when the system identifies the drug being dispensed -- not the consumer requesting the prescription. In fact it does not cultivate any patient information for later use outside the pharmacy. Once the newsletter is printed, the database does not keep a record of the patient's private information.


"There's nothing to identify the patient [in the database] after the fact," Mr. McClorey says. He says the patient record is destroyed. "We've designed the system specifically to enable us to do this. None of this information ever leaves the pharmacy."

It's not surprising privacy concerns would crop up around pharmaceutical marketing. The two seem diametrically opposed and consumers are rightly sensitive to information being disseminated about their health and medical history. Thus, companies that compile databases for marketers tend to be extremely careful about data collection.

"We always believe that consumers should opt-in," says Cathy Cronin, VP-client services at ICOM Information & Communications, Toronto, which has developed a database of up to 18 million households.

ICOM's TargetSource database is updated regularly and includes specific medical conditions of respondents. It covers a broad range of questions that cover ailments in the household and what brand drugs are being used.

ICOM compiles the database through mailings to 50 million U.S. households twice a year, and the database is current within two years. ICOM's client base includes Johnson & Johnson, Kraft Foods, Lever Bros., Procter & Gamble Co., and Warner-Lambert Co.


"The database enables companies in the pharmaceutical industry to access households that will be of interest to them for the purposes of direct marketing or for analysis and research," says Ms. Cronin.

Ms. Cronin says TargetSource's capabilities translate to both the pharmaceutical and over-the-counter aspects, but says more of its focus is on over-the-counter.

Schering's Claritin regularly sends direct mail via CommonHealth to existing customers with information and discounts on future prescriptions; its Web site enables consumers to sign up for its "Blue Skies" newsletter. The consumer enters his name and e-mail address to be added to the distribution list. A strict privacy statement is attached to that link, declaring that "We will NOT sell, lease or reveal your profile to anyone else."

Pharmaceutical database marketing will continue to grow as those companies refine their approach.

As for companies that have an existing database, opportunities also abound. Reader's Digest Association this month (AA, March 1) announced its intention to form partnerships to sell health-related products such as pharmaceuticals and vitamins through the mail employing the company's extensive database of baby

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