The effort marks the first time a pharmaceutical marketer has used specific gay-targeted creative for a product not used to treat HIV.
The estimated $1.5 million to $2 million campaign from Prime Access, New York, features a print ad of two men during a close moment. "He likes me just the way I am," the copy reads. "Keeping my hair is my choice."
The ads will run nationally in gay-targeted publications The Advocate, Genre, Hero and Out, and in local publications in the 10 markets with the largest gay populations. The campaign includes an online component, which will appear on Web sites such as Gay.com.
Propecia generated more than $96 million in spending through the first 11 months of 1999, more than any other drug except Schering-Plough Corp.'s Claritin, which spent $136 million, according to consultancy IMS Health.
The campaign may be an indication that Merck wants to find new markets for the hair-loss prevention product, whose $94 million in U.S. sales last year, according to IMS, was less than the marketing outlay. The gay market, especially in large cities, tends to be more affluent than the general population. That makes it an attractive target for Propecia, which users often must pay for on their own.
"Ninety-nine point nine percent is not reimbursed by medical plans," said Beth Cariello, an analyst with Deutsche Banc Alex. Brown. "It's a lifestyle kind of drug."
A Merck spokeswoman denied gay men are a more receptive target than the general population. "They're just another group of men who may be concerned about their hair loss," she said.
But gay consumers tend to be more loyal to advertisers that develop specific creative to speak to them, industry observers said.
"In focus groups with gay men and lesbians across the country, it's very clear there's a strong preference for gay-specific advertising that reflects who they are and how they live their lives," said Howard Buford, president-CEO of Prime Access, which specializes in niche marketing.
Direct-to-consumer pharmaceutical advertising has boomed in recent years, approaching $1.6 billion last year, and gay publications may be poised to grab a larger share. Until now, publications such as decade-old Genre have mostly run DTC ads for HIV medications such as Merck's Crixivan.
"It's starting to filter down," said Doug Shingleton, Genre's associate publisher. "[Marketers] see the importance and marketing capabilities of these consumers."