GlaxoSmithKline's niche marketing strategy for diabetes drug under stress

By Louise Story
The New York Times
(June 6, 2007) Della Reese, the jazz singer and actress, seemed a natural choice to star in ads for Avandia, when Glaxo signed her on in 2004. Not only does Ms. Reese have broad appeal, known most recently for her role in the television series “Touched by an Angel,” but she has Type 2 diabetes.

And while she was Avandia’s main spokeswoman, from 2004 to 2006, Ms. Reese represented a important target in Avandia’s marketing: African-American consumers.

Because Type 2 diabetes is a disease twice as likely to affect black Americans as non-Hispanic white people in this country, Avandia’s maker, GlaxoSmithKline, has long placed a marketing focus on African-Americans — much more so than any other maker of diabetes drugs, according to industry executives.

In the eight years that Avandia has been for sale, becoming a $3-billion-a-year worldwide best seller, Glaxo’s African-American focus in the United States has won the company praise in the advertising industry and from some black doctors. They credit the campaigns for putting a friendly face on a drug for a disease that too often goes untreated, particularly among minority groups.

But now that Avandia is dogged by safety questions — a Congressional hearing today will address concerns that the drug may increase the risk of heart attacks — some black advertising executives wonder if Glaxo’s advertising strategy could end up working against the company.

“Avandia has such a large African-American niche, I’d expect competitors now to step up their outreach to African-Americans,” said Howard Buford, the founder and chief executive of Prime Access, a multicultural advertising agency in New York.

Alternatives to Avandia include Byetta, which is marketed by Amylin Pharmaceuticals and Eli Lilly. It and others could benefit if doctors started encouraging patients to drop Avandia. So far, though, many doctors seem to be playing wait and see.

Avandia’s main competitor in this country is a drug called Actos, which had a comparable number of total prescriptions written last year, about 11.3 million, according to Verispan, a health care information company based in Yardley, Pa.

Actos is made by Takeda Pharmaceuticals of Japan, which does not conduct significant consumer advertising in the United States. A spokesman for Takeda said the company had no plans to increase its advertising to consumers in light of safety concerns about Avandia. So, the competitive issue raised by Mr. Buford could be largely theoretical.

Still, Mr. Buford said it would be incongruous if Glaxo’s black outreach did come back to haunt the company, because Glaxo had worked to overcome what he described as a deep distrust of the drug industry among many African-Americans, particularly older people. He said the skepticism traces in part to the notorious Tuskegee syphilis experiment from the 1930’s to 1970’s in which the federal government allowed black sharecroppers to go untreated in order to study the disease’s physical effects.

“There’s still a lot of distrust,” Mr. Buford said.

And yet, some other ad industry executives said that because Glaxo had helped raise diabetes awareness in recent years among African-Americans, the company might now have a reservoir of good will that it could draw upon.

“For them to advertise a drug to African-Americans that could help save lives and provide information, that is important,” said Jo Muse, the chairman and chief creative officer of Muse Communications, a multicultural agency in Hollywood. “Thousands of African-American men, in particular, have been affected in a positive way by direct-to-patient advertising.”

A spokeswoman for Glaxo said she could not comment on the company’s marketing strategy.

Ahead of today’s hearing by the House Committee on Oversight and Government Reform where Moncef Slaoui, Glaxo’s chairman of research and development, is scheduled to testify, the company has been scrambling to address safety questions about Avandia that were raised on May 21 in a New England Journal of Medicine article.

The company has posted a video on its Web site featuring an executive, Dr. Anne Phillips, addressing the health concerns. And on Tuesday, the company ran a full-page ad in more than a dozen newspapers, including The New York Times, with an open letter to patients from Dr. Ronald L. Krall, its chief medical officer.

“As leaders in diabetes, we understand that managing your Type 2 diabetes is not easy,” the letter said, in part. “We also understand the confusion and concern you may have experienced following recent press coverage about the safety of Avandia. GlaxoSmithKline stands firmly behind Avandia.”

Glaxo, which spent a total of $25.7 million on Avandia advertising last year, according to TNS Media Intelligence, has by no means ignored potential white customers.

After all, black Americans represent only about 13 percent of the population. And although they are more likely to develop Type 2 diabetes, the number of non-Hispanic white Americans in this country with the disease outnumbers African-American patients, 13.1 million to 3.2 million, according to the American Diabetes Association.

Latinos have been another important group for diabetes drugs, and an audience that Glaxo has also made a target with some of its Avandia advertising. The American Diabetes Association does not have national figures on the percentage of Type 2 diabetes patients in this country who are Hispanic.

Caucasians featured in Avandia ads have included the actress Jane Seymour, who was in a 2001 television spot, just a few years after she starred in the TV series “Dr. Quinn, Medicine Woman.”

And currently, a Glaxo-sponsored Web site about health, www.stepitupdiabetes.com, features the white fitness coach Bob Harper, who is the exercise guru on the NBC reality series “The Biggest Loser.” Various Avandia advertisements depicting everyday people feature Caucasians.

But there is no disputing that Glaxo has made a special effort to reach African-Americans with its Avandia advertising, ad executives say.

“You see in the broad diabetes category an acknowledgment or nod toward the African-American community, but GlaxoSmithKline was definitely a leader and one of the first groups to really use a more targeted effort,” said Croom Lawrence, the vice president for strategy and insight at RTC Relationship Marketing, a direct marketing advertising agency in the WPP Group. “That was really the face of this brand.”

And it was a brand-building effort that at least until now had been considered generally effective, as evident in the awards for multicultural marketing in 2001 and 2002 that Glaxo won at the DTC National Conference, an annual conference about marketing drugs to consumers.

Generally among marketers, efforts to reach black audiences often include ads featuring African-Americans that run in magazines like Ebony, Essence and Jet or on the television network Black Entertainment Network. But those ads do not always run in mainstream media.

With Avandia, however, ads featuring a black couple or a black grandfather with his grandson also ran in mass-market magazines like Sports Illustrated, Reader’s Digest and Ladies’ Home Journal. Direct mail and outdoor advertising have also promoted Avandia to potential black patients. And African-Americans appear as prominently, if not more so, than any other group on Avandia’s Web site.

Whenever safety questions start clouding a drug, pharmaceutical companies tend to expend most of their crisis-control effort trying to persuade current customers to keep refilling their prescriptions. Any thought of acquiring new patients tends to be deferred until the controversy is resolved.

And so, for Glaxo, maintaining Avandia customers will probably involve continuing its strategy of mainstream ads, with an African-American emphasis, outside ad executives said.

And some advertising industry executives say Glaxo may now be able to build on a reputation with Avandia for having provided important information to black consumers. “This is an audience that has not had the benefit of advertising in the past,” said Byron E. Lewis, chairman and chief executive of the Uniworld Group, an agency in New York that created the multicultural ads for Avandia from 2001 to 2004.

Pharmaceutical companies in general have been seeing a higher return on direct-to-consumer advertising for minority groups, because many of the people in those audiences might not otherwise go to a doctor about a problem, said Mr. Muse of Muse Communications.

Dr. Gerald L. DeVaughn, president of the Association of Black Cardiologists, said he was awaiting more evidence before deciding whether to advise his patients to stop taking Avandia in light of the concerns about potential cardiac risks. Patients have not been asking him about the news reports about the suspected risks, Dr. DeVaughn said.

While some ad executives said the new concerns about Avandia’s level of cardiac risk may cause Glaxo to lose customers, others said that the company could hold onto many of its black customers if Glaxo is now seen as having effectively communicated the pros and cons of Avandia over the years — and having encouraged people to seek out medical help in their decisions.

“None of this exists in a vacuum,” said Mark A. Robertson, the director of business development for UniWorld, the former Avandia agency. “Glaxo has always promoted and motivated people to see their doctors to ask what is best for them.”


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