GSK shortlists 20 in US Rx advertising review
The UK-based company is reviewing agency assignments for consumer and professional advertising, relationship marketing and digital promotion on all its prescription drug brands in the US.
“Our goal is to achieve cost savings, efficiencies and increased integration of traditional and digital channels,” said a company spokesperson.
Round one of the review, initiated in October, included 96 agencies. A decision on “preferred suppliers” will be made “early in the new year,” said the company.GSK spent $666 million on advertising in measured media across all brands for 2009, according to Kantar Media data, of which nearly half — $312 million — went toward promoting prescription drugs. Of that, $198 million went into TV ads and $103 million was for magazine ads. That was a big step down from 2008, when GSK spent $363 million on TV ads for its prescription drugs alone.
The company has been hit hard by patent expiries in recent years, as it has lost exclusivity on drugs including Valtrex, Imitrex, Lamictal, Advair, Serevent, Combivir and Epivir. Expiries on Avandia, Boniva and Avandamet loom in 2012. Shortly after taking the reins, CEO Andrew Witty vowed in 2009 to slash TV advertising and seems to be following through.
Interpublic Group (IPG) agencies have the most to lose in the review, with IPG's Draftfcb Healthcare and McCann Group healthcare agencies holding the lion's share of the business. In a 2006 review, GSK shifted professional advertising on six brands into IPG from WPP.
A separate review of the company's US media planning and buying business, initiated in August, will be decided before the end of the year, GSK said. That review involves several holding companies.
“It's really about positioning GSK for future growth and ensuring that we benefit from leading strategic planning services and innovation, ensuring that we have media buying effectiveness and efficiency,” said a spokesperson.