A September article in Bloomberg detailed pharmaceutical company Mylan’s turnaround of EpiPen, the auto-injector used to treat allergic reactions. Once a throwaway brand which Mylan was close to divesting, EpiPen has become far and away the leader in its product category through a multi-pronged marketing effort. Since acquiring it in 2007, Mylan has seen an incredible 400% increase in revenue from EpiPen, now earning over $1 billion annually. Though the success story of a major pharmaceutical company may not seem relevant to small business owners, there are clear lessons in the EpiPen story applicable to nearly any group involved in marketing. Let’s take a look at what we can take away to make sure your business isn’t allergic to growth.
Possibly the largest pillar of EpiPen’s success has been the increase in public awareness of the product and of allergies themselves. Mylan spokeswoman Nina Devlin confirmed that “advocating for increased anaphylaxis awareness, preparedness, and access to treatment” has been a commitment of the company for years. Mylan did have help in this effort, however, as a 2013 Center for Disease Control study showed a nearly 50% increase in diagnosed food allergies in children age 0-17 from 1997 to 2012. Mylan took advantage of this trend, and perhaps aided it, by increasing their EpiPen television advertising budget nearly eightfold from 2010 to 2014.
Not all businesses can rely on global health trends or multimillion dollar budgets to spread awareness for their products or services – which is why Mylan’s strategy of finding new spaces to occupy is so pertinent. Mylan has taken inspiration from the many emergency health devices in public places – like defibrillators in public schools – to position EpiPen as one of those emergency necessities. They’ve had major success – even restaurant chains and Disney parks and cruises are stocked with EpiPens.
Finding and activating new markets is invaluable for business owners, no matter the business size or industry. Mylan found a somewhat untapped market for prescription medications, and small businesses can do the same. Take a step back and reevaluate the fundamental assumptions about who your customers are and who can become one. While you may not be selling in Disney World any time soon, you can make great strides by targeting groups you may have never thought of as potential clients.
The Strategy of Pricing
The other side to Mylan’s EpiPen success story, and a large portion of Bloomberg’s article, is the steady increase in the medication’s price. Though delivering little more than a dollar’s worth of epinephrine, market prices for a pack of two EpiPens have recently seen highs of nearly $400.
Mylan’s pricing strategy serves as a lesson for business owners, pricing often has little to do with production cost and everything to do with the perceived value of the product. With wide awareness and a huge perceived value (human lives are fairly valuable), the rising price of EpiPens are sustainable. Most businesses can’t emulate that, so the ability to determine and convey the value of your product to consumers is paramount. Think about what benefits your service offers customers, whether they be concrete like saving money, or intangible such as improving confidence or peace of mind. Allow yourself to separate cost from value, and your business will be better equipped to keep your pricing strategies competitive.
Injecting Your Business
Few businesses will ever have billion dollar revenues, especially from one product alone. Still, Mylan’s strategy in revitalizing EpiPen can be a useful case study on savvy marketing and industry dominance. Innovative positioning to increase awareness and smart pricing strategy are just two tactics successful businesses employ, and using them can inject growth into your enterprise.
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