Cannibalization of drug in pharmaceutical industry

Cannibalization: while estimating demand forecast for a product if you drug is taking significant share from your existing product that is known as cannibalization.
It could be active cannibalization or passive cannibalization.
Active cannibalization is when you by will move patients from old product to new product. There can be multiple ways to do that for example you can remove your current product from the market and introduce a new product. Active cannibalization of drugs requires marketing and promotional efforts to physicians, pharmacist and healthcare professionals.
Passive cannibalization involves when patients on your old product by will switch to new drug by their choice. During passive cannibalization companies usually don’t discontinue their old medicine from the market
Forecasting medicine demand is very tricky in this case because sometimes new innovative medication doesn’t suit patients so if patient tend to move back to old medicine or drug.
Mainly cannibalization is used as line extension strategy for in-market medicine. Cannibalization in the pharmaceutical industry is used to introduce new formulation example moving patients form 3 dose a drug to replace with one dose a drug.
Cannibalization is also a drug product lifecycle management strategy.
  1. Companies can increase the price of a new product
  2.  To extend patient protection
  3.  To have market exclusivity

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