Executive Summary
The diabetes market is expected to be over 500M cases by 2030. Sanofi’s Lantus has over 40% of the basal insulin market is the global leader in the diabetes solution space. However, came off patent in February 2015 and is at risk for competition from Eli Lilly. Sanofi needed to round out its diabetes portfolio and make up for lost revenue so it looked for an unmet consumer need. Afrezza helps Sanofi diversify its diabetes portfolio. Afrezza, is an inhalable insulin. It differentiates itself by providing a less painful and more convenient method of insulin administration for many patients. While the primary goal is to diversify itself from competition and generating lost revenues from Lantus , the greater opportunity lies in bringing transforming the diabetes solutions space.
Overview of Diabetes Market
As of 2014, there were 387M cases of diabetes worldwide which caused an estimated 1.5 million deaths globally. Diabetes is a chronic condition that has to be managed daily as it cannot be cured. Diabetes is the leading cause of amputations, blindness and many other health problems. The number of diabetes cases worldwide is expected to grow by an additional 205M cases by year 2030. There is a large financial incentive for companies to get into this space. As of 2012, the global insulin market was valued at $20B growing at a CAGR of 5.09% to $54B in 2030. Many of the new diabetes patients will have Type II and more and more Type II patients are using insulin as a course of treatment. According to the American Medical Association the “use of insulin among patients with type 2 diabetes increased from 10 percent in 2000 to 15 percent in 2010.”
There are many options to treat this disease such as taking a daily long lasting basal insulin shot in the morning supplement by a fast acting mealtime insulin, fast analogs and human recombinants, to help control hypoglycemia during and after eating. As of 2015, Sanofi, Eli Lilly and Novo Nordisk are the global leaders on the pharmaceutical solutions side of this expansive market.

The Three C’s of Marketing: Afrezza Launch
It is important to correctly identify the right target and segmentation for a new product before launching it into the market place. As Alex Sapir said in his lecture about the launch of Remodulin, comparing growth, market share, and market positioning helped United Therapeutics identify key brand strengths to develop the proper positioning to grow 30% year over year. A critical aspect of positioning is identifying the competition, and finding the product offering that offers something differentiated from the competition. Additionally, it is the company needs to its own internal strengths as well as understanding its consumer.
Company
Sanofi is a major player in the diabetes market. Lantus, Sanofi’s market leading long lasting insulin treatment for Type I&II diabetes had 40% market share. However, it came off patent in February of 2015and is at risk for competition from biosimilars. Sanofi introduced an updated version of Lantus called Toujeo to compete in the basal insulin space. Sanofi received FDA approval for Toujeo in February 2015. To fend off competition and protect their market share, Sanofi needed to round out their diabetes portfolio. In August 2014 Sanofi paid $925M to form a partnership with Mannkind to market its new inhalable insulin Afrezza. This partnership will leverage Sanofi’s strong credibility in providing the most efficacious insulin solution as well as its superior sales competency. Sanofi has a global sales force of 33,150 people, with approximately 5,000 salespeople in the United States. They can leverage their previous provider relationships and their knowledge of marketing an international diabetes portfolio. This will create an inimitable competitive advantage.
Consumer:
Patients: Type I & Type II Diabetes patients over the age of eighteen that want a fast acting mealtime insulin. Sanofi’s head of United States Marketing, Stefan Schwartz, says that they are creating “an alternative for those patients who are not willing to inject insulin or to increase the number of shots per day.” Additionally, the method of delivery will appeal to many Type II diabetes patients that delay starting insulin on average by five years due to needle phobia. This delay in starting treatment causes many medical complications.
Providers: Afrezza responds much faster than injected analog insulin which will appeal to endocrinologists.
Payers: Afrezza is more efficacious than its injectable mealtime insulins. Additionally, it will help prevent additional complications by delaying starting an insulin treatment.
Competition: The analog fast acting insulin market is dominated by Eli Lilly and Novo Nordisk. They each provide a variety of minimally invasive injectable solutions. The three rapid-acting insulins currently in the US market are lispro, aspart (NovoLog), and glulisine (Apidra ). Eli Lilly had a failed inhaled insulin product—Exubera. Sanofi sees an opportunity to steal market share by using a different delivery method to diversify.
Segmentation, Targeting and Positioning:
Positioning: Sanofi is targeting Type II diabetes patients, that want added the convenience and painless experience of using an inhaler versus needles.
The Four P’s
Product: Afrezza is much faster than injected insulin. The delivery mode makes it possible to get patients with Type 2 diabetes to try insulin who may have been impeded by needle phobia. Additionally, the inhaler is palm sized which adds convenience unlike its predecessor, Exubera, which had an inhaler the size of a can of tennis balls.
Price: Sanofi is using a competitive price strategy. Afrezza is competitively priced @ $220 per monthly Type-1 dose. It is competitively priced against minimally invasive fast acting insulins.
Placement: Endocrinologists will be prescribing this product to their patients. This will initially slow the uptake of Afrezza. It takes on average up to three months for patients to get an appointment with their endocrinologists. It will not be prescribed by general practitioners as the marketing materials are generated for diabetes specialists. It is available for purchase by patients at retail pharmacies. It can also be purchased via mail order pharmacy.
Promotion: Sanofi is currently using its large salesforce and wide network of endocrinologists to market this drug to providers. For direct to consumer marketing, there is a large social media campaign on Facebook and Twitter. Additionally many diabetes patients are blogging about the drug on their support group websites. There is also a discount card program to help more patients get access to the product.

Conclusion
The launch success of Afrezza still remains to be seen as it is has only been on the market since February 2015; however, its different form factor is revolutionizing the fast acting diabetes space. Afrezza leverages Sanofi’s expertise in the diabetes solutions market. To launch the product, Sanofi is playing to its strengths by leveraging its vast sales network and deep connections with endocrinologists through its marketing of Lantus. They have strong competition from Eli Lilly and Novo Nordisk in the fast acting insulin. Sanofi has positioned Afrezza as a convenient pain free option and is using social media to market directly to consumers.

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