Purpose- This study aims to combine the literature on generic drugs awareness, perception and availability to explore the buying behavior of consumer .
Methodology- This study summarizes the literature related to the socio demographic variables, psychographic variables and the buying behavior to explore the concept of generic drugs. A questionnaire was administered to verify the hypothesis. Data was collected from Indian consumers and was analyzed using correlation and regression analysis.
Findings- Socio demographic variables identified as weak measures in explaining buying behavior of consumers while psychographic variables showed significant positive effect on buying behavior. The relevance of perceived consumer awareness (PCA) perceived perception (PP) and availability of generic drugs (AGD) found more apparent than socio demographic variables. The conclusions drawn in the study are useful to know the affect of psychographic variables on buying behavior of generic drugs and help the government to improving the strategies.
Originality-Although researchers have been examining the generic drugs in context with its buying behavior. They aimed to expore the knowledge, perception and attitude of general practitioners towards generic drugs. This study provides the comprehensive understanding of various determinants generic drugs, affecting the buying behavior of the consumers.
Generic Drugs, Perceived Consumer Awareness, Perceived Perception, Availability of Generic Drugs, Psychographic Variables, Socio Demographic Variables.
The Indian pharmaceutical industry is the fast growing industry that is targeted for promotion and development by the government. Narcotic Drugs and Psychotropic Substances Act is a formal government document that interprets and prioritizes the medium and long term objectives of the national pharmaceutical policies that guide the development of pharmaceutical industry players in the country. The greater portion of this policy aims to increase the consumption of generic drugs among the health care providers and patients.
The products that manufactured by the Indian pharmaceutical industry are broadly categorized into four categories, including prescription medicines, over-the-counter(OTC) products, traditional medicines and generic drugs. The pharmaceutical industry is mainly dominated by large and medium sized companies that engaging in the production of generic drugs.
Now generic drugs in india have received a new impetus with Prime Minister Modi himself advocating the usage of these medicines. Doctors will now be required to prescribe generic formulations of medicines , as opposed to specific brands. The PM has announced that prescription of medicines by their generic names will be mandatory.
This is expected to bring down drug prices and expand access to affordable health solutions. As per the latest National Sample Survey Office survey on heathcare, in 2014, medicines emerged as a principal component of total health expenses- 72% in rural areas and 68% in urban areas. For a country with one of the highest per capita out-of 'pocket expenditures on health, even a modest drop in drug prices will free hundreds of households from the widespread phenomenon of a medical poverty trap.
In addition to the social benefits, the generics only policy also makes economic sense. By promoting generic drug consumption, the government safeguards the health of its generic drug manufacturing industry- one of the largest suppliers of low cost medicines in the world.
With increasing pressure from the 'BIG PHARMA' companies in developed countries. Indian generic manufacturers must now operate under a markedly restrictive Intellectual Property Rights(IPR)regime. The new policy can ensure that ' atleast in the Indian market ' generic manufacturers retain an advantage. Big pharma's access to Indian consumers willhave to be routed through generic companies using channels such as voluntary licensing.
Low- cost medicines, apart from their attribute as a commercial commodity, have far reaching implications on public health and international human rights. India has unambiguously subscribed to the pro- public health argument, and has articulated its position several times at home and in international forums.
2. Literature Review and Framework
The reviews is presented as follows-
2.1 Generic Drugs
A generic drug is a pharmaceutical drug that is equivalent to a brand name product in dosage, strength, route of administration, quality performance and intended use. The Indian government began encouraging more drug manufactured by Indian companies in the early 1960s, and with the Patents Act in 1970. The code of ethics issued by the Medical Council of India in 2002 calls for physicians to prescribe drugs by their generic names only.
2.2 Consumer Profiling
From the managerial perspective, it is important to identify the consumers who may be influenced by generic drugs to know buying behavior. Several studies have been done in the literature to profile the population of customers conscious towards generics drugs, evaluating the knowledge, perception, and attitude of general practitioner regarding generic drugs (South Med Rev. 2012 July). Mainly the two variables are categorized; sociodemographic factors such as gender, age, education, income, and social class and psychographic factors, such as awareness, perception, availability.
During the last three decades, pioneered studies of Roberts (1996), Schlegelmilch et al. (1996), and Kilbourne and Beckmann (1998) determined the sociodemographic segmentation of environmental conscious consumers. These studies showed that socio demographic profiling has less impact on buying behavior. In this study, we have empirically explored the linkage between sociodemographics and buying behavior context.
In an attempt to conceptualize the awareness constructs , considered age as a parameter to segmentalize generic drug consumer. Many study stated that that younger age group exhibits higher awareness of generic drugs.
Several studies examined the linkage between gender and consumer behavior. Some studies say that there is a significant relationship between gender and consumer behavior while few studies contradicted these findings.
Many studies examined that there is a relation between the occupation and consumer behavior. While others contradict these findings and find no such reation between between occupation and consumer behavior.
According to the studies, income has a positive correlation with the consumer buying behavior. Few authors found it otherwise, i.e., no relationship between the income and consumer buying behavior. Hence it may concluded that it may affect the buying behavior if generic drugs.
Many studies were relatively homogenous in their findings that higher educated consumers are more sensible and concerned regarding the quality and awareness regarding generic drugs. Conversely, few studies observed that education has no significant relationship with consumer behavior. Due to the inconsistency in the past results, to support the alternative hypothesis of no difference is postulated in generic drugs context.
2.2.2 Psychographic Characterization
Many researchers have been considering psychographic variables in profiling the consumer behavior and mainly considering the variables, namely knowledge, perception, and attitude of general practitioner (South Med Rev. 2012 July). However no attempts gave been made to explore the extent to which, or how these variables affect the buying behavior of generic drugs. In this paper we have taken three psychographic variables explicitly; PCA, PP and AGD. The concept of characterization of consumers is at mature phase and socio demographic variables have limited utility in characterization of consumers. It may be asserted that relevance of sociodemographic variables is relatively less in explaining buying behavior of generic drugs context.
126.96.36.199 Perceived Consumer Awareness (PCA)
This study proposes the construct ,'PCA' to address the premise that it may influence buying behavior if consumers are more aware about the generic drugs and its usage and quality regarding attributes.
188.8.131.52 Perceived Perception (PP)
Conceptually perception is linked with individual's general orientation towards generic drugs. The perception regarding the quality and performance of generic drugsis most oftenly compared with the quality and performance of generic drugs. So it will lead to the buying behavior of generic drugs by consumers.
184.108.40.206 Availability of Generic Drugs (AGD)
The commercialization of generic drugs after patents and exclusively protection ends, or patent owners waived their rights, and FDA requirements are met. The marketing strategies and availability across the country is the crucial factor to determine the relationship between the availability and buying behavior of consumers.
The summary of investigating extant literature as well as the hypothesis developed for this study were provided in the previous discussion. Eight tested hypothesis are presented as below-
H1 : Age is related to buying behavior in case of generic drugs.
H2 : Gender is related to buying behavior in case of generic drugs
H3 : Occupation is related to buying behavior in case of generic drugs.
H4: Income is related to buying behavior in case of generic drugs.
H5 :Edication is related to buying behavior in case of generic drugs.
H6 : PCA is related to buying behavior in case of generic drugs.
H7 : PP is related to buying behavior in case of generic drugs.
H8 : AGD is related to buying behavior in case of generic drugs.
3.1 Data Collection and Survey Instrument
The quantitative study was developed to test the relationship among socio demographic variables, psychographic variables and buying behavior of consumers. To study the effects of two major profiling variables, i.e., sociodemographic and psychographic variables on buying behavior. A questionnaire is prepared and data is collected from 91 participants.
Age (n = 91) (%) Occupation (n = 91) (%)
15-20 4.40 Student 48.35
20-25 53.85 Govt. Job 6.59
25-30 10.99 Private Job 28.57
30-35 3.29 Self Employed 12.08791
35& above 27.47 Others 4.395604
Total 100.00 Total 100
Income (n = 91) (%) Qualification (n = 91) (%)
below 1lac 18.68 12th 6.59
1lac- 3lac 20.88 Graduation 40.66
3lac- 5lac 17.58 Post garduation 40.66
5lac- 7lac 16.48 Professional course 12.08791
7lac- above 26.37 Doctorate 0
Total 100.00 Total 100.00
Gender (n = 91) (%)
Following measures are used for the study.
3.2.1 Sociographic Variables
Gender, age, education, and income were considered as independent variables in this study.
3.2.2 Psychographic Variables
PCA, PP, and AGD were examined as independent variables in psychographic measures.
3.2.3 Buying Behavior of Generic Drugs
To examine the buying behavior of the respondents ,we gave them a hypothetical situation. Five questions were administered to investigate the buying behavior of the respondents in case of generic drugs.
For the preliminary analysis, the correlation analysis was run. The results indicated that the demographic variables, i.e. age, income, gender, occupation and qualification has positive correlation with the buying behavior of generic drugs. However, the correlation of psychographic variables classification i.e. awareness is significantly correlated and perception and availability were negatively and insignificantly correlated with buying behavior of generic drugs.
Further regression analysis was carried to test the hypothesis. General assumptions of the multiple regressions were taken into consideration. Buying behavior was taken as the dependent variable and demographic variables viz age, gender, occupation, income, and qualification were taken as dependent variables (Regression model M1). According to the regression model fitted on the data. R-square = 0.8938, F=0.731 and p- value= 4.06E-09, leading to the rejection of the hypothesis: H1, H2, H3, H4, H5. Hence, this study affirms that demographic variables(gender, age, occupation, income, qualifications) are not significantly related in explaining buying behavior. The regression coefficients, standard error, and R- square values corresponding to all independent variables in the regression model are shown in table-1
Table-1 Regression Analysis(Model M1) of Demographic variables with buying behavior
Variables Coefficients Standard Error P-value
Intercept 0.596300532 0.090943729 4.06E-09
Age -0.033537277 0.018696224 0.076401221
Sex 0.098312314 0.037278694 0.00993733
Occupation 0.242235165 0.01991085 2.62094E-20
Total annual income of your family 0.181552762 0.01249574 9.37149E-25
highest qualification 0.184471376 0.022657176 2.93325E-12
To examine the hypothesis H6, H7,an H8, stepwise regression models were fitted on the psychographic variables considering PCA, PP and AGD as independent variables and buying behavior as dependent variable. In the step one regression equation is fitted with PCA as independent variable(Model M2). As shown in Table-2 model M2 explains significant relationship between PCA and buying behavior with R-square=0.00687 and F value= 0.434, p-value= 0.434. in the second step variable PP is added as dependent variable removing the variable PCA. The R-square value for this model (Model M3) is 0.0014 and F value= 0.7226 , p value= 0.7226. In the third step variable AGD is added as dependent variable. The R-square value for this model(Model M4) is 0.0159 and F value is 0.2335 and p value is 0.2335.
In the fourth step, PCA, PP and AGD were taken as independent variables and the model(Model M5) explained R-square= 0.0309, Fvalue= 0.4321, p-value=0.0036.
Table-2: Stepwise Regression Analysis Of Psychographic variables with Buying Behavior
Model Variables Coefficients Standard Error p-value R- square
M2 Constant 2.060502
M3 Constant 2.318258
Table 3: Regression Analysis of Psychographic Variables (Model M4) with buying behavior
Variables Coefficients Standard Error P-value
Constant 2.364072 0.334314 3.65E-10
PCA 0.101779 0.087768 0.249369
PP -0.03482 0.097777 0.722627
AGD -0.10342 0.077909 0.18785
Again stepwise linear regression is run to test demographic and psychographic variables as independent and buying behavior as a dependent variable (Model M5). The results show R-square=0.1012, F value=0.3366 and p- value= 0.0002. It is asserted that psychographic variables are appropriate in profiling consumers which lead to buying behavior. The below table shows that:
Table 4: Regression analysis of Sociodemographic and psychographic Variables with buying behavior
Coefficients Standard Error P-value
Intercept 1.561193 0.411265 0.000281
Age -0.01388 0.05765 0.81031
Sex 0.022567 0.11424 0.843893
Occupation -0.04339 0.063081 0.493472
Total annual income of your family 0.030486 0.038083 0.425718
highest qualification 0.046214 0.074259 0.535447
awareness 0.178855 0.095063 0.06346
perception -0.07414 0.100823 0.46421
availability 0.074217 0.081824 0.367048
The study shows that H1, H2, H3, H4, H5 are not supported and implies that demographic variables are insignificant in profiling buying behavior. However H6, H7, H8 are excepted which infer that psychographics variables are more relevant and significant in impacting buying behavior in case of generic drugs.
Discussions and Implications
The emergence of generic drugs market is appreciated by many researchers to segmentalize and characterized the consumers. Therefore, this paper presents an approach to examine the profis of generic drugs through two constructs, namey demographic and psychographic variables and subsequently examining their impact on buying behavior. The literature has not been conclusive in determination of buying behavior through demographic and psychographic variables and how these variables effect on action orientation of consumers. This study allows us to affirm that demographic characterizations are not pertinent in explaining buying behavior among consumers. Nevertheless, psychographic variables are verified to be more effectual in categorizing consumers and establishing its relationship with buying behavior.
This study shows that the five perspectives of buying behavior in generic drugs. First, the study attempts to understand the role of demographic and psychographic variables on buying behavior. Second, when participants were asked if they were aware of generic drugs and buys generic drugs.
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