EXHIBIT 34

THE FOND DU LAC STUDY: AN INTENSIVE STUDY OF THE MARKETING OF FIVE NEW ETHICAL PHARMACEUTICAL PRODUCTS IN A SINGLE MARKET, RESULTING IN SOME THEORY OF SCIENTIFIC MARKETING AND SERVICE PROGRAMS FOR ACTION

A BASIC MARKETING STUDY MADE FOR THE AMERICAN MEDICAL ASSOCIATION, 1956 By Ben Gaffin & Associates, Board of Trade Building, Chicago, Illinois CONTENTS

Foreword.

Section I. Introduction to the Fond du Lac study:

Chapter 1. Objectives.

Chapter 2. Methods and procedures.
Chapter 3. What the study means.

Section II. Description of the Fond du Lac market:

Chapter 1. Fond du Lac as a consumer market and medical service area.

Chapter 2. How Fond du Lac physicians keep current on new drugs.

Section III. The marketing of five new ethical pharmaceuticals, and what happened to them in Fond du Lac from the product point of view:

Chapter 1. The story of Ciba's Serpasil.
Chapter 2. The story of Eaton's Furadantin.
Chapter 3. The story of Geigy's Butazolidin.
Chapter 4. The story of Lederle's Achromycin.
Chapter 5. The story of Upjohn's Pamine.
Chapter 6. Some questions raised by the stories.

Section IV. What happened to the five new ethical pharmaceuticals from the market's point of view:

Chapter 1. Fifty-five physicians and how they accepted these five new tools.

Chapter 2. Thirteen pharmacists and the addition of these five new inventory items to their stocks.

Section V. An approach toward a science of ethical pharmaceutical marketing developed from the Fond du Lac study:

Chapter 1. The idea of scientific marketing.

Chapter 2. The first principle: The reputation of the company preconditions the market's reception of the product.

Chapter 3. The second principle: The product determines its own market.

Chapter 4. The third principle: The market for the product exists in terms of the physician types who will understand the product, and need it.

Chapter 5. The fourth principle: Each physician type has its own motivations, and
promotion of the product must be based on the motivations of the types who con-
stitute its market.

Chapter 6. The Fifth Principle: For Each Product There Is an Ideal Budget: Falling
Short of It Delays Success and Exceeding It Is Wasteful.

Section VI. Designing a Scientific Marketing Program for Your Product.
Chapter 1. A Checklist for Designing Your Next Marketing Program.
Chapter 2. The Rewards of Scientific Marketing.

(The Fond du Lac Study: An intensive study of the marketing of five new ethical pharmaceutical products in a single market, resulting in some theory of scientific marketing and service programs for action-A basic marketing study made for the American Medical Association by Ben Gaffin & Associates (full text).)

FOREWORD

The Fond du Lac Study has been sponsored and financed by the American
Medical Association as the second in its series of basic studies in phar-
maceutical marketing undertaken as a service to the pharmaceutical industry.
The first study, also undertaken as a service to the phar-
maceutical industry, was titled "Advertising and the American
Physician". Completed in 1953 by Ben Gaffin & Associates, it
was made available as a series of twenty mailing pieces sent
to pharmaceutical companies by the American Medical Association.
The earlier study emphasized, if it did not discover, the
importance in physician education of pharmaceutical adver-
tising and promotion to the medical profession. It revealed
that physicians receive a large proportion of their post-
graduate medical education from the advertising and detail-
ing which are paid for by pharmaceutical companies.

The present study, through intensive investigation of the
marketing of five new ethical pharmaceutical products in
a single market, attempts further to help pharmaceutical
companies develop more efficient methods of promoting their
products.

Is Distribution Still Too Costly?

The 1939 Twentieth Century Fund study titled "Does Distribution Cost Too Kuch?" indicated that distribution cost paid by drug manufacturers was the highest of any class of products and that three-fourths or more of the retail price of a drug was going for costs and profits in the various stages of distribution.

If one asks today, "Does pharmaceutical advertising still
cost too much?", the answer must be that any unnecessary
cost, any waste of money spent for promotion and distribu-
tion of pharmaceutical products is "too much". That part
of the $130,000,000 spent on medical advertising this year
will be wasted is another question, but it must run into
8 figures.

The American l'edical Association, as the most important
single influence in the field of medicine, is recognizing
its leadership responsibilities to the public, to the
physician and to the pharmaceutical industry in sponsoring
this series of basic marketing research studies. By help-
ing the pharmaceutical industry do a more effective pro-
motion job at decreasing costs, it helps make the promo-
tional efforts more useful to the physician with less waste
of his time and it helps the public obtain better drugs at
lower cost.

Pharmaceutical Marketing Research

Marketing and opinion research is a new field, which the pharmaceutical industry is just beginning to discover. Yet, although this industry has been somewhat alowor than some other industries to discover its value and uses, there is every indication that the pharmaceutical industry is now learning more at a faster rate about the real possibilities of marketing research than other industries which have been using it for twenty years

or more.

Yet, the pharmaceutical industry is spending only tenths of mils for marketing research compared with thousands of dollars for laboratory and clinical research.

The pharmaceutical industry has recognized the importance and
need for product research as no other industry has. It
annually plows back into the development of new products a
greater porcentage of its earnings than does any other industry.

As the pharmaceutical industry learns more about the benefits
of marketing research, this great discrepancy in allocation
of research funds will be adjusted. Efficient marketing will
be granted more importance than before in the industry's
total contribution.

Send Rosearch Philosophy

The pharmaceutical industry is entering into market and opinion research at a sufficiently advanced stage that it can avoid some of the pseudoscientific faɖɔ and escapз so of the faulty generalizations of fledgling research efforts. The Fond du Lac Study can help the industry develop a sound philosophy of market and opinion research.

The cornerstom of this philosophy is the appreciation of
the individual and the recognition that all markets are
people.

The Ford du Lac Study shors that there is no such person as
an "avorato doctor". The industry will see that its prono-
tional offorts are not directed at "the American physician"
but to all or part of the 160,000 individual human beings
who are also physicians. Any categorization of these individuals
is made solely for the convenience of people who have to
deal with them. Although such categories may be usoful, it
must be remambored that they are basically arbitrary
160,000 individuals and not the categories are the reality.

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the

In studying man, it is either convenient or fashionable some-
times to view him through the eyes of the psychologist; same-
timos through the eyes of the economist; sometimes through
the eyes of the sociologist; the anthropologist; and the
historian. We can and sometimes we have to use the tools of
the various sciences, but we should not make the mistake of
confusing what is only the man made categories of the
specific social science with the actual persons.

Dostors Are Individual People

Each one of the 160,000 physicians in the U.S. is first and foremost individual human being.

He starts in life with a physical make-up including
glandular structure, which gives him a certain temper-
ament and predispositions which are the heritage of
his ancestors. He grows up in an individual family
environment where he is exposed to certain cultural,
social, psychological, educational and other influ-
ences which mold his views and attitudes and behavior
patterns, and to some extent modify the organic structure
through which he acts. After receiving a basic educa❤
tion in his local environment, he is exposed for several
years to the study of the basic sciences, and then for
several more years to clinical studies. After a year
or more of apprenticeship, he begins to have other human
beings ca to him for treatment for physical or emo-
tional difficulties.

After he finishes his medical school, he seldom or
nover gets any additional formal education. Most of
the new ideas which he gots come from reading, from
formal or informal discussions with other doctors, from
printed advertising to which he is exposed, and to à
large extent, from detail mon from various pharmaceu
tical firm with whom he talks for a few minutes nearly
every day.

As a human being, he is comparatively quick or com-
paratively alc; he is comparatively hard-working or he
is comparatively lazy; he is friendly or crabby; social
or colitary; happy cr unhappy. His morning contacts
with his wife and children affcet in a croator or losser
dorca his attitude toward patients, toard co-workers,
and toward detail on. His basic temperment, modified
by his daily interpersonal relations, influence all his
actions and attitudes to som extent.

His human-beingmoss is modified by his being a physician.
As a physician, both society and he himself cot up some
principles of belief and behavior which tend in certain
respects to make him more like other physicians than
like other groups who have different basic intorests and
approaches to life.

Safe Generalirations

o can safely make a number of generalizations about all human boings human boings, including that they are social animals who are happiest when they have the respect and affection of the people around them.