It may require true “out of the box” thinking, but failure to improve successful launch rates will doom your company to marginalization in the competitive fight for brand affinity – not to mention the prescriber loyalty that keeps medicines in play for the long haul, write Partha & Jayanthi Anbil
The impact of patent expirations and rising payer market power means that a new product launch is the single most important initative for any big Pharma company today – there is real money left on the table if it is not done right.. The window of opportunity for launch is short and unforgiving and success depends on flawless execution of launch activity across countries and functions. Given that companies spend an average of $800 million to develop and launch a new product, it’s not surprising that pharmaceutical companies’ success rests not only on the quality of R&D pipelines, but also on the rapid uptake of their brands.
Despite the high stakes, a recent study found that an outstanding launch performance is a rare event. Consistently high performance across markets is even rarer, suggesting there are gaps in launch strategy that companies cannot afford to ignore. However, identifying those gaps and bridging them can be tricky. Our conclusion? Without a solid, empirical understanding of the key determinants of success, companies are likely to approach this crucial phase haphazardly, wasting resources and missing opportunities. With few real evidence-based approaches for successful launches available for scrutiny, there is still one documented certainty: the winners always include those who . start the commercialization process early in the development cycle.
Challenges in early commercialization
In fact, recent analyses suggest that R&D efforts are incorporating more commercialization inputs even earlier than pre-clinical stage, in fact as early as 'Target validation' and at 'Target Selection' milestones.
Many factors are driving decisions earlier, including escalation in investment cost particularly in discovery (Figure 1), and the soaring cost of failure when it occurs later in the development phase. All this is motivating the industry to reconsider R&D business models, evaluation criteria, and 'go-no go' decision points.
To adapt to the new approaches and to enhance speed and reliability of decision making in Pharma R&D, additional key sources of data, intelligence and insights that augment and inform – rather than just report -- will be needed.
Another challenge is that R&D and commercial operations are not well integrated and aligned with each other. It can be challenging to engage commercial input with those assets that are still several years from launch, especially as commercial teams are often prioritized on working with assets in mid to late stage development. The vehicles by which early commercial knowledge is captured and translated are first a 'disease area and later the formal product profile (PP). The requirement for these documents to contain more information to guide investment decisions is ever more important today.
Pharmaceutical companies want to make the right investment decisions at the earliest opportunity and are now challenging whether the key criteria outlined below are enough.
A commercialization checklist
Today, asset evaluation is addressed with reference to the key criteria of:
– Commercial potential - derived from calculation based upon the potential number of patients, the ability to access those patients, the strength of the potential differentiation of the new brand and hence share attainable, and further the price that the Payers are willing and able to pay
– Cost of development - in terms of resources and capital consumption as well as elapsed time
– Risk from a range of taxonomies:
– Technical risk - wherein the quality of the asset and its potential for efficacy in its early evaluation is assessed relative to the disease models and biomarkers available as well as the clarity of 'Mode of Action' and the potential for that to be communicated to the market
• Developmental risk - the ability to develop the medicine and scale up, and in large part the tolerability of the asset in patients
• Commercial risk - competitors, sub-optimal pricing, co-pay versus full reimbursement, factors that impact the share (volume) and price assumptions that underpin commercial potential
Early commercialization is recognized as the critical connector. Therefore companies need improved data and analysis capability. That need is increased by the trend towards the employment of new approaches in drug development, for instance accelerated proof of concept. Such an innovation requires improved knowledge of the asset and its potential on which to base that acceleration.
The commercial criteria appliedvaries across the development cycle with qualitative factors such as availability and credibility of robust animal models being more important in the Target Selection and Pre-Clinical stages. When an asset is being evaluated for phase 3 investment, more so in the decision to launch, data should be highly quantitative and the evaluation based upon a number of key criteria about which the uncertainty has been effectively managed and risk mitigated.
In early commercialization efforts, especially with the move towards personalized medicines, companies must assess:
· Riskiness of a candidate molecule moving forward
· Likelihood of achieving a target product profile
· Pharmacoeconomic data - how does cost compare to other drugs on the market or future drugs that may make it to market
· Payers - due to a shift toward personalized medicines requiring a defined value proposition that responds to payers
· Global healthcare regulations and potential for change
· New developments such as changes in policy that changes value proposition and
impact on data and analysis
· Areas of unmet medical need
· Quality of life improvement (for instance auto injectors over visits to physician)
Market validation needs to be thorough to ensure positive forecasts for return on investment. With increased healthcare pressures, ensuring the benefit against the risk reward ratio is critical. Given the current economic environment, the essential question to pose is: would the benefit to cost ratio hold. More importantly, companies might want to understand where others have tried and failed, particularly as their experimental data provides lessons to others. Detailed data and analysis such as this is critical for companies since it allows planning of their portfolio, especially if it means saving time and cost by killing programs, through stricter go/no-go decision making points.
It appears that decision-makers think of early commercialization space as spanning “discovery” through “Phase 2”. In addressing the early commercialization space key components can be categorized into:
• Portfolio management
• In-licensing opportunities
• Lifecycle management
Portfolio Management Decisions
– What competitors are doing?
– What are Key Opinion Leaders saying?
– How will a change in the valuation of asset X, affect the rest of the portfolio valuation?
– What disease areas hold value?
– What label claims will others try to make?
– What is the market size?
– Will HTA authorities like NICE endorse asset X with a specified profile?
– How are physicians making choices?
– What do physicians claim they will do in the future?
– Is it a new mode of action?
• What information is there that can help understand this? Does the company possess the in-house knowledge and experience to develop this asset?
• What competitor products are out there that may decrease asset value?
• What clinical endpoints are needed to satisfy the FDA?
• What are the clinical protocols being used? Can the design be replicated? Could the required patient population be recruited?
• How is the FDA currently approving drugs? What have they not approved?
– When closer to potential product launch, what to expect in terms of product perception particularly by physicians?
• Would there be any impact in considering co-morbidities for example?
– Will there be a monopoly on label claims for this particular asset?
– What has the FDA declined recently?
• What is the current stance of the FDA? What have they not approved?
• Can regulators be approached to understand what is needed for approval?
– What are patients demanding?
• How are patient requirements changing? What can be learned from their use of social media?
– What else can be done to achieve greater asset value?
• Is there potential for coupling with devices/diagnostics?
– How is the standpoint of governments in different countries around health changing?
– What markets could be explored?
• What are the entry hurdles in emerging markets? What other markets (other than U.S or emerging markets) should be explored?
The key test
You will find few development teams in companies taking a position that their candidate products are no good. The challenge is in being able to identify potential winners so their development can be prioritized and the resources will be made available to expedite launch. The opportunities to build extra value into the brand should be identified and planned for early to ensure that the full potential of a brand is realized. New indications, formulations and presentations must be identified and evaluated as part of the overall development strategy for the new brand. Problems of delivery and potential challenges of compliance and adherence should be identified as early as possible. The aim must be to take valuable, differentiated medicines into their chosen markets as effectively as possible.
'Picking the winners' early has been of significant importance to R&D executives – it is not by itself a new concept. The problem is executing around it. The worst case scenario for R&D management is late attrition, for it is costly and can be debilitating for an organization in terms of retaining good staff and encouraging new innovation. AstraZeneca reeled under the impact of a series of late stage failures, which forced the company to install new management. This precedent is likely to be repeated in the years ahead. With costs of development escalating and customers exhibiting an increasing trend towards effectiveness and value for money in the new brands they accept into the market, the pressure is on to identify earlier those new molecules that have the potential to become reimbursable medicines, not just new drugs!
About the Authors
Partha & Jayanthi Anbil are Principals at the ConfluenceElite Group, LLC, provider of consulting services to Health care & Life Sciences industry. They can be reached at [email protected] and [email protected]