As mega-blockbusters like Lipitor and Plavix approach the end of their runs, the pharmaceutical industry is scrambling to
replace the big revenue streams that are drying up almost instantaneously. So far, R&D efforts have proven none too successful.
In 2007, FDA approved only 18 new chemical entities; only twice in the past thirty years has there been a smaller number of
Discovering new compounds and getting them to market has clearly become more difficult. One strategy the pharmaceutical industry
is using to address its productivity crisis is to find new uses for drugs that have already made it through to the marketplace.
In the good old days, pharma companies typically pursued marketing approval for a single indication for a new medicine. In
the last few years, however, they are increasingly exploring all possible uses for promising new compounds in order to gain
approval to market the same drug for multiple indications—and improve the return on their R&D investment.
"We are being much more rigorous and disciplined in evaluation of the likely potential of any compound across multiple indications,"
Pfizer's vice president of global medicine, Steve Romano, told the Newark Star-Ledger earlier this year. "The mechanisms we're pursuing...can have an effect across a number of disease states."
Multiple Indications: A Routine Strategy
FDA seems to be supportive of this approach. After all, olatform drugs make sense. Once a product's safety is established
in the first approved indication, the agency can generally be more secure that no serious unexpected safety issues will arise
in a second or third indication. In fact, the number of expanded indications for biotech drugs doubled in the first half of
this decade: from 2000 to 2003, 29 got the nod; from 2004 to 2006, 58 did.
The Pain Market
Genentech's Avastin (bevacizumab) is an even more recent example. In February, amidst considerable controversy, FDA cleared
the TVEGF-inhibitor—already approved to treat lung and colorectal cancer—for breast cancer, based solely on the drug's ability
to slow tumor growth. This action went against both the recommendation of the advisory panel and its traditional requirement
that a cancer drug demonstrate that it can extend, or improve the quality of, a patient's life.
TNF inhibitors, a category of biologics that includes Amgen's Enbrel (etanercept), Abbott's Humira (adalimumab), and Centocor's
Remicade (infliximab), have either been approved, or are knocking on the door to treat a variety of autoimmune conditions
such as rheumatoid arthritis, psoriasis, and Crohn's disease.
So brand extension is a revenue enhancement strategy that seems to be working for the pharmaceutical industry, although it
presents certain challenges. The choice of a first indication is all important, and the development program should be managed
to ensure that the initial approval provides a strong platform for additional indications. For example, companies developing
compounds to treat multiple indications including obesity should think twice before committing to obesity first. They'll probably
be better off focusing on an indication recognized as a medical (rather than a lifestyle) condition because securing reimbursement
for weight loss is much more difficult than, for example, diabetes—as illustrated by Roche's troubles with Xenical (orlistat).
The Fibromyalgia Market
Another challenge with a platform drug strategy is one of public perception. The approach has been criticized as simply another
ploy by pharmaceutical companies to make up for, if not cover up, a lack of R&D innovation. Insurers may view it as nothing
more than an effort to maximize revenues. But both perceptions are a bit unfair. While they are by no means breakthrough drugs,
the extended indications endure the same clinical and regulatory rigor as new, single-indication chemical entities, as well
as offering patients new treatment options.
Prescribing Data: Right From the Source
Doctors are free to use approved medicines off label, but drugmakers are unable to promote these unapproved uses. Hence, the
broader a drug's label, the more freedom sales and marketing have in promoting the drug.
Share of Promotions
As labels expand, a company's ability to track brand promotion and prescribing by indication becomes increasingly important.
The data generated by ImpactRx's information network of more than 3,500 physicians demonstrates the growing importance of
performance measurement by indication.
ImpactRx utilizes smart phone technology to collect treatment information at the ICD-9 diagnosis code level directly from
its network physicians. Because this data capture takes place at the point of treatment in the doctor's office—and prior to
any coding intervention for billing and insurance purposes—ImpactRx is able to obtain a uniquely accurate read on physician
prescribing patterns at the diagnosis level.
A clear breakdown of business by indication is imperative for effectively evaluating market performance, and for making insightful
resource allocation decisions. It's important that a marketing team understands, with as much granularity as possible, how
physicians are using its brand—both on and off label.
The atypical antipsychotic market illustrates how important information on brand usage by diagnosis is to managing the business
of a multi-indication category. Drugs such as Bristol-Myers Squibb's Abilify (aripiprazole), AstraZeneca's Seroquel (quetiapine),
and Lilly's Zyprexa (olanzapine) are approved to treat a variety of neurological disease states such as bipolar disorders
and schizophrenia. A breakdown of the prescriptions written for Abilify in the first quarter of 2008 by both psychiatrists
and primary care physicians demonstrates they clearly use the drug differently (Figure 1, page 105). Schizophrenia accounts
for more than 30 percent of Abilify's usage by psychiatrists, compared to only 18 percent of primary care doctors' usage.
Conversely, bipolar disorders represent 56 percent of primary care usage of Abilify and less than 45 percent of prescriptions
written by psychiatrists. (This breakdown is only logical—schizophrenia represents a larger percentage of specialists' prescribing,
given the severity, complexity, and chronic nature of the disease.) In order to effectively manage Abilify's performance,
the brand team needs to know how these business breakdowns by physician specialty compare to both the market opportunity for,
and the resources allocated to, each indication.
Share of Prescriptions