The 7 Habits of Highly Effective Competitors - Pharmaceutical Executive


The 7 Habits of Highly Effective Competitors

Pharmaceutical Executive

5 Compete At Multiple Levels

HECs practice of "Multi-Level Competition," the strategy of seeking to win not only with individual brands but also at the franchise, portfolio, and corporate levels. Roche wants to win with its HER2 breast cancer agent Herceptin, a $5 billion brand; its emerging HER2 franchise which includes recently launched agents Perjeta and Kadcyla; its overall oncology portfolio which includes blockbusters Avastin and Rituxan as well as biomarkers and diagnostics; and to further enhance its industry-leading oncology reputation.

Similarly, Novo's diabetes portfolio offers multiple brands and franchises including basal, rapid-acting, and premix insulins; GLP-1 agents including Victoza and soon other GLP-1 combinations; and a myriad of devices. For over two decades, Biogen has concentrated on Multiple Sclerosis, resulting in the industry's most robust MS franchise (Tysabri, Avonex, Fampyra, and Tecfidera) to help manage this debilitating disease across its continuum. Competing at multiple levels provides many advantages, including better stakeholder relationships, more product combination opportunities, and improved operating efficiencies. Not surprisingly, Novo and Roche held the top two spots in the PE Industry Audit of sales-to-assets, a measure of corporate efficiency.

6 Mitigate the Impact of Payers and Generics

In the industry's Competitive Lifecycle Stage, both payers and generics represent significant threats. HECs realize that payers are not only customers but also potential "budget competitors," often fighting for the same funds as biopharmaceutical companies. These payers use numerous tactics to control the access, pricing, reimbursement, utilization, and perception of innovative drugs, including leveraging generic competition. Roche has relied on innovation to address payers and generics. The company recently launched 2nd generation follow-on products Gazyva and Kadcyla for its aging blockbusters Rituxan and Herceptin, respectively. Kadcyla, which links Herceptin's antibody with ImmunoGen chemotherapy agent DM1, is one of 25 antibody-drug conjugates in the company's pipeline.

Celgene has also emphasized new product development with a three-pronged strategy: expand Revlimid, its core $5 billion hematology-oncology agent, into new indications; develop new blockbusters such as apremilast for psoriasis and other indications; and build its early-stage pipeline through active deal-making. These efforts have provided Celgene with a 90% pricing margin, the highest in the PE Industry Audit.

7 Seek to Dominate Their Market

While many companies focus on specialty areas of unmet and growing therapeutic need, the most successful competitors seek to dominate and own their respective therapeutic areas. With an impressive portfolio of insulin and non-insulin products, Novo is the leading player in the burgeoning global diabetes market with a 27% global market share according to EvaluatePharma Research. Roche dominates oncology — the world's largest pharma market — where it owns nearly one-third of all cancer product sales worldwide totaling $22 billion. Roche markets the industry's three best-selling cancer brands and is poised to have five of the six best cancer sellers by 2018. Gilead is expected to capture 43% of all anti-viral sales by 2018 by owning the HIV area while challenging the HCV arena. Catapulted by its recently launched Tecfidera, Biogen will cast an increasingly dominant shadow over the MS market. The company is expected to grow from a 34% to a 50% share of the projected $20 billion MS market by 2018.

In summary, highly effective competitors demonstrate three fundamental ways to win. They prepare to win by committing to a specialty market mission with the right people and products. They plan to win by shaping their market and competing at multiple levels. They play to win by mastering the Pre-Launch, countering payers and generics, and seeking to dominate their competitors.

Stan Bernard, MD, MBA is President of Bernard Associates, LLC, a global pharmaceutical industry competition consulting firm. He can be reached at


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