Diversity was one of the big business buzzwords of the early nineties, but many major industries have a long way to go toward achieving the lofty goals set out in those days. Pharma is no exception. True, women and employees of color have more of a presence in middle management than ever before. But though noticeable progress has been made, white men still hold the vast majority of executive positions. 

Enter Reggie Smith. A veteran division sales manager at Genentech, Smith has a wealth of experience in the ever-changing, ever-evolving pharmaceutical industry. As the manager of a nine-member sales team, Smith is well versed in training, hiring, motivation, and staff development, not to mention sales goals and project management. As an African-American sales pro, Smith brings a particularly personal perspective to a discussion of diversity within the industry, an issue he sees as enveloping ethnicity, race, upbringing, and socioeconomic background.  

 asked Smith to share some of his accumulated wisdom on the topic and to offer advice that would ring true for brand-new hiring managers and industry veterans alike.   

Over the past several years, have you seen a change in the amount of diversity in the pharmaceutical industry and in pharma sales, in particular?

The short answer is yes, but it depends on what category you're talking about. For example, I've definitely seen more and more women hired by pharma companies. In the seventies, the stereotype of the sales representative was a man with a loud laugh and a big personality, the kind of person who'd slap doctors on the back. In the eighties, more women started to creep into the industry, and then it exploded in the nineties with the advent of larger sales forces. And so I think the pharmaceutical industry could be one of the model industries from a gender-diversity standpoint. 

But, like many other industries, pharma has been lagging behind in terms of its ethnic diversity. Since I've been in the industry, it has gotten better, particularly in the Big Pharma arena. I think it has room to improve in the biotech arena. And from what I've seen, it still has a long, long way to go in the medical device arena.  

I think there are a few different issues that are at work. First, there's a fear of difference. As humans, we like and are more comfortable around those who are very similar to us. But that shouldn't mean that a candidate must have the same background as the hiring manager in order to succeed in the interview process. Still, if a hiring manager hasn't spent much time around people with backgrounds different from his or hers, he or she might be hesitant to consider those candidates. He or she may have preconceived ideas that aren't necessarily accurate.  

Second, there's a dated hiring paradigm of looking at candidates only from certain schools. Sometimes companies get in the habit of only recruiting at a particular school in their geographic region. And if most of the student body consists of people from a particular background, that really limits the diversity of the potential new hires.  

Third, sometimes we overemphasize the idea of "territory fit." This might sound a bit controversial, but it's something that I think we have to look at. Instead of just making assumptions about how a particular rep would fit with a particular sales territory, we should really look at the individual and at how adaptable he or she is in forming relationships. When I was turned down for a job once, I got wind of the fact that there was a perception that I wouldn't do well in a rural territory. There was a belief that it would be an issue for me to cover this particular part of east Texas. Well, the irony of it all is that when I finally did get hired (after being turned down twice), a third of my territory was that area out in east Texas, and I did very well there.  

Now, when I had that job, there was a problem that popped up with an individual with whom I had to deal professionally. And from my perspective, it seemed like a race issue. But being the type of person I was, I adapted to that situation, and we moved along famously. And in fact, the person with whom I had that issue ended up helping me big time in beating my competition.  

Fourth, sometimes hiring managers have a lack of commitment to cultivating diversity. They feel there is no real or perceived value in why we should be doing this. They might be confusing diversity with affirmative action. Affirmative action is more reactive, but diversity is more proactive. From a business standpoint, there is a strong argument to be made for diversifying your sales force.  

Do sales managers get information about the business case for diversity?

I think typically not. In the United States right now, one-third of the citizens are people of color. I just read that of the 50 biggest cities in the United States, 19 have a majority of people of color. More and more people of color are going to universities. Still, it hasn't translated to the point where sales managers see a real dire need to go out and hire this educated, diverse workforce.  

People really want to hire the best team. Unfortunately, if you're dealing with a fear of difference, a tendency to hire only from particular schools, an overemphasis on territory fit, or a lack of commitment to diversity, then the "best" team starts looking like a very similar team rather than a team that could really be vibrant, different, and extremely successful. 

What are the benefits you're seeing from this approach?

In Genentech, when we launched the Raptiva (efalizumab) franchise, the senior management team hired a very diverse, skilled management team. It was probably the best I've ever heard of within the industry, at least within biotech. Out of the original nine managers, four were people of color, as was our director of sales. That was really unusual, and we did a really good job coming out in the extremely tough, competitive psoriasis marketplace. One rep, who was white, told me once that he's seen firsthand the value of having a diverse team.  

When I speak of diversity as it relates to my team at Genentech, I don't just mean different ethnic backgrounds. I also mean different skills sets and mind-sets. Some of us have such different approaches to the job. Early on, one of the senior managers mentioned to me that my team was like a band of misfits in that regard. But they've been a very, very successful band of misfits. We've been Team of the Year. We've led in prescriptions three out of four years. In any category that measures success, we've always been in the top-two or -three teams. And we've been extremely consistent.  

What should managers do in order to increase diversity in their sales teams?

Hire for traits and behaviors, more than for professional experience. The famous football coach Barry Switzer used to say, "You can't coach speed." What that means to me is, I can't coach the traits and behaviors, like the hunger, drive, passion, and persistence—but I can try to hire those. And after six months, the experience will be there as well. 

Hiring managers need to realize that the Asian, African-American, and Hispanic populations are growing here in the United States. Diversity is not going away. At this point, the train has left the station. That's why I strongly suggest you diversify the areas where you recruit. Make sure your recruiting sources are giving you diverse talent as well. But don't hire someone only because he or she is a diverse candidate. That's something I would never do or advocate. It's not that you'll necessarily hire the people they bring you, but diverse people should be in the mix.  

Personally, I've found it beneficial to assess and value candidates with tougher, nontraditional upbringings. Consider someone who might have had a lot of responsibility in raising his or her brothers and sisters. Think about someone who had to do a lot of work around the house before he or she went to school in the morning. The reason I value these types of experiences in candidates as I'm building my team is that these folks often show an unusually high level of adaptability relative to other workers.  

I'm not saying that people who came from stable backgrounds are not great employees and can't make great salespeople. That's not the case at all. But what I am saying is that when you're in a highly competitive, tough market in an industry or company going through a lot of changes, you need people with extra flexibility, resilience, and determination. Those qualities go a long way and make a huge difference. Some of the very best reps I know have that type of background. I think that's something to consider as you're getting to know people in the interviewing process. 

 is a division sales manager at Genentech, where he has worked for 10 years. He is a graduate of the University of Texas at Arlington. Prior to joining Genentech, Smith worked in sales at Lederle Laboratories. He spent four years as an active member of the US Army and one year in the National Guard. 

Articles

Thought Leader

Veteran salesperson Reggie Smith of Genentech makes the case for sales force diversity

Valuing Diversity

Manhattan Research interviewed more than 5,000 consumers for its annual ePharma Consumer study—a report designed to uncover behaviors and traffic patterns of consumers researching pharmaceutical information online within the past 12 months.  

After every site visit, consumers were asked a battery of questions: why they visited the site, whether they are already on the therapy, whether they are using a competing product, or if they have been diagnosed but aren't taking any product.  

Web Trends The number of eHealth consumers doubled since 2002; the number of ePharma consumers tripled. 

 talked to Meredith Abreu Ressi, vice president of research at Manhattan Research, to learn more about the study. 

How can a pharmaceutical company use this data?

A pharma company can segment and understand the visitors to its Web site. It can see what other sites they are visiting, as well as their likelihood to take certain actions after they leave. We wanted to understand what is driving consumers to these sites, what they are looking for, and which sites are most successful within a given category.  

Therapeutic Snapshot: Diabetes Which of the following actions did you take after visiting this product Web site? 

The product-site data is only a piece of the overall finding. We also look at specific Web sites that consumers are going to, e-mail newsletters they are receiving, corporate sites they visit, and Web site features they prefer. You can segment the entire study based on visitors to a given product site, for instance.  

Is pharma making it easier for consumers to find information on the Web?

Pharma has really caught on to the Web a lot more in the last two or three years. Any company I visit knows that having a solid online strategy is important. Product sites with a lot of content is the norm now, and the number of consumers going to pharma product sites has skyrocketed in the past two years. Nearly 50 million consumers visited a pharmaceutical product site in the past 12 months—double the number that went to a pharma product site two years ago. 

How can pharma companies continue to grow online?

Where I think we are going to see a lot of growth is in the way that companies leverage their properties. The product site is no longer the only place consumers visit for information. They are more likely to be going to a WebMD or a search engine than they are to be going directly to a product site. There's a push now to target the product site content and make sure that it's relevant. Companies also need to understand why consumers are visiting their Web sites and how they are getting there. For instance, we found that consumers are more likely to be driven to a product site by their physician. Of course, that changes by the product.  

Was there anything surprising in the results?

Cialis and Viagra have been very successful in driving product requests after consumers visited the product sites. Also, Chantix certainly drew a lot of traffic this year. Pfizer came in and swept the smoking-cessation category with that drug this year—which is not surprising. They had a great campaign that got control of that particular market.  

Have there been any noticeable changes in how physicians use the Web?

One of the changes I'm seeing is that physicians are driving a lot of the consumer product-site visits. It really highlights this overall need for patient-education materials, especially from primary care physicians. In those five-minute meetings in the doctor's office, a physician can give a prescription and a Web site that the patient can go to for more information on what they are being prescribed. That is something that pharma really needs to keep in mind when developing content. They need to include more condition data and think about how the Web site's patient-education component is weaved into the sales rep strategy.  

What's the average age of online health consumers?

It varies. One thing that's been interesting to see over the years is the degree to which e-pharma consumers are getting older. As older consumers are going online, they are becoming more active consumers of pharmaceutical information in general. Also, it's a relatively even male/female split, which is surprising to some people. A lot of clients assume that women are going to be more active pharmaceutical information seekers, but that's not what we see. 

So what does today's e-pharma consumer look like?

The number of consumers researching pharmaceutical information has tripled in the past five years. Today, there are more than 80 million consumers researching pharmaceutical information online. Young people are more likely to be online in the first place, but less likely to be researching drug information. That said, the numbers skew one way for certain conditions. Women certainly look at birth control sites more than men. In general, the people who are researching online are getting older, but you do see spikes in certain therapeutic categories where people are more likely to be going to be researching information post-diagnosis.  

Where do you see e-pharma going in the future?

In the near term, I really think that pharma is looking at Web 2.0 opportunities. In the coming years, they will start to get more comfortable advertising within these communities, as well as starting dialogues with some of the consumer opinion leaders that are online. From the product-site perspective, the whole concept of e-mailing with customers is going to become a key area. Identifying customers and going from one-way marketing to having a two-way dialogue with consumers is where the industry is heading. E-mail is this forgotten way of communicating that customers can use without much regulatory hassle.  

GlaxoSmithKline and Novartis have e-mail marketing tools standard across all of their Web sites and most industries have e-mail on their sites as a standard course of business. I feel e-mail is the key next step to engaging consumers in a dialogue as opposed to just pushing out content. 

Column

New study ranks the top RX product sites and looks at the consumers who view them

Tracking Pharma Consumers Online

The nimble, cross-functional team—common in other industries where speed to market is critical—is fast becoming a reality at leading pharmaceutical companies. No more throwing the product over the wall from R&D to Regulatory Affairs to Manufacturing to Quality Assurance to Sales and Marketing. Facing patent expirations, spiraling development costs, and proliferating competition, companies must now be able to move quickly on many fronts simultaneously. They must find creative ways to shorten time to market while securing regulatory approval and ensuring a favorable reimbursement environment and receptive healthcare providers.  

Further, as the blockbuster business model becomes less tenable, pharma must also find ways to rapidly achieve more product successes on a lesser scale. Recognizing these imperatives, senior leaders are not only creating high-profile cross-functional teams but also are identifying future leaders partly on the basis of their teaming skills. 

Football coaches are fond of pointing out that there's no 

 but effective teaming doesn't simply mean sacrificing oneself for the greater good. For individuals, it means developing specific organizational, interpersonal, and group skills that are unfamiliar and often far removed from the skills that carried them to their present positions. In short, it means learning how to successfully fit your "I" into the cross-functional teams that pharmaceutical companies will increasingly rely on to get products to market faster.  

Three simple but powerful principles can guide you in that quest to develop those teaming skills: 

Like Janus, the ancient god of doorways depicted with two faces looking in opposite directions, successful team members simultaneously focus inward on the organization as well as look outward at markets, regulators, payers, providers, and customers. Traditionally, most functions in pharmaceutical companies have focused either internally or externally. The quantitatively focused scientists in R&D concentrated on drug development while Sales and Marketing people, with their interpersonal and market-facing skills, spent most of their time talking to healthcare providers. Meanwhile, Regulatory Affairs personnel, while nominally focused outward on regulatory agencies, tended to let the science do the talking rather than cultivating relationships with regulators. Rarely, however, have these disparate groups functioned as a team that required its members to understand multiple perspectives, team up early in the development process, and leverage that understanding to speed up commercialization of products and ensure that the company is ready to seize the market from the first day of launch. 

Team members must understand not only one another, they must understand the company. Pharmaceutical organizations are global, matrixed, and highly complex—it is often difficult to understand where the real levers of power lie. No matter how good you may be at scanning the horizon outside the company or handling the chief discipline involved in your function, you must be equally adept at reading the organization if you want to get anything done. 

For marketing and sales executives, that means bringing to organizational dynamics the same combination of analysis and intuition that they bring to the market. For scientists and regulatory affairs executives, it means applying the same rigor to understanding organizational relationships that they apply to understanding chemical reactions or interpreting regulatory guidance. 

For example, a regulatory affairs executive, having consulted closely with regulators and studied closely a recent guidance, may believe that the principles of Process Analytical Technology (PAT) and Quality by Design (QbD) embodied in that guidance have the potential to eventually lighten the company's regulatory burden and costs. The executive must not only persuade fellow team members but also know how to influence the many organizational segments—from R&D to Manufacturing, from Quality to the CFO and CEO—that must be won over in order to embark on such a paradigm-shifting approach to drug development and manufacturing.  

Self-knowledge is indeed the beginning of wisdom, but it is difficult to put that wisdom to work. It's not enough to understand how the organization or the external environment works, or even to understand the people you're dealing with. You must also know authentically who you are—your values, motives, personality—and be able to manage the dynamics of a wide range of interpersonal encounters based on that self-knowledge. 

When you know who you are, you can bring your authenticity to bear in whatever way is called for by the context. This ability is emphatically not a chameleon-like talent for pleasing people. Rather, it is an ability to flex your personal style according to the situation. An encounter with a fellow team member, a regulator, a payer, or the CEO is not just about that other person—it's about that person and you. Salespeople, for example, certainly understand that to be effective, they must take into account the personality of the person they're dealing with as well as the circumstances of the encounter. The best salespeople, however, also understand themselves and draw on that understanding to genuinely engage other people.  

As a member of a cross-functional team, with its hitherto unfamiliar internal as well as external relationships, you may need to be direct, inquiring, reflective, facilitative, accepting, or confrontational, as the circumstances require. But whatever style you use must be based on an inner core of self-knowledge. Many organizations provide executive coaches for their leaders, but how many really provide those leaders with the freedom to understand who they really are? This may seem like the soft stuff, but it offers solid payback.  

No one knows better than you what you bring to the team in the way of skills and knowledge—and what you lack. But you should also analyze what competencies the team as a whole possesses. Given the team's charter, such as speeding time to market, does this particular group of individuals collectively have all of the disciplinary bases covered? Does each member have the necessary interpersonal and organizational skills? If there are gaps in the team's competencies, can those competencies be developed by current team members or should additional members be sought? 

Consider, for example, a cross-functional team charged with educating payers and providers about the efficacy and superiority of a drug currently in development. The goal, of course, is to promote a favorable reimbursement environment and solid market acceptance well in advance of the drug's approval, although it is only after approval that reimbursement can begin. By preparing the way for the broadest possible launch, the team is aiming not just at speed to market but also speed to profit.  

To successfully educate payers and providers, the team will need competencies in the product's science, its regulatory prospects, competitive intelligence, marketing, and more. Just as importantly, the individual team members who can provide those competencies must also possess the interpersonal skills that enable the team to seamlessly integrate those competencies into a unified, persuasive message and communicate it.  

Numerous techniques exist for making sure individuals and teams have the right competencies and interpersonal skills—360-degree reviews, individual assessments, self-assessments, and competency models. Coaching, feedback, and team-building exercises can also be used to deepen and broaden interpersonal and group skills that will facilitate better teamwork and more productive encounters with external constituencies. And for those individuals with the courage to embrace it—and organizations with the courage to let them—authentic self-knowledge, along with its demonstrable return on investment, is readily attainable through proven techniques of self-discovery.  

These skills—the ability to look internally and externally, to manage the dynamics of a wide range of interpersonal encounters based on deep self-knowledge, and to understand and acquire the full range of requisite competencies for your team—mark the difference between a technically competent executive and a high-potential leader in tomorrow's team-driven pharmaceutical organization. 

  is US practice leader, organization development at YSC. She can be reached at 

Commentary

Pharma is embracing the cross-functional team. But that doesn't mean that you must blend in with the sheep. Putting your best foot forward strengthens the team...and you.

Putting the "I" in "Team"

You win some and you lose some. For Charlotte Sibley, the worst loss in her more than 30-year career in pharma came when she tried to tell her boss some bad news about a brand-new drug called Lipitor. 

It was 1996, and Sibley was head of market research at Bristol-Myers Squibb. BMS, of course, had a strong foothold in the lucrative cholesterol-lowering market, thanks to its statin Pravachol (pravastatin), launched in 1991. The question was what kind of impact could be expected from the new cholesterol drug just launched by Pfizer and Warner-Lambert.  

The marketing department predicted that Lipitor (atorvastatin) would take share from Zocor (simvastatin) and other competitors, but would not affect Pravachol. Finance agreed. But Sibley's research showed Lipitor as having much bigger gains—and she said so. 

Who to listen to? As Sibley says, when it comes to developing fact-based forecasts, marketing has the capability, but its job is to promote the product, so it tends toward rose-colored perspectives. Finance is objective, but it doesn't know the market.  

We all know that it sometimes takes a lot of business discipline not to kill the messenger. This was one of those times, but the discipline apparently wasn't there. Soon afterward, Sibley was fired. And Pravachol—well, you know the rest. 

Charlotte Sibley thought she was going to be a French professor. But by the time her college graduation photo was taken (left), she had decided on a career in business; Sibley is also known for her sense of humor and love of life (right). "Life is not a dress rehearsal," she says. "Go for it!" 

What she doesn't say—though others will—is that stories like this are less common today than they used to be. And if market research and customer focus have taken on a larger and more secure role in pharmaceutical companies, it's partly Charlotte Sibley's influence.  

Early on in her career, a boss once told Sibley, "You're the navigator. Tell us where to go." She apparently took the advice in the broadest possible way. Throughout her career—which includes stints at Pfizer, Johnson & Johnson, BMS, Pharmacia, Millennium, and her current employer, Shire—Sibley has been in the vanguard of engaging pharma with its customers. She was an early visionary of working with consumers and other stakeholders, and is credited with turning market research into a strategic function that helps the business make smarter decisions, a mantra she's repeated so many times that it is now in the DNA of most companies. Along the way, she helped establish the industry's first competitive intelligence unit and helped invent the field of pharmacoeconomics and health outcomes.  

You lose some, but you win some. And Sibley recently added two items to her already long list of wins. She was appointed Shire's senior vice president of leadership development, a job that acknowledges and builds upon her decades of mentoring and developing generations of research professionals. And she has just been elected Woman of the Year of the Healthcare Businesswomen's Association, an honor she shares with previous winners such as Meryl Zausner, CFO of Novartis Oncology, and Christine Poon, J&J's vice chairman. 

"Charlotte can laugh or cry with you," says Wassihun Alemayehu, Shire's director of market research. "That should speak volumes, because leadership isn't about your technical skills, which she has plenty of. It isn't about how much people love you, though she has plenty of love. It is how much you can open up and communicate and nurture other leaders, which the industry is now starting to realize." 

"She has courage, internal fortitude, and an incredible drive to overcome difficult obstacles and be successful—all while remaining down-to-earth, incredibly supportive of others, and a genuinely nice person," says HBA President Elizabeth Mutisya. "It's a rare combination." 

As for Sibley, she believes in taking the good and bad alike in stride. "I've been hired, I've been fired," she says. "I've been upsized, I've been downsized, I've been promoted, I've been demoted, I've been acquired, I have been the acquirer. I look at all of this and say, 'You know what? This is what happens.' I've gone through tough times and good times, and neither lasts. You just have to try to keep a sense of humor and resilience." 

Sibley was born in Natick, MA, 15 miles outside of Boston. She was the first in her family to go to college, attending Middlebury, a small liberal arts school in Vermont, where she majored in Romance languages and music. In the summer, she worked as a waitress to make money. But come school time, she doubled and tripled up on course load so she could graduate early, working toward what she thought would be an academic life as a French professor. 

Charlotte says she and her husband, Leif, enjoy life. In particular, they are avid opera fans. They met on a blind date to see The Marriage of Figaro at the Met, and they married in 1998. 

That plan changed when recruiters from the US Trust Company came to Middlebury hunting for summer interns to staff the international division in New York. Sibley says she didn't know the difference between a stock and a bond, but she majored in French and German, and that made her "international enough" to get an interview. Besides, a stint in the Big Apple would allow her to spend time with her fiancé there. By the end of her second interview in New York, she no longer had a fiancé—but she did have a job, and she became US Trust's first female intern. 

It was 1967, and a bull market on Wall Street. Business was great, and New York had it all. By the time Sibley returned to Middlebury that fall, she had changed her mind: She was going to business school. She attended the University of Chicago Graduate School of Business, making connections and learning about the value of teamwork. But when it came time to graduate, she didn't take a job at an accounting or consulting firm, like most of her classmates. Instead, she joined Pfizer as a market research analyst. "Maybe it was a sign of the times," says Sibley. "The people at school said, 'Fizzer? What is that, an agricultural company?' They didn't understand. The joke was that I worked on 42nd Street and pushed drugs." 

At Pfizer, Sibley learned the fundamentals of data collection and management. She was also exposed to the bureaucracy of corporate life. "You think American business is the most efficient," says Sibley. "Then you see the reality, which is that it's not as efficient as what you were taught from books. And you have to make things work in the real world with the constraints of never having enough time or money." 

If Pfizer was Sibley's introduction to pharma marketing research, then her next job as a drug securities analyst for Donaldson, Lufkin & Jenrette taught her the basics of sound company management. "I had to step back, look at the industry, and determine what made a successful company," says Sibley. "Thirty years later, it's still the same things: good pipeline, financial controls, and visionary management." 

At this point, Sibley understood what a pharma company needed to succeed, and she had learned a bit about how pharma market research had always been done. But what she hadn't learned was how to truly get inside a consumer's head. That was a lesson she received at her next job, with tea-and-prepared-food giant Lipton, in an industry where companies live and die by their knowledge of customers. 

Sibley arrived at Lipton in 1978 as a market research manager for new-product introductions. She found herself immersed in the world of consumers. There she studied the habits of women who hiked, raised children, and were relieved when they could get dinner on the table by just adding boiling water. It was a different world than Sibley knew, who was a single New York city girl with a taste for opera, but an important early lesson in understanding the representative consumer. 

Sibley's boss, Vivian Bruno, was a stickler who didn't cut corners for anyone. "The product had to meet certain criteria set by market research, and if it didn't, it was back to the drawing board," says Sibley. "There was no slippery slope." 

Sibley wanted to bring that type of research-based decision making to pharma. "I knew from Lipton that marketing research could play a more definitive role," she says. "We should be the voice of the customer, the objective voice." 

Sibley got her chance in 1987, joining Bristol-Myers Squibb as director of business research and information in the global strategy group. (She would later move to oversee the larger domestic group.) Bristol-Myers had just merged with Squibb, and the atmosphere was solemn inside the company. People were protective of their jobs and scared to stick their necks out. 

But Sibley stood in sharp contrast to the company around her. She was full of new ideas and looking for more, says Colin Maitland, whose agency Isis Research counted BMS as a long-time client. "It was exciting—and exciting was the right word. There was a readiness to look at any idea we put up, instead of the 'not done here,' which is what we were used to." 

Sibley got the whole team moving forward and looking outward—all the way to the patient level. That was new. Most companies at the time focused on key opinion leaders (KOLs), who in many cases didn't even accurately represent average physicians. "It was like the pharmaceutical field of dreams," says Sibley. "Make it and they will come." Direct-to-consumer advertising had not yet arrived, and managed care was still in the midst of its rise to importance, but Sibley was already arguing that pharma needed to pay attention to all of its stakeholders.  

"Charlotte always thought of patients as the ultimate consumers of drugs," says Cliff Kalb, now head of the consultancy C. Kalb & Associates. "She was ahead of the curve—it wasn't until DTC that the industry caught up with Charlotte." 

Sibley championed some of the first efforts to find out what patients want. For instance, the virology group at BMS was about to move forward with a shingles drug. The head of the division had sought advice on formulation from several of his KOL physician friends, who said a spray would be best—that way, they reasoned, patients wouldn't have to touch the suppurating lesions characteristic of the disease. But Sibley's group insisted on conducting focus groups and invited the R&D execs to listen.  

The patients, it seems, didn't like the idea of a spray. They said they thought it would feel cold, that it would sting, that they would dread putting it on. Instead, they preferred a cream—it seemed soothing, and applying it would make them feel as if they were doing something to help themselves. Sibley watched the scientists' eyes light up. They understood: "Hearing directly from the patient, the end user, was absolutely revelatory to the R&D people," she said. "And then, of course, as direct-to-consumer came along, we had to start understanding the consumer more. But for most pharma companies, this was a brave new world." 

At BMS, Sibley pioneered many industry "firsts." She helped start the first competitive intelligence unit in pharma and championed the use of market research data to design better clinical trials. In particular, she worked with a group that advocated testing their drug against the most popular, most prescribed drug—not just the ones KOLs preferred. Sibley also worked on helping researchers institute health outcomes, both in terms of patient-reported outcomes but also in terms of health value. This is common today, but it was quite revolutionary in the late 1980s. She also conducted the first perceptual mapping of the ACE inhibitor market. 

Everything was falling into place—until the fateful Lipitor forecast, after which everything simply fell apart. After Sibley departed, people were worried. A vendor said she had watched Sibley beat her head against the wall for so long that she was afraid there was no way to fix the damage that had been done. Some doubted that she would return to pharma. 

For her own part, Sibley says she just felt relief. And before too long, she was ready to start again. She went to work for longtime client Colin Maitland, and built Isis Research's US business from scratch. She was the right person for the job, and just 15 months after starting, the business achieved profitability.  

And then, in 1999, along came an opportunity and a pair of kindred spirits, in the form of Fred Hassan and Carrie Cox, who were heading up Pharmacia and shared her ideas about developing customer-focused products. She joined the company as vice president of global business research. "This was a critical position at the company, with products like Detrol, which required the company to create white space out of nothing in the overactive bladder arena," says Richard Vanderveer, group chief executive officer of the GfK US Healthcare Companies. "She was part of the excellent management team at Pharmacia" (which, later on, would gain the nickname "the dream team").  

Sibley was handed a $56 million budget and charged with building an information group. At Pharmacia, she was able to talk market research with Fred Hassan in a way that he could understand. She gained buy-in to pioneer a big segmentation project and brokered a shared accountability by tying the bonus of oncology market researchers to the profitability of the oncology group. 

There was just one distraction: Six weeks after she joined, Pharmacia merged with Monsanto/Searle, which rearranged the building blocks of the company and the entire industry. Still, Sibley exceeded expectations. She cleaned up the post-merger mess and assembled a new group at breakneck speed, hiring 68 people in 16 months.  

For this new group, the chaos unfolded in a positive way. "Pharmacia had this colossal growth with all these new people coming in," says Maitland. "And at the end of that, all these people had done really well and loved her—it was fun working for Charlotte. And they bred another generation of people, who were also enjoyable to work with." 

It got Sibley a reputation—and a career path—as a sort of Johnny Appleseed of market research groups that mattered. She built one in Millennium in 2003 and then at Shire in 2005. 

These market research operations were previously seen as service providers. "It used to be a 'Here's what needs to be done—go do it' kind of thing," explains Wassihun Alemayehu, who worked with Sibley at Millennium and then joined her at Shire. But Sibley retooled them so that they were part of the product teams and could influence decision making. "Charlotte ensures that marketing research is integrated with the business team," says Alemayehu. "It isn't secondary technical expertise residing somewhere. It's about the business itself."  

At Shire, she created an intelligence unit that allowed the company to better leverage its specialty model through segmentation, patient flow models, and behavioral-based marketing. She also built the forecasting function she dreamed of—one which resided in market research, where she could assure its quality and integrity. "The secret to a good forecast is shared accountability with finance, marketing, and market research in terms of agreeing on the assumptions—what are the things that are going to drive this market," says Sibley. "It's not, as we used to say at Millennium, 'WNH'—that's wishing and hoping." With this model, Sibley went on to forecast the growth of Velcade within 1 to 2 percentage points year after year. At Shire, Sibley and her group forecasted the launch and sale of the new ulcerative colitis drug Lialda within 400 prescriptions—a personal best. 

You can't spend your life building high-powered market research organizations one after another without developing some people skills. For much of her career, talent management has been a passionate side project for Sibley. But in 2007, Shire formalized Sibley's passion into a new role, naming her senior vice president of leadership development. After years of sending human resources director Peter Lasky articles on leadership and the like, it took Sibley only about three seconds to consider the opportunity when he approached her with the offer. 

Sibley's philosophy has been to first find the right people—and then let them build the organization. "She brings in amazing employees everywhere she goes," says Anita Graham, chief administration officer and Sibley's boss. "She is into attracting and developing her people, having a vision for them, and helping them see their own vision for themselves."  

CEO Matt Emmens says Sibley's analytical approach is just what Shire needs to develop its people. The company grew 41 percent in 2007 and has hired 2,000 people over the past two years. It has made several acquisitions, changed the product mix, and consolidated the business. With all the commotion, it would be easy for anyone to get lost. "Our organization's culture is still evolving rapidly, and we have a large number of new employees who will need guidance and a place to touch base to figure out their growth," says Emmens, who is no stranger to the idea of leadership development. In 2006, he won HBA's 2006 Honorable Mentor award and recently published a book intended to motivate young people working in the biz. "We can't be in better hands, with Charlotte piloting and being the navigator of our people's growth."  

Sibley brings to her new role some tricks she learned along the way—about shared accountability, this time between employer and employee—and a culture of inspiring greatness through career development. For example, Bridget Cleff contacted Sibley when considering a career change. She had known her from Millennium, and Sibley gladly threw open her network of contacts. When Cleff came on board at Shire, Sibley offered her the chance to head up market research for the important Lialda launch. "It was the kind of opportunity that you sit and you wait for, that opportunity to work on a new brand in multiple countries," says Cleff. "Charlotte gave me the chance by saying, 'It's yours. Run with it. Make it happen.'"  

Part of that goes back to the finesse with which she influences others to  invest in their employees' development. "It's not just Charlotte who is supporting you," says Cleff. "She builds the culture so that people throughout our organization are committed to career development of the people on their team." 

Meanwhile, Sibley's first project in her new role is a program for senior management of Shire at Wharton. The course builds the cross-functional leadership that is needed to be competitive today and enforces the feedback loop.  

Features

Here's the saga of how market research, health outcomes, and dozens of other tools that connect the industry to patients came to be.

The Navigator: Charlotte Sibley

WIIFM is a favorite on everyone's dial. What's In It For Me is how an initiative gets built—why do it otherwise? Driving a new initiative for the firm, which is what leaders do, is tough to accomplish without knowing the WIIFM motivation. 

Results don't lie. "Excellence in execution is the only long-term competitive advantage," says Raul Cesan, former president and chief operating officer of Schering-Plough. Everyone wants to work for the company that moves ahead and stays on the cutting edge. If not driving upward, you're just a commodity firm, and there's nothing exciting about that. In order to drive the initiative, you have to show that there is something to be gained—something for you and for them.  

Cesan knew Claritin could do more than the 14 percent market share his team projected; he wanted 40 percent. "Too much," they answered. "Come back in a week with a number that can get us to 40 percent," he challenged. They put the numbers together and came back with a $200 million advertising budget. "Let's do it," Cesan said, to the amazement of the team. Claritin broke new ground with a direct-to-consumer advertising campaign for the prescription drug, won a 50 percent market share, and became a $3.5 billion blockbuster brand. Cesan's drive changed not only a single product launch, but also the shape of the entire pharmaceutical industry.  

Steve Jobs' aggressive and demanding personality was made legendary when 

 called him one of Silicon Valley's leading egomaniacs, but it was Jobs' innovation and style—combined with the aspiration to position Apple and its products at the forefront of the information technology industry—that led to the iPod success story. 

A CEO study by B-school professor Steven Kaplan and colleagues at the University of Chicago reports the tougher the CEO, the better—acknowledging that "harder" personal characteristics focusing on performance and execution are paramount to success. 

"When hard times came to the tech sector, we went to our investors and said, 'We're going to spend more on R&D and innovate our way out of this downturn.' We did, but it was rough," Jobs has said. 

After analyzing hundreds of extensive interviews with CEOs, the University of Chicago researchers found that successful chief executives were a hard-nosed lot who hired Grade A players, set high standards, and showed attention to detail, efficiency, problem solving, and persistence.  

Leaders with persistence who can perform with excellence and who have the courage to hire good people are the font of initiative momentum, motivating people to get ahead of the curve and realize better returns on faster timetables. It's up to you, the leader, to get your company moving. This is sometimes a matter of changing your focus. Competing with the number-one and -two contenders on a level field is not the best way to drive a new initiative if you are number four, and vice versa. Change the field instead; change the focus. As the company grows, so do you.  

Gillette has been number one in men's razors for so long that when the company made its last appearance on the New York Stock Exchange in 2005, over one-third of its value was in brand recognition. Why, then, does it continually cannibalize itself, developing a new razor to replace the previous top seller? Some will remember the Trac II, then the Mach3, Mach3 Power, and now the five-bladed Fusion and Fusion Power. The answer is that Gillette is never fat and happy; it strives to maintain number one. "Courage is key to effective leadership, which in turn drives critical innovations," says A.G. Lafley, CEO of Procter & Gamble, which bought The Gillette Company—Lafley's winning move to make P&G into the premiere consumer goods and services company in the world. Procter's people love working for Procter. It's good to be number one. 

How do leaders drive new initiatives and the "big idea" processes? Persistence never goes out of style. Persistence is the ability to see difficulty simply as territory through which you have yet to navigate. Make a believer out of yourself and transcend limits. 

 tomorrow. When you start to believe, it will begin to show—and others will believe too. I am convinced that, ultimately, the most important thing a person needs is total conviction that it can be done. Fight until you get it. 

It is interesting to note the ongoing human desire for rock-solid iconic leaders. The University of Chicago report ranked "softer" teamwork skills, such as flexibility, enthusiasm, and listening, at the very bottom of the desirable CEO traits. Leadership is the closest thing we have in our society to applied philosophy. Real leaders recognize the need to be surrounded by ambitious, passionate, bright achievers who will champion a new direction. When leaders are in sync with their followers, both sides are transformed by the experience of having a focused mission and overcoming a difficult obstacle. Expect that WIIFM will bring you joy, leading to a life of higher meaning and the ability to push your people to become more than they ever imagined possible. 

"A goal is a dream with an ending," said jazz legend Duke Ellington. Driving a new initiative takes single-mindedness, and to be able to execute on a field of excellence requires an incredible amount of concentration and vision. We must use every ounce of energy to accomplish what we want, even if that end takes us beyond our own lifetime. 

 is managing partner of Flaum Partners and chairman, Fordham Graduate School of Business, Leadership Forum. He can be reached at 

Leadership

Everyone likes to work for a successful company. But how do you drive your initiatives to the top? Never underestimate courage and persistence.

The WIIFM Initiative

Pharmaceutical manufacturing has become a global business, transforming the way drugs are produced, regulated, and marketed. Along with many benefits, this development carries added risks, as illustrated by the Baxter heparin case. It may make economic sense to shift heparin production to a land with millions of pigs and cheap labor. But that can open the door to product contamination or fraud. 

When Baxter International was hit by hundreds of serious adverse event reports earlier this year, including up to 20 deaths, it took the manufacturer, its supplier, and the Food and Drug Administration months to uncover the "root cause" of the problem. Baxter had to recall thousands of vials and shut down production of heparin, a blood thinner used by thousands of patients undergoing surgery and kidney dialysis. Soon after, similar adverse events prompted recall of heparin made in Germany, but with ingredients from a different supplier. 

Although the cause of contamination was initially a mystery, the fact that Baxter's API (active pharmaceutical ingredient) came from China quickly captured national attention. With unsafe Chinese food, toothpaste, and drugs making headlines, the media had a field day running stories on how small Chinese operators process an extract from pigs' intestines into crude heparin.  

Compounding the problem was the unexpected discovery that FDA never inspected API manufacturer Changzhou SPL, nor did Chinese regulators (see sidebar). At a contentious hearing in February before the House Appropriations subcommittee that approves FDA funding, chair Rosa DeLauro (D-CT) termed the heparin-inspection error one more example of "FDA's myriad failures" in dealing with drug safety issues. Rep. Frank Pallone (D-NJ), chairman of the House Energy and Commerce Health subcommittee, said the inspection error reflects "sloppy work" and "carelessness that seriously jeopardized the health of American patients." 

Certainly the heparin debacle highlights FDA's difficulties in overseeing a fast-expanding volume of imported drugs and medical products. FDA officials admit that their tracking system is so obsolete that they have only a vague idea of what drugs are manufactured where and which overseas facilities have been inspected. The House Energy and Commerce Committee held a hearing last November on FDA's inability to monitor imported drugs and active ingredients, and the heparin debacle has fueled that ongoing investigation.  

The case also focused attention on FDA's preapproval inspection (PAI) program, which has narrowed in recent years as part of agency efforts to reduce redundant site visits and to target inspections to higher-risk products. E&C subcommittee chair Bart Stupak (D-MI) said that if FDA fails to adequately assess new drug production, Congress might consider legislative changes that would "prohibit the marketing of any drug from a plant that has not been properly inspected."  

Such a statutory PAI requirement would further stress FDA's depleted field inspection operations. About 80 percent of drug APIs come from foreign manufacturers, reported Janet Woodcock, FDA deputy commissioner and acting director of the Center for Drug Evaluation and Research (CDER), at the Appropriations hearing. However, the agency now inspects only about 10 percent of foreign drug producers due to inadequate field force funding. 

"We have raised red flags for years" about the overseas shift in drug manufacturing and clinical trials," Woodcock commented. Although imports of finished drugs now are much lower than for APIs, she predicted that this "is going to change" as operators in "many regions of the world have indicated that they want to take over drug manufacturing." FDA says it conducted a record 1,000 inspections of overseas facilities last year. But it cannot sustain that volume without hundreds of additional inspectors and an updated data system to better control drug imports into the United States and to ensure product quality.  

A coalition of agency advocates is campaigning to boost FDA's budget significantly, but Congressional support is mixed. While DeLauro backed added funding to support FDA's mission, she also insisted that FDA first improve its management and operations. "All this agency ever does is cry about resources," she complained, noting "serious negligence" in using what it does have to enforce regulations.  

Even with more funding, FDA Commissioner Andrew von Eschenbach acknowledges that FDA can never inspect every production facility around the world. He looks to strengthen ties with foreign regulatory authorities to enhance FDA's ability to respond quickly to safety problems. When FDA inspectors sought to examine Chinese upstream pig processors that make crude heparin, it helped that US and Chinese health officials had signed a memorandum of agreement (MOA) last December supporting regulatory cooperation. FDA hopes to establish regulatory offices in China and in other regions of the world as part of the "FDA Beyond our Borders" initiative to boost US regulatory presence overseas.  

At the same time, FDA had to tread lightly with Chinese officials anxious to save face. Last year, the Chinese government executed the former head of the State Food and Drug Administration (SFDA) for fraud in approving unsafe drugs, and Chinese regulators bristled at speculation that widespread pig disease may have contaminated China's heparin supply chain. SFDA officials insisted that they strictly regulate chemicals used in pharmaceutical products and emphasized that importing countries and companies are responsible for ensuring product safety and quality. 

US regulators agree that government agencies are not solely responsible for the quality of drug products, whether imported or not. Although FDA inspects API manufacturers, the agency still relies on industry product testing, and most foreign regulators leave API monitoring entirely to manufacturers. 

At a February conference on FDA enforcement sponsored by the Food and Drug Law Institute, David Elder, director of FDA's Office of Enforcement, emphasized that the manufacturer of the finished product has to take responsibility for problems with drug quality or safety. Too often, he said, manufacturers want to blame suppliers for product failures. He pointed to pharmaceutical companies in asserting that FDA "will continue to hold them accountable" for such problems. 

Under the Food, Drug and Cosmetic Act, the marketer of a finished drug product is ultimately responsible for quality and safety, even if a contractor is at fault, explained Eric Blumberg, FDA deputy chief counsel for litigation. Peter Arduini, president of Baxter's Medication Delivery business, acknowledged that Baxter takes "this responsibility to produce quality products very seriously."  

An earlier FDA inspection of Changzhou probably would not have prevented all these problems, whether the contamination was intentional or just an error. Baxter had been using heparin API from China for several years without any serious reactions. But the crisis illustrates the risks as well as benefits of international sourcing—and the challenge for FDA in retaining its "gold standard" regulatory status. 

's Washington correspondent. She can be reached at 

Washington Report

International outsourcing carries risks for marketers and regulatory challenges for FDA

Supply Chains Without Borders

In recent years, the pharma industry has taken a pounding from a wave of federal whistle-blower lawsuits. These cases, focused largely on allegations of pricing improprieties, off-label marketing, kickbacks, and other Medicare fraud violations, have forced companies to pay $2.5 billion in settlements. 

But that amount may pale in comparison to payments that could result from a little-noticed provision in the Tax Relief and Health Care Act. Enacted in December 2006, the legislation amended Section 7623 of the Internal Revenue Code to increase the size of whistle-blower rewards, provide whistle-blowers a process to challenge the size of the reward, and establish a whistle-blower office within the Internal Revenue Service to handle and track whistle-blower cases.  

Congress decided it needed to up the ante to get more insider information about tax fraud in order to help close the "tax gap"—the difference between the amount companies and individuals owe in taxes and the amount actually paid. Like all US government agencies, the IRS has limited enforcement resources. And while the number of companies the IRS audits is growing, the odds of corporations getting caught for tax underpayments is still very low. In 2003, the IRS audited 7,125 large corporations (those with more than $10 million in assets). In 2006, that number grew to 10,591. However, Congress is counting on larger whistle-blower rewards and the new IRS whistle-blower office to increase the odds of catching tax scofflaws.  

"One well-positioned whistle-blower could expose millions of dollars of fraud," said US Senator Charles Grassley (R-IA), who authored the new whistle-blower tax-fraud law. "It might take IRS auditors years to catch that much cheating on their own." 

The new provision in the Tax Relief and Health Care Act follows a similar whistle-blowers' reward provision in the 1986 False Claims Act, which convinced thousands of insiders to report non-tax fraud against the government, particularly in the defense and health industries. The government has collected more than $11 billion as a result of these whistle-blower cases (also known as "qui tam") and has paid whistle-blowers rewards totaling more than $1.8 billion. However, the False Claims Act specifically exempted tax fraud from the kinds of cases covered under the statute.  

These provisions for whistle-blowers in the Tax Relief and Health Care Act will offer a huge incentive to employees thinking about blowing the whistle—employees who can now hope to reap tens, if not hundreds, of millions in tax cases. Before the new tax law, the IRS rarely paid rewards to whistle-blowers. When it did, the reward was small—from 1 to 15 percent—and whistle-blowers had no recourse if they disagreed with the amount.  

Under the new law, the IRS offers whistle-blowers 15 to 30 percent of the total amount it collects—including taxes, interest, and penalties—as a result of information given. The incentive is targeted to employees working at companies that have defrauded or underpaid the IRS by more than $2 million. What's more, whistle-blowers also may challenge the amount of their awards in federal Tax Court. Such judicial scrutiny will likely bring increased accountability and transparency to the IRS' whistle-blower program.  

Finally, whistle-blowers don't have to be citizens of the United States—which thereby opens the reward to foreign employees of multinational companies. The IRS has pledged to keep the whistle-blower's identity confidential. This makes it even easier for whistle-blowers to report tax fraud without fear of retaliation or harassment from their employers.  

The pharma industry's profitability has caught the IRS' attention—and made it a target. But what really puts the industry at risk is the global nature of the business. There are very large differentials in tax rates between countries, and this can create opportunities for improper tax reporting. 

In its enforcement efforts, the IRS has placed transfer-pricing violations—the ability to shift reported income between affiliated companies—high on its enforcement agenda. Transfer-pricing laws require that intercompany transactions, particularly between foreign and domestic affiliates, are valued at "arm's length," so that company revenues are appropriately allocated between foreign and domestic entities. Misallocation of revenues may shift income that is taxable in the United States to a related foreign affiliate that is taxed in lower-rate jurisdictions. Billions of dollars in US taxes are lost to such transfer-pricing irregularities. 

The complexity of many intercompany transactions and their relative lack of transparency make transfer-pricing compliance and enforcement particularly challenging—but the reward makes it a worthy pursuit. For example, GlaxoSmithKline paid $3.4 billion in September 2006 to settle a long-running transfer-pricing dispute with the Internal Revenue Service and agreed to abandon a refund claim for $1.8 billion. The controversy concerned intercompany transactions over the previous 17 years and charges that GlaxoSmithKline shifted profits from its US to its UK affiliate. The IRS contended that this resulted in the substantial underpayment of US taxes. 

"We have consistently said that transfer pricing is one of the most significant challenges for us in the area of corporate tax administration," said Commissioner of Internal Revenue Mark Everson when he announced the Glaxo settlement.  

Although the GlaxoSmithKline settlement predates the new tax whistle-blower law, the law's powerful financial incentives are likely to expose similar large underpayments or fraud schemes.   

That was the case last February, when Merck paid $2.3 billion to settle its battles with the IRS over taxes relating to minority equity interest financing transactions and loans from a foreign subsidiary to Merck. The 

 reported that Merck transferred valuable patents to a subsidiary in tax-favorable Bermuda, and then paid its subsidiary for use of the patents. This resulted in a reduction of $1.5 billion in US taxes over a 10-year period. 

Among many other questionable practices are schemes involving mischaracterization of taxable gains in connection with asset sales or other divestiture transactions, abusive schemes involving the misuse of net operating losses, and mischaracterization of US source income of taxable entities.  

Pharmaceutical companies may want to consider taking steps to minimize the potential whistle-blowers' need to go outside the company to report questionable tax practices. In many cases, whistle-blowers report the fraud to the government only after they've tried going through their supervisors and managers to stop the practices and have been retaliated against or fired for their efforts. 

Ensuring a vigorous and meaningful compliance structure specifically for tax compliance that covers the corporate parent and all foreign subsidiaries might be beneficial. This would include integrating measures that would allow for anonymous or confidential internal reporting and real guarantees by employers of nonretaliation. Independent board oversight of this internal reporting function at pharmaceutical companies could be important to ensure that tax compliance receives due consideration throughout the organization. 

The new law is set to expose hidden tax-avoidance practices by corporate America—and pharma companies are high on the target list. In fact, the promise of big rewards has already persuaded industry insiders to provide information to the IRS that exposes tax-avoidance practices.  

"They're coming in with big, fat piles of paper, and they have, at least on the surface...some credibility about the information they're bringing to us," said Stephen Whitlock, director of the new IRS whistle-blower office, in an interview last year. 

 is a lawyer with Phillips & Cohen LLP. She can be reached at 

Legal

A little-known provision in a new law rewards employees for blowing the whistle on tax fraud. Pharma should examine its tricky tax situation-and work out the issues on a global level.

Mind the (Tax) Gap

The folks in biotech have a saying, "The process is the product." In their world, drugs are so complex and difficult to characterize that you can't just run a set of simple chemical tests to ensure that what comes out of the bioreactor today is the same thing that came out a month ago. Instead, you have to develop a rigorous process and stick to it absolutely. There are chemical checks you can make, and they're getting better all the time, but in the end, the way you assure that you've got the right product is to stick to the process. They're thinking of process in the narrow sense—maintaining cell lines, monitoring temperatures, carrying out purification processes, things like that. But as the past few weeks have reminded us, process can mean a whole range of things—who you buy supplies from, who they buy their supplies from, how your raw ingredients are treated, and, of course, what you do to ensure that no one ekes out your active ingredient by loading it up with counterfeit APIs and contaminants. 

That, of course, is what happened to Baxter. Somewhere along the chain of actions that leads from hog guts to heparin—an old and valuable anticoagulant—someone apparently mixed in a cheap chemical based on chondroitin sulfate, a commonly used dietary supplement made from animal cartilage. As we went to press with this issue, FDA and Chinese officials were still investigating, but it was impossible to doubt that the contamination was deliberate, the result either of an attempt to cut costs or of an unscrupulous vendor sneaking the chemical into the supply chain. 

The heparin case is the subject of a story in this month's 

written by Senior Editor Walter Armstrong (see "Chinese Puzzle"). Walter makes the case that if the heparin contamination is in fact counterfeiting, as it seems to be, it represents counterfeiting on a whole new level. This is not a matter of substituting deadly but cheap ethylene glycol for glycerine (as one Chinese manufacturer did not so long ago). In this case, some clever chemist identified a cheap product that could be made to resemble heparin, then chemically modified it so the resulting product could pass all the standard tests of purity. It's fraud on a molecular level—an appalling waste of human skill, talent, and ingenuity in the service of greed and destruction. 

It's essential for pharma to protect itself against this sort of crime—not least because FDA and others are making ominous rumblings about criminal prosecutions for executives whose products go bad, whether the defect was deliberate or not, and whether the executive knew about it or not.  

But how? It's really not reasonable to expect that chemical testing will be adequate to thwart deliberate deception—in the heparin case, FDA and Baxter had to use state-of-the-art technologies to simply locate a contaminant it knew was there. Biologics are intrinsically complex and resistant to definitive analysis. 

In the long run, the answer is probably going to be the classic biotech answer: If you want your product to be pure, control the process. But as Walter's story demonstrates, that won't be easy. In the heparin case, the Chinese government argued that it had no responsibility for supervising exports. And suppliers on the upstream side said they couldn't or wouldn't inspect their vendors. To get the Wild East under control will be the work of decades. But it has to happen. If you lose the process, you've lost the product. 

From the Editor

The real question in the Baxter heparin scandal is not who's guilty but whether pharma can get reliable results from a country in chaos

Molecular Fraud

Pharmaceutical marketers spend enormous amounts of time and effort defining product positioning and building brand characteristics. But, given the fact that pharmaceutical products are marketed to physicians, should we not devote similar time and effort developing the science brand?  

Educational research has shown that the visual sense accounts for up to 90 percent of how we acquire information, a finding that is certainly not lost on advertisers. But while physicians have many characteristics in common with other consumers, they are a distinct subpopulation with a unique perspective and a specific way of processing information that is shaped by decades of scientific training and experience. The language of science is part of the social anthropology of physicians. In order to communicate effectively with physicians, one should consider how they process information, view body processes, and envision pharmacologic principles.  

Physicians are trained to view human physiology as a complex but inherently logical system of homeostatic balance that is far more intricate, sophisticated, and elegant than even the most elaborate computer system. A fundamental rule of nature is that body processes contain complex "yin and yang" systems of balance. Given their training, physicians anticipate this form of relationship when learning about new ideas in physiology and pharmacology. Novel ideas make intuitive sense to physicians when presented through the perspective of homeostasis and evolutionary drive. The most effective science branding takes advantage of this view of nature and presents ideas in a way that is consistent with the physician's view of how the body works.  

This principle of using ideas that are familiar to physicians can be applied to almost every product area and can help to create a clear, concise, and sustainable impression. Just as lexicon development is part of launch preparation, a similar process can also be applied to the process of building your science brand.  

In the top illustration, the diagram of arachidonic acid has a bobby pinâlike structure. The shape was immediately recognizable to many physicians and became a foundational element in the designs. The bottom image displays rudimentary sketches for what eventually became fully realized, beautiful animations. 

Professional marketers must use technology and visual design to make the science come alive for physicians. The market preparation prior to the introduction of the first COX-2 inhibitor was a good example of how visual design can be used to make complex ideas simple, clear, and intuitive. COX-2 is an inflammatory enzyme that produces prostaglandins that cause pain and swelling.  

The idea for developing a COX-2 inhibitor was based upon the discovery that the COX enzyme has two different forms, COX-1 and COX-2. Because this was new science at the time, an enormous amount of education had to be accomplished well in advance of product launch. The science was based upon arachidonic acid metabolism, a topic that is about as unexciting as they come.  

Essentially, marketers needed to create professional promotional materials that said, "COX-1 is important for normal health. COX-2 produces inflammatory prostaglandins that cause pain and inflammation. Aspirin and NSAIDs block both the good and bad COX enzymes. COX-2 inhibitors spare the normal enzymes while blocking the inflammatory enzymes." 

The designs for the COX enzymes were developed in collaboration with the scientist who discovered the two forms of this enzyme. His work showed the COX enzymes to be funnel-like structures with a central enzymatic channel through which arachidonic acid enters and prostaglandins emerge.  

Talk to MDs in their language and build a better brand

Pharmaceutical Executive-04-01-2008

Valuing Diversity

Tracking Pharma Consumers Online

Putting the "I" in "Team"

The Navigator: Charlotte Sibley

The WIIFM Initiative

Supply Chains Without Borders

Mind the (Tax) Gap

Molecular Fraud

How to Wow the Docs

Money-Back Guarantee

The Hispanic Factor

Chinese Puzzle

British Biotech Blues

Let's Play Pharmazooticals

Molecular Fraud