Identifying and acting on the risks developing in the major markets in light of COVID-19 disruption and the implications for assets in late-stage clinical development and early commercialization.
As the global markets react to COVID-19, disruption to travel, communication, and consumer behavior is a set-back for companies looking to launch and commercialize new assets in any industry. This is particularly significant in healthcare, where these assets are borne on long development cycles, massive R&D investment, and a unique need to reach patients awaiting treatment. In this article we assess the risks developing in the major European and US markets in light of COVID-19 disruption, the implications for assets in late-stage clinical development and early commercialization, and present some next steps for pharmaceutical companies to identify and act on these threats.
When considering the COVID-19 impact on new asset commercialization in healthcare, planning must recognize that the threat is multi-faceted and constantly progressing. Considering the launch timeline of any product, we have identified three key risk areas; clinical development, the regulatory process, and HTA and price negotiations, though the extent and impact of each of these can vary significantly by therapeutic area and even across individual markets.
Products under clinical trials face the threat of delays to patient enrolment, with GlobalData estimating that over 420 clinical trials1 have been impacted, delayed or suspended due to COVID-19 by April 9th. Correspondingly, reports of a study from Clinical Research IO2 suggests 24% of physicians have stopped enrolment due to safety concerns, and a further 37% are considering the same. The messaging from companies themselves follows a parallel vein, and we expect more to be forthcoming; Eli Lilly, Bristol Myers Squibb, Vertex, Moderna, Galapagos, and a multitude of smaller biotechs3 have announced delays to the start of new clinical trials, or suspension of enrolment in ongoing studies.
Enrolment or data collection delays are not expected across all clinical trials, particularly for late-stage trials which have completed enrolment or large cohort trials utilizing digital tracking, such as J&J’s Heartline Study4, but these still face potential loss of patients to follow-up or delays in analysis. Notably, regulatory agencies are expecting an increase in protocol deviations and communicating that as long as these are documented, they will not be considered as serious breaches.
Even if a product has completed pivotal trials and has submitted dossiers to the regulatory agencies, they may still face delays in achieving marketing authorization. Like all organizations, these agencies have been adjusting to adapt to the new constraints, whether through digitalization by moving meetings to virtual platforms, prioritization of COVID-19 diagnostics and treatments in the appraisal process, or suspending accompanying activities, such as manufacturing site inspections.
The EMA has rapidly transitioned to virtual meetings, announcing early in March that all committee meetings will be conducted virtually, and expects no impact on its core activities for the assessment of new medicines and pharmacovigilance of marketed products. To date, no delays have been seen, with the CHMP completing its March meeting5 on schedule and recommending approval of 8 new treatments, including Novartis’ Zolgensma, and 6 indication extensions.
Conversely, the FDA was forced to postpone or cancel public meetings, including advisory committee meetings6 for GSK’s Trelegy Ellipta, Eli Lilly/Avid Radiopharmaceuticals’ F18-flortaucipir, and Intercept’s Ocaliva in NASH. It is considering, but yet to confirm, utilizing virtual platforms to minimize further disruption. The CDER has also acknowledged the possibility of de-prioritization of non-COVID-19 related activities in divisions including the antiviral, critical care, and pulmonary review groups.
HTA and price negotiations
With respect to pricing and market access processes, some major markets have announced that they will prioritize COVID-19 diagnostics and treatments. As a consequence non-COVID-19 therapies will see delays in terms of appraisals and negotiations:
• The Transparency Committee in France has moved to virtual meetings and has published a list of prioritized topics for HTAs: oncology, pediatrics, and indications with no therapeutic options; others may be delayed. The CEPS cancelled several committee meetings but resumed in a virtual format as of last week; it has since published guidance that it will prioritize market access proceedings for “indispensable” products and that manufacturer hearings will be postponed.
• In Germany, there is minimal disruption expected with the G-BA migrating oral hearings to virtual platforms and both the G-BA and GKV-SV expected to maintain the existing schedule.
• The latest emerging from Italy is that AIFA has initially moved to managing submissions and negotiations by email. Aside from prioritization of COVID-19 clinical trials in Italian hospitals, there is no clear guidance on non-COVID-19 prioritization policies.
• The GCPT IPT development process in Spain has been disrupted, with low unmet need therapeutic areas expected to be deprioritized. The CIPM price commission is not expected to meet in April, with future meetings facing uncertainty.
• NICE has migrated to a virtual platform and besides COVID-19 appraisals will prioritize appraisals considered “therapeutically critical” to the UK market, defined as oncology, except for Cancer Drugs Fund reviews, and a select number of non-cancer medicines.
• In the US, while there have been no direct statements from payer organizations, we would expect forthcoming delays as P&T committee are transitioned to virtual platforms.
While it is too early to define accurately what the eventual impact on the launch timeline of new products will be, companies should be conducting rapid audits on late-stage pipeline products to identify the implications for their commercialization opportunity and timelines. The factors that drive these delays are not uniform across all indications and markets and so we must expect significant variation in impact, even for the same product in different markets.
Determining that there will be a timeline impact is the first step in the process; we must consequently recognize the implications and revisit existing commercialization planning. Late-stage clinical trial assets earlier in the process have more flexibility to adjust strategy, potentially utilizing the opportunity to generate additional data, improve messaging or preparedness, and create contingency plans. Products which have already submitted dossiers to regulatory agencies are now more constrained in their maneuverability; however there is always opportunity to reassess and identify emerging threats.
Launch timeline & sequence
First and foremost, changes to the clinical trials and regulatory delays will have an impact on the ability to submit dossiers, conduct negotiations and secure access and reimbursement. As we have discussed, this may vary significantly across markets due to prioritization inconsistencies; one can envision a product being delayed in Market A, but achieving the target launch timeline in Market B.
This delay can lead to price publication in Market B first, a reversal of the launch sequence identified in the commercial planning. Depending on the price potential across the markets, this reversal may result in undue negative pricing pressure in Market A, a fall in the achieved net prices, and long-term loss in revenue potential. Consequently, pharmaceutical companies should reassess country launch waves and cross-country launch sequencing in light of any COVID-19 delays.
Market Access and Commercial teams should additionally collaborate with Competitive Intelligence teams to reassess the competitive landscape and expected launch timeline for competitor products; opportunity lies for those who can minimize the commercialization disruption for their own product, and accelerate their launch sequence relative to the wider market. Conversely, for products launching with competitors close behind, any delays can increase the risk of parallel negotiations and increased pricing pressure, especially in markets with loose negotiation timelines.
Pricing & market negotiations
Secondly, products which have initiated the appraisal process in markets face delays and uncertainty to the negotiation process. Regulatory and HTA bodies are still defining which products are on their prioritization lists, and negotiation teams face uncertainty on when negotiations will take place and the format of discussions. Some markets have quickly adapted to virtual meetings with minimal timeline disruption for appraisals while others have adopted virtual but are postponing all de-prioritized appraisals. At present, no major market aside from Italy has adopted a model of email-based negotiations, which is likely to have the largest impact in slowing processes.
Even for those markets utilizing virtual meetings, the negotiation teams must rapidly adjust their preparations from face-to-face to a virtual platform. Reduced ability to communicate within your own team, lack of non-verbal cues and ability to ‘read the room’, lack of collegiality and small talk before and after the meeting, and even the basic issues with virtual platforms will cause disruption and difficulties for the negotiating team-the CEPS Vice-President referred to some first virtual meetings with manufacturers as “slightly chaotic”.
Finally, the opportunity for field-facing teams (i.e. Sales and Medical Affairs) to conduct market shaping activities including awareness and advocacy engagements and physician and payer education has been constricted by COVID-19 restrictions. Physician availability has been reduced even in therapeutic areas unrelated to infectious disease or emergency care, as healthcare professionals from across all specialties are drafted into the effort to manage the outbreak. HCP office closures have effectively halted face-to-face meetings, leading to a greater use of alternative media such as phone calls, virtual platforms, and digital interactions. In addition, the cancellation of major healthcare conferences has reduced networking and data socialization prospects. To compound these issues, patients are avoiding non-essential physician visits, resulting in fewer prescriptions being written, and they are not filling less urgent prescriptions to avoid pharmacy visits.
As the need for continued access to stakeholders is paramount, companies that have existing investment in digital marketing solutions are in a very strong position to adapt quickly to this disruption and fully transition their communication into these channels. Conversely, any loss of contact will diminish short-term brand awareness and reduce initial uptake, particularly for non-urgent interventions or interventions for asymptomatic conditions. While established brands may be more immune to a reduction in interactions, sales representatives are still key to driving brand awareness and overall performance for new products. Failure of products to meet sales targets can further lead into perceptions of ‘failed’ launches when the overall market returns to stability, albeit with new and different dynamics than the market reality we left pre-COVID-19.
Reflecting on the implications of COVID-19 in healthcare demonstrates there is a need to act, and it is obvious that action plans will need to be adjusted frequently as a function of the extremely dynamic situation. It is how pharmaceutical companies react now in these uncertain times that will define the success, or failure, of upcoming product launches. Each product will require a distinct response, but actions should include:
Global, regional and even market-specific launch strategies and timing should be reviewed for sustainability in the face of emerging commercialization threats. Contingency plans should be established for the most likely scenarios to enable effective adjustments in the face of a rapidly changing COVID-19 background.
Prioritization lists and policy papers are emerging in key markets, however local affiliates must ensure rapid transfer of any threats to global commercial teams to collate, adjust and refine strategies as appropriate. Designate champions per market to monitor and report pertinent information on any regulatory changes.
Market prioritization and launch sequence modelling should be revisited to assess the impact of any identified delays; key price referencing markets should be identified and threat mitigation strategies developed to ensure any negative cross-country pricing pressure is quantified and acted on as necessary.
Negotiations conducted virtually will present new challenges, even for the most experienced negotiating teams. Virtual negotiation playbooks and mock negotiations will enable affiliate teams to practice for a new setting, while reassessment of market policies and negotiation teams may identify opportunities to involve additional actors.
Digitalization of healthcare communication has been discussed at length, however many companies remain in the nascent stage, with a theory and desire but no implementation plan. A complete response to COVID-19 requires the rapid deployment of digital communication channels towards both prescribers and payers to ensure medical, market access, sales, and public affairs teams can get the message out.
Delay to commercialization timelines and severe limitations in face-to face interactions does, however, not mean a loss of opportunity. While payers and physicians may currently have their focus on COVID-19 and its impact on public health, manufacturers can utilize this time to pressure-test product differentiation and launch approach. This is the time to anticipate the market realities post-COVID-19: how they will impact existing brands, how to revise and re-vitalize current brand strategies, how to rework key communication messages, what changes to make to media-mix, and how to train field-facing teams to be ready to execute.
Robert Dumitrescu is Partner, Simon-Kucher & Partners (Paris), Dr. Marc Matar is Partner, Simon-Kucher & Partners (London), Dr. Dr. Rainer Opgen-Rhein is Senior Director, Simon-Kucher & Partners (Munich), and Dr. Samuel Calderwood, Consultant is Simon-Kucher & Partners (London).
AIFA [Italy]: Agenzia italiana del farmaco (Italian Medicines Agency); CEPS [France]: Comité économique des produits de santé (Economic Committee for Health Products); CIPM [Spain]: La Comisión Interministerial de Precios de los Medicamentos (Interministerial Medicinal Products Pricing Committee); G-BA [Germany]: Gemeinsamer Bundesausschuss (Federal Joint Committee); GCPT [Spain]: Grupo de Coordinación del Posicionamiento Terapéutico (Therapeutics Positioning Coordination Group); GKV-SV [Germany]: Spitzenverband Bund der Krankenkassen (National Association of Statutory Health Insurance Funds); NICE [UK]: National Institute for Health and Care Excellence.