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A deep-dive into how pharma companies can apply service operations principles to achieve a greater level of marketing and promotional review committee satisfaction.
A common source of frustration across many pharmaceutical and medical device (“life sciences”) companies is the process for approving promotional material (“promotional review committee process” or “PRC process”). This article recognizes the PRC process for what it is, a service provided by the clinical, legal, and regulatory affairs departments to the marketing department and the organization as a whole. By managing the PRC as a service function, this article will show how to apply service operations principles to achieve predictable outcomes, which will lead to greater marketing and PRC satisfaction.
Why PRCs are a service business. When a business sells a physical good like a car, the customer receives the product after it has been created by the manufacturer. In contrast, in a service business, the customer is involved in the creation of the service. A hair salon is a good example.The customer first describes the desired outcome and then participates in the service as the hairstylist performs the work. This co-creation of service introduces variabilities that can negatively affect the quality of the service being provided. Such variabilities will be described further below.
In life sciences companies, the PRC process begins with marketing drafting promotional material and then submitting the material to the PRC for review and approval.In the PRC process, marketing is the customer and the service providers that compose the PRC are the regulatory affairs, clinical, and legal corporate functions. The PRC process is a service provided by regulatory affairs, clinical, and legal to marketing. Although the final PRC deliverable is indeed a tangible good (the final, approved marketing piece), the internal customer (marketing) is involved in the creation of the final product. Therefore, PRCs should be managed like a service business, where service operations principles should be applied for optimal results.
Substantive background of why PRCs exist. In the Life Sciences industry, promotional materials are regulated by the U.S. Food and Drug Administration (FDA). The FDA has the authority to enforce companies to remove the marketing pieces from distribution. This results in higher promotional costs as a company removes the offending material from the marketplace and creates new, replacement pieces.
Separately, the U.S. Department of Justice can point to a Life Sciences company’s promotional material to show a pattern of more egregious conduct that can potentially lead to lawsuits against the company. Such lawsuits have cost companies hundreds of millions of dollars and have tarnished their reputations, thereby lowering their stock price.
For these reasons, the PRC process is an important part of every life sciences company’s business operations and if not managed properly, can lead to employee frustration, commercial launch delays, and unnecessary costs.
PRC service creation process. Because of the potential government scrutiny, the industry practice is to form an internal cross functional team (PRC) to serve as the organization’s governing body for review and approval of promotional material. Its purpose is to ensure that the company’s promotional material is accurate and complies with applicable laws and regulations.
The PRC process begins when marketing drafts the promotional material and then submits it to the PRC for review and approval. The PRC returns the material to marketing either as approved or with comments and questions. After marketing satisfactorily addresses the PRC’s comments, the PRC signs-off and marketing is free to use the material in the company’s promotional campaigns. Because the PRC process is a service, variabilities can arise that are typical of service businesses. Such variabilities are described below.
Variabilities caused by the co-creation of promotional materials. Variability in a service (in this case, the PRC process) can be caused by either the customer (marketing) or the service provider (PRC), although the sources of variability differ. Nine variability challenges pertinent to PRCs are listed in Table 1.
Marketing induced variabilities. Marketing induced variabilities are discussed next and consist of: arrival times, capability, effort, and subjective preference.
Marketing promotional material arrival times. Marketing creates promotional material when the business need arises, not necessarily when the PRC is available. If promotional material is created at random times and is expected to be approved at such random times, this requires the PRC members to be readily available to serve the customer, marketing. This means that the PRC members must have some degree of idle time, in order to accommodate the review of promotional material at each random time. This is costly for companies because these PRC functions are not revenue generating functions.
Marketing’s capability. Part of the PRC service experience depends on the quality of the initial piece submitted by marketing. If marketing is not well versed on the clinical, legal, and regulatory affairs requirements, the piece will be edited extensively by the PRC. This is frustrating for both the PRC and marketing because more time is required for further reviews. Marketing is further discouraged because the edits can make the promotional material look substantially different than what marketing intended, thereby reducing the chances of it reaching its goal.
Marketing’s effort. Even if marketing is effectively trained or is aware of the legal, clinical, and regulatory affairs requirements, marketing may not put in the time to create a marketing piece that meets these requirements. This can then lead to lengthy reviews and edits by the PRC, causing more work for the PRC to edit the piece.
Individual (subjective) preference variability within marketing. Individual marketing staff members may prefer different content in marketing pieces. If an individual marketing staff member and the PRC agree to a decision regarding specific content, this sets a precedent for future materials with that same content.
In service businesses, the unpredictability of outcomes is not only caused by the customer, but also by the service provider. The five service provider induced variabilities that apply to PRCs include: turnaround time completion, expertise (capability), effort, subjective preference within the same function, and unclear roles and responsibilities. These variabilities are described below.
PRC turnaround time completion. Marketing has expected deadlines when it wants a marketing piece to reach external customers. When the PRC does not complete its review or approval within the committed turnaround time, this creates unpredictability for Marketing to meet its commercial timelines. Such delay can negatively impact product launches, promotional campaigns, and ultimately revenue.
PRC expertise (capability) and PRC effort. If a PRC approver does not have the required expertise to clearly articulate a consistent rule or standard, marketing will not know what rule/standard will be applied and how such rule/standard will be applied consistently. This leads to an inconsistent and frustrating review process with marketing being unable to predict what will and will not be approved. Sometimes the PRC approver will not approve a marketing piece by asserting that the piece creates a “risk”* for the company, without defining the risk or providing evidence/data to substantiate the risk. (*Note: The term “risk” is intended to mean that the U.S. Government may misinterpret the language in promotional material to be non-compliant with FDA regulations or applicable laws.)
Individual (subjective) preference variability within PRC corporate functions. What may occur is that language in promotional material is approved by one member of a corporate function, but then later disapproved by a different member (within that same function). This leads to a lack of predictability for Marketing, who expects a consistent outcome from the PRC. Marketing relies on previously approved pieces as precedent when creating promotional material. However, when the requirements vary per individual PRC approver within the same function, this leads to unpredictable outcomes.
Unclear roles and responsibilities across PRC approvers. Regulatory affairs is looking for regulatory infractions that could lead to an issue with the FDA. Legal is looking for issues that may lead to lawsuits against the company. A problem can arise if a specialist in one area attempts to override a decision outside their purview. This causes unpredictability if it is unclear which PRC function has the authority to make the final decision for a given issue. This unpredictability extends the review timeline and can lead to missed deadlines if the decision maker is identified on an ad hoc basis.
Table 2 outlines how the sources of variability described in Table 1 can be reduced in clearly articulated operating rules.
Conclusion. Promotional material in the life sciences industry is closely scrutinized by the U.S. Government. Because of this, the creation and approval of Life Sciences promotional material is a much more time consuming and unpredictable process compared to other industries.However, by recognizing that PRCs are performing a service and by operationalizing the PRC process in a manner applicable to service businesses, the predictability of outcomes can be increased. More predictable content in marketing pieces can lead to timely delivery of such pieces to external customers and less frustration between marketing and the PRC.
Jessica Akers, JD, MBA is a senior attorney in the pharmaceutical and medical device industry. Her opinions are her own and do not constitute legal advice. She can be reached at firstname.lastname@example.org.