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Five key areas biopharma manufacturers focus on to predict where the markets will be and determine how standards of care will evolve to effectively position new products.
New products undergoing clinical development in biopharma today face significant uncertainties around post-approval success. Rapid advances in science and technology are fundamentally altering the competitive landscape and biopharma companies risk falling behind. For example, novel gene therapies that offer curative potential could leapfrog competitors who are still developing disease-modifying or combination treatments, or encounter reimbursement delays in the absence of compelling outcomes data. Many of these products in clinical development could become obsolete even before they get approved.
Changes in healthcare policy, and systemwide cost pressures exacerbated by heightened political and social pressures will make future market access even more uncertain. Key stakeholders (patients, providers, payers, and policymakers) who are feeling these pressures, are unable to address the quality care vs. cost of care conundrum because of the fragmented nature of the healthcare marketplace in which stakeholder incentives are misaligned. Radical changes to the system, driven by innovation and competition, are warranted to make healthcare markets efficient and effective.
The FDA approved 59 novel drugs in 2018 and an additional 33 year-to-date in 2019. Many of these recent approvals were in highly competitive therapeutic areas, such as oncology, where product positioning and differentiation are challenging. Adding to the complexity is the growing number of combination treatments for advanced cancer patients. Payers and third parties (e.g., ICER) are challenging the incremental value and cost-effectiveness of these therapies. The value-cost imperative will continue to be a priority for all stakeholders as expensive therapies enter the market. Furthermore, studies have shown that very few marketed drugs are financially successful.
Given these uncertainties, biopharma companies must predict where the markets will be and determine how standards of care will evolve to effectively position new products. To ensure commercial success, we suggest that manufacturers focus on five key areas in new product commercial planning efforts:
The strength of early scientific evidence for a product’s mechanism of action (MOA) forms the basis for pursuing a clinical program in a target disease of interest. However, a thorough understanding of the target disease profile is critical for new product development efforts, including optimizing the expected launch indication and the corresponding label. Manufacturers must not only assess the current disease dynamics but also predict how the future disease landscape will transform based on changes in the competitive landscape. In order to gain powerful insights, standard approaches used to characterize customer unmet needs, the patient journey, and payor expectations must be supplemented by new technologies such as artificial intelligence.
A patient’s journey offers many insights into how they are coping with and managing the disease at each stage of the continuum-diagnosis, treatment initiation, treatment optimization, monitoring, and access. To support each patient’s journey, manufacturers must uncover patients’ real and perceived unmet needs, as well as the requirements of stakeholders (e.g., caregivers, providers, payers, advocacy groups), at each stage. These unmet needs will vary and be affected by clinical issues, quality of life, and socio-economics. The market developments that could positively or negatively impact these unmet needs must be closely monitored to assess how a new product can address these needs. Multiple factors are relevant, for example, in dementia and Alzheimer’s disease where the unmet treatment needs remain high at the same time that the healthcare costs, social costs, and family burden of care continue to increase at a rapid pace.
Standard of care (SoC)
In some diseases, the SoC is well established; but in others, it is evolving or even non-existent. The challenges in SoC are often driven by a variety of factors: a lack of understanding about the disease mechanism, the benefit/risk profiles of drugs, the lack of consensus among thought leaders, the absence of guidelines, the lack of biomarkers, and the lack of evidence for appropriate medical interventions. For example, more than 15 drugs are currently available to treat multiple sclerosis (MS), each of which offers varying benefit/risk profiles. Therefore, physicians are challenged to select the best treatment for each patient because of the lack of biomarkers, as well as lack of consensus among thought leaders about how to optimize treatment. With several new therapies entering the MS market, it will become even more difficult for stakeholders to align on the future SoC.
Factors such as competitors’ R&D investments, emerging biomarkers and companion diagnostics, and new medical technologies will critically influence every decision in the product development pathway. An approximation of the future of SoC will provide a useful benchmark against which to measure product effectiveness. Specifically, will a new product under development be compatible with a future treatment paradigm? Or based on its MoA, can a new product be used in combination with the future SoC? To inform the development strategy, manufacturers need to predict the future SoC and determine how a new product might be positioned in the course of treatment and how competitive it might be.
Patient stratification can provide manufacturers with a deeper understanding of where potential opportunities (blue ocean spaces) might exist. Many diseases have subpopulations classified by disease severity, stage of disease, response to a specific treatment, etc. For example, 1L/2L treatments and even 3L treatments often fail cancer patients; and although some of these patients might not respond to mono-therapies, they could respond well to combination treatments. Therefore, biopharma companies need to determine the best combinations for their products, as well as identify in which patients a product is effective as a monotherapy. A strategic approach to patient stratification will identify the most promising positioning and most compelling labeling for a product.
A well-characterized target product profile is central for guiding clinical development and regulatory pathways. Studies have shown that new drug applications with TPPs (Target Product Profile) had a lower incidence of decisions such as the dreaded refuse to file (RTF) or complete response letter (CRL), as well as a shorter time from the initial submission to approval.
Shift from TPP towards a TVP
Manufacturers have successfully leveraged TPPs to guide the clinical development and regulatory approval process while minimizing development risk. However, in the current healthcare environment and given changes in its future, it is imperative that companies expand the scope of the TPP from clinical impact to overall value and, as importantly, demonstrate the meaning of that value to patients, physicians, payers, policymakers, and advocacy groups. This approach shifts the focus from a list of attributes to an “expected outcome,” and therefore is a mechanism that will unlock unforeseen possibilities for a new product and optimize its overall value in the market.
The TVP approach encourages discipline within an organization as value creation becomes the core decision-making driver. As such, investment choices across the pipeline, or within a development program, become more discernable. In turn, the ROI is easier to measure as revenue capture becomes laser-focused on target segments-patient types, prescriber groups or payors (or combinations)-linked to the prospective value creation. The approach also supports the differentiation of the product and facilitates a product’s evolution to a unique brand that is less susceptible to competition and “class effect” impacts.
Of course, the perceived value of a drug varies with the stakeholder and creates an interesting dynamic as manufacturers try to articulate the value of a new drug. For example, patients seek more efficacious and safer treatments that also offer convenience and quality of life benefits. Payers seek value in terms of benefit-cost and cost-effectiveness of the drug. Therefore, the early engagement of payers is key to understanding how they view other value components such as healthcare system savings, cost avoidance, and head-to-head drug acquisition cost comparisons.
The economic value of drugs is articulated using health economics and outcomes research (HEOR) / and evidence-based medicine (EBM) instruments. However, the generation of HEOR data cannot be an afterthought, as these data are much more robust and useful when produced within the pivotal clinical trials. The opportunity cost of not generating HEOR data during clinical trials could be quite significant in the future healthcare environment. In fact, failure to show value, notwithstanding the innovative or unique aspects of a medicine, could lead to formulary exclusion or niched opportunities. For health delivery systems, these data could prove critical for managing the negotiation strategy and process.
Patient-reported outcomes (PROs) are increasingly being used in regulatory and commercial claims to show how a new drug creates value for patients. Regulatory agencies are showing more receptivity to accepting PROs as primary endpoints in drug approvals. These PROs should be incorporated into trials, particularly in diseases where other surrogate endpoints do not exist, and clinical outcome assessments are unclear. The PROs (clinical-reported outcome measures, observer-reported outcomes, and performance outcomes) are often undermined because there is a systemic bias toward using conventional clinical endpoints to clear regulatory hurdles. For example, products for the treatment of IBS must carefully consider PROs because most of the symptoms being treated in these patients are typically reported by the patients. Carefully validated research instruments (e.g. questionnaires) are required for collecting data in pivotal trials, and for avoiding the significant “placebo” effect that could also contaminate PRO reports.
A TVP approach would also position a product for innovative outcomes-based reimbursement initiatives with payors. Aiming toward a targeted set of value-creating data points (both those required for regulatory approval and the commercial profile) would provide a transitionary step from controlled clinical trial data to real-world evidence (RWE) studies that support the desirable use levels.
In diseases where there are limited treatment choices and the unmet need is high, product differentiation may be less of a concern. A good example is glioblastoma where most drugs in development have failed in the last decade. Several new treatments are being developed and patients are anxiously waiting for these next-generation treatments. This is especially the case for many rare diseases where there are few if any effective treatments available.
In contrast, the success of new products launched into highly competitive markets is contingent on differentiation. Manufacturers need to determine levels of differentiation as well as the data that support the evidence required to capture market share. Many of the primary care disease areas, including hypertension, dyslipidemia, diabetes, and others, are classic examples of conditions affected by the emergence of many classes of drugs and products within each class. This development forced manufacturers with a follow-on drug to think more strategically about building differentiation into their product profiles. Whether the product is a novel MoA, first-in-class, or best-in-class, manufacturers must develop a differentiated launch label reflecting value attributes.
A patient-centric approach allows manufacturers to develop personalized solutions via a deeper understanding of the issues impacting diagnosis, treatment optimization, and treatment monitoring. Each stage of the disease continuum plays an important role impacting overall health outcomes. In order to pursue personalized solutions, manufacturers need deeper insights about the patient’s journey, patient engagement, and patient advocacy. Patient centricity is key for strengthening the brand essence and brand leadership platforms as follow-on competitors struggle to break free from “class-effect,” “me-too” and market access issues.
Each patient experiences a unique journey as he or she learns about the disease and how to cope with it. Unfortunately, many patients with complex diseases encounter challenges as they seek proper diagnoses and timely interventions. The difficulties are compounded when diagnosis/treatment guidelines are unclear, and the available treatments are suboptimal. Manufacturers employ advanced analytics and new technologies (artificial intelligence and machine learning) to process information from disparate data sources, including social media to track in-real-time changes in customer behaviors. By understanding patient journey and stakeholder perspectives, manufacturers will be able to develop personalized solutions that produce the best outcomes.
Manufacturers should invite patients to their organizations so that their development teams could better understand how patients are living with a disease. This engagement is critical on two fronts. On the one hand, it allows the development teams to directly hear from patients about their experiences. On the other hand, it instills a sense of empathy! Such engagement often energizes employees to continue to focus on development efforts despite setbacks. This patient engagement approach may not be a priority for development teams, but early commercial teams must frequently encourage this dialogue in order to foster a patient-centric culture throughout the organization.
Today, patient advocacy groups play an important role in raising disease awareness and in supporting research and health policy initiatives. Prominent Alzheimer's and Parkinson’s disease organizations have partnered with academic and research institutions (e.g., NIH) to advance several research initiatives. The organizations that have helped HIV patients over the years have had a profound impact on healthcare policy and access to care. Leveraging advocacy groups and their networks enables manufacturers to not only gain a deeper understanding of issues affecting patients but also leads to faster recruitment of patients for clinical trials. The early commercial teams need to identify and foster these relationships in order to make a lasting impact on patients’ lives. Building relationships with industry advocacy groups such as NORD, NPC, and PhRMA will be beneficial during the development, regulatory, and commercialization process.
As soon as compelling scientific evidence for a drug is observed, manufacturers need to begin life cycle planning and product enhancement efforts (Yes! early in the development process). For a variety of strategic, operational, and financial reasons, manufacturers tend to fall behind with LCP efforts, and by the time they come to this realization, the opportunity cost is significant because limited patent life is left to target financially viable opportunities. Leveraging a sophisticated process and using tools like ProLOGS (Product Lifecycle Optimization and Growth Strategy) are key to identify, evaluate, prioritize, and sequence indications.
A drug’s MoA often works in multiple diseases, and the compelling scientific rationale for the drug in each disease could open multiple indications for consideration. These indications must be evaluated from medical, clinical, regulatory, tech ops, and commercial perspectives in order to prioritize them. If viable, they could offer additional patent and/or market exclusivity and potentially extend the life cycle of an asset. Beyond mono-therapies, companies must evaluate combination opportunities in complex diseases for the optimal treatment of patients. Note that the immuno-oncology drug Keytruda has secured multiple mono and combination indications as part of LCP making it a widely successful drug in oncology.
One of the most common approaches in LCP is to identify label expansion opportunities around the core indication by focusing on unmet needs across patient sub-segments (e.g., refractory patients, patients failing therapy, pediatric patients). Innovative clinical trial designs, such as expanding cohorts in ongoing trials or testing biomarkers/companion diagnostics, are needed to target these opportunities. A strong label is key to building a strong promotional platform; an ever-evolving label also leverages the first-mover advantage. By leveraging commercial insights and understanding data gaps, manufacturers can realize how to further strengthen and differentiate the product's label.
New technologies and therapeutic modalities are helping manufacturers to bring innovation to all aspects of disease management. These technologies are key to improving diagnostics and drug delivery and enable manufacturers to pursue “beyond the drug” strategies. For example, nanotechnology is allowing drugs to reach difficult targets: in glioblastoma, the nanotechnology-based intratumoral delivery is currently being evaluated to deliver drugs directly to the tumor. It is often these incremental innovations in diagnostics and delivery, when combined with drug treatments, that can have profound impact on patients' lives. Manufacturers should adopt this holistic view of disease management in order to develop innovative solutions that yield the best possible outcomes for patients.
One of the most challenging areas of new product development is the alignment of internal stakeholders with development efforts while also engaging external stakeholders to condition the market to positively receive a new product’s clinical data, labeling claims, and brand positioning. Internal stakeholder engagement is guided by the company’s mission, whereas the external stakeholder engagement efforts require a long-term strategic approach.
Internal stakeholder engagement
The primary goal of the clinical and regulatory teams is to demonstrate the benefit/risk profile of the drug to regulators to obtain license. The early commercial teams should leverage TVP to engage internal stakeholders and guide the clinical program to make it commercially attractive. The TVP, in combination with promotional claims, is required to effectively engage regulators prior to initiating pivotal trials. The value of these potential claims and their relative attractiveness could be cross-referenced in order to assess the probability of technical and regulatory success. The early commercial teams must collaborate with tech ops teams to assess the feasibility to produce clinical materials, plan for commercial-scale manufacturing, and develop delivery mechanisms.
External stakeholder engagement
The market conditioning effort requires engaging thought leaders and institutions who are spearheading scientific developments in the target disease area. The first step in this process is to develop scientific platforms and communication mechanisms to increase awareness and generate interest in the product’s MoA. The early experiences of these thought leaders during clinical development often influence their behaviors and attitudes toward the value of the drug and its role in treatment optimization. At each step, manufacturers must operate in an ethical and compliant manner by following industry and regulatory guardrails. Manufacturers must also engage policymakers and advocacy groups to lay the foundation for market access and early adoption. Insights into the external landscape, in combination with a strategic approach to stakeholder engagement, are needed to effectively condition the market to ensure product success.
We suggest that biopharma companies consider the following strategic questions as part of early commercial planning efforts to maximize a product’s lifetime value.
1. Profile Target Disease
2. Shape Product Value Profile (TVP)
3. Ensure Patient-Centricity
4. Initiate Life Cycle Planning
5. Condition Target Market
Subbarao Jayanthi, managing partner; Nick DeSanctis, executive partner; James Hoyes, executive partner, all with RxC International