The State of Market Insights in Pharma

December 8, 2016

It's time to take advantage of a nascent technology embrace taking hold among market insights professionals, writes Janet Kolsoff.

It's time to take advantage of a nascent technology embrace taking hold among market insights professionals, writes Janet Kosloff.

Obtaining clear market context is harder than ever for pharma executives today at a time of profound business, regulatory, and technology change-not to mention an election year.  It’s why pharmas spend an estimated $2 billion on market research annually and retain pharma market insights teams whose real job titles could be shorted to that of “context providers.” The insights they deliver from key stakeholders cut though market noise and help to ground the hundreds of decisions required to access new drug and treatment markets-unchartered and often unpredictable.

The pharma market insights function itself is undergoing change and challenge-some of it endemic to the function, like the drive to control costs or do more with less-and some related to the explosion in technology that has brought big data-sized data sets to every pharma team, without the meaningful context to put them to use with data of the quality the team has come to expect. In the era of the self-driving car and robots for everyday tasks, it’s easy to headline writers to suggest that technology can replace insights professionals and thus predict “the death of market research” or at least its fading away. 

But to paraphrase Mark Twain, predictions of “the death of market research,” particularly in pharma, are greatly exaggerated. A recent survey of Pharm Exec readers performed by InCrowd took the pulse of over 100 pharmaceutical and life science market research executives, who they are, their attitudes toward their work, emerging technology approaches, investments, desired innovations, and challenges. The data show several promising pivot-points with impact on the function’s ability to perform even at a time of historic M&A levels and regulatory uncertainty-when the industry needs timely, quantified market insight more than ever.

1. A new technology embrace

The 2016 Life Science Market Research-State of the Market Report spotlights where organizations are investing today, and major barriers to success in using market research to help meet heightened competition and cope with time-strapped primary research respondents.    

The most striking result was a spike in receptivity to new technology-which is particularly noteworthy given industry pundits citing the reluctance to adopt new technology as the #1 challenge facing the profession-including such items as more expedient mobile research solutions, “smart sampling,” or technologies that have been well proven in other domains such as cloud computing.  (GRIT 2015 Report) Compared with other industries, pharma is slower to adopt new insight technologies. This may be due to a high emphasis on data validity, or a desire to make sure all data is defendable to a p=0.001 confidence level.

In contrast, InCrowd’s State of the Market Report analysis revealed that more respondents characterized their approach to market research as “tech savvy” and “resourceful,” with nearly 50% of life science market research executives surveyed saying they agreed or strongly agreed with these statements. They outnumbered the approximately one-third who agreed or strongly agreed that “traditional” best described their approach.

Perhaps reflecting the ambivalence towards technology, an equal percent of respondents (31% for each) described their approach as “nimble” as well as “conservative.”

This receptivity is a critical first sign that today’s explosion in market research automation, data integration, and visualization technologies is being viewed as a way to streamline some of the profession’s most painfully repetitive tasks such as longitudinal tracking studies-which implicitly demand a seasoned expert to implement them and interpret their results.

2. Investments in an expanded toolbox

The State of the Market Report showed that these pharma market research professionals are putting their sentiments to action and investing accordingly in innovative new approaches.

Figure 1 shows the list of new insights technologies in which respondents’ organizations had currently invested. Not surprisingly big data topped the charts. However respondents’ investments are diversified and testing new innovations seems to be commonplace in the industry including social media analysis, shorter and more focused microsurveys that can source data in a few hours versus days and wearable-based research. On the opposite end, mobile ethnography and facial analysis represented lowest areas of investment.

Even with their present and sizable big data analytics investments, respondents wanted more. Big data analytics still lead the lineup of new research approaches in which the respondents wished they could invest, with predictive markets and behavior economic models falling in second and third respectively.

3. Staffed by highly senior talent

Life science market researchers are highly educated and older. Seventy-one percent of respondents had a graduate degree or above, with almost 40% holding PhDs-much more highly educated than market research professionals as a whole across all vertical markets (59% holding graduate degrees and only 6% holding PhD, as reported in a 2015 Quirks Corporate Report.)

Ninety-two percent also were older than age 36, and 71% of respondents had 15 or more years of experience in their field. Eighty-four percent were married, and 80% have children.

4. Teams are stable with less job-changing than average

Respondents stay on the job longer than the average market researcher-with 75% staying for 3 or more years before changing roles within a company, markedly larger than the 49% level for horizontal market research industry (Quirks 2015 Corporate Research Report)-and 95% saying they typically change companies only after 3-4 years. 

5. Twitter doesn’t do it for them

In a social media age, sentiment expressed on Twitter is ubiquitous and is becoming an ever more frequently used information source. However it’s not where this community seeks input on the market research challenges they’re trying to address. Over 70% of respondents looked to their peers for information on market research challenges they face, with less than 2% seeking insight from Twitter.

6. Three big problems keep them up at night

1)   Reaching the right respondents

For more than 60% of Pharm Exec readers in the study, reaching the right physicians is their single biggest barrier to success. According to one researcher, shrinking budgets have made it even harder to hire the expertise to ensure only those doctors writing prescriptions for their drug are being targeted.

2) Getting information fast enough

In two separate open-ended questions study respondents voiced strong concern about obtaining information fast enough as the second greatest concern that kept them you up at night. Obtaining fast data that is also high quality and actionable was another concern, given the traditional toolbox elements of long-term studies, elaborate procurement procedures, and bloated processes that take weeks or months to deliver needed insights.  

3) Overcoming budget issues

Problems of cost overruns and shrinking budgets are endemic to the field-with nearly 40% of respondents listing funding as one of the top three barriers they face to achieving their market research goals. For example, with Awareness, Trial, and Usage (ATU) studies-inevitably a herculean endeavor in time, operational resources, and budget-the initial project cost estimate is only half the picture after those unforeseen questions are folded -the initial project cost estimate is only half the picture after those unforeseen questions are folded in.  The market has opened up space for more efficient solutions to help address these budget issues.

Speeding toward the future

The philosopher Heraclitus said, “There is nothing permanent except change.” In a market that’s mercurial-when years of painstaking product development and multi-billions of market capitalization can be wiped away in a few hours of an adverse drug trial event-pharmaceutical and life science executives need to ensure that the multitude of business decisions they make help the organization evolve ahead of a changing industry-and not trail behind it. 

Market insights teams are the first line of defense in that effort, and fortunately the latest market research on pharma market research team reflects a new imperative to change with changing times. By “watching where the smart money is going” in their profession, these professionals are poised to better structure the many forms of market research they are called upon to deliver, in ways that achieve their goals while saving time, hassle, and costs.

Janet Kosloff is CEO and co-founder of InCrowd