Q&A With Jim Lang, CEO at Eversana

Jim Lang

After several years of growth, the pharma industry saw a downturn in investor interest in early 2022. Jim Lang, CEO of Eversana, spoke with Pharmaceutical Executive about where the industry stands now and what may happen in the future.

As 2022 winds down, what stands out to you in the pharma industry as the top 1-2 things from this past year?

It’s been a bumpy year for the industry, and I’ve been surprised to see how resilient the industry has been. It remains a very attractive industry in the sense that it is a bunch of people who are highly motivated to create a healthier world for folks. I’m an optimist for the industry, and COVID-19 gave the average citizen of the world an insight into the industry that they haven’t had before.

But there have been some headwinds this year. The bio-tech funding environment is down at half the levels it was in the past couple of years. That’s made for some difficult choices and rationalization in that sector. In large pharma, the FDA is operating at an approval rate of about 30 to 40% of where they’ve been in recent years. Instead, what they tend to do is issue a complete response letter (CRL) asking for something additional. That’s a meaningful impact.

Some of it is COVID taking the mindshare of other activities and disease states to add product approvals. Some of it is risk aversion in the FDA given what happened with Biogen, and some of it is that the leadership has been in flux at the FDA. We forecast that to turn around in the second part of next year, but those have been both meaningful headwinds for the industry. Despite that, we’ve seen growth and introductions in new products, and I think that those phenomenon are not long term phenomenon.

Are there any trends you and your team are seeing at Eversana that will continue to evolve in 2023?

The commercialization budgets globally are two and a half times the size of the discovery & research budgets and the manufacturing budgets. The clinical budgets are around $60 billion annually, and about two-thirds of that is outsourced to big partners like IQVIA, Nikon, Parexel, and those big players. The manufacturing industry, there’s about $50-55 billion spent annually on building these solutions to scale, and about a third is outsourced to companies that build products at scale.

How do things differ in the commercialization space?

That commercialization space is actually $150 billion annually, of about 20% being outsourced. We decided to question if it was being spent well and, more importantly, is it going to get more complex in the next decade as it has been in previous decades. Over the past decades, we’ve learned how to launch very high volume, low, to moderately priced products. As you know, however, the pivot is to solutions for highly rare and complex conditions. Even cancer is becoming a rare disease category. When someone gets cancer, doctors may look for biomarkers that can determine if they should get very specific treatments.

By definition, there’s very few people for these sorts of products, and they face a much smaller population, which causes a challenge when trying to price it correctly. At Eversana, we’re seeing two trends now that we hope we’re catching at the right time. One is when you look at large pharma, the CEOs and leaders are questioning their commercialization spends now and deciding to outsource significant parts of their activities in hopes that they can get higher efficiencies, higher patient outcomes, better sales and at a lower cost. We’re also seeing a trend of emerging companies launching on their own but are also really willing to partner with outsourcing for the help. It also helps if they get a CRL, they aren’t spending all kinds of money but instead can wait through that period. We’re also seeing a trend in large pharma to go after the spend in commercialization. It’s time to look at it and see if companies are doing it as well as they can.

Economic conditions continue to be challenging. How have you navigated this and what has this done in the ongoing ‘war for talent?’

As a service company, Eversana is filled with knowledge workers serving knowledge workers in other companies. Like many of us, we have seen the geographical democratization of talent. It used to be that talent was tied locally and would only stay in a local labor market. Now, most of our jobs can be delivered anywhere in the world, which means that the labor markets can really adjust.

We’ve seen a tremendous amount of wage inflation in the business. We’ve fended it off by driving a unique culture that unlocks people’s interest in the company. We spend a lot of time and effort on culture, creating new kinds of benefits, ways people can be involved in the firm, and flexibility. It’s paid off in the sense that we have now won “Best Place to Work” in the U.S. for four years in a row, which is a measure of employee engagement.

In terms of the general economic conditions, we’ve had two quarters of negative growth, we’ve had choppy waters, and we’re working with our clients to help them manage their own cost effectiveness. We’re making sure that we don’t over hire into a noisy environment. There’s been over 100 life sciences companies that have had major lay offs this year, a lot of it was related to products failing in the markets and companies not being able to secure funding. Many of those companies are now looking at their cost structure and questioning if there’s a better way to do business. These companies are reshaping their overall cost structure internally and how of the activity to they do inside versus with partners.

How are technologies like AI and machine learning changing the Pharma industry?

There’s a lot of big things changing the pharma industry right now. The two big trends are data and analytics, along with the digitization of workflow. We see a big trend in pharma wanting to find an end-to-end solution where patients are being served. Companies are asking if they can get better patient outcomes at a lower cost by not having as many middle-men and trade-offs. This might be things like digital solutions for you or care givers to be aware of a treatment, a momentary spin up of telehealth to get patients on treatment, a patient support program to help deal with concerns over the treatment, or training, injection training, infusions, or something like that, and the ongoing support where life science companies are stepping up to say that the payer and provider struggled to have the margins to support patients. It’s a win-win if that person should be on this therapy, it lowers the cost of care for society, we can stand up these innovative programs.

Some of it is the digitization of work flows, but it’s also unique ways to use data and analytics. We can predict patients who are likely to be diagnosed with a rare disease by looking at their long history of EHR, claims, lab results, and social determinants of health data. If we can predict that, can we shorten the time to diagnosis. In rare disease, people on average take seven years to get diagnoses and usually get misdiagnosed and put on incorrect treatments for a period of time.

If we can make that a few years instead of seven years, we can really improve the quality of health of those people and the cost of care for that.