This document contains five top practices in launching blockbuster drugs. The leading practices, managerial insights and benchmark metrics in this report are drawn from in-depth interviews with more than 24 executives at 12 leading pharmaceutical companies.
“Top Five Best Practices in Launching Blockbuster Drugs” includes a top practice from each of five functional areas identified through extensive research and interviews.
This document contains five top practices in launching blockbuster drugs. The leading practices, managerial insights and benchmark metrics in this report are drawn from in-depth interviews with more than 24 executives at 12 leading pharmaceutical companies.
“Top Five Best Practices in Launching Blockbuster Drugs” includes a top practice from each of five functional areas identified through extensive research and interviews.
1. Developing and Deploying Integrated Marketing Support: Incorporate pre-clinical marketing support to enable effective drug development.
To adequately predict the future market size and needs of the drug before entering development phases, the most important activities during the Pre-Clinical Phase center on market research – needs assessment, competitive analysis and commercial potential analysis. Benchmark partners emphasized the importance understanding these key elements had on the success of clinical trial design and product marketing strategy.
Due to rising competition and patient awareness in the pharmaceutical industry, drug manufacturers are challenged to differentiate their product from others in their therapeutic area. The tools to accomplish this feat are held by the marketing and market research department. The earlier these resources are brought in to shape clinical development plans, the more the plans support a differentiated and competitive product.
One benchmark partner has found that marketing support needs to start at the discovery stage. Group members work closely with research scientists and provide therapeutic area managers with market research data including:
· Epidemiology of disease
· Unmet medical market needs
· Market opportunities and size
The company’s market assessment group co-locates at several major research labs. This co-location effort originally encountered some resistance, but the company and teams have found the proximity facilitated interaction and created a powerful synergy. That has helped to mesh the company's market goals with the research teams' strengths in more effective ways. The result has been a pipeline filled with promising compounds and an active portfolio that is building upon traditional strengths while expanding into new strategic therapeutic areas.
(Please see documents Nos. 3611 and 3612 for related practices)
2. Investing for Maximum Impact: Align marketing resources to reflect market readiness, level of competition, and order of entry for a new product.
Benchmark partners agree that early and consistent marketing support is crucial to the successful launch of a high-potential product. But many fail to differentiate levels of spending based on different market situations. One company incorporates a multitude of market variables in its marketing resource allocation process. For example, if the market is highly competitive with many entrenched players, the company needs to spend more, especially at the launch of the product to overcome this high barrier to entry. If the therapeutic area is relatively quiet with little competition, the marketing spend is going to be smaller. If the company's product is expected to be the first to the market, the company should spend more to educate customers (health care professionals and patients) on both the disease and new therapy to prepare the market for its new product. If the company is the second, third, and fourth to the market, a higher level of spend needs to be allocated for differentiation, including positioning studies, aggressive thought leader development and value-added service or programs.
One executive shared her observation about the battle in the cholesterol-lowering drug category. Merck undertook a tremendous amount of educational work before it launched Mevacor and Zocor. This helped Parke-Davis and Pfizer in terms of market education and preparation. But since Lipitor was the fifth to the market, it needed to differentiate itself from the existing products. Parke-Davis allocated a significant amount of spending on thought leader development and sampling. The early involvement of thought leaders helped the company understand the critical factors that would set Lipitor apart from similar products and came up with a powerful positioning message: "Lower is Better." Heavy sampling at product launch provided customers the opportunity to determine firsthand the efficacy of the product.
(Please see document No. 3615 for related practices)
3. Managing Team Structure, Communication & Transition: Structure committees to have cross-functional representation in order to ensure commercial perspectives.
Drug approval teams are important players in determining the nature and priority of drug development at most pharmaceutical companies. At the highest level, one top-performing benchmark partner has a 10-person committee that consists of people from central research and from commercial operations to ensure equal input during the product development phase. While the head of central research leads the committee, senior executives from the commercial side already play a major role in Phase I. The company replicates that committee structure in the teams that work on product approval and launch. A marketing executive noted that the company believes this is one of the major reasons for its product success in the market.
Marketing's expanded role has meant that issues such as competitor standing, portfolio strengths, consumer and physician concerns, and product life cycle now play a larger part in clinical managers' development plans. These details are the crucial levers that drive a moderately successful drug into the blockbuster range. Both the executive team and the development team are driven by the company's goals to produce higher quality drugs as opposed to a high quantity of drugs. This is in contrast to pre-commercialization periods when the purely clinical view of success was to bring as many different drugs to market as possible.
(Please see document No. 3620 for related practices)
4. Driving commercially focused drug development: Incorporate input from non-physician influencers to bring commercially focused products to market.
Non-physician opinion leaders are playing an ever-greater role in the pharmaceutical industry, so infusing the drug development process with input from these influential groups is paramount. While individual consumers have incremental impacts on pharmaceutical sales, large representative groups have fundamentally reshaped the landscape, forcing pharmaceutical companies to develop a formal plan for interacting with them.
Payer groups, whether insurance, managed care or employer-based in the U.S. or governmental units in Europe, become active in advisory boards in Phase III and have helped the company quickly address the business changes of the last decade.
Key issues addressed by the payer advisory board include:
· Impact on pricing for managed care,
· Strategies to overcome barriers or hurdles in the market, and
· Variables such as order of entry and degree of product differentiation.
Marketing personnel interacting with the payer advisory board must determine how vital potential concerns are. If managed care acceptance is viewed as critical to launch success, for example, the launch could potentially be delayed in order to iron out concerns with pricing, dosage, or other aspects of the product profile.
(Please see document No. 3626 for related practices)
5. Preparing Market for Rapid Product Uptake: For products likely to gain approval, begin key promotion activities in Phase III to hit the ground running after submission and approval.
Depending on a company's level of confidence in drug approval or based upon the product's blockbuster potential, companies may ramp up marketing and promotional activities as early as mid-Phase III. For a retail product whose sales are predicted to reach $500 million within three years of launch, one benchmark partner allocated 55% of its Phase III marketing spend on targeted advertising and promotion activities.
The following activities are identified as early drivers of product awareness when conducted in Phase III:
· Agency fees (mostly planning)
· Disease management programs for physicians and patients
· DTC education materials
· Article generation for publications
· Field force material development
Several benchmark partners indicated that one or more of the key drivers are begun as early as Phase III, but the majority of the activities are usually pushed until the Submission Phase. Depending upon the therapeutic area, the differentiation of products in the marketplace may depend on the timing and completion of these activities. Accomplishing these key drivers in Phase III, especially for a drug predicted to become a blockbuster, makes the timing of activities easier during submission, which may only last six months.
(Please see documents No. 3613 for related practices)