Even before COVID-19, launching a new pharmaceutical product was a massive and costly undertaking within the pharma industry. Just steering the product past clinical trials to the market was an impressive feat in its own right, especially for first-time market participants. What are the crucial roadblocks of a pharma new product launch?
Companies that successfully reach that exciting stage must then confront a whole new array of obstacles, many of which contribute to the fact that 65% of first-time launches fall short of pre-launch sales expectations. Seeing as first-year sales performance expectations are a strong indicator of future success, you need to set the right tone from the outset.
It’s not enough to have a rough outline of a launch plan. If you’re wondering why so many new drug launches miss market expectations and how you can prepare for the challenges ahead, you’re in the right place.
Here are four pharmaceutical new pharma product launch hurdles and solutions.
Challenge #1 – accurately estimating market potential
One of the more common reasons a drug underperforms at launch execution is an inadequate understanding of market needs. Companies often underestimate how challenging it will be to convert customers from existing therapies.
The consequences can be disastrous if coupled with limited market access.
Such issues often occur due to an insight gap that creates a gulf separating pharma companies from HCPs, payers, key opinion leaders, and patients. When that chasm arises and companies base decisions on old, incomplete, or just bad data, it can lead to the creation of a product that falls woefully short of both consumer and market expectations.
The solution: end-to-end strategic planning
Before you ever dream of having a product ready for sale, you must comprehensively understand your market, customers, and existing competition.
Throughout that process, your goal should be to close the insights gap from planning and recruiting to engaging, understanding, and analyzing.
For that, there are powerful solutions like an insights management platform that’s capable of identifying, engaging, and analyzing input from relevant stakeholders. With the right technology, you can address questions like:
- What are the needs of the patients you’d be treating and the physicians treating them?
- Who are the key opinion leaders in this therapeutic area?
- What are the regulatory hurdles that could affect the disease and product development?
- What are the standards of care for that therapeutic area?
- How will the product be better than existing drugs and interventions?
- How will a normal clinician or patient differentiate your product and competitors?
- How will competitors respond to your launch?
- Will generic drugs emerge that undercut your product sales?
After you’ve completed your due diligence, you can begin assembling a team, establishing collaborative relationships, securing approvals, defining the pharma marketing strategy, and developing the product life cycle strategy. It should be a checkpoint to assess launch readiness and even set critical success factors the marketing team can leverage.
Thorough launch planning and accurately estimating your market potential will set you up for success once the product reaches the market.
Challenge #2: COVID-19’s impact on sales and marketing
Even as the world recovers from the global pandemic, there are still aftershocks that will leave long-lasting repercussions on how the pharmaceutical industry operates.
While it’s too soon to understand the aftermath’s total impact on drug launches, there’s already been a noticeable difference in how healthcare professionals (HCPs) interact with pharma companies and their sales reps.
In the past, pharma sales reps built relationships via interpersonal connections. But the pandemic made that difficult, if not impossible. As a result, face-to-face customer engagement has been deprioritized. According to McKinsey:
“There has been a drastic reduction in pharma companies’ visits to HCPs… the average number of in-person contacts between HCPs and pharma sales reps was 70 percent lower in September 2020 than before the pandemic. In parallel, HCPs’ adoption of digital channels and telemedicine has accelerated for interactions with patients and pharma reps alike.”
And it’s not just the lack of face-to-face interactions between sales reps and HCPs impacting marketing operations. Clinicians are seeing fewer patients in person as well.
The solution: leverage virtual solutions
Although we don’t know the staying power of these changes to the in-person engagement sales model, pharma companies must make two significant strategic adjustments:
- Acclimate to virtual meetings – The further we move away from the pandemic, the more HCPs will likely return to the traditional engagement model where sales reps meet with the clinicians in person. However, virtual engagement will still remain in some capacity. Some HCPs will prefer it for the convenience factor alone. As such, pharma companies must provide reps with the virtual solutions and digital training they need to make virtual meetings as compelling as possible.
- Cater information delivery to the HCP – COVID altered how clinicians consumed information about new drugs. While digital channels will reign supreme, the most effective methodology should still be tailored to meet the tastes and preferences of the specific HCP. That could mean in-person interaction, printed content, an array of digital content, or some combination of the three.
Challenge #3: increased competition
Competition within the pharmaceutical industry has significantly intensified in the last decade.
After a new drug was launched, it used to have a window of opportunity that lasted an average of 8 years before a new challenger entered the market. Today, that average has been halved to only four years. And to make the situation even more difficult, peak sales forecasts have also declined by more than 50% over the last decade.
Both factors significantly limit a company’s opportunity to maximize returns from a new launch and achieve launch excellence.
Solution: communicate the clinical and non-clinical benefits
With increased competition and shortening times to peak sales, pharma companies must get their new drug launch strategy right the first time. There’s no room for error.
In the past, companies could leverage phase III clinical trial data to differentiate their drug to HCPs and regulators. But that’s no longer the case. Today, pharma companies must go above and beyond to communicate the clinical and nonclinical benefits to physicians and key thought leaders by:
- Differentiating their product – Pharmaceutical companies must provide compelling reasons, evidence, and social proof about their product’s value, especially if there are existing competitors that clinicians already trust and use. This could include content about:
- Clinical protocols
- Drug pricing
- Ideal patient personas
- Treatment regimen
- Targeting prescribers – Pharma manufacturers must build prescriber profiles to identify the doctors and integrated delivery networks that already prescribe specific types of drugs or categories. In doing so, you can align your product with clinicians who are more likely to be interested.
- Personalizing content – Furthermore, creating universal content based on homogenous customer segments is no longer an effective means of communication. Content must be designed to meet each physician’s interests so that they can then convey that information to their patients.
- Supporting clinicians – For many clinicians, brand preference is built on factors beyond the product. In particular, they require support from and open communication with pharma companies. The ways you can satisfy this need include:
- Readily answering any medical questions they might have
- Helping them identify ideal patients
- Connecting physicians with other peers who have successfully used the product
Challenge #4: limited market access
Returning to the earlier Deloitte study, nearly half of the products that came up short of their first-year forecast dealt with market access issues, such as:
- Unfavorable placement
- Exclusion from formulary
- Use of formulary restrictions
- Lack of health-economic evidence in support of pricing
- Higher than expected expenses on rebates or discounts
When market access is limited, both patients and clinicians lose trust that they’ll be able to access the drugs. This reduced confidence can create a ripple effect that becomes a self-fulfilling prophecy, jeopardizing a new product’s ability to succeed.
Solution: make market access a cornerstone of strategic planning
Similar to the first challenge discussed above, your end-to-end strategic planning impacts your long-term success. How you address this situation will differ according to the therapeutic you’re developing. For instance, there will be different considerations for a vaccine, a rare disease therapeutic, or a high-volume specialty.
With that said, researchers from Deloitte recommended the following principles for establishing a successful market access strategy:
- Incorporate market access into early and ongoing pipeline and launch activities.
- Continuously evaluate and adjust your market access strategy.
- Create a comprehensive value and evidence strategy that lists the most important outcomes to each stakeholder.
- Align cross-functional coordination with your overall brand strategy.
- Design a strategy that adapts to changes in consumer, competition, and external factors.
Insights management across the product lifecycle
Simply launching a new drug product will hardly yield pharma launch excellence. But it’s just one milestone in a much longer journey. Once you’ve reached the market, you must prepare for hurdles such as increased competition, limited market access, and changes in how a product can be marketed and sold. Understanding the current market is a crucial step to a successful launch. But you should also set KPIs for launch success to measure performance effectively.
How can you overcome the obstacles and challenges outlined in this article?
An insights management platform is designed to answer life science teams’ most pressing questions. This digital tool helps organizations close the insight gap from early stage development to post-launch activities. To learn more about insights management, read our blog series.
McKinsey. EvaluatePharma: McKinsey Analysis. https://mck.co/3AKdLeV
Deloitte. Key factors to improve drug launches. https://www2.deloitte.com/us/en/insights/industry/life-sciences/successful-drug-launch-strategy.html
McKinsey. Ready for launch: Reshaping pharma’s strategy in the next normal. https://www.mckinsey.com/industries/life-sciences/our-insights/ready-for-launch-reshaping-pharmas-strategy-in-the-next-normal
Deloitte. Rethinking market access. https://www2.deloitte.com/xe/en/insights/industry/life-sciences/pharmaceutical-market-access.html