A new report delves into why so many pharma brands struggle to launch and what can be done about it
There has never been a more challenging time for product launch in the pharmaceutical industry, conclude the authors of a new report from management consultants Eden McCallum.
“Approvals are at an all-time high, the market is more competitive than ever, and there is an urgent need to refresh revenues as a wave of products go off-patent,” concludes Launch perspectives: The new rules for success in pharmaceuticals. “Centralised reimbursement and formulary decisions mean success at the point of launch is binary. The future looks tough.”
While two-thirds of pharma product launches between 2003-2009 performed below forecast, the future is not all doom and gloom. What is needed is a “dramatic rewriting of the rules for a successful product launch.”
Pharma, however, is not the only sector feeling the pain of poor launches, concludes the report. “A 2014 global study by Simon Kucher & Partners revealed that, across all major industries, 72 percent of all product launches fail to meet their revenue targets.”
But why, specifically, do pharma brands fail to launch successfully? The report suggests four key reasons: insufficient launch resources, high prices, risk concerns and failure to understand the market.
“Human Genome Sciences’ launch of Benlysta for lupus, Savient’s launch of Kryotexxa for gout and Somaxon’s launch of Silenor for insomnia all struggled to achieve success as a result of insufficient resources dedicated to the launch,” write the authors. “Dendreon’s Provenge for prostate cancer struggled due to a combination of regulator misunderstanding, the market not being ready and a price which was too high. Sanofi’s Zaltrap for colorectal cancer also saw an adverse public effect to pricing. Insufficiently addressing concerns on risk meant difficulties were encountered during the launch of Sanofi’s Multaq for heart disease.”
However, Edwards et al also point to some recent successes. “Biogen’s Tecfidera for MS made an innovative response to reimbursement delays, used a marginally lower price than Gilenya and solid data around tolerability. Novo Nordisk’s Victoza for diabetes performed well on the back of major head-to-head studies… and making the most of the company’s position in diabetes. Bayer and Regenon’s Eylea for macular degeneration is viewed as successful due to a better dosing regimen, a small price difference per injection, [while] Bayer and Johnson & Johnson’s Xarelto went to plan as Pradaxa took the burden of educating the market and lawsuits of early bleed worries.”
They also mention Gilead’s Stribild for HIV (a strong key opinion leader position), J&J’s Zytiga for prostate cancer (oral administration) and BMS’s Yervoy for melanoma (first new treatment option for some time).
Up, up and away
With a greater number of smaller launches, more intense competition and shifting customer buying behaviour, how can companies ensure their launch is on track? “Constant innovation is required to remain one step ahead of the competition,” write the authors, who identify several key innovations:
Early and ongoing external engagement: this could be through ‘medical’ engagement, early player engagement or a living value dossier.
Sufficient resource: for example, by front-loading investment and having mechanisms in place to adjust.
Flexible resourcing: for example, making sure there is marketing support for the initial launch within the sales force, as well as ensuring there are sales reps that can work across therapeutic areas.
Highly skilled launch teams: this can be achieved by setting up a ‘launch academy’ to provide in-depth training prior to launch or even a ‘launch factory’, a dedicated team solely responsible for product launches and specialised in launch tactics. Launch factories are commonplace in technology companies such as Microsoft and Apple.
Adaptive launch management: launch wargaming and modelling of scenarios allows launches to be managed reactively, as well as a dedicated tracking team to follow progress of a launch and offer thought-out solutions to scenarios.
Deep real-world analytics: real-time information tracked by a dedicated analytics teams to combine all data sources and gives overview of launch success. Procter and Gamble uses performance data rooms to track launches live, with personal ‘cockpits’ for individuals to access real-time updates and daily reports.
The report, Launch perspectives: The new rules for success in pharmaceuticals was written by Michael Edwards, Stephanie Mill and Katherine Tonks of Eden McCallum.
Key questions to ask for future launch success:
- How are we making sure we are doing ‘launch 101’ to an outstanding level, not just ticking boxes?
- What breadth and depth of pharma launch experience do we have in our organisation today?
- Are we developing capabilities in the innovation checklist, at scale?
- What will be the key innovations for success relevant to our launches, business and organisation?
- Do our cross-functional teams have a shared view of how the rules for success have changed?
- In what aspects of launch are we going to outperform our competition?
Five common launch mistakes
1. A revolutionary product but no market demand:
Google glass, the futuristic, wearable technology glasses, was introduced in 2013 amid privacy concerns and a market that failed to grasp the point of the product.
Lesson: Know who is going to buy your product.
2. No distinct benefits:
Crystal Pepsi was a clear, caffeine-free drink promoted as a healthy, diet beverage. Despite strong first-year sales, customers were not convinced by the health angle.
Lesson: Make your product distinctive enough to sway buyers.
3. Failing to meet expectations:
Launched in 1957, the Ford Edsel became known as the ‘Titanic of automobiles’ after selling only 64,000 in the first year. The word ‘edsel’ has since become a popular symbol for failure.
Lesson: Don’t release a product until it’s truly ready and tested.
4. Unable to keep up with the pace of growth:
The Mosquito Magnet, launched in 2000, quickly became a big seller but, after production was expanded in China, quality dropped and consumers got angry.
Lesson: Be ready to scale rapidly if a product takes off.
The launch of Scentstories, an air freshener in the shape of a CD player, was so confusing to customers that the launch failed.
Lesson: New category products need strong educational campaigns.