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This New Engagement Model Garners Significant Rewards For Pharma

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Last year, on July 26, 2021, I wrote in this blog on gaining a competitive edge with Omnichannel pharma marketing Omnichannel pharma marketing. However, from several recent studies, it appears, it’s still remains in a nascent stage. Most players in the industry haven’t been able to get there, just yet.

This is evident from a paper, published in the Reuters Events on November 08, 2022. It underscored, ‘But few, perhaps none, can say they have yet mastered omnichannel. A 360-degree view of the customer remains a work in progress. The seamless customer experience that physicians have come to expect in their private lives as customers in retail, finance, or hospitality, remains an aspiration.’

That said, the good news is – today – with rapidly declining Covid-19 onslaught, many drug companies have realized that their earlier assumption of ‘we know what our customers want,’ is invalid in the emerging perspective. Thus, it is foolhardy for their marketing strategy planners to believe that have a 360-degree view of their customers. This realization has prompted several companies to find out, based on the data, what the key customers’ needs are and engage with them accordingly.

In this article, I shall, therefore, reemphasize for the consideration of the young marketers that Omnichannel customer engagement, including patients and doctors, would help fetch significant and sustained financial rewards for drug companies.

However, another visualization of 6 years ago seems to have come true:

About 6 years ago, on December 26, 2016, I visualized in this blog: ‘a majority of the doctors’ choices in India would, possibly, involve MRs, while a good number of other important doctors’ choices may probably be independent of them. Nevertheless, from this emerging trend, it’s clear now that multi-channel engagement would be a new normal in pharma sales and marketing, sooner than later.’

This visualization seems to have come true by a great extent, as vindicated by the above study of the Reuters Events. It confirms, currently, most companies are stuck in multi-channel content delivery and, in fact, are still a long way of enjoying the benefits of truly aligned – Omnichannel engagement. This brings us to the question: ‘What’s the difference between Multi-Channel and Omnichannel content delivery strategy for customer engagement?’

Difference between Multi-Channel and Omnichannel content delivery strategy:

The article published in the Pharmaceutical Executive, on June 30, 2021, indicated: ‘An integrated strategy based on Omnichannel marketing is now increasingly replacing multichannel marketing.’

Nonetheless, in my article of July 26, 2021, I highlighted, although both omnichannel and multichannel engagement will be able to deliver targeted contents to patients through several interactive digital platforms, these two aren’t the same. Omnichannel approach connects these channels, including smartphone-based Apps, specially formatted websites, social media, community, and the likes – bridging technology-communication gaps that may exist in multichannel solutions.

Notably, any change from the fragmented and siloed multichannel approach to Omnichannel marketing would entail simultaneous orchestration of channels across personal, non-personal, and media. Besides orchestration of channels, the message of course, needs to be unified, interrelated – without being repetitive. From this perspective: ‘Bringing the channels and stakeholders together in a truly integrated manner is the pivotal shift required to break through today’s noisy and crowded pharmaceutical marketplace,’ as the above Pharmaceutical Executive article concluded.

More and more people are charting the digital space:

Fast increasing penetration into the cyberspace by a large section of the population, especially in the healthcare space – triggered by Covid related lockdowns, is now all pervasive. An increasing number of people now want to know more and more about various disease states, their treatment and prevention options, in the digital space. Patients and healthcare providers’ key requirements include, where to get the right information from, and how.

Information-needs expanding beyond disease or drug efficacy and safety:

A discussion, arranged by the Fingerpaint Group and published in the Fierce Pharma on November 14, 2022, covered some interesting points in this area. It acknowledged that in the digital space: “You’ve got the efficacy, the safety information, all that.” The discussion then pointed out: “But for a consumer, it’s a different type of journey. It’s, how do I learn more about the disease I’m dealing with? What is it I want to know, not only either for me, or if I’m a caregiver for somebody in my family, even, how do I help support them?”

Thus, it comes out clearly that patients’ or care givers’ quest for information isn’t just about the disease, it’s also about the quality of information that will help the person, as a whole. The drug companies, I reckon, should now accept it as one of their responsibilities. As one of the participants in this discussion said, ‘finding ways to reach everybody in the whole continuum so that they’re educated and informed, so that they can make better decisions for themselves,’ are imperatives for the marketers.

Personal detailing or other personal engagements don’t become irrelevant: 

Omnichannel approach doesn’t make traditional in-person detailing or other personal engagements irrelevant or obsolete. However, those alone, will no longer help a pharma player to achieve performance excellence. The new challenge is how does a company get to the right audience, get the right product to the right patient, or caregivers, amongst this vast ocean of digital noise.

Moreover, the ongoing digital push – beyond several essential personal outreach, will only accelerate in different ways. Omnichannel customer engagement, based on their own terms of engagement, including time, speed, and quality of information, will be the name of the new the game for success.

Many pharma companies aren’t sure where to start, But…

McKinsey & Company in a paper, published on January 05, 2022, also said so. It observed: ‘An analytics-enabled omnichannel commercial model can elevate HCP engagement, but many pharma companies are not sure where to start.’ However, it reiterated: ‘An analytics-enabled omnichannel commercial model can create value; Companies should start now.’

Thus, many pharma marketers may require hand-holding by domain experts, at least, to begin with. However, selection of experts being the key, should go through a structured validation process, including their previous success record in this initiative. As I articulated above, the challenge remains, how does a company use Omnichannel platform to engage the right customers with the right products and associated details, navigating through the noisy cyberspace.

That said, it won’t be unfair to acknowledge that many pharma companies are moving in the right direction.

But many pharma companies are moving in the right direction:

As I mentioned in my article of May 31, 2021: COVID-19 is driving lasting changes in what HCPs need and value,’ found the Accenture Healthcare Provider Survey May 2020, named – ‘Reinventing Relevance.’ Several physicians from the US, Europe and Asia were found to have experienced a significant change taking place in many pharma companies’ communication with them – going much beyond just product information.

Accenture’s follow-up study in August 2020 also reiterated, ‘pharma companies have improved how they engage with healthcare providers during Covid-19.’ It, therefore, appears that the new value expectations of many physicians are being met with a newer value delivery model, significantly deviating from pre-Covid practices.

However, in the above article, I discussed about value delivery through content – not about the channels used.

Conclusion:

The paper by McKinsey & Company, as mentioned above, also indicates another important point. While channels to engage HCPs and other customers are proliferating, the line between online and offline engagement is rapidly blurring. It further adds, managing this imperative has become more and more overwhelming for sales reps. The reason being, they “have traditionally relied on their ‘instincts’ to build relationships with HCPs.

It is now becoming challenging even for many experienced reps to tailor and optimize today’s complex mix of channels, content, and frequency of interactions for individual HCPs, the paper underscores. Which is why, today, transforming the existing commercial model is considered both inevitable and urgent, and:

“Pioneers that have adopted analytics and omnichannel approaches as part of their commercial model have garnered significant rewards.” the paper concluded.

By: Tapan J. Ray      

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

 

Leveraging Data Science To Deliver Unique Patient-experience

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“Changes in consumer behavior, many of which were accelerated by the COVID-19 pandemic, are fueling a redesign of the health ecosystem.” This finding was revealed by a recent study of the PwC’s Health Research Institute (HRI). The research provided insights about how and why specific groups of consumers used health services during the pandemic – from mental health and telehealth to in-home care and other non-traditional care sites.

The study also captured ‘their willingness to use them again in the future,’ and suggested, those pharma companies that closely monitor these consumer signals and design, accordingly, will likely emerge as more customer centric, as the pandemic wanes.

From this perspective, effective application of data science for creating a unique patient experience by listening to patient voice, is now an imperative for pharma players. Which is why, this approach is nowa key business success ingredient in the changing paradigm. It helps offering a holistic disease treatment solution to patients searching for an effective and affordable disease treatment process.

This article will, therefore, focus on leveraging data science for strategic use of Real-World Evidence (RWE) based on Real World Data (RWD) – on how customer characteristics and behavior impact health outcomes. This initiative is fast becoming a key driver to excel in contemporary pharma business.

Strategic use of RWD/RWE increasing in pharma marketing plans:

RWE, as the name suggests, is the evidence derived from RWD. These are collected outside of clinical trials from various sources, such as, patients and HCP surveys on treatment outcomes, electronic health records wherever available, Wearable Health Devices (WHD), insurance claims, data from connected healthcare records, custom study and many others.

The McKinsey & Company article in this area, published on July 23, 2020, also indicated so. Although, some leading pharma companies have already been using RWE. However, recent progress in digital and advanced analytics allows it to be employed in new ways to deliver impact at scale, the article highlighted. When used by hands-on- professionals of repute in this area, RWE can help pharma marketers understand how patient characteristics and behaviors affect health outcomes.

The research paper on how Biopharmaceutical companies are embedding real-world data and evidence use across the enterprise, published in Deloitte Insights on September 21, 2022, presented an interesting contemporary example. It wrote: ‘During the COVID-19 pandemic, RWD/E played a key role in enabling Biopharma companies to innovate and bring novel vaccines and therapies against this highly contagious disease to market in record time.’id-19,

The approach gained momentum during the Covid-19 pandemic:

The above research study of Deloitte brought out this fact succinctly. It found; unprecedented challenge posed by COVID-19 pandemic prompted several drug companies to leverage RWD/E to innovate faster than ever before. More than half of the companies surveyed by Deloitte used RWD/E to understand the incidence and severity of COVID-19 and its variants for vaccine and drug development.’

The survey found: ‘Many vaccine developers, such as Johnson & Johnson analyzed RWD to predict COVID-19 hotspots across geographies to optimize site selection and collect data from diverse racial and ethnic groups.’ Besides, RWE also played a critical role for these companies in understanding vaccine effectiveness across demographics such as age, gender, race, and ethnicity and determining the need for boosters.

Improves patient experience for business excellence:

A systematic and ongoing tracking and analysis of well-identified RWD, by pharma marketing analytics professionals, can help in-depth understanding of changing pharma customer characteristics and behavior, more precisely. Such initiatives include patients, HCPs, hospitals and even the policy makers. Several drug majors have adopted this practice, immediately after absorbing the initial shock of unprecedented disruptions during the Covid-19 pandemic.

Similarly, RWD can help map the exact available space for demand where a brand is being used and potential competitive value-space for its further demand extension – based on real time customer behavior with changing characteristics. To shape customer journeys, such findings may immensely help while strategizing for more targeted content delivery, with sharper segmentation and brand positioning.

Therefore, finding such gaps in various areas of patients’ journey – in their search for an effective and affordable treatment, and appropriately filling these up with brand value delivery is critical. This will help improve patient experience manifold, accelerating business excellence, in tandem.

A recent paper titled, ‘Maximizing your role as a newly appointed real-world evidence leader,’ published by the ZS on March 23, 2022, made similar observations, as above. The study reiterated that patient-generated insights obtained through RWE, are uniquely capable of adding value at different stages of a pharma brand’s life cycle. Or, throughout a patient’s journey on the care pathway of the value delivery system. It concluded: “Carrying out a successful RWE study is a fine balancing act – but its inconveniences and risks are almost certain to be outweighed by the eventual benefits.”

Increasingly used to gain actionable insights to improve patient experience:

In the contemporary market dynamics – driven by changing customer characteristics and behavior, several pharma companies are now effectively combining and analyzing RWD to retrieve RWE. The objective is to gain actionable insights for effective customer engagement for better patient outcomes, to drive business growth. According to a recent podcast by PwC on using data to shape customer journey, the process includes the following:

  • Focusing on the value and outcomes of treatment protocols and less about specific products.
  • Gaining a better understanding of pharma customers and what drives their behavior.
  • Reaching beyond the barrier in driving differentiation amongst competitors.

Conclusion:   

The Forbes article on the Data Science trend in 2022, published on October 04, 2021, aptly epitomized its relevance in today’s business, including pharma industry. It articulated, data science encompasses the practical application of ideas generated by credible and meaningful data from various relevant sources, predictive analytics, and artificial intelligence. Our ability to use such data to our advantage across wide areas in business, would help deliver increasingly worthwhile, valuable, and enjoyable patient experience. 

The article also underscored: ‘If data is the oil of the information age and Machine Learning (ML) is the engine, then data science is the digital domain’s equivalent of the laws of physics that cause combustion to occur and pistons to move.’

Thus, I reckon, both intrinsic and extrinsic brand value creation process, driven by its effectiveness, would increasingly call for Real World Evidence (RWE) based on top-quality Real-World Data (RWD). This is increasingly becoming so critical for success – spanning right across, from product development, launch planning with value propositions – to launch and beyond.

The core purpose of leveraging data science in pharma is, as I see it, is effective decision making throughout the brand life cycle, to deliver a unique patient experience in patients’ journey – with better treatment outcomes.

By: Tapan J. Ray      

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

Why Pharma Need To Connect Better With Patient Organizations Now?

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A good number of patients (63%), especially those with chronic ailments would look for Patient Support Services, revealed a survey by Human Healthcare Systems, released on February 25, 2020. Alongside, drug companies are also, reportedly, investing billions of dollars in every year, for several types of patient support programs, according to the Fierce Pharma article of July 06, 2021, on this subject. It emphasized: ‘Pharma companies spend more than $5 billion on patient support programs every year.’

Thus, it will be interesting to explore – when patients are looking for Patient Support Services (PSPs) and pharma companies are also trying to deliver the same, what’s really happening on the ground? Today’s article will focus on this area to help pharma marketers to get a ringside view of this area, and take necessary action in this area to make this investment more productive.

The aim is to help create a cutting-edge marketing strategy, while delivering best patient value and outcomes in the new normal. Let me start by recapitulating what exactly is a PSP to ensure that we all are on the same page, during this discussion.

Patient Support Services (PSPs):

According to IQVIA, a key challenge in deliberating with PSPs is that they have broad definitions, and consequently, may often give rise to multiple interpretations, misunderstandings and even bias. Be that as it may, IQVIA defines PSP as ‘An umbrella term to describe initiatives led by pharmaceutical companies to improve access, usage, and adherence to prescription drugs. These programs can have a financial component, support clinical investments, focus purely on education, or a combination.’

As we also see around, such programs include – disease awareness campaigns, helping patients use their drugs at the right dose for the right duration for best outcomes, to help patients use their drugs with disease education, financial support and more.

Relevance of PSP in the new normal:

Although PSPs aren’t a new concept, studies unfold – value that PSPs deliver to the community is so significant that when created with a clear understanding of motivators and drivers of patient behavior, can fetch equally significant return on investments for the pharma players.

A recent IQVIA White Paper concludes by noting: ‘One of the major trends seen from the COVID-19 global pandemic, is an increase telehealth. As the point of enrolment into a patient support program goes digital, PSP programs need to adjust.’ This seismic shift in the way we seek and receive treatment will require companies to revisit and potentially update their actionable insight in this space, The paper further notes: ‘With an increase in digital enrolment there are now more opportunities to capture data points and utilize technology.’

Thus, I reckon, it will be worthwhile to fathom, when patients are looking for health care support services and pharma companies are also spending considerably towards the same, what exactly is happening on the ground.

Interestingly, according to the 2021 findings of Phreesia Life Sciences, which surveyed nearly 5,000 patients checking in for doctors’ appointments during the past February and March, found, ‘just 3% were using patient support programs (PSPs).’

Some key highlights of the survey findings:

The support programs in the above survey of Phreesia Life Sciences, broadly includes, services, such as, financial assistance, disease education and specifics about medicine – offered by pharma companies. Based on these, some of the key findings of the study were as follows: 

  • Just 3% of eligible patients are currently using support programs, and 8% have used them in their lifetimes.
  • 59% of patients have little to no knowledge of patient support programs.
  • 61% of patients feel that patient support programs of pharma companies would be “somewhat,” “a little,” or “not at all helpful” for them.
  • Most patients who had used support programs, used them either at first diagnosis, or when starting medication.
  • Only 10% of patients said they had learned about support programs online, but 44% said they’d like to learn about support programs online

Further, as one of the senior officials involved in this research, reportedly, said, ‘nine out of 10 qualified patients were not using the brand’s copay card—even though more than half (53%) said they would likely use one if they had it.’ Moreover, ‘two out of three patients reported it was the first time they were learning about it.’

Likely reasons for low usage of pharma’s PSPs: 

Some of the most likely reasons for low usage of pharma’s PSPs were deliberated in another article of Fierce Pharma dated December 04, 2020. A domain expert commented there, ‘pharma companies simply have missed the mark in developing useful, durable tools for patients. Elaborating this point further, she said, ‘Focusing just on specific adherence tasks, like medication reminders, isn’t providing enough value for patients over a long period of time.’

Another contributing factor could be, patients suffering from multiple diseases and those who are on multiple medications of different pharma companies, are unlikely to download four different apps to track each one.

One more reason could well depend on patients’ generally preferred sources to avail such services, which may not necessarily be pharma companies.

Patients generally preferred sources for patient services:

This point was discussed in the Accenture study – ‘Uniting pharma companies and patient organizations,’ published on August 07, 2019. This survey was done on 4000 patients and some broad findings of this study include the following:

  • Patients generally prefer services from patient organizations over those from pharma companies.
  • Patients feel that patient organizations have a better understanding of their emotional, financial, and other needs than many pharma companies.
  • Patients also want pharma companies to coordinate with patient organizations to provide better care.

The survey also captured details of patient preferences regarding availing required services from patient organizations, rather than the drug companies, as below:

  • Over 50% of patients have greater trust in and better experiences with patient organizations.
  • 64% of patients are willing to share their health data with patient organizations to get better care.
  • 52% of patients are willing to share their health data with patient organizations to get better care.
  • 72% of surveyed patients call or talk to someone at patient organizations on the phone.
  • 58% of patients attend in-person events hosted by patient organizations.

Are PSPs commercially useful to pharma companies?

The very fact that drug companies are currently spending over $5 Billion annually for PSPs, reflects their direct and indirect influence in pharma’s branding strategy and image building process. Otherwise, why would they spend so much? That said, the above survey details send a clear message to pharma marketers to maximize their marketing investments on PSPs, more than ever before. Consequently, the question arises, how to achieve that goal? 

Maximize marketing investments on PSPs:

Echoing and paraphrasing some points from the above IQVIA White Paper, let me highlight, especially for the marketers, 3 clear steps for maximizing returns from pharma’s investments on PSPs, as follows:

A. Gain beforehand deeper insights of patients’ PSP need and expectations: 

37% of patients surveyed said, pharma companies with actionable insights, will better understand their needs through collaboration with Patient Organizations (PO), leading to meaningful engagement in a more personalized way and more frequently.

B. Deliver patient expected value thorough close coordination with the POs:

This is because, 84% of patients think pharma companies – with closer coordination with, at least, a couple of influential patient groups or organizations (PO), will deliver greater value. This will also create a seamless and more cohesive patient experience, while filling gaps in the patient treatment process, to enhance end-to-end customer experience - in an unbiased way.

C.  Creating and delivering new and seamless patient experiences:

The newness is important – not just to delight the patients, but also for strategic differentiation in this ball game. This is possible by working closely with Patient Support Groups (PSGs) as partners, seeking ways to rethink for creating and delivering a unique patient experience from patients’ perspective, and outcome first basis.

Use of data, analytics and insights will be essential while creating care experiences that will better meet the patients’ needs, and would also help measure the impact of PSPs on an ongoing basis.

PSGs are helping to transform health care also in India:

Some PSGs are helping to transform healthcare with prudent use of PSPs in India, as they raise awareness about diseases, help people recover psychologically, and more, have been captured by Indian media, as well. One such report titled, How patient support groups are revolutionizing health care’ says: ‘Because of these networks, patients and their families have become better organized, and are equipped to handle emergency situations and advocate for access to treatment.’

Conclusion:

Echoing the ZS article, published on August 17, 2020, I too concur that COVID-19 has pushed the drug companies to define new ways to deliver care and reach patients. It is quite possible that patient organizations are moving faster in this direction than many pharma companies. Which is why, more patients, reportedly, prefer PSPs from patient organizations, over those from pharma companies.

Further, a course-correction in PSP, would also offer pharma marketers an additional opportunity. Because, PSPs have hidden potential to create an exceptional patient support base that marry brand’s key attributes with the new reality of patients, living with their conditions in the new normal.

Pharma companies will, therefore, need to move from typical reactive support programs – to delivering proactive patient experiences in a post-COVID-19 world, in partnership with PSGs. To ensure maximum number of patients use PSPs, it’s critical for pharma marketers to redefine – the “new normal” patient journey, and meet their current unmet needs in this space. That’s why, I reckon, to succeed in this ball game, pharma would need to effectively connect with patient organizations, more than ever before.

By: Tapan J. Ray  

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

Covid Prompts Pharma To Move Away From Competition Driven Business Model

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As deliberated in my just previous article in this blog, Covid has been a watershed in several areas of pharma business. One such key area is its competition driven strategic business model. It aims to deliver significant value for a longer time than the competition, protected by a patent thicket driven TINA factor – and only for those who can afford such patented drugs. It didn’t matter, if a vast majority of patients are denied access to these medicines, with a dangerous pricing trend acting as an insurmountable barrier. Flying solo has been the motto of most players in this ball game, to delight the stock markets.

Interestingly, Covid pandemic seems to be changing this model. Pharma industry, by and large, is now trying to demonstrate its core value for the society – moving away from displaying competition driven one-upmanship. In this article, I shall deliberate on this area.

Covid poses both – a humongous challenge and a great opportunity:

As the article, published in the MIT Sloan Management Review on April 16, 2020 highlights: ‘The COVID-19 pandemic may well prove to be the biggest challenge for humankind since World War II.’ The same holds good for the pharma industry, as well. The drug companies are now expected by all, to play a pivotal role in the fight against the pandemic ‘that is bringing health care systems to their knees and sending shock waves through economies across the globe.’

This is generally because, pharma industry possesses wherewithal to develop effective drugs and vaccines to combat this health crisis – if not alone, but certainly collectively. It also offers a great opportunity for pharma to ‘walk the talk,’ by demonstrating upfront that meeting all patients’ unmet needs lie at the core of the pharma business. As I quoted a global CEO in one of my articles articulating, this crisis also comes as ‘a Shot at Redemption in Pharma Industry.’

Thus, if the industry reacts quickly and responsibly, it may have the chance to also redeem a reputation that’s been tarnished for years. Some of these instances are, illegal marketing practices, corruption scandals, and obscene pricing of vital drugs, the MIT Sloan article underscored. Flying solo in this situation may not be just enough, if not foolhardy.

Flying solo in this situation may not be enough:

Taking this initiative won’t be a piece of cake, either, if pharma companies prefer to do it alone during this unprecedented health crisis.  The drug players will need to be willing and able to successfully collaborate with other players in the race to develop treatments and vaccines. Otherwise, their legitimacy will be fundamentally questioned, especially when the entire world is running against time.

The rationale of two top drug companies entering into collaborative arrangements is obvious – the realization that pooling of all resources together is the best way of delivering effective Covid related solutions to the society at the shortest possible time. The good news is, pharma has already taken the first step in this direction, even when some of them are competitors, in several areas – moving away from their competition driven business models, as of now.

Once strange bedfellows – now partners:

The article published in the Bloomberg Law on June 05, 2020 very aptly observed: ‘The race to address the pandemic has brought together strange bedfellows as big-name companies’ partner with their rivals.’ The Scientist also wrote on July 13, 2020: ‘The urgent need for tests and therapeutics has brought companies together and pushed researchers to work at breakneck speeds.’

One can find this happening on the  ground now, as some major pharma and biotech companies, including Eli Lilly, Novartis, Gilead, and AstraZeneca, formed a group called COVID R&D to share resources and expertise to try to accelerate the development of effective therapies and vaccines for COVID-19. Besides, Roche Holding AG and Gilead Sciences Inc. have teamed up on trials for a drug combination to treat Covid-19.

There are several instances of such collaboration also in the Covid vaccine area. For example, GlaxoSmithKline plc struck a deal with Sanofi to produce 1 billion doses of a coronavirus vaccine booster. Besides, Pfizer from the US and BioNTech from Germany are joining hands to co-develop and distribute a potential Coronavirus vaccine, aimed at preventing COVID-19 infection.

It’s a reality today that Covid-19 has brought not just the strange bedfellows within pharma and biotech companies together. Academia and governments have also moved on to the same collaborative platforms, to save people from a deadly and super contagious infection, in the shortest possible time. We have witnessed this

in India, as well. For example, the Council of Scientific and Industrial Research (CSIR) and Aurobindo Pharma Limited have also announced a collaboration to develop vaccines to protect against SARS-CoV-2 or COVID-19.

The rationale and some possible issues: 

Each of these players is bringing some expertise and intellectual property to the table. “As they work together, they’re going to create more, so you have the ‘yours,’ the ‘mine,’ and the ‘ours’ of collaboration,” as the Bloomberg Law points out. That said, any collaboration of such nature and scale will have its own share of legal issues, such as, patents, trademarks, trade secrets, revenue sharing models, and more.

The collaborators, in pursuit of saving mankind from Covid-19, are expected to find enough alternatives to resolve these glitches for a win-win outcome – not just for now, but much beyond – with the dawn of a new collaborative model. The rapid general acceptance of this collaborative model by more and more drug companies to meet unmet medical needs in many other areas – much faster, in all probability, will delight the health care consumers and also be appropriately rewarded.

Leveraging the collaborative business model beyond pandemic:

E that as it may, it still remains an open question to many, whether such collaborative model will be leveraged for an accelerated rate of drug, vaccine and diagnostics development beyond the pandemic.

The good news is, as The Scientist article reported, some pharma players are seriously pondering how to continue working in this new way – with the same sense of urgency and purpose, for other disease areas too. They believe, the lessons being learned with the collaborative models, may help expedite development of therapeutics in other serious conditions, such as, Alzheimer’s, intractable cancers and autoimmune diseases.

If and when it happens as a predominant business model, suffering patients and the society, in general, would lap it up and the innovators would be suitably rewarded. However, the paper also says, there are still some drug companies who prefer to continue working in a more insular fashion, as was happening in the old normal. But, experts also feel, that should not cause any worry, as long as majority prefers to continue following the collaborative models, in the new normal, as well.

Pharma would make a good profit from collaborative business models too:

For those who say that drug companies won’t make good profit from Covid drugs and vaccines, Pfizer CEO has an answer. Albert Bourla, Pfizer’s CEO, reportedly, has no patience for the argument that pharmaceutical companies should not be making a profit on the drugs and vaccines they introduce to fight Covid-19. This article highlights, at $19.50 per dose, the 1.3 billion doses of Pfizer BioNTech Covid vaccine that the Pfizer plans to make by the end of next year, could translate to nearly $13 billion in sales, after the company splits its revenue with its partner BioNTech. It is roughly the same as Pfizer’s all-time best-selling drug Lipitor sold in its best year.

Adding to it, another article on the same issue, published by Fierce Pharma on August 13, 2020, further reinforced the above expectation. It wrote, the longtime Evercore ISI pharma analyst haspredicted the total market for COVID-19 vaccines would be worth $100 billion in sales and $40 billion in post-tax profits. It assumed frontrunner Moderna would supply about 40 percent of the market, Novavax would take 20 percent and the other vaccine developers would split the rest. “One could look at the field under this base scenario and conclude it is reasonably valued in total,” the analyst concluded.

Nonetheless, there could still be several points that remained unanswered in this analysis. But the bottom line is, the collaborative model is not just profitable, it starts generating profit earlier and faster – virtually eliminating the cost of possible delays when a company flies solo.

Conclusion:

With a seemingly flattening curve, the Covid pandemic still continues, alarmingly. As of October 25, 2020 morning, India recorded a staggering figure of 7,864,811 of Coronavirus cases with 118,567 deaths.

With this backdrop, COVID-19 has provided the pharma industry a new opportunity to demonstrate its true value to the society – not the self-serving ones. It’s now clear that no one can rule out, there won’t be a similar unprecedented health catastrophe in the future too. It may come in various different forms, or may even be from a rapid and complex mutation of the same lethal virus.

Moreover, such crisis may not come and go in just a few months – may even linger for a long time. In any case, these may again be equally disruptive – or even more disruptive to lives, livelihoods and the economic growth engine. In such a scenario, putting the brightest scientific brains of the world together will be critical, and adding top speed to the process being the essence to come out of the crisis with least possible damages.

Covid pandemic has also demonstrated that the competition-based model of the drug could be a serious retarding force in that endeavor. What will matter, is a well-structured collaborative model that can create a win-win situation – both for patients and the business. I reckon, it’s about time to move into this model to find most effective drugs and treatment solutions for many other unmet needs related to a host of intractable diseases, much sooner.

There could, of course, be some business issues with this model. But those can be resolved amicably for an all-weather greater success in business, along with protecting the society – for all. From this overall perspective, it appears, Covid pandemic now sends a strong signal to pharma companies to move away from predominantly competition driven business models, expanding more into collaborative ones.

By: Tapan J. Ray    

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

 

Pharma To Leverage The Art of Turning Challenges Into Opportunities, Now

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Since, the dawn of the year 2020, the human population living in different countries, across the world are facing ‘lockdowns in different forms. Although essential, it severely restricts normal daily essential and other important activities of all. A large number of populations in India, is also experiencing the same – for nearly 4 months, almost at a trot, as on date.

The fear of getting infected by COVID-19, fueled by uncertainty about a comprehensive way to surely avert infection and apprehension about what happens if someone gets infected, have been haunting many for several months. Moreover, the possible impact of several related essential measures, such as, social distancing and wearing a mask mostly while being outdoors, on both life and livelihood, is profound. It has already started causing an unprecedented – both physical and mental stress on many individuals, besides the economy of the nation.

Living amid ‘lockdown’ conditions is not just an unpleasant experience for all, it’s almost a ‘prison like’, experience for a vast number of people – particularly, both young and old with comorbidly. “It’s very similar to being trapped in a bunker with no access outside,” as expressed by a person with similar issues, which, may be construed as a universal feeling of common individuals. Interestingly, this was quoted in an article -  ‘What patients need right now’, published in the Reuters Events Pharmaon July 07, 2020. The article also highlighted that many other fellow sufferers, especially non-Covid-19 patients, are enduring pandemic enforced isolation without much hope. “They are staying in limbo until help is available and adapting to the worsening of their health conditions,” the article added.

Further, as captured in the McKinsey article – ‘COVID-19 and commercial pharma: Navigating an uneven recovery,’ published on April 21, 2020 – not just patients, health care professionals including doctors, are also facing unprecedented challenges. Especially, because of the need to address fundamental changes in the treatment of patients with conditions other than COVID-19. This is happening across medical specialties and therapeutic areas, besides of course in advising and treating patients with suspected and confirmed cases of COVID-19.

In some instances, some doctors do also worry about their financial security, as practices and health systems face unprecedented financial issues, the above article emphasized. However, at the same time, many of them are now rapidly adjusting how they deliver care, such as through increased use of telemedicine in different forms and ways, the survey found. Which is why, the support they need from pharma companies is also changing.

Taking cognizance of these critical developments, pharma players would require rewriting their playbook for business operations and for its urgent implementation. This article will focus on this important area of pharma business, by leveraging the art of turning a problem or a challenge into an opportunity.

Leveraging the art of turning a challenge into an opportunity:

Turning a problem or challenge into an opportunity in managing business operations, isn’t a cup of tea of all managers, across domains. More so, when it’s caused by an unprecedented disruptive change, such as the Covid-19 pandemic.

The first and the foremost prerequisite from a manager is a mindset to make it happen – driven by uncluttered thinking, with a clear focus on what needs to be achieved, how and when – step by step. Each element of a change has to be analyzed in-depth – supported by credible data, with possible barriers envisaged on the way. In tandem, weighing the chances of success in these initiatives based on data – and not gut feeling, within a predetermined timeframe will be critical. The net outcome of this process will help pharma players acquire a differentiated competitive edge for excellence, amid today’s all-pervasive quandary.

Under this backdrop, leveraging the art of turning a problem or challenge into an opportunity – in an organized manner, for a successful outcome of the present and future pharma business, appears to be a crying need.

The points to ponder:

Effectively moving in this direction will call for – at its very onset, a careful and unbiased data-based assessment of several critical areas, which will include:

  • Whether customer engagement platforms, medium, processes and also the core content of communication of pre Covid-19 days remain equally relevant today, and will remain so in the foreseeable future, for productive business outcomes.
  • Mapping changes with the extent for each, in all touchpoints of disease treatment processes is important – involving both patients and doctors, and simultaneously capturing their new preferences in those areas.
  • Arriving at what strategic and tactical changes the new normal calls for, to effectively engage with especially, non-Covid patient treating doctors and non-Covid infected patients, for other disease areas.
  • How doctors are delivering care, particularly to these patients today?

Accordingly, the pathway for required changes has to be charted out in detail, specifying the end point of each, on a time-bound and ongoing basis. The good news is, several pharma players have already taken several praiseworthy initiatives to combat this crisis.

What pharma companies have done so far:

So far, many pharma companies – both global and local, have taken some commendable steps to address the immediate fallouts of the crisis. These include,

  • Repurposing old medicines – starting from hydroxychloroquine, remdesivir to dexamethasoneand probably beyond. All these drugs are currently being used for the treatment of Covide-19, although conclusive scientific evidences are still awaited – for most of such repurposed drugs.
  • Covid-19 vaccine development started almost immediately, including the homegrown ones.

As the above McKinsey article – ‘COVID-19 and commercial pharma: Navigating an uneven recovery,’ also reconfirms, now most pharma companies are largely focusing on ‘the immediate crisis, including by facilitating access to medicine; supporting HCP, institution, and patient needs in new ways; safeguarding employees; and enabling employees to operate in a new environment.’

The areas where pharma needs to focus more amid immediate crisis:

Another, responsibility of pharma to help tide over the immediate crisis, is to ensure that critical drugs, such as remdesivir, do not go in short supply. And also, avoiding unnecessary hype on a COVID-19 vaccine, which a global CEO termed as a grave disservice‘ to the public.

Nearer home, it also happened – not by any pharma company, but by the country’s premier, state-run medical research organization – the Indian Council of Medical Research (ICMR). The head of the ICMR has announced that India is planning to launch the Covid-19 vaccine by August 15, 2020. This was later retracted under heavy adverse criticism.

Future focus areas need to be in sync with the changing customer behavior:  

While converting several challenges into opportunities in sync with the future requirements of their business operations, drug companies should try to derive the first mover advantages. For this purpose, creative use of almost real-time data will be vital. In this endeavor, I reiterate, one of the top priorities will be to ensure that all touchpoints of the consumer engagement process take into account the changing customer behavior, as captured by data.

To have a productive value delivery system in the new normal, cerebral use of modern technology-based tools and platforms could provide a sharp cutting edge. A similar process may be adopted – even a stage earlier – during the differential value creation process of the business. Nevertheless, the name of the game for the future, would still remain delighting the customers at all the touch points, especially while navigating through strong headwinds.

Another major impact area of pharma business:

The onslaught of Covid-19 pandemic has also resulted in some significant behavioral changes among many health care consumers. These spans across several areas, as I wrote earlier. For example, a number of surveys have revealed that fewer number of non-Covid-19 patients are now visiting doctors’ clinics.

The study quoted by the above McKinsey article highlights some important points in this regard, such as:

  • Among surveyed HCPs, 82 percent report declines in patient volumes, with more than half describing the declines as “significant”.
  • 40 percent of the surveyed patients reported having a doctor cancel an appointment, while an additional 30 percent or so canceled the appointments themselves.
  • Half of surveyed physicians worry that their patients will not be able to receive timely care for new or existing conditions, particularly those that are not COVID-19 related.
  • The overall reduction in volume is widespread, but variation exists. For example, the number of oncology-related visits have declined far less than those related to cardiology or dermatology, perhaps reflecting patient or physician perceptions of urgency.
  • Such data represent a snapshot of a time still early in the trajectory of this crisis, but the HCPs surveyed expect the trends to continue—and to accelerate, potentially.

Another challenge is surfacing, the talent gap to squarely deal with the crisis.

The problem of talent gap, an opportunity? 

While preparing a company to succeed amid new challenges of the new normal, pharma leadership will notice some critical talent gaps in important areas of business. This is indeed a problem or a challenge. But can this also be converted into a new opportunity? … I guess, this is an opportunity of reskilling the company to meet with the future challenges, to move ahead at a faster pace.

In pursuit of this goal, top pharma decision makers may wish to evaluate a well-balanced mix of two approaches:

  • Reskilling competent existing employees for the new world.
  • Hiring new and ready – suitable talents, for immediate results.

Conclusion:

Reuters reported last Friday, with over 1 million Covid-19 cases, ‘India joins U.S., Brazil in the grim Coronavirus club.’ As on July 19, 2020 morning, the recorded Coronavirus cases in the country reached 10,77,874 with 26,828 deaths. According to the Indian Medical Association (IMA), the spike in the number of Covid-19 cases in India has resulted in the community spread of the Coronavirus disease. It further added: “This is now an exponential growth. Every day the number of cases is increasing by more than around 30,000. This is really a bad situation for the country.” The pace of climb continues going north.

Meanwhile, the Prime Minister of India has also urged all concerned to convert Covid-19 related challenges into opportunities. He said, it’s time to initiate reforms in several areas of governance by all the Indian State Governments.

Call it, the Prime Minister’s advice, or a basic management tool – most appropriate to leverage at this hour, the concept is worth considering by pharma players, as well, instead of getting overwhelmed by the crisis. Thus, in my view, it’s about time for pharma companies to identify critical Covid-19 related challenges, both immediate and also of the future – and convert those into opportunities – powered by technology-based cerebral inputs, in the new world order.
By: Tapan J. Ray
Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this

 

A Link To Ponder: Pharma Digitalization – Cyber Threats – Cyber Immunity

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Digitalization in the pharmaceutical industry – slowly but steadily, across its various domains, from drug discovery, clinical development, supply chain, sales and marketing to engage with various stakeholders, is a reality today. Consequently, the concept of data as a business asset, is fast taking the center stage, being the nerve center of the business. It encompasses, conceiving data requirement, generation of a massive pool of credible data accordingly, their analysis and finally – putting a robust data security system in place, against any kind of theft or misuse.

While digitalization of pharma business, helps transform the company to an all-time ready and an agile customer-centric business entity, with one ear always listening to customers to delight them with its deliverables. Conversely, the other ear is on its employees with a similar objective. This is a difficult task and mostly involves disruption of status-quo within the organization, but often produces game changing outcomes for the business, as is known to many.

Which is why, one sees a good number of people around, offering expert digital services for the pharma industry – along with a hope of a never before improvement in the future organizational performance. So far so good, but this transformation process also invites a huge technology-related threat to business – ‘Cyberthreat.’ In this article, I shall focus on the critical need of taking guard against this threat, as is often advised by all well-qualified domain experts. This risk is expected to increase further, as the technology keeps advancing.

Although, I had deliberated on Cybersecurity in my article, ‘Exigency of Cybersecurity in Digitalized Pharma,’ in a different context, before delving into the core point of today’s discussion, let us together try to recapitulate what does ‘Cyberthreat’ mean to us, in the real world.

Cyber-threat in the digitalized business:    

Let me paraphrase, especially in context of the pharma industry, what the Cybersecurity and Infrastructure Security Agency (CISA) of the Government of the United States, has stated. It articulates, ‘Cybersecurity’ or ‘Cyber threats’ to a control system, refer to the attempts of unauthorized access to a control system device and/or network using a data communications pathway.

This access can be directed from within an organization by trusted users or from remote locations by unknown persons using the Internet. Threats to control systems can come from numerous sources, including disgruntled employees, and malicious intruders. To protect against these threats, it is necessary to create a secure cyber-barrier around the Industrial Control System (ICS).

Many sources indicate that the threat to cyber security in business, is often triggered to gain access to a company’s digital system to damage or steal data, or even to rattle its digital infrastructure for accomplishing a specific purpose.

Rapid digitalization in pharma may attract more cyber criminals:

According to a senior official of Kaspersky - a global cyber security company: “As rapid digitalization penetrates the healthcare sector, cyber criminals are seeing more opportunities to attack this lucrative and critical industry, which is honestly not equipped enough to face this virtual danger.”

The company further emphasized, with systems are now interconnected and mobile devices extensively used, both for remote access and for data sharing, digitalization in pharma increasingly exposes the organizations to both generic and targeted attacks. Thus, ‘creating Cyber immunity’ to ensure a powerful safeguard against such threats, becomes a top priority area in the digital transformation process of the drug industry.

Interestingly, way back in 2012, another report had also cautioned: ‘Cybercrime costs economy billions annually, with pharmaceutical and biotech companies among the hardest hit.’

Evidences of Cyber-attacks on pharma across the world:

There are numerous evidences of Cyber-attacks on the pharma players, globally. Such as, in June 2017, The Washington Post reported, US-based global pharma major, was among dozens of businesses affected by a sprawling cyberattack, with victims across the globe facing demands to hand over a ransom or have their computer networks remain locked and inaccessible.

Another report of December 13, 2017 wrote, by the third quarter of the year, ‘Merck had a better idea of the financial tab from the attack. While it generally had a very solid quarter, the results were dampened by the impact of the attack. There were $300 million in lost sales and costs.’

The Deloitte paper, titled ‘Cyber & Insider Risk at a Glance: The Pharmaceutical Industry’, also reiterated, the evidence abounds that pharmaceutical companies are the target of sophisticated Internet criminals. Serious cyberattacks are taking place even in the most advanced countries, including the US, Europe and Japan.

In the US, besides Merck, hacking has taken place against other major pharma and medical device makers, such as, ‘Boston Scientific, Abbott Laboratories, and Wyeth, the drug maker acquired by Pfizer Inc. The same group successfully hacked the Food & Drug Administration’s computer center in Maryland, exposing sensitive data (including formulas and trial data) for virtually all drugs sold in the US,’ the paper revealed.

The real impact of the attack often doesn’t come out:

Outside world often doesn’t get to know about the comprehensive impact of numerous cyber-attacks for various reasons. Some of which may include, it’s possible aftermath on both the corporate image and also the brands, besides share prices. At the same time, the situation may prompt many to question the company’s capability to protect its business in the digitalized world.

The key reasons:

As the 2018 Data Security Incidence Report highlights, healthcare-led all industries accounted for around about 25 percent of more than 750 reported incidents, in volume. As identified by Kaspersky from various cyber-attack techniques and behavior of cyber-criminals, on the digital infrastructure of pharma players, let me paraphrase below the three key motivators, besides a few others:

  • Getting Intellectual Property (IP) related strategic details, including R&D, unpublished clinical trial results and formulation development processes.
  • Detailed business plans for pre-identified products.
  • Or, may even be for ransom.

Where does India stand?

According to reports, India ranks 6th for highest cyber-attacks on pharmaceutical companies. Nearly 45 per cent machines in the Indian pharmaceutical organizations more than four in 10 devices were detected with malicious attempts. Ahead of India features - Pakistan (54 per cent), Egypt (53 per cent), Mexico (47 per cent), Indonesia (46 per cent) and Spain (45 per cent).

Such attacks are taking place even in India, as cyber-criminals “are slowly realizing that pharmaceutical companies house a treasure trove of highly valuable data such as the latest drugs and vaccines, the newest researches, as well as medical secrets,” the report says.

Likewise, another article, published in Health Issues India, on September 17, 2019, made some interesting points. The article is titled, ‘Cyberattacks: A crisis in Indian pharma?’ It flagged in the following three areas, in this regard:

  • Numerous cracks exist in the cyber-security armor of Indian pharmaceutical companies.
  • Just five to ten percent possess security systems strong enough to protect information from hackers.
  • And many do learn about a breach for several months.

Quoting a top expert, the paper reemphasized that generally in the Indian pharma companies “current systems don’t have security control and visibility in place to immediately detect the attack and respond on a real-time basis.” Thus, ‘it is unsurprising that Indian pharma has been so hard hit by cybercrime,’ the article further commented.

Conclusion:

Echoing many others, Booz Allen also advised in its article – ‘Understand the risks, and stay ahead of the game.’ This is a critical requirement in the digital age. Although, most pharma companies agree on the possibility of huge business losses from a cyber-attack, the industry continues to lag behind other industries when it comes to cyber-security implementation, the paper reiterated.

On the other hand, just strengthening a company’s IT systems, alongside an installation of powerful anti-virus software may still not be enough. Nor will it be adequate to working closely with the vendors who help protect cyber-security of the digital infrastructure of various companies. Even a robust system of forensic audit and analysis and reevaluating cyber-security protocols on an ongoing basis, may not be able to prevent cyber-attacks.

This is primarily because, a company is run, managed, looked after and cared by its employees. Although, it always remains the endeavor of any company to hire good, trustworthy and high performing employees, it does not always happen that way. It is also equally possible that some of them, at some time, for some reasons, may misuse the digital network for others or personal gain.

Thus, besides putting in place all other safeguards, as stated above, to attain desirable ‘Cyber-Immunity’, it is crucial for the organization to ensure buy-in of each employees a vital concept. This is – protecting cyber-security is everybody’s responsibility in a digital business framework, both individually and collectively. The process should start from the CEO and percolate down to the lowest rung in the ladder of hierarchy.

Hence, the reality is – ongoing digital transformation process of the pharma business would open the door of cyber-threats – often leading to crippling cyber-attacks. Thus, developing a comprehensive and strong cyber-immunity framework becomes essential for the organization. From this perspective, right from the start of this process – and not later on, drug companies need to ponder over the critical link between digitalization and cyber threats to provide adequate cyber immunity to its digital systems, for game changing outcomes.

By: Tapan J. Ray   

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

 

Would ‘Complex Generics’ Attract More ‘Authorized Generics’?

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Despite increasing numbers of alleged scams involving generic drugs, both in the United States and also in India, even involving many large generic drug manufacturers, the traditional generic drug market, keeps growing globally. Although, the current growth is in mid-single digit, the market can’t be ignored, either.

That apart, enormous pricing pressure, squeezing bottom line and cutthroat competition, are prompting many companies, including Big Pharma, to craft different strategies to excel in this market. One such involves a shift in business focus from relatively low priced traditional generic drugs to comparatively higher priced complex or specialty generic medicines with a few competitors.

In this emerging situation, a lurking apprehension does surface for many. If the margin is good and the prices of these complex or specialty generics, are much higher than traditional ones, won’t it prompt more ‘Authorized Generics’ coming into the market? Won’t that jeopardize the interest of other generic drug makers? In this article, I shall explore this area, along with its possible consequences. Before doing that, it will be worthwhile to give an overview of the generic market, before recapitulating what are ‘Authorized’ and ‘Complex’ generics.

How lucrative is the generic drugs market now?

According to the latest report by IMARC Group, the global generic drug market size reached US$ 340 Billion in 2018 and is expected to be at US$ 475 Billion by 2024, growing at a CAGR of 5.3 percent during 2019-2024 period.

The key market growth drivers remain, increasing number of product patent expiration, higher prevalence of chronic diseases and different government initiatives to encourage faster generic launch, including the United States. The pace of increase is faster in the emerging markets, like India. However, unlike India, non-branded generic drugs, rather than branded generics, are dominating most the markets.

Although, Central Nervous System (CNS), cardiovascular, dermatology, oncology and respiratory are among the dominant segments in the market, CNS and Cardiovascular segments are the two largest ones in this market. North America holds the largest market share, with more than 88 percent of total prescriptions being written for generic drugs in the U.S., as the report highlights. Despite this scenario, to mitigate huge pricing pressure, cutthroat competition and low margin, many drug players are preparing to move into specialty or complex generics.

The size and growth of complex or specialty generics market: 

The April 2019 report by Research and Markets- “Specialty Generics Market: Global Industry Trends, Share, Size, Growth, Opportunity and Forecast 2019-2024″ states, the global specialty generics market reached a value of US$ 44.8 Billion in 2018. By 2014, its value is expected to reach US$ 88.9 Billion with a much higher CAGR of 11.9 percent, in 2019-2024 period.

Which drugs would belong to this market?

According to the ‘White Paper’ titled, ‘Complex Generics: Maximizing FDA Approval Prospects’ of Parexel, the following are some examples of complex generics; the list continues to grow as more products are being added in this category every day:

  • Complex Active Pharmaceutical Ingredients (APIs), examples being Enoxaparin, Low Molecular Weight Heparin, Glatiramoids, Iron Carbohydrate Complexes etc.
  • Complex Formulations, examples being Liposomes, abuse-deterrent generics, parenteral microspheres.
  • Complex Route of Delivery, such as topical ointments and locally acting GI drugs.
  • Complex Drug-Device Combinations, such as DPI, MDI, nasal sprays, and transdermal systems.

These types of complex and high-cost generics, besides some off-patent biologic products and even Biosimilar drugs, are often used to treat complex and life-threatening diseases, such as, cancer, Hepatitis C, and many others. Complex generics are expected to eventually own a significant percentage of the total generic drugs market, as a number of big-ticket specialty drug molecules will go off patent in the ensuing years.

The major advantages of complex generics:

Some of the major advantages of the complex generics market over traditional generics are as follows:

  • Complex manufacturing requirements with higher capital costs – thus, higher price, better margin, fewer players, lesser competition.
  • Increasing prevalence of life-threatening diseases, besides, cost containment measures from the government and healthcare providers, are pushing the demand of these drugs.

Indian companies are also entering the fray: 

As the share of specialty medicines in global spending in 2017 increased to 32 percent from 19 percent in 2007, Indian drug players also could sniff the opportunity in this space. Just as Sun Pharma, reportedly shifted its focus from once lucrative traditional generics medicines to specialty drugs, amid continued price erosion in its biggest market – the US, many others are also joining the fray.  The Indian players who are, reportedly, investing in complex generics include, Aurobindo Pharma, Dr. Reddy’s Labs, Cipla, Lupin, Glenmark and Cadila.

More specifically, with the contribution of specialty medicines to overall pharmaceutical spend in the US, Germany, France, Italy, UK, and Spain – almost doubling over the last 10 years, this trend is likely to gather momentum, as the above report indicated. Accordingly, commensurate strategic actions aimed at this segment by many companies, both global and local, are clearly now visible.

Some strategic initiatives:

In preparation of a major shift in the strategic focus on complex generics, key examples of some of the important initiatives of different companies will include the following:

  • Big generic players wanted to be bigger in the global market through M&A, such as Teva acquired Allergan’s generic business, Mylan bought Abbott Laboratories’ generics businessAbbott Laboratories’ non-U.S. developed markets specialty and branded generics business. Similarly, Endo International acquired Par Pharmaceuticals. In India the mega deal of Sun Pharma acquiring Ranbaxy in 2015. In the same year, Lupin acquired New Jersey-based generic drugs firm GAVIS to boost its presence in the US.
  • Novartis sold its 300 ‘troubled’ U.S. generics to India’s Aurobindo for US$ 1B, as the entire generics industry faced unrelenting pricing pressure in the U.S.’ Whereas, Novartis’ wants to focus higher-margin assets like Biosimilars and complex generics.
  • Pfizer is set to combine its off-patent drug unit Upjohn with Mylan, to create a new business with its own off-patent branded and generic drug lines. The merger will bring together Pfizer medications such as Lipitor and Viagra with Mylan’s EpiPen, used to halt life-threatening allergic reactions.
  • Owing to margin pressure and other reasons, some of the Indian drug players also decided to enter into higher margin complex generics space, pursuing both organic and inorganic routes. There are several such examples, such as: In January 2017, Zydus Cadila announced acquisition of Sentynl Therapeutics Inc., a US based specialty pharma company specialized in marketing of products in the pain management segment. And in October 2017, Lupin acquired US-based Symbiomix Therapeutics LLC to expand Lupin’s US women’s health specialty business in the highly complementary gynecological infection sector.

Any flip side of complex generics business for the Indian players? 

Although, driven by mainly higher profit margins and tough entry barriers, many generic players with the requisite wherewithal, find complex generics business more attractive to focus on, there’s a flip side to it, as well. This is, post patent expiry, innovator companies may be encouraged to introduce more ‘Authorized Generics’, creating a tough competitive environment for other generic players to compete with them. This brings us to the question of what are ‘Authorized Generics?’

Authorized Generics:

According to the USFDA, the term ‘Authorized generic’ is used to describe an approved brand name drug that is marketed without any brand name on its label. It is exactly the same product as the branded one, and may also be marketed by another company with the innovator company’s permission. Generally, an ‘Authorized Generic’ is launched at a lower price than the brand name drug.

Moreover, ‘Authorized Generics’, despite being the generic version of patented molecule, are mostly marketed by the patent holders themselves, both pre and post patent expiry. While a separate NDA is not required for marketing an ‘Authorized Generic’, USFDA requires that the NDA holder notify the FDA, if it markets an ‘Authorized Generic. The NDA holder may market both the ‘Authorized Generic’ and the brand-name product at the same time. Interestingly, the USFDA has approved around 1215 ‘Authorized Generics’ as of September 30, 2019.

Advantages of ‘Authorized Generics’ over ‘Traditional Generics’:

The key advantage of ‘Authorized Generics’ over traditional generic drugs is, while traditional generic drugs can be marketed only after patent expiry of the innovator drug, ‘Authorized Generics’ can be marketed even before patent expiry. In other words, innovator companies or their authorized collaborators can make lower priced ‘Authorized Generic’ versions available on their behalf, under their own new drug application (NDA). ‘Authorized Generics’ may be made available to patients even before patent expiry to out-maneuver the conventional generic drug makers, in advance, on price, quality and doctors’ confidence in the original drug.

According to several reports, over the past years, ‘many innovator drugs companies have been launching Authorized Generics, simultaneously with the first Abbreviated New Drug Applications (ANDA) filer’s launch of its generic drug product.’ However, the question remains how do the stakeholders perceive the ‘Authorized Generics’?

Perception of ‘Authorized Generics’:

Studies are available analyzing the impact of ‘Authorized Generics’ on the pharma market and also on the stakeholders. In this article, I shall refer to a comprehensive research study, titled ‘Authorized Generics: Effect on Pharmaceutical Market,’ published in the International Journal of Novel Trends in Pharmaceutical Sciences (IJNPTS), on February 29, 2012, which came out with the some notable findings.

Generally, there isn’t any doubt, either on the fact that ‘Authorized Generics’ provide the identical experience that the patient receives from the brand drug but at a lower price. Nor is there any question over greater confidence of doctors while prescribing these drugs. However, the researchers wrapped up the discussion by stating: It is difficult to conclude that the ‘Authorized Generics’ practice should be continued or banned. Though Indian pharmaceutical companies are dealing with generic drugs – 42 percent of the respondents were in favor of ‘Authorized Generics’ practice, whereas 58 percent opposed it. Thus, the overall perception of ‘Authorized Generics’, appears to be a mixed bag.

Conclusion:

There are free flowing arguments both in favor and against the ‘Authorized Generics.’ The article titled, ‘Drugmakers Master Rolling Out Their Own Generics to Stifle Competition,’ published in the Kaiser Health News (KHN) on August 05, 2019, captures it well.

It quoted the spokeswoman for the Pharmaceutical Research and Manufacturers of America, or PhRMA, a powerful pharma lobby group saying, an Authorized Generic drug “reduces prices and results in significant cost savings.” Whereas the critics say, “Authorized Generics hurt long-term competition and often perversely increase costs, even in the short term.”

The detractors further expressed, ‘Authorized Generics’ don’t just steal sales from existing generic rivals, they erode incentives to make generic drugs. A professor at the University of California, Hastings College of the Law, who studies pharma was also quoted in this article saying, this practice can “stave off generic competition and make sure that generics can’t get much of a foothold when they do get to market.” Adding further he said: “That’s the game. And drug companies have become masters at this.”

As the Kaiser Health News highlighted, Eli Lilly announced launch of the ‘Authorized Generic’ version of Humalog insulin in March 2019 for US$137 a vial, at half the price of its brand name version costing US$237. This was reasoned by the company as a considerate move to address the need of those patients who can’t afford the price of the brand – Humalog. Curiously, even some analysts believe that ‘Authorized Generics’ may help explain why relatively few true generics are reaching the market despite a surge in approvals, especially in the United States.

Against the above backdrop, the drug policy makers need to ponder, would ‘complex generics’ of different companies face greater challenges from ‘Authorized Generics,’ playing a spoilsport for the rest in this ball game?

By: Tapan J. Ray   

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

 

 

Deadly Climate Change Impact On Human Health: How Prepared Is India?

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It’s not uncommon to find many people, including heads of countries, expressing their serious apprehensions in public, about the scary impact of climate change. Just the last year, on November 26, 2018, BBC News captured one of such incidences with the astonishing headline: “Trump on climate change report: I don’t believe it.” The findings of this report have underscored, ‘unchecked global warming would wreak havoc on the US economy.’

Similarly, a few years ago, on September 05, 2014,CNN News 18 quoted Prime Minister Narendra Modi as saying: “Climate has not changed. We have changed. Our habits have changed,’ while answering to a question on climate change. Regardless of the outcome of any split-hair analysis of the rationale behind such statements from the world leaders, such public discourse could trivialize the possible catastrophic impact of climate change on the planet earth.

Be that as it may, that climate change is taking place, carrying all its ill-effects, is real now, without any ambiguity. There is also widespread consensus among the members of the United Nations that ‘the Earth is warming at a rate unprecedented during post hunter-gatherer human existence.’

It is worth noting that way back in 2001, the ‘Third Assessment Report of the Intergovernmental Panel on Climate Change’, further recorded: “There is new and stronger evidence that most of the warming observed over the last 50 years is likely to be attributable to human activities”, most importantly the release of greenhouse gases from fossil fuels.

Several ‘International Agreements’, including the Paris Agreement on Climate Change - all supported by hard scientific data, have called for immediate, quantifiable measures in each country to address the ‘wide-ranging environmental threats, such as ozone depletion and long-range transboundary air pollution.’ Against this backdrop, in this article, I shall focus on the dreadful effect of climate change in the proliferation of a wide-variety of ailments, especially infectious diseases, within a few decades. While doing so, let me first have a quick recap on what is ‘Climate Change’, in a simple language.

Climate Change – a quick recap:

According to the United Nations, ‘Climate Change is the defining issue of our time and we are at a defining moment. From shifting weather patterns that threaten food production, to rising sea levels that increase the risk of catastrophic flooding, the impacts of climate change are global in scope and unprecedented in scale. Without drastic action today, adapting to these impacts in the future will be more difficult and costly.’

It’s important to note, although, the planet Earth’s climate is constantly changing over geological time, the current period of warming is occurring more rapidly than many past events. Scientists are concerned that the natural fluctuation or variance, is being overtaken by a rapid human-induced warming, as they emit more greenhouse gases. As these gases get trapped in the atmosphere, more heat is retained that has serious implications for the stability of the planet’s climate, even impacting human health with grave consequences. The World Health Organization (W.H.O) has also warned that the health of millions could be threatened by increases in malaria, waterborne disease and malnutrition.

Its impact human health:

The direct and indirect impact of climate change on human health is profound. Before I go into the specifics, let me indicate some of the direct ones, as captured by the Center for Health and the Global Environment (CHanGE), University of Washington. This is sans any charts and maps, unlike the usual practice:

  • Increasing temperatures are causing poor air quality that can affect the heart and worsen cardiovascular disease.
  • Increasing exposure to pollen, molds, and air pollution, all of which can worsen allergies and other lung diseases, such as asthma.
  • Changes in the geographic range of disease-carrying insects, such as mosquitoes, ticks, fleas and other similar ones, which can fast spread many tropical ailments, such as dengue fever and malaria to humans.
  • Increasing frequency and severity of extreme weather and climate events can cause, besides many physical illnesses, several kinds of mental illnesses – increasing both morbidity and mortality.
  • Frequent flooding events and sea level rise can contaminate water with harmful pathogens and chemicals, potentially causing food-borne and waterborne illnesses.
  • Changing weather patterns affect the quality and quantity of nutritious foods with increasing incidence of under-nutrition and micronutrient deficiencies.
  • Additional stress placed on hospital and public health systems, could limit people’s ability to obtain adequate health care during extreme weather events and disease outbreaks.

Most specific and the deadly one:

The World Health Organization (W.H.O) publication - ‘Climate change and human health – Risks and Responses,’ clearly flagged that ‘Changes in infectious disease transmission patterns are a likely major consequence of climate change.’

Citing a pertinent analogy to explain the reason, it said: “Humans have known that climatic conditions affect epidemic diseases from long before the role of infectious agents was discovered, late in the nineteenth century. Roman aristocrats retreated to hill resorts each summer to avoid malaria. South Asians learnt early that, in high summer, strongly curried foods were less likely to cause diarrhea.”

Would pharma players convert these problems into opportunities?

Curiously, some pharmaceutical investors are researching to fathom potential business opportunities lying underneath the above problem, especially for vaccines and newer antimicrobials. It’s probably a blessing in disguise not just for the drug companies, but also for the general public, considering the following two issues, prevailing in the current scenario:

  • According to W.H.O, Antimicrobial Resistance (AMR) is an increasingly serious threat to global public health. It threatens the effective prevention and treatment of an ever-increasing range of infections caused by bacteria, parasites, viruses and fungi, causing the success of even major surgery and cancer chemotherapy seriously compromised.
  • ‘Pharmaceutical companies are backing away from a growing threat that could kill 10 million people a year by 2050’, reported a July 19, 2018 article. This is because, ‘Antibiotics Aren’t Profitable Enough for Big Pharma to Make More,’ wrote another article, published in Bloomberg Businessweek, on May 3, 2019.

Interestingly, a recent report analyzed and evaluated how this can be done, and which companies will be benefitted most in that process. 

“Climate change to fetch a big business opportunity for pharma”:

As reported on July 25, 2019, Morgan Stanley told investors that climate change will cause an increased prevalence and rapid spread of infectious diseases that may be a boon for some drug companies with big vaccine portfolios. It also highlighted, between 383 million and 725 million more people may be exposed to Zika, dengue and other diseases by 2050, depending on the pace and severity of global warming.

The analysts estimated, especially 7 pharma companies will be critical to fighting infectious diseases brought on by climate change. According to the research note of thebank, ‘the USD 500 billion infectious disease market could see demand for an added USD 125 billion in new vaccines, or as much as USD 200 billion assuming premium pricing for more complex new treatments.’

The top possible gainers:

Identifying the top possible gainers, Morgan Stanley apprised, vaccine development being more difficult and expensive, companies that are already in that business will have an upper hand.

Hence, Sanofi and GlaxoSmithKline are expected at the top, given their existing pipelines and manufacturing capacity. Takeda and Merck both have vaccines in the works for dengue fever, one of the diseases that climate change is likely to exacerbate. Janssen and Pfizer are both active in the vaccines market, but would need to establish new research programs to take on tropical diseases. ‘Moderna’ is also in a good position because it has demonstrated a potential pipeline for drugs combating the Zika virus., as Morgan Stanley further elaborated.

Nevertheless, Morgan Stanley isn’t the only bank looking at investment opportunities from climate change, on July 24, 2019, Goldman Sachs also, reportedly, said it was hiring a sustainable-finance group that is looking into issues related to sustainability. Thus, on the positive side, climate change could fetch a big business opportunity for many pharma players, across the world.

600 million people at risk for climate change in India:

On June 24, 2019, a reputed national business news daily of India reported, “600 million people at risk: Climate change may soon turn critical in India.” Against this threat, the current public health care infrastructure in the country, continues to remain fragile, as stated in India’s National Health Profile, 13th Issue.

It also states, the cost of treatment has been on the rise in India and it has led to inequity in access to health care services. Intriguingly, the country spends around 1.02 percent of its GDP towards public health, which has remained static to declining over a long period of time. Although, health insurance is a growing segment, it hasn’t taken off fully. Several measures are needed to improve and expand insurance coverage.

Further, according to the report by the Center for Disease Dynamics, Economics & Policy (CDDEP) in the US, India is facing shortage of 600,000 doctors and 2 million nurses. This report was widely quoted by the Indian media, on April 14, 2019.

These facts give a perspective on what is India’s level of preparedness to address the critical health issues related to climate change, especially the havoc that the dreaded infectious diseases can cause to so many.

Conclusion:

Astute health policy makers, including a large section of the top political echelon of the country are, apparently, aware of various ill effects of climate change. They also seem to be cognizant that these are likely to accelerate the worsening health problems of the population, including infectious diseases, asthma and other respiratory diseases.

Assuming, new and modern drugs will keep coming to help treat these ailments, do we have a functioning and efficient public health infrastructure to grapple with such issues. What about high out of pocket expenditure towards healthcare for a large section of the population, regardless of Ayushman Bharat?

As the (W.H.O) publication - ‘Climate change and human health – Risks and Responses’ recommended, ‘early planning for health is essential to reduce, hopefully avoid, near future and long-term health impacts of global climate change. The optimal solution, however, is in the hands of governments, society and every individual—a commitment to a change in values, to enable a full transition to sustainable development.’

That said, as India is also a signatory to the latest Paris Agreement on Climate Change, can we assume, India will walk the talk to significantly contain its deadly impact on human health? How is India preparing itself to meet this great challenge of Probably it is anybody’s guess, at least, as on date?

By: Tapan J. Ray   

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.