Ims-new Product Launch Effectiveness

Maximizing New Product Launch Effectiveness

PMCQ Education Day

Rose Schuett, Director, Marketing - Launch Management 1

October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

We are all familiar with benchmark reports and their recommendations

PHASE 1

PHASE 2

PHASE 3

PHASE 4

Market Assessment Thought Leader Development PR strategy Health Economics Promotions Management Numerous other activities

Then, why do so many products fail to meet expectations?

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October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

Launch Management Milestones Clinical Development Phases: Phase III

Submission

Launch

Corresponding Commercial Activity Sets:

1. MARKET ASSESSMENT

2. COMPETITIVE ASSESSMENT

7-10 years pre-launch

3

5. PROMOTION PLANNING, EVALUATION & OPTIMIZATION

3. MARKET POTENTIAL & FORECASTING

6. MONITORING PERFORMANCE

Post Launch

7. CONTROLLING PERFORMANCE

4. BRAND & SALES FORCE OPTIMIZATION

2-3 years pre-launch

1-2 years pre-launch

October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

1 year post-launch

1-2 years post-launch

In nearly all markets, success is defined in the first 3 to 4 quarters 60% 60% of of monthly monthly volume volume at at year year 33 achieved achieved in in first first 12 12 months months (CAN) (CAN)

NRx 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 Month

1

2

Avandia

4

3

4

5

6

Remeron

7

8 Actos

9 10 11 12 13 14 15 16 17 18 Comtan

October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

Travatan

Companies are striving to… Maximize the uptake curve… 35,000 Total 30,000 Cdn Sales ($ 000) 25,000

Crestor Forecast

20,000 15,000

Pariet Forecast

10,000

Spiriva Forecast

5,000 Months post launch

Zelnorm Forecast

1

4

7

Crestor

5

10

Pariet

13

16

Aranesp

19

22

25

Pegetron

October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

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Spiriva

31

Bextra

34

37

Zelnorm

40

…And reduce time to peak sales 18 16

Years since launch

14

Years to US$ 2 billion

Years

12

Faster to reach US$ 2 billion sales

10 8 6 4 2

Lo ve no x Lo se c Zo co r Er y Ep po og N en or Pr vas av c ac ho l Zo l Se oft r Zi ox a th t ro m R is ax pe r N eu dal ro n Fo tin sa m Ef a x fe x O or ga O s tr xy o co n Zy tin pr ex Li a p Si ito ng r ul ai Pl r a Se vix re R ti d em e ic C ade el eb re x Vi o N xx ex iu m

0 Most recent launches

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Source: IMS Health: MIDAS, MAT Dec 2003 October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

Revenue expectations have changed . . . . . . and so have investments

+

2. Fast multicountry roll-out means multinational coordination & simultaneous resource investment

Launch earlier

3. Rapid competition means a constant post-launch challenge to generate and promote new clinical stories to maintain competitiveness

$ -

1. Pre-launch promotional investment becomes crucial to maximize rapidity of launch take-off

Years

4. Post launch promotional and clinical investment must both be high decisions on where investment will be most effective become key

20 Years ago Today Source: Sir Richard Sykes, Scrip article (adapted)

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October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

A new reality is emerging •Market access, including regulatory, pricing and reimbursement and formulary approval is becoming increasingly challenging and complex •No evidence = no label, no formulary and high co-pay •FDA (& Health Canada) will mandate responsibility to pharma for risk management and post-marketing surveillance post-launch •Increasing segmentation will challenge current sales force mantras on size, deployment and overall optimization •More biotech and segmentation will change sales force skills portfolio requirements •Patients are more accessible than previously thought and will demand increased attention

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October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

Maximizing New Product Launch Effectiveness

“BLOCKBUSTERS ARE NOT DISCOVERED, THEY’RE BUILT.” -Author Unknown

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October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

Pharmaceutical & Biotech Companies often fail to maximize product launches An alternate 4P’s for product launch success 1. Plan ¾ Given the complexity of launching new products, a planning process can be critical to success 2. Positioning ¾ Target appropriate audiences while maintaining a cohesive & consistent brand identity 3. Promotion ¾ Brand management (not product marketing) aligned with product’s positioning strategy 4. Product ¾ P&R and distribution operational readiness including training and incentive programs 10

October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

Launch planning can significantly increase the chances of success Effects of Launch Plan Detail on Success 70

Percentage of Respondents

60

• About 70% of new product launches experience delays

50

• Only 7% incorporate a crisis plan in their launch planning

40

30

20

10

0

Highly Successful Launches

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• Flexibility is a key component of plan development

Less Successful Launches

• Scenario planning and wargaming can be extremely useful tools during launch planning

Source: Schneider & Associates and Boston University, 2001 October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

Launch Management Milestones 1. MARKET ASSESSMENT 6. MONITOR & CONTROL PERFORMANCE

2. COMPETITIVE ASSESSMENT

Sales

Time

5. PROMOTIONAL EFFECTIVENESS

Launch 3. MARKET POTENTIAL 4. BRAND OPTIMIZATION

7-10 years pre-launch 12

2-3 years pre-launch

1-2 years pre-launch

October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

1 year post-launch

1-2 years post-launch

Market & Competitive Assessment Business Questions: -What is the size of the market? -What is driving the growth and how does this vary by channel? -What are the treatment patterns in this TC? 1. MARKET ASSESSMENT

-How many patients are suffering from this disease? -What stage is this market: growth, maturity, or decline?

Business Questions: 2. COMPETITIVE ASSESSMENT

-Who are the players in the market? Today? Tomorrow? -What products are driving volume? Who is on formulary? -Is market share by player growing or declining? -What channels do they play in and how much do they spend to promote their products?

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October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

Environment as a driver of blockbuster growth A blockbuster is the product of its environment as well as promotional activity, product development and the company or companies that launch it

PRODUCT ENVIRONMENT BLOCKBUSTER

PROMOTION

COMPANY

The development of a detailed product launch plan can dramatically improve the probability of a successful launch 14

October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

Market & Competitive Assessment Key Business Outcomes: 1. Provide a macro-level assessment of the target market, the potential patient population, and early indicators of market entry opportunities and challenges. •

The outcome of this assessment forms the basis for initial market segmentation, opportunity sizing, and performance expectations, and highlights critical assumptions to test throughout the launch process.

2. A comprehensive competitive assessment should provide indepth information about the current and future participants in this market. This set of activities should result in a SWOT Analysis (Strengths, Weaknesses, Opportunities, and Threats) for the launching product.

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October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

Market Potential Business Questions: -What is the forecast for patients, prescriptions, and sales of the brand and its therapeutic category? -What are the potential uptake curves and forecast launch 3. MARKET POTENTIAL & FORECASTING

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milestones? -What can we learn by evaluating past (analog) launches? -What indication(s) will be promoted at launch? -How does this impact our estimate of market potential?

October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

Gain insight into the therapeutic class and then, use analogs to inform your baseline forecast

IMS ANALOGUE PLANNER New Product: CANADA - Quarterly Sales (LC) 7,000

6,000

5,000

4,000

3,000

2,000

1,000

0 Q0

Q1

Q2

Fitted Line -

Q3

Q4

Q5

Q6

Q7

Q8

Q9 Q10 Q11 Q12 Q13 Q14 Q15 Q16 Q17 Q18 Q19 Q20 Q21 Q22 Q23 Q24 Q25 Q26 Q27 Q28 Q29 Q30 Q31 Q32 Q33 Q34 Q35 Q36 Q37 Q38 Q39 Q40

HECTOROL - 2003/03/01

Copyright (c) 2004. IMS Health. All rights reserved.

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October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

NEORAL - 1995/03/01

REBETRON - 1999/04/01

REMINYL - 2001/07/01

SUSTIVA - 1999/03/01

Market Potential & Forecasting

Key Business Outcomes: 1. This activity results in an initial sales and prescription forecast that should be refined as you progress through the Launch Management process and acquire new insights about your brand and its opportunity in the marketplace.

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October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

Brand & Sales Force Business Questions: Optimization -What are the physician and sufferer attitudes about current treatments? -How should the market be segmented? -Which prescribers should be profiled and targeted based on: -Adoption patterns?; Prescribing potential? -Switching vs. loyalty?; Attitudes, values & beliefs? -What is the ideal messaging strategy for the brand?

4. BRAND OPTIMIZATION

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October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

Getting it “Right” through all phases of the New Product Launch!

------- Driven by the Right Segmentation ------Right Customers

Right Frequency

Right Message

Right Size

Actionable customer segments reflecting true opportunities

How often to call on each customer; coordinate routing across multiple sales forces

Positions product based on physician’s segment profile, and use commensurate collateral

Does your size and structure reflect growth opportunities?

Right Deployment

Right Training

Right Tools

Right Motivation

Unbalanced territories will negatively impact growth

Enables reps to deliver quality calls consistently

Allows sales force to focus on selling

Does incentive compensation drive behavior consistent with company’s growth strategy?

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October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

Segmentation is the cornerstone from which other critical launch activities are grounded. . . Segmentation data can be collected via secondary data or primary research

High

Predictive Modeling Integrated Segmentation (includes all below)

Psychographics / Attitudinal Longitudinal Patient Segmentation

and facilitates . . . Additional Analyses Age & Gender Payer-Type

Stakeholder Affiliations

VALUE

Behavioral Segmentation Demographic Segmentation

Low

Cross –Tab / Overlap Volumetric-(Deciling)

Low 21

INNOVATION

October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

Provides insight into other stakeholder or key influences on the prescriber

High

Effective segmentation combines behaviors, attitudes and longitudinal insight…

Brand loyalty Rx share trends Adoption & Switching Prescribing concentration Group Practice Influence Managed Care Influence Rx volume/share Demographics

Titration Patient switching New therapy starts Concomitant medication Continuing therapy Practice profiles Compliance

Integrated Attitudinal & Behavioral Segmentation 22

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Managed care Treatment approaches Communication preferences Reimbursement issues Clinical concerns

…to drive Sales and Marketing Strategies by Segment Longitudinal Insight Attitudes Behaviors Demographics Integrated Attitudinal & Behavioral Segmentation

Segment 1 Marketing Approach A

Segment 2 Marketing Approach B

Segment 3 Marketing Approach C

Segment 4 Marketing Approach D

Sales Plan A

Sales Plan B

Sales Plan C

Sales Plan D

‰ Positioning ‰ Messaging ‰ Promotion mix 23

Marketing Strategy

Sales Force Strategy

October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

‰ Targeting ‰ Sizing ‰ Deployment

Analytics – Case Study Anticonvulsant Market Integrated Segmentation

Client problem/opportunity

Results

• 2-year old AED product experiencing flattened growth

• Net gain of $28M in revenue the first year

• Specialty field force competing with “mega” field forces

• Deployed against targets as a company, not just a field force

• Product was the basis (funding) for a 2-3 year gap in the portfolio pipeline

• Representative buy-in and motivation fueled success

How IMS made the client successful

• Completed an in-depth Integrated Segmentation • Worked with the client to pilot and implement the segmentation in the field force • Worked with the client and their agency to update product positioning and messages. • Tracked and reported on success, while assisting on teams to address “hot spots”

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October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

Brand & Sales Force Optimization

Key Business Outcome: 1. Optimizing a brand requires intimate knowledge of the customers and competitors. Having pulled together this intelligence, the detailed marketing and sales strategies as well as objectives for launching the new drug can be established.

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October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

Promotional Planning, Evaluation & Optimization Business Questions: -Which combinations of activities will have the greatest impact?

5. PROMOTIONAL PLANNING, prescribing behavior? EVALUATION & -Which physicians were most impacted? OPTIMIZATION

-Did the promotion change physicians’

-Did the promotion have the desired financial impact?

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October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

Key drivers determine promotional spending for potential blockbusters Low $400 million

Promotional Spend

High $1 billion

Small

Market size

Large

Small

Number of people

Large

Easy

Ease of raising awareness in physicians and potential patients in order to raise level of diagnosis/treatment

Small (specialty drug)

Number of physicians targeted (GP vs. specialty drug)

Difficult

Large (GP drug)

Low

Ability of patient to influence physician choice of Rx

High

Low

Promotional spend by competitors

High

No new competitors

Low

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Threat of new competitive launches Desire/need of company to build strength in therapeutic area

October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

Strong competitor launches approaching High

A web of influencers has increased the complexity & number of pre-launch & launch activities Successful companies select critical activities / emerging strategies for specific market constituents

• •

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Opinion leaders Physicians

• • • •

Advocate Development Publications Medical Marketing Continuous relationship marketing

Patients

• DTC – patient advertising • Continuous relationship marketing

Payers

• Medical Marketing • Pharmaco-economic trials

Customers require about 9 promotional encounters to sufficiently raise awareness and use. Customers only notice 1 in 3 promotional activities

October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

Leading companies have begun to target an expanded view of decision makers and the customer interaction process Payer Interactions Public & Private, CDR

Direct Interactions Reps

Peer / Staff Interactions Patient Out of Pocket

Medical Liaisons

CME

Programs/Sponsorships

Group Practice

Information Center Product Info Requests

Key Opinion Leaders Prescribing Behavior (Not necessarily decision-making)

Journal Advertising Conferences

Referring Network Nurses / NPs

Patient Types Requests/Preferences Caregivers

Consumer Interactions 29

Hospital

October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

Innovative customer models: 9 Enhance direct interactions 9 Influence physicians indirectly

Gleevec commands a global niche market with clear differential advantage

Gleevec approached the market with a new strategy Patient-Driven Patient-Driven Demand Demand

Comprehensive Comprehensive Access Access Program Program

••

Unlike Unlike most most biologics, biologics, Gleevec’s Gleevec’s demand demand was was driven driven by by patient patient demand demand from from the the earliest earliest development development phase phase

••

Novartis Novartis employed employed an an innovative innovative pricing pricing strategy strategy -- $2,200 $2,200 per per month month with with potential potential indefinite indefinite use use

••

Novartis Novartis was was able able to to rally rally patient patient activists who aggressively activists who aggressively lobbied lobbied for for early early access access and and fast-track fast-track approval approval

••

HE HE studies studies in in the the US US and and the the UK UK aimed aimed to show that Gleevec was cost-effective to show that Gleevec was cost-effective compared compared to to usual usual care care

••

AA global global assistance assistance program program extended extended exceptionally exceptionally broad broad discounting discounting to to uninsured uninsured

••

Novartis Novartis offered offered the the following following terms terms in in the US: the US:

Data-Driven Data-Driven Positioning Positioning ••

Gleevec Gleevec stressed stressed its its targeted targeted nature nature and and its its out-standing out-standing clinical clinical data data

••

The The message message was was “precise “precise targeting of the targeting of the molecular molecular abnormality abnormality that that leads leads to to CML” CML”

••

Key Key communication communication points points were were “outstanding “outstanding hematological hematological response”, response”, “unprecedented “unprecedented cytogenetic cytogenetic response” response” and and “well“welltolerated tolerated and and convenient” convenient”

••

••

Novartis Novartis used used evidence evidence based based marketing – most marketing – most KOL’s KOL’s were were investigators investigators and and brand brand champions champions

AA key key segmentation segmentation base base was was “Internet-positive” “Internet-positive” patients, patients, who who created created aa world-wide world-wide network network and and petitioned petitioned the the company company and and regulators regulators to to accelerate accelerate approval approval

Source: Building Global Biobrands – Simon & Kotler

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••

Free Free drug drug for for < < $43,000 $43,000 per per yr yr

••

Drug Drug cost cost capped capped at at 20% 20% for for $43,000 $100,000 per $43,000 - $100,000 per year year

Fosamax – Redefining a Market

90,000,000 80,000,000

Total Sales ($)

• Fosamax was first to market • Osteoporosis had low awareness • There were no globally accepted disease definition • Osteoporosis was traditionally defined as fractures • Existing treatments ranged from Calcitonin & Vitamin D to Fluoride

70,000,000 60,000,000 50,000,000 40,000,000 30,000,000 20,000,000 10,000,000 0 1

4

7 10 13 16 19 22 25 28 31 34 37 40 43 46 49 52 55 58

Months post launch

Merck had a 3-pronged strategy: 1. Expanding diagnosis 2. Obtaining multiple indications 3. Developing new formulations

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• Merck worked with manufacturers of densitometry and even took equity positions • Merck funded and managed the National Osteoporosis Risk Assessment program • Low-cost scanners started to appear in physician offices and osteoporosis managements started to move from the specialty offices to PCP’s

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Promotional Planning, Evaluation & Optimization Key Business Outcome: 1. A thorough analysis of the level and effectiveness of various promotional vehicles in this market establishes the framework for the launch promotional plan, including:

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•

Definition of promotional elements to be used

•

Required budget

•

Resource allocation

October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

Monitor & Control Performance Business Questions: -What are the key drivers of launch performance to be monitored? -What performance metrics best support our

6. MONITORING PERFORMANCE

product’s marketing and financial objectives? -What information will be shared throughout the organization? -What is the product uptake, penetration and usage over time? -How is our product performing against plan and Corporate expectations? Vs. the Competition?

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October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

7. CONTROL PERFORMANCE

Monitor and Control Performance Key Business Outcome: 1. Effective Monitoring of Launch Performance requires: •

The definition of key performance indicators, which enable the organization to get a timely and actionable read on their in-market results.

•

The implementation of efficient and effective enterprise-wide communications and reporting procedures, enabling the entire organization to have the same read on results.

2. This activity generates the “risks and contingencies” of the launch plan providing insight and direction to the team during the critical first 12 to 24 months on the market.

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October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

Conclusions – Maximizing Launch Effectiveness •NPLs are processes, not events — they require on-going management and measurement •Products may fail to attain their maximum potential due, in part, to the complexity of the commercialization process •Launch success is multi-factorial, is enhanced by skilled and trained individuals, and organizations that have a sense of urgency, flexibility and willingness to be innovative •Commercialization success is boosted by meticulous planning, independent of strategies and tactics •Organizations that plan for and review NPL metrics as standard practice, better position themselves for timely, focused responses to market results •At the end-of-the-day, the company that knows their customers best and develops brand loyalty will win •The right strategy and tactics are by-products of customer and marketplace intimacy 35

October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.

Thank You.

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October 18, 2004 © 2003 IMS Health Incorporated or its affiliates. All rights reserved.