Achieving Launch Excellence in Asia-Pacific

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Achieving Launch Excellence in Asia-Pacific
An audio interview with Anthony Morton-Small, IMS Practice
Leader, Commercial Effectiveness, APAC
AUDIO INTERVIEW!
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Achieving Launch Excellence in Asia-Pacific
IMS Expert: Anthony Morton-Small
Length: ~18 minutes
Anthony Morton-Small
To download an MP3 of this interview, click here.
To download the PDF transcript, click here.
Questions? Comments? Fill out the form at the end of this presentation.

3
I have here results from a study that IMS HEALTH
conducted between 2007 and 2009 and it states that only
61 of some 8,600 products launched in that time period
met IMS’ criteria for launch excellence. That seems to be
extremely low.
Anthony Morton-Small (AMS): Yes, in Launch Excellence
study, we found that launch success declined each year as the
survey went on. For example, in 2007, 2% of products, 88 in
total outperformed in more than one country following launch
while that figure dropped to 1% or only 14 products in 2009.
There are a number of reasons for these low take-up rates. It
really boils down to how well companies know their markets and
how they deal with new challenges in the local markets.

4
That’s interesting. You mentioned new challenges. This
implies that the launch environment is changing then?
AMS: Yes that’s right. Companies are acknowledging, but not
yet consistently responding to, the new demands of the
changing launch environment. The issues are essentially
threefold. Firstly, we are seeing different decisions makers
today. The traditional prescriber-based sales model is ineffective
in commodity markets. Companies need to address all
stakeholders and not simply the prescribers these days.
Know more on IMS Health, click here

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I see.
AMS: Secondly, there are different market dynamics. Fewer
launches today are achieving an even modest therapy market
share of let’s say 5% in their first year. We are seeing today
that even the best market share uptakes are not as high as
previous years.

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What would be the reason for that then?
AMS: Well, really it is to do with a decline in the impact of the
traditional market model externally, and internally it’s more to
do with a lack of preparation and readiness to launch as well as
a failure to align objectives, and identify and incentivise payers
& policy makers.

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I see. You mentioned a third reason for launch failure?
AMS: Yes, pharmaceutical companies are faced with differing
timescales in different countries. Companies need to understand
the optimal range and timing of prelaunch activity at a global
and at the country level. Most importantly, companies are not
capitalising on opportunities presented in the first six months of
launch, and our research and experience shows that the sales
seen during this crucial period determine sales thereafter.

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So companies really need to make an impact in the first six
months of launch.
AMS: Actually I would say now that we can narrow that window
even further to the first three months as we have seen in our
2008 study that within the six-month window there lurked an
even shorter critical time frame; on average, three months is
the period in which a launch agent establishes its share of the
dynamic market in its therapy area. In other words, it has
become evident that sales efforts in the first three months tend
to determine sales trends for the first two years of a product’s
life cycle.

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Really, it’s as short a period as that? That’s a real
challenge then.
AMS: Well, yes it is. But it is within the power of companies to
make a success of a launch by being fully prepared while
adapting to the dynamic market to ensure that the initial launch
trajectory of a new product is created by the drug being
prescribed for new patients, by having existing patients
switched to it or by being added on to their existing regimens.

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OK, so we have identified the 3 issues facing companies
launching new products. How should they be addressing
them, since you say that it is in their power to make a
difference?
AMS: Well, taking the first point about dealing with different
decision makers, companies should have a powerful and
pertinent value proposition for the product that is compelling
and differentiated from the existing therapies in the category.
This means ensuring their messaging are consistent yet adapted
to the different decision maker audiences, and aligned through
country communication.

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That can be quite a challenge. Can you give any advice on
how this can be done?
AMS: Yes, of course. For example, to do this successfully with
payers, pharmacos need to understand payer motivations such
as budget impact, cost-effectiveness and therapeutic value to
meet the value criteria necessary for optimal approval. It comes
down to understanding and catering to your audience.

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OK, so getting the value proposition for the product right
for each target audience is crucial. What specific actions
should companies be taking prior to launch to
communicate their value proposition effectively?
AMS: Firstly, companies need to identify who is responsible for
the funding flows and formulary decisions for the related
disease areas both now and in the future. Then they need to
identify the decision makers controlling these funding flows and
understand what drives their buying decisions. From here they
can craft their value proposition for new products during the
Phase Three of clinical trials, and keep building momentum and
interest throughout the trials and beyond in terms of real world
patient outcomes and value over other therapies.

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Right so it is an ongoing process.
AMS: That’s right. And during the launch process they should
be segmenting payers and target areas of the value dossier
accordingly. Obviously they also need to build the commercial
go-to-market strategy in tandem.

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And what about dealing with the different market
dynamics you mentioned at the beginning?
AMS: Companies need to build long-term launch strategies for
non-prescribing customers through an effective stakeholder
engagement strategy. This is required to drive market
expansion. They need to consider all stakeholders such as policy
makers, payers, patients and prescribers. It’s not enough
anymore to target just prescribers.

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So the key is to target all stakeholders then.
AMS: Exactly right. Roche is a good example with the success
of their oncology products in a many geographies. They were
basically more prepared. They found a local strategy in each
country, they made a success of engaging all stakeholders, and
that includes patients, they worked out how to best work with
payers in the local context.

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So it proves it can be done with more preparation and an
in-depth understanding of the individual market. But how
do companies manage the different timescales?
AMS: There needs to be strong governance of the launch
strategy across functions and geographies with a focus on
quality and timeliness.

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I see, so everyone working to common objectives and
strategies relevant to their area.
AMS: Yes that’s right. Basically it comes down to the right
internal alignment and measurements of the launch strategy.
Companies that have succeeded at launch did well in building
alignment into their planning process, creating enterprise-wide
launch focus, and benchmarking and tracking performance
consistently.

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So the launch process needs to be managed from the top
down.
AMS: Not necessarily, but centrally driven yes. Certainly senior
management leadership is crucial for setting the broad direction.
When launches have been unsuccessful, we have seen that
wrong expectations have been set in terms of over promising or
ignoring potential. Also there tended to be an insistence on
global policies being followed that work in the US or EMEA
perhaps but don’t work elsewhere. As I mentioned before, it all
comes down to knowing your market.

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A case of one size does not fit all.
AMS: Precisely. Companies need to work out the dynamics in
individual markets and work that market locally.
So, you’ve mentioned an interesting point, that what works
in one market does not work in other countries
necessarily. Let’s look specifically at the Asia Pacific
market now and the localisation that needs to take place.
AMS: Well, as I’ve just mentioned, the crux of the matter is
knowing your market and being able to adapt your strategies to
local markets. Failures in the past clearly resulted from the
failure of companies to capitalise on opportunities.

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What kinds of opportunities were typically missed?
AMS: For example, the companies failed to develop a deep
understanding of the indigenous economies, historical trends,
cultural predilections and public policy among other things. The
launch was compromised in each case as a result. They needed
to consider that the approaches they had been using in Western
markets might not fit local circumstances. What will work in the
US for example is not necessarily going to work in Korea.

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Of course. So homework was not done then.
AMS: To a certain extent, yes, but you have to remember that
these markets were generally unknown territory. And other
factors contributed as well, such as an absence of clear
forecasting data in these emerging markets, compounded by
the fact that the majority of patients were undiagnosed, under
compliant or under served. With a lack of data on the true
healthcare system in the target country, it is difficult for
pharmaceutical companies to adequately plan launches. And of
course there are the challenges faced with Asia being such a
dynamic market.

22
What do you mean by that?
AMS: Well, markets in Asia are changing all the time. So launch
principles have to be revised more often than would be
necessary in a traditional market, which isn’t going to change
much over time. To give you an example, the market in China
has changed beyond all recognition from the market it was a
year ago, so launch principles that were used last year simply
won’t be appropriate today. In some countries, the landscape
changes so fast that strategies have to be revised even during
the launch process itself.

23
So what kinds of changes take place in these markets that
can have such an impact on launch success or failure?
AMS: It can be introduction of new regulations, government
reforms, changes in insurance regulations, or more drastically,
policy change as a result of a change of leadership following an
election can change the potential success and entire outlook for
a launch overnight – for instance in the US with the passing of
the Healthcare Reform legislation creating expanded coverage
for uninsured Americans. In the Asian context, the healthcare
reform activities in China as well as is the impact of mandatory
drug pricing controls on generic supply driven by the recent
elections in the Philippines.

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I see. So how can pharmas be better prepared to launch?
AMS: At IMS Health, we have identified the five drivers for
launch uptake in any country are Advocacy, Approval, Access,
Adoption and Adherence. But in addition, companies need to
consider what we call the Three As of pharma marketing;
Awareness, Accessibility and Affordability. Let me just quickly
cover these one by one.

25
Certainly. You mentioned awareness as being the first of
the three.
AMS: Yes, Awareness. MNCs need to actually create the
market for their drugs by educating patients and physicians on
the benefits and value of this medicine over others, and as
mentioned before, all stakeholders. To do this, they need a
thorough understanding of disease states, therapeutic options
and the potential fall-out of non-compliance. Innovative
outreach programmes are needed such as key collaborations,
sponsorship of a family network support, language translation
and so on.

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And the second A, which is Accessibility?
AMS: Accessibility to medicines (in terms of healthcare
infrastructure) is a major challenge as there are substantial
variations in availability between say urban and rural
environments in emerging Asian markets. Companies,
therefore, need to pay particular attention to local access to
diagnosis, prescribing & dispensing stations and distribution
channels to ensure their products are economically supplied,
targeted accurately and get to market where there are access
challenges.

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I would suppose relationship building would be a critical
component of their strategy?
AMS: Actually, no not necessarily . Sometimes quite the
opposite in emerging markets, in fact.

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Oh really?
AMS: Yes. Companies need to realise that relationship-selling is
not always going to work as well in these emerging markets,
where the local manufacturers will have the relationship
advantage. They need to be prepared to prove their products
value over local therapies through in-country clinical trial data,
which may require additional investment.

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Yes, I can see how that will be a major difference to
marketing in their established markets. And the third A, I
am guessing, would be Affordability.
AMS: That’s exactly it. Naturally pricing is a concern in any
market but it is particularly sensitive in APAC, where inflation,
GDP growth, rising incomes and elevated expectations make
price a crucial buying decision. GlaxoSmithKline in India is a
prime example of a company operating a local pricing strategy
across its portfolio. In China, we see different pricing strategies
between urban and rural markets. MNCs can also meet the
challenge by partnering with local manufacturers and suppliers
and seeking possible tax exemptions.

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That’s an interesting point. So applying the three As is
crucial when launching in APAC. What assistance is there
for companies available from IMS Health?
AMS: Well, IMS Health is well positioned to help MNCs avoid
common pitfalls and strengthen the three Foundational Success
factors of determining and optimising their product’s value
proposition, effectively and efficiently engaging stakeholders,
mapping out resource allocation and monitoring and driving
performance, as well as aligning and preparing these
organisations for launch.

31
I see. You mentioned common pitfalls just now. Can you
give us some examples of what these typically are?
AMS: Yes, certainly. What we see often is that companies don’t
tend to learn from past launch mistakes not just in targeting
their audiences better, but also they tend to under-estimate
their own constraints, they don’t give themselves enough time
to prepare, and don’t adopt a consistent framework to drive the
launch execution process to ensure plans are followed through.

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What can happen as a result?
AMS: They can fail to get their product listed on formulary, or
payers won’t accept their value proposition, or they could fail to
forecast the demand in Asia, or fail to drill down to the base of
the socio economic pyramid, to the patients, and understand
patients’ capacity to spend on medicines. These are all issues
IMS Health can help companies avoid.

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I suppose companies can also take advantage of IMS’ in-
depth knowledge of the market they intend to launch,
and services to help them achieve better success as they
prepare to launch into those markets.
AMS: Very much so. We are well positioned to assist in a
number of ways. As you mentioned, we have deep therapeutic
market knowledge and competitive insight so we can advise on
the complex competitive dynamics in today’s changing markets.
Secondly, we can advise on marketing approaches to take in
individual markets.

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Your analytical tools are also known to be pretty effective.
AMS: Yes, using IMS Radar Dynamics, APLD, primary market
research and enhanced promotional audits, we have country-
by-country evidence-based insight into marketing tactics and
success drivers.

35
Right. As well as supplying the needed information, how
else can IMS Health add value to the launch process?
AMS: Our clients are up against competitors that may have
significant resources and effective marketing and sales force
spend. We have designed specific methodologies and tools to
help our clients’ investment stays focused and effective by
optimising investments in the commercial planning and
execution stages.

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Great, well, this has been a very interesting topic. Is there
any additional advice you would like to give before we
wrap this up?
AMS: Well, in summary, I would say that MNCs should adopt a
5-tier strategy for entry: One: Act Fast, Two: Understand,
Three: Differentiate, Four: Tailor and Five: Execute. And know
that your success is dependent on the first 3 months of launch.

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Each of those points is self explanatory, and I would
imagine each are equally as important. So let me just
repeat them again. It’s Act Fast, Understand,
Differentiate, then…?
AMS: Tailor to the market and Execute well.
Tailor and Execute. OK. So, in summary, achieving launch
excellence really depends on understanding and catering
to the local market, engaging all stakeholders and
aligning strategies for launch success. Anthony, thank
you very much for talking to us today and providing an
enlightening insight into the challenges and solutions to
launching pharma products in the Asia Pacific region.
Thank you.

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Thank you for listening!
• To download an MP3 of this interview, click here.
• To download the PDF transcript, click here.
• Questions? Comments?
− Fill out the form at the bottom of this slide, or
− Visit www.imshealth.com or email info.sg@sg.imshealth.com.

Achieving Launch Excellence in Asia-Pacific

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