SM 182A Pharmaceutical New Product Planning

Report Summary: Driving Growth Through Planning, Structure and Activities: Best Practices in Pharmaceutical New
Product Planning

Driving Growth Through
Planning, Structure and
Activities: Best Practices
in Pharmaceutical New
Product Planning
PROJECT BACKGROUND Benchmarking Report
at-a-Glance
Pharmaceutical and biotech companies are
increasingly under pressure to deliver effective Featured Study Participants
new products in shorter time frames while • Abbott Laboratories
minimizing development costs. The structure, • Actelion
activities, and resources of New Product • Alcon
Planning (NPP) groups are critical to focusing • Allergan
• Almirall
new product development and optimizing • Altus
product portfolios. • Amgen
• Astellas
This research identifies the structure and roles of • Auxilium
NPP groups as well as the full set of activities • Bayer Healthcare
that NPP groups perform across the development • Biogenidec
• Daiichi Sankyo
cycle.
• Eli Lilly and Company
• EMD Serono
Best Practices, LLC initiated this research to • Human Genome Sciences
help new product development leaders better • Merck
understand the strengths and weaknesses of • Novartis
various NPP organizational structures and how • Ortho Biotech
• Sanofi-Aventis
the operational characteristics of the NPP • Stiefel Laboratories
function evolves as a company matures. In • Takeda
addition, the research examines dozens of NPP • Theravance
development activities in terms of timing during • UCB
• Victory
• Wyeth

Copyright Best Practices, LLC (919) 403-0251

Product Planning

the development process, intended outcomes and value for the organization.

STUDY METHODOLOGY
Best Practices, LLC conducted this
Industry Analysis
study in two phases involving a field
survey as well as in-depth interviews 25 benchmark companies in the
pharmaceutical and biotechnology
with selected survey respondents. industries across the globe

The survey tool collected quantitative Information Types
data on the structures, roles and • 40+ Information Graphics
responsibilities of benchmarked • 60+ Data Graphics
companies’ NPP groups. In addition, • 700+ Metrics
• 50+ Narratives
the survey gathered data on the timing
• 35+ Best Practices
of the activities NPP groups perform
during the development process. Best
Report Length
Practices, LLC analysts used deep-dive
176 Slides
interviews with selected participants
from 13 of the participating companies
to collect qualitative information such as activity details highlighting why
organizations undertook activities at specific times, what information they were
seeking and how they used the information to inform the commercial
development process.

Twenty-seven managers and executives at 25 leading bio-pharma companies
participated in the survey. Thirteen New Product Planning leaders also
participated in one-on-one interviews with Best Practices, LLC analysts. In
interviews, leaders shared best practices and lessons learned surrounding the
NPP function.

This research is focused on several major topic areas: (1) New Product Planning
Evolution, Structure and Effectiveness, (2) Interactions and Optimal Working
Relationships between Regional and Global NPP groups, (3) The Full Set of
Activities NPP Groups Perform, their Timing, Intended Outcomes and Value for
the Organization, and (4) The Future of the NPP Function.

Note: Data is presented in three segments: Global Function, Large Pharma,
Global Function, Small Pharma and Regional Function, Large Pharma.


Product Planning

Specific areas of coverage include:

• Structural Traits that Build an Effective NPP Group

• Evolution of the NPP Function

• Coordinating Regional and Global NPP Activity

• NPP Activities and Outputs – Pre-clinical to hand-off

• Timing, Outcomes and Values for two dozen-plus NPP Activities

• Key NPP Deliverables

• Transitioning Activities from NPP

• NPP Activities Summary

• Future of NPP

SAMPLE FINDINGS
Among the findings that emerged from this research are the following:

1. Involving NPP early in the development process speeds decision-making
and allows low-value projects to be pruned. While the structure of the NPP
function affects how it carries out its roles and responsibilities, it does not in
itself determine the extent of its influence in the larger organization.

2. Some activities, such as creation of the Target Product Profile, become
central to the work of NPP groups because they serve as repositories of
critical information and outcomes that can be updated with further studies.
NPP activities generally follow established patterns of drug development.
Market planning and research must support meeting development milestones,
although the focus of NPP activity must be geared to align development with
market potential, not just getting past regulatory hurdles.

DATA & INSIGHT EXCERPTS


Product Planning

New Product Planning Evolution, Structure and
Effectiveness
New Product Planning has become the central conduit for early cross-functional compound
assessment and resulting development decisions, and plays a critical role from early on in shaping
development activity. New Product Planning’s main role is to drive a program forward by
identifying its value to the marketplace. Some interviewed New Product Planning leaders noted
that their insight and ability to shape portfolio decisions can be substantial, amounting to veto
power, even if they exercise their influence only in informal ways.

One interviewed New Product Planning leader explained how the group directly influences
portfolio decisions: “We have veto power. If we don’t think that there’s a compelling economic
model or a strategic fit in a program or a potential investment fails to get our endorsement, it’s
probably over. It’s got to have a huge champion with a great argument to be able to get past that
veto power. Otherwise, if there is something that we endorse, we’re working collaboratively with
clinical, with medical research, thinking about clinical trials, thinking about target product profiles
in the economic modeling.”

By turning its commercial lens on development work even at the preclinical stage, New Product
Planning has become recognized as the critical bridge between R&D and commercial interests.
Despite the broadness of this mandate, and acknowledging that it is a task handled differently, and
at varying scales, across different organizations, the balance being maintained is an important one.
The central challenge here is in ensuring that the right new products get developed efficiently—
with minimum risk and maximum value— to allow senior management to make smart decisions
confidently.


Product Planning

New Product Planning
Bridging the Gap Between R&D and Commercial Interests
The central challenge is to ensure that the right new products get developed efficiently—
with minimum risk and maximum value—to allow senior management to make smart
decisions confidently.

R&D pipeline marketing clinical patent COMMERCIAL
brands molecules market competition
phase I me-too lifecycle commercial
pre-clinical co-promotion FDA submission
pharmaceutical New Product physicians
medical affairs Planning disease state
compounds phase II sales development
research forecast biotech blockbuster
therapeutic area phase III drug

“…with pressure on all stakeholders in the pharma industry and the few new
drugs that came to the market in recent years, NPP should take on more and
more importance in driving what projects to dedicate resources to…”
12
Copyright © Best Practices®, LLC B E S T P R A C T IC E S , ®
LLC

Figure 2.1: Bridging the Gap Between R&D and Commercial Interests

Develop a process to align all stakeholders across different functions and create
focus on the decision at hand to combine wisdom and experience for making the
best possible decisions.

All organizations value and employ committee-based decision making. Since the stakeholders
making up these committees come from various functions – scientific, commercial, marketing,
medical, legal – all of which have their own agenda, it is important to centralize their focus in
order for them to be able to make good, sound decisions.

One interviewed executive director stated, “You’ve got a number of different players that you
want to have aligned. You want the new product planning and the team that’s driving the
therapeutic effort to be aligned with not only the research group, but also with what we call our
global product team, because they’re the ones who will be the recipients of our work, and the ones
who will be tasked with taking it through the submission.”

Stakeholders obtain their position on the committee through their extensive experience and
knowledge, which are important traits in terms of adding the value and credibility necessary in a
role that ultimately has the responsibility of making important portfolio decisions. Since tools and
market research can be unreliable, especially in the early stages of development, a large group of
select experts encompassing the gamut of impacted areas offer a credible basis for judging new
information as it is presented.


Product Planning

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Product Planning

TABLE OF CONTENTS

Executive Summary Error! Bookmark not defined.
INTRODUCTION...................... ERROR! BOOKMARK NOT DEFINED.
RESEARCH APPROACH ......... ERROR! BOOKMARK NOT DEFINED.
PARTICIPANT DEMOGRAPHICSERROR! BOOKMARK NOT DEFINED.
DEFINITIONS AND ABBREVIATIONSERROR! BOOKMARK NOT DEFINED.
REPORT STRUCTURE AND ORGANIZATIONERROR! BOOKMARK NOT DEFINED
KEY FINDINGS ...................... ERROR! BOOKMARK NOT DEFINED.
Structure.........................................................Error! Bookmark not defined.
Function .........................................................Error! Bookmark not defined.
Market Planning Activities ............................Error! Bookmark not defined.

New Product Planning Evolution, Structure and
Effectiveness 4
Develop a knowledgeable team of the best minds available to
identify the technical success factors that help determine a
molecule’s ability to meet the criteria established by the draft
launch label. .......................................Error! Bookmark not defined.
Utilize market topography maps to align all decisions to fit
within the portfolio strategy to aid in making decisions based
on facts and not emotional attachment to a molecule.Error! Bookmark not defined.
Develop a process to align all stakeholders across different
functions and create focus on the decision at hand to combine
wisdom and experience for making the best possible
decisions.............................................................................................. 5
Coordinate resources and activities, including training
opportunities, science and the timeframe at hand, so as not to
waste budget allocations, which are based on the probability
of a molecule’s success......................Error! Bookmark not defined.
Employ tactics that encourage collaboration to help support
balance in the endemic tension between regional and global
New Product Planning groups. ..........Error! Bookmark not defined.
Coordinate New Product Planning activities at high levels
within the organization to balance corporate imperatives and
therapeutic interests, as well as ease the transition of activities
from New Product Planning Groups to other groups.Error! Bookmark not defined.


Product Planning

New Product Planning Activities and OutcomesError! Bookmark not defined.
NOTABLE MARKET RESEARCH AND MEDICAL MARKETING
ACTIVITIES AND TOOLS ......... ERROR! BOOKMARK NOT DEFINED.
Target Product Profile (TPP)..............................Error! Bookmark not defined.
Competitive Assessment ....................................Error! Bookmark not defined.
Commercial Positioning .....................................Error! Bookmark not defined.
KOL Identification and Management.................Error! Bookmark not defined.
Lifecycle Planning..............................................Error! Bookmark not defined.
Publication Strategy............................................Error! Bookmark not defined.

The Future of New Product Planning, Best Practices and
Lessons Learned Error! Bookmark not defined.


Product Planning

TABLES AND FIGURES
Figure 1.1: Benchmark Class.............................................Error! Bookmark not defined.
Figure 1.2: Benchmark Segmentation................................Error! Bookmark not defined.
Figure 1.3: Participant Titles..............................................Error! Bookmark not defined.
Figure 1.4: Industry and NPP Experience..........................Error! Bookmark not defined.
Figure 1.5: Company Headquarters Location...................Error! Bookmark not defined.
Figure 2.1: Bridging the Gap Between R&D and Commercial Interests ........................... 5
Figure 2.2: Commercial Insights Help Shape Development ActivityError! Bookmark not defined.
Figure 2.3: NPP Uses Three Principle Structures..............Error! Bookmark not defined.
Figure 2.4: Structural Traits that Build an Effective NPP GroupError! Bookmark not defined.
Figure 2.5: Independence Seems to Carry Greater WeightError! Bookmark not defined.
Figure 2.6: Structure Alone Does Not Determine InfluenceError! Bookmark not defined.
Figure 2.7: NPP is Evolving to Cope with Industry ChallengesError! Bookmark not defined.
Figure 2.8: Evolution of the NPP Function – Maturity CurveError! Bookmark not defined.
Figure 2.9: Level 1, Tactical Focus ...................................Error! Bookmark not defined.
Figure 2.10: Level 2, Process Focus ..................................Error! Bookmark not defined.
Figure 2.11: Natural Tensions Develop Along Two DimensionsError! Bookmark not defined.
Figure 2.12: Level 3, Strategic Focus ................................Error! Bookmark not defined.
Figure 2.13: Transitioning Activities from NPP................Error! Bookmark not defined.
Figure 2.14: NPP is Responsible for Providing a Launch RoadmapError! Bookmark not defined.
Figure 2.15: Balancing Corporate Imperatives and Therapeutic InterestsError! Bookmark not defined.
Figure 2.16: Global Oversight with Regional Oversight ...Error! Bookmark not defined.
Figure 2.17: Coordinating Regional and Global Activity..Error! Bookmark not defined.
Figure 2.18: Balancing Regional and Global Interests ......Error! Bookmark not defined.
Figure 2.19: One “High-Level” Decision-Making FrameworkError! Bookmark not defined.
Figure 3.1: NPP Shapes Development Activity.................Error! Bookmark not defined.
Figure 3.2: NPP Activities and Outputs, Early Stages.......Error! Bookmark not defined.
Figure 3.3: Global NPP, Large Pharma Segment Activity OverviewError! Bookmark not defined.
Figure 3.4: Global NPP, Small Pharma Segment Activity OverviewError! Bookmark not defined.
Figure 3.5: NPP Activities and Outputs, Later Stage ........Error! Bookmark not defined.
Figure 3.6: Regional NPP, Large Pharma Segment Activity OverviewError! Bookmark not defined.
Figure 3.7: NPP Develops Broad-Reaching Market PerspectivesError! Bookmark not defined.
Figure 3.8: TPP Provides Early Framework to Assess Product ViabilityError! Bookmark not defined.
Figure 3.9: TPP Creation Usually Begins Early with Global NPPError! Bookmark not defined.
Figure 3.10: Competitive Assessment Informs Go/No-Go DecisionsError! Bookmark not defined.
Figure 3.11: Competitive Assessment ...............................Error! Bookmark not defined.
Figure 3.12: Spotlight, Market Topography Maps ............Error! Bookmark not defined.
Figure 3.13: Positioning Research Starts in Phase II.........Error! Bookmark not defined.
Figure 3.14: Spotlight, Early-Stage Scenario Planning .....Error! Bookmark not defined.
Figure 3.15: KOLs Define Unmet Need and Optimal Market FitError! Bookmark not defined.
Figure 3.16: Spotlight, Getting KOL and Payer Perspective EarlyError! Bookmark not defined.
Figure 3.17: Lifecycle Planning Can be Both Strategic and TacticalError! Bookmark not defined.
Figure 3.18: Lifecycle Planning Starts Early for Some .....Error! Bookmark not defined.
Figure 3.19: Spotlight, Extending Product Lifecycle ........Error! Bookmark not defined.
Figure 3.20: Publication Strategy Can Shape the Commercial ContextError! Bookmark not defined.
Figure 3.21: Core Message Development Requires Market TestingError! Bookmark not defined.
Figure 3.22: Spotlight, Seeding New Ideas that Challenge OrthodoxyError! Bookmark not defined.


Product Planning

Figure 3.23: Managed Care Research Can Optimize Formulary AccessError! Bookmark not defined.
Figure 4.1: NPP’s Role Will Expand to Meet Business NeedsError! Bookmark not defined.


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