September 2013 Edition Vol.11, Issue 9

FDA’s New Breakthrough Therapy Designation: What does it mean for Pricing and Market Access?

FDA’s New Breakthrough Therapy Designation: What does it mean for Pricing and Market Access? (cont.)

For example, ibrutinib [Pharmacyclics and Janssen]—a first-in-class oral agent that selectively inhibits Bruton's tyrosine kinase, a critical signaling kinase in the B-cell receptor pathway—filed a New Drug Application based on the results of a Phase 2 trial. With the breakthrough designation, the company may have significantly pushed up ibrutinib’s potential launch date, and management will be under increased pressure to get ibrutinib’s P&MA strategy completed in a much shorter time period. 

Time will tell how recipients of the breakthrough designation will ultimately be affected; but much excitement surrounds the possibility that the program will significantly decrease the length of clinical development for these therapies. Such an opportunity requires a paradigm shift in standard pharmaceutical and biotech pre-launch P&MA planning practices, and we recommend three strategic initiatives, which manufacturers should consider when preparing the launch strategy for a new breakthrough drug.

  1. Initiate P&MA planning earlier and leverage excitement generated by the breakthrough designation. 

With the power to drastically shorten drug development timelines, the breakthrough therapy designation has the potential to impact almost every aspect of the pharmaceutical and biotech industry. Clinical research and manufacturing elements will have to contend with changes introduced by the new designation, as will sales and marketing teams.

Underscoring the importance of a well-crafted commercial strategy, a breakthrough designation and associated faster launch may translate into up to 3 years of additional peak or near peak annual revenues. The revenue impact of this will depend on a variety of factors such as relative patent expiration and competitive dynamics, but for many breakthrough drugs the impact will easily reach into hundreds of millions of dollars.

With compressed development timelines and expedited launch schedules, a drawn out refinement of commercial strategy will not be possible for drugs negotiating the breakthrough therapy program. Where previously drug companies could afford to wait until Phase 3 development before addressing P&MA challenges, manufacturers with a breakthrough product will have to start crafting such strategies in Phase 2.

While compressed development timelines will present a challenge, the new approval pathway will also lend support to P&MA activities. The positive clinical stage attention provided by the breakthrough designation will likely aid market access. Payers will find it more difficult to restrict access to a drug whose therapeutic value has been singled out by the FDA and which may have already generated excitement among physicians and patients. In a period of increasing focus on drug prices, especially within the oncology space, the breakthrough designation may prove to be a useful shield against media scrutiny.

  1. Be prepared to craft a compelling value story for your breakthrough product with limited data.

By thinking strategically about the product and the role it will play in the treatment paradigm, it is possible to craft a compelling value story before Phase 3 data are available and create a plan to address any gaps identified in the value story.

In order to get a true picture of the product’s value with limited data, it is important to identify the product’s key value drivers, such as the critical clinical endpoints and performance measures that drive market access and product utilization. During P&MA strategy development, conducting a landscape assessment will help to fully capture market dynamics and identify key value drivers critical to P&MA. Understanding how the product performs against the competition on the key value drivers, enables the manufacturer to refine its value story appropriately and achieve optimal market access.

As shown in a simplified hypothetical example (Figure 3), the relative importance of the value drivers and the performance of the product on these factors can be mapped to create a “Matrix of Competitive Advantage”. This matrix highlights the critical value drivers to securing optimal P&MA as well as the product’s relative strengths and weaknesses.  

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