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.)

Due to the expedited nature of clinical development, a breakthrough drug could fall short of generating extensive, compelling evidence to convince payers/healthcare providers of its value at the time of launch. From our experience, there is a segment of payers and healthcare providers who can make the leap without complete clinical data. These “Product Champions” are willing to “buy in” to the value of the product with only preliminary data and infer clinical value based on their understanding of the product’s mechanism of action. On the other hand, some payers and healthcare providers are likely to reserve judgment on drugs arriving in the market without the support of full Phase 3 trial data. Marketing teams need to adapt traditional value story approaches in order to persuade these “Product Skeptics”.

Identifying “Product Champions” and “Product Skeptics” through market segmentation allows the manufacturer to implement strategies to target the specific concerns of each of these types of individuals. The manufacturer should be prepared to justify the value of the product without full efficacy and safety data by preparing objection handlers that articulate the clinical relevance of the preliminary data outcomes and the science that distinguishes the product from the other therapeutic options in the market. For example, if overall survival data for an oncology therapy is not available, make sure to articulate the value of the available clinical endpoint(s) (e.g. progression free survival data) and explain why the overall survival data will not be available until after launch.

  1. Use scenario-based market planning to harness the full market potential of breakthrough products. 

Given the multiple data gaps before Phase 3 data become available, many elements of a breakthrough drug’s clinical profile will likely remain projections. Target product profile design will therefore be complex, requiring careful, assumption-based forecasting. Adding to the challenge, those crafting a comprehensive value story will only have one shot at getting it right. Here, too, the condensed developmental timeline means there will not be enough time to incrementally build a value story and refine it.

Even with the best forecasting, straightforward market research will not generate the knowledge base necessary to craft optimal launch strategies for breakthrough drugs. For reasons of both research practicality and lack of clairvoyance, it will be impossible to clearly test all potential clinical outcomes and market launch conditions. Instead, the output of successful sales and marketing planning efforts must be a holistic understanding of how foreseen and unforeseen market events will impact a breakthrough drug’s commercial prospects.  

Additionally, compressed clinical development timelines may allow a rival drug company’s promising early stage molecule to rapidly advance and secure FDA-approval. Thus, the breakthrough designation program necessitates increased scrutiny of other manufacturers’ clinical pipelines for possible competing products. The breadth of this knowledge will be particularly valuable in areas with more common off-label prescribing, such as oncology. A product may launch in its breakthrough indication, but obtain significant prescribing in other indications. Competitor pipelines should be closely monitored for potential breakthrough candidates, and the impact of such competitive entry must be captured through the scenario based approaches.

Key Takeaways

  • In order to translate the breakthrough designation to commercial success, manufacturers need to start P&MA activities early and rely more on increased collaboration and less on “traditional hand-offs” between R&D and Commercial teams.
  • Manufacturers should conduct a landscape assessment to fully understand market dynamics, identify key value drivers critical to P&MA, and develop appropriate objection handlers to justify the value of the product despite limited data.
  • Product teams will have to anticipate broader ranges of product potential and possible market developments. Comprehensive, scenario-based market planning will be essential to support P&MA activities. 

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About the Contributors

Simon-Kucher & Partners is a global consulting firm with 690 professionals in 27 offices worldwide focusing on Smart Profit GrowthSM. Founded in 1985, the company has 28 years of experience providing strategy and marketing consulting and is regarded as the world’s leading pricing advisor.

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