Mindset Change: Now A Bigger Factor in The Rise And Fall of Pharma Corporations

Posted on July 19, 2021 by Tapan Ray

Currently, in the pharma industry across the world, almost everyone is talking, thinking, and trying to implement several significant changes – just to be in sync with the changing customer needs and market expectations. As Covid vaccination process gathers momentum with markets gradually opening up, many envisage even much bigger changes. Such changes encompass, medium to long-term strategic thinking process, re-engineering business operations, customer-centric new value creation and value delivery mechanism in the new normal.

Several pharma players have also started expressing it explicitly, even on their websites. One such example is a Novartis communique of January 21, 2021. It says: COVID-19 was a catalyst for change in healthcare during 2020 – an accelerator for digital health. As the virus spread exponentially, the world was forced to work virtually, wherever possible. Digital solutions were needed fast – not just to support remote working, but to keep the very fabric of business, healthcare, education, and essential services in operation. The need to cope with multi-faceted pandemic–triggered challenges of change, prompted the rise of digital health as the only viable option of the time, as it were. In the following months thereafter, it has set some emerging trends for digital innovation to meet global healthcare needs, which will continue through 2021.

The communique underscored: “For Novartis and many other pharmaceutical companies, the challenge was not just to enable employees to continue working, but to ensure that medicines reached patients as needed, and that healthcare professionals (HCPs) had the information they required to support their patients’ questions and needs. It was also essential to make sure that clinical trials remained on schedule and the development pipeline continued.”

Similar mindset was exhibited by many other pharma companies when the chips were down, and Covid vaccines were under development or just had hit the markets. Its impact, got reflected in The Harris Poll Survey of February 2021, which reported a peak positive rating of 62% for the image of the pharma industry – an incredible turnaround from 32% of just the previous year.

Therefore, the question, arises – with Covid vaccination initiatives gathering steam what will major pharma players, both local and global, possibly do? Will they use the pandemic period experience as a springboard – for more innovation of all kinds to reap a sustainable harvest – with an ongoing customer-centric mindset? Or they will try to get back to the old normal – with self-serving interests – till it stings – very hard. This article will explore that area.

What prompts the above questions?

The above questions are prompted by the fact that since then, pharma industry’s image slipped from a peak positive rating of 62% in February as the vaccine rolled out and then dipping to 60% in May and now at 56%, according to The Harris Poll Surveys. Thus, many wonders – ‘is it time to ask whether the halo around COVID-19 vaccine and treatment innovation is gone?

Further, some recent instances on pharma’s reverting to self-serving interests, could also play some role in this regard. Interestingly, notwithstanding pharma’s image going south after achieving a peak of 62%, the ghost of unreasonable drug pricing appears to haunt again.

As an illustration, amid Covid pandemic, the public perception that pharma companies’ business practices changed – from mostly self-serving interest orientated – to meeting customer value and expectations, did not last long. Several actions akin to pre-Covid period, went against the above perception. These include, Covid vaccine prices and Biogen’s $56,000 (Rs.40 lakhs/year in India) price tag for its recently approved Alzheimer drug – Aduhelm that requires monthly infusions with no clear limit on treatment duration. No wonder, Alzheimer’s Association, reportedly, finds this price simply unacceptable,’ as it further “complicates and jeopardizes sustainable access to this treatment” and could further deepen health equity issues.

I reckon, how pharma companies conduct their strategic business operations from now on will possibly reveal the nature of Covid-triggered changes, if at all, within the industry. Industry watchers generally believe the majority will follow the digital transformation path with a new organizational culture, and an agile mindset to always be in sync with stakeholder values and expectations. However, there are also some, who want to mostly revert to the pre-pandemic business culture, practices, and mindset. It will be interesting to know what some top ‘Think Tank’ of the pharma industry envisage.

What some top pharma ‘Think Tank’ envisage:

Notwithstanding some recent developments as mentioned above, which could be outliers, some top pharma think tanks are quite optimistic about the continuity of Covid triggered positive changes in the industry. For example, in an interview with Pharmaceutical Executive, published on May 19, 2021, a current Amgen Board Member and former CEO of several global pharma majors - Fred Hassan, made some profound statements.

He reiterated, ‘COVID-19 has accelerated the ongoing shift to enterprise-level digital transformation across Fortune 500s.’ Fred further emphasized, “the impact of digital in helping transform the customer experience or to improve efficiencies, is now a bigger factor in the rise and fall of corporations. Astute C-suite executives recognize the opportunity to not only enable, but to also empower their teams to quickly embrace digital as a differentiating tool.”

A journey – not just a destination:

The above interview further underscored – ‘Digital transformation is a journey — not just a destination.’ The speed of transition to digital must be accompanied by sustainability. It should take all stakeholders on board in the journey of change. The key requirement is to ‘actively energizing the entire organization so that people internalize the digital mindset to help empower their customers, their own company and themselves, as individuals.’

More importantly, ‘Dithering around scaling past the initial digital pilots, is rapidly becoming an unacceptable option,’ as Fred Hassan cautioned. Which is why, while the C-suite needs to actively lead during a digital transformation, they must leverage the commitment of their middle management to motivate front line managers to keep following through with passion, courage, and tenacity. This is because: ‘Digital transformation is a journey – not just a destination.’

Indian pharma suddenly had to ride the wave of digital transformation:

The unprecedented pandemic literally compelled most Indian pharma companies of all sizes, to ride the digital wave in business, mostly for survival – to keep the business operations running. However, with the passage of time, Covid related disruptions started accelerating their journey for digital transformation – at a varying pace, though. This was also reported in the KPMG paper – ‘India’s healthcare sector transformation in the post-COVID-19 era,’ published on February 01, 2021.

The paper also articulated that this unprecedented health crisis “have not just laid bare the myriad challenges and gaps in our health system, but also highlighted the importance of investing in ‘well-being’ at both personal and system levels. It has ushered in an era of digital and technological innovations and advancements that is expected to help communities fulfil those requirements at a much faster pace.”

The pandemic has also accelerated the pace of evolution of ‘Smart Healthcare’ in India. This is also not a destination, but a journey with the digital transformation process, where changing or flexible mindset of the leadership, is the catalyst for change.

‘Smart Healthcare’ is also a digital journey:

As more and more health care customers are entering the digital space, triggered mainly by Covid appropriate behavioral norms, Virtual Healthcare initiatives are also increasing manifold, backed by robust supports from the Government. As a result, several integrated ‘Smart Healthcare’ platforms like Telemedicine, are now, reportedly, being, considered as the “Natural evolution of healthcare in the digital world.” Specifically, in the Indian scenario of low doctor to patient ratio, telemedicine has the potential to be one of the frontline health care value delivery systems, in the “new normal.”

Capturing early signals for such changes in the market trends, and leveraging the same to create a win-win situation for both the company and stakeholders, would necessitate a changing or flexible pharma leadership mindset. The reason being the digital transformation of an organization is an ongoing process with increasing rate of obsolescence of digital tools, platforms, and applications. Let me illustrate this point taking ‘Smart Healthcare’ as an example.

‘A bigger factor in the rise and fall of corporations:’

In today’s digital environment any transformation initiative is a continuous journey, and not a one-time exercise. Digital transformation of an organization – if, as and when pursued for business excellence in the new normal, would demand, at least, two big leadership commitments. These constitute – one, to continuously exceed stakeholder expectations in value delivery, and the other – a changing mindset that always puts customer perceived value on a higher pedestal than a company’s self-perceived value, both for product and services.

For example, for telehealth to carve out its niche as a dominant force in health care after the pandemic ends, will depend on how successfully virtual health care is humanized that will allow physicians and patients to build and maintain trusting relationships. These issues were well deliberated in Harvard Business Review article – ‘3 Ways to Humanize the Virtual Health Care Experience,’ published on March 25, 2021.

The paper concluded by emphasizing, the future rate of adoption of telehealth will ‘heavily depend on its ability to support a trusting relationship between patients and physicians. As provider organizations choose telehealth technologies and digital health companies develop new tools, they must keep the core human needs of both patients and physicians front and center.’

Conclusion:

The above examples clearly point out that any digital transformation process, be it of a corporation or of a system, such as telehealth, is a journey and not a destination. To successfully leverage the benefits of moving into a digital frontier would call for a changing or a flexible mindset of the provider or its leader.

This requirement undoubtedly, therefore, is ‘a bigger factor in the rise and fall of corporations,’ or any digital application, platform, or a system. Which is why, as many believe: ‘pharma still needs to be on its front foot and pushing forward,’ in the new normal. Going back to the traditional practices of the old normal is not an option, any longer.

By: Tapan J. Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

Fostering EQ For Pharma’s Excellence In The New Normal

Posted on March 1, 2021 by Tapan Ray

On February 25, 2021, one of the top Indian business daily flashed a headline – “It will be working from home, post-pandemic too at many top companies.” It wrote, companies like, Tata Steel, Philips, Infosys and Maruti Suzuki are evaluating job roles to permanently enable employees working from home, or remotely – even after the pandemic. This is just one example, out of many unique outcomes of last year’s disruptive business turbulence, causing a potential mental or emotional impact on many employees.

Virtually across industries, many such significant changes have taken place in several facets of businesses including traditional operational processes. As has been widely witnessed, many desk-bound office jobs – temporarily, partly or fully – shifted to remote working – almost overnight, as it were. Such a shift is being contemplated in several work-areas by a number of drug companies, as well.

For understandable reasons, another concurrent and instant demand surfaced for a critical hard skill – involving applications digital tools and platforms. This was mostly to ensure that key business communications and customer engagements, at least, keep ticking during the crisis, despite unprecedented initial headwinds.

However, sans a catalytic soft skill that helps address several current-environment specific several organizational needs, even applications of digital skills are unlikely to be able to leverage the full potential of digitalization. While navigating through today’s uncharted frontiers, where there are no footsteps to follow, the organization will need flexibility and resilience among leadership, ensuring employee adaptability to change, and creating a new climate of fostering creativity with digital technology.

Interestingly, this soft skill – ‘Emotional Intelligence’ – often referred as ‘Emotional Quotient’ or EQ, wasn’t discussed, as much, for various reasons. In this article, I shall deliberate, why this much-known soft skill is indispensable for business excellence in the new normal – from the pharma industry perspective.

EI/EQ in business isn’t a new idea, but more important now than ever before:

Peter Salovey and John D. Mayer coined the term ‘Emotional Intelligence (EI)’ in 1990 describing it as “a form of social intelligence that involves the ability to monitor one’s own and others’ feelings and emotions, to discriminate among them, and to use this information to guide one’s thinking and action”.

In 1995, Daniel Goleman in his book ‘Emotional Intelligence’ defined EI as the ability to:

Recognize, understand and manage our own emotions and,
Recognize, understand and influence the emotions of others.

In other words, ‘this means being aware that emotions can drive our behavior and impact people (positively and negatively) and learning how to manage those emotions – both our own and others.’The ability to manage emotions is measured through Emotional Quotient (EQ).

EQ – a cutting edge of excellence, especially in the new normal:

Much before the pandemic, in 2018, McKinsey & Company had projected that between 2016 and 2030, demand for people with high EQ would grow across all industries. Again, in May 2021, the Company reiterated: ‘To meet this challenge, companies should craft a talent strategy that develops employees’ critical digital and cognitive capabilities, their social and emotional skills, and their adaptability and resilience.’

However, with unprecedented changes in pharma business dynamics, the process has been further accelerated. EQ is now expected to be a cutting edge for performance excellence – in any organization. Hence, digital savviness may not be just enough in the new order for organizational turnaround aspirants. Sans people with high EQ, among both – the leadership and staff members, digital transformation alone may not be enough for commercial success.

Long ago, Daniel Goleman epitomized it in his article - ‘What Makes a Leader?’ This was published in the Harvard Business Review (HBR) in January 2004, where he wrote: ‘IQ and technical skills are important, but emotional intelligence is the sine qua non of leadership.’ This old advice assumes even greater importance, in the new normal.

With emotions prevailing in workplaces, high EQ improves performance:

COVID pandemic has demonstrated to all, including highly tradition bound and slow to change – the pharma industry that the name of the game of survival, particularly when a crisis strikes as a bolt from blue, is quickly adapting to changes. A time came as ‘national lockdown’ started – when a sense of losing control and confusion, virtually engulfed the work environment, which is so necessary for livelihood. A key example of these changes include, a sudden shift from remote working, related to remaining engaged with customers.

Alongside, home life and work life got merged for many. New ways of remaining in touch with customers, sometimes gave rise to a sense of seclusion or alienation, causing mental or emotional stress. Many employees’ keen desire and expectation of the return of the old normal – in the same form, are causing more emotional complications with them.

A study by EQ training provider TalentSmart also found that emotional intelligence is responsible for 58% of one’s job performance. Thus, any pharma company’s ability to be in sync with all employees, at the emotional level, is one the key requirements to boost performance. It will determine the effectiveness of digital tools given to employees to deliver the deliverables. Further, as other studies established, ‘the ability to connect with people on an emotional level – is crucial to maintaining strong and resilient teams.’

Some telltale signs of low EQ in an organization:

Some common telltale signs of low EQ in an organization, were well captured in an article with Covid pandemic in the backdrop. This was published in Inside HR on September 01, 2020. The manifestations of low EQ include, when employees:

Don’t want to take responsibility for their own feelings, but blame others for those,
Let things build up and then blow up,
Often overreact to life’s minor events while struggling to remain in emotional control.
Lack empathy and compassion,
Tend not to consider others’ feelings before acting,
Lack self-awareness of their own emotions and the emotions of others around them.

Such signals, if not addressed promptly, can lead to a number of adverse business outcomes. Especially when, quick adaptation to fundamental changes in the business environment, business operations and key customer behavior, is the name of the game. People’s EQ in an organization, could often stand between business success and failure – in the new normal, more than ever before.

Conclusion:

As pharma industry has started navigating through the new normal with wide-scale application of digital technology, employees also need to keep pace with these changes, and come on board. In such a ‘never before’ situation, emotional needs of both internal and external customers are to be properly understood, and effectively addressed, just as the need for digitalization within the organization.

Notably, low or high EQ are not genetic, neither are these pre-implanted in the brain by God. EQ comes as one learns through ongoing experience in life, and also from the advices of elderly, interaction with peers, superiors and training by professionals. This is a lifelong process of learning, which is continuously honed through practice in real life situations. It’s not bizarre, at all, if EQ of an individual has changed before, during and after the pandemic. What really matters is fathoming, how is the employee EQ today, monitor it continuously, and help the individual as and when required – to help the organization.

Several studies have established high employee EQ as a stronger predictor of success, that helps strengthen hard skills like digitalization by helping to think more creatively while using the tech tools and platforms. Thus, amid unparalleled changes in business operations, customer behavior and the need for quick adaptation to digital technology, fostering employee EQ to encourage them committing to the corporate shared goal, is an imperative for pharma’s performance excellence - more than ever before.

By: Tapan J. Ray

Focus On Core Competencies – Regardless of Generic Or Innovative Drug Business

Posted on February 22, 2021 by Tapan Ray

On February 11, 2021, by two different Press Releases, two global pharma majors – GSK and Novartis simultaneously made interesting announcements. Both were related to three generic cephalosporin antibiotics.

GSK revealed, ‘it has reached an agreement with Sandoz – a division of Novartis, to sell its Cephalosporin antibiotics business. Sandoz will pay GSK USD 350 million at closing, plus additional milestone payments up to USD 150 million, subject to the terms of the transaction.’

While articulating the purpose of hiving of its generic cephalosporin brands, the company reasoned: GSK is now dividing itself into two companies – one with core competencies focused on OTC products, and the other – prescription drugs and vaccines. The company emphasized: ‘The transaction aligns with GSK’s strategy to prioritize and simplify its portfolio and invest in the company’s innovative R&D pipeline and new product launches.’ Other brands in GSK’s antibiotics portfolio, are not impacted by this divestment. In other words, this would possibly mean that the generic drug business doesn’t fall within the core competencies of GSK, any longer.

Whereas, Novartis disclosed, the company’s Sandoz division, ‘has signed an agreement to acquire GSK’s cephalosporin antibiotics business, reinforcing its leading global position in antibiotics.’ Its noteworthy that Sandoz’s core competencies lie in the generic drug business.

While explaining the purpose of this acquisition, Novartis explained, cephalosporins being the largest antibiotic segment by global sales, acquiring these 3 leading brands - Zinnat, Zinacef and Fortum,“will further position Sandoz as a global leader in antibiotics – truly essential medicines that are the backbone of modern healthcare systems.”

The above transactions bring to the fore the criticality of focusing on core competencies for business excellence, regardless of innovative drug business and in multiple situations, such as:

Bringing organizational focus back on core competencies when these tend to get diluted.
Increasing the focus on core competencies as opportunities arise.

In this article, I shall revisit this critical management concept in the current perspective.

A brief recap:

The concept of core competencies of a business organization was introduced by two global pioneers in business management – C.K. Prahalad and Gary Hamel with the article – ‘The Core Competence of the Corporation.’ This was published in the May-June 1990 edition of the Harvard Business Review.

The relevance of focusing on ‘core competencies’:

The quality and quantum of commercial dividend in consistently focusing on ‘core competencies’ in any space, spanning across individual professionals to business organizations, have been profound. This calls for defining these in detail and collectively, at the top rungs of organizational leadership. Then, cultivate, and leverage the core competencies to differentiate an organization from its competition, creating a company’s long-term competitive and sustainable advantage in the marketplace – for business excellence.

What constitutes core competencies to gain strategic strength?

Core competencies – whether for individuals or for businesses, comprise primarily of resources, such as, special skills, capabilities and rewarding experience in those activities as strategic advantages of a business. Garnering financial resources would usually follow, thereafter. Thus, core competencies are always considered as a strategic strength, everywhere. That said, core competencies require continuous monitoring to always be in-sync with changing market dynamics. Otherwise, the strategies are likely to fail.

Broad examples – from pharma perspective:

Broadly speaking, discovering, developing and successfully marketing new drugs, identifying repurposed drugs for new clinical trials, and churning out novel vaccines quickly, may be considered as core competencies for innovative drug makers. They have demonstrated this skill even during Covid-19 pandemic. Similarly, immaculate skills in reverse engineering of existing drug molecules and high efficiency in process research to gain price-competitiveness, may be construed as core competencies of generic drug companies.

Examples of shifting focus on core competencies:

Although, it is desirable that pharma players stick on core competencies for sustainable long-term performance excellence, regardless of being in primarily innovative or generic drug business, we have witnessed this focus shifting on several occasions for both. However, expected success did not generally follow those companies with such tweaking in the strategic business models.

Nevertheless, some drug companies did get tempted to deviate from their core competencies. For example, innovative drug players tried to expand into low-risk generic medicines, which, in the long run, did not deliver expected results for many companies. However, this deviation wasn’t without any compelling reasons.

There were some valid reasons, though:

As is much known, traditionally, global R&D companies prefer to focus only on the business of innovative prescription medicines. Low margin generic business wasn’t their cup of tea. Subsequently, this trend shifted. Especially in those cases, where the pipeline of high potential new drug molecules did not meet the concerned company’s expectations. To stick to the knitting, some companies with deep pockets, explored another model of Mergers and Acquisitions (M&A) of innovative patented products and companies with rich new drug pipelines. Interestingly, in this M&A business model, low risk, low cost and high-volume turnover of generic business also started attracting several R&D based companies, alongside.

Which is why, an increasing number of R&D based companies started planning to expand their business in less risky generic drug business. This appeared to be a quick fix to tide over the crisis, as the generic drug business model won’t require going through lengthy R&D processes. Besides, compliance with ever increasing stringent regulatory approval protocols, particularly in the developed markets of the world.

Examples of why focus on core competencies matter, even in new normal:

There are several examples of large companies to illustrate this point – both from the old and the new normal. Just to give a flavor of the relevance of focusing on core competencies of organizations, I shall draw upon three interesting examples. Each of these, highlight different organizational visions and perspectives at different times, particularly the relevance of focus on core-competencies for a corporation. These are as follows:

The first one is Daiichi Sankyo of Japan’s acquisition of India’s generic drug major of that time – Ranbaxy, in June 2008. The parent company claims: “We provide innovative products and services in more than 20 countries around the world. With more than 100 years of scientific expertise, our company draws upon a rich legacy of innovation and a robust pipeline of promising new medicines to help patients.” It is much known today, what happened to this acquisition, thereafter, for various reasons, including faulty pre-acquisition due diligence. However, later on, the domestic pharma leader – Sun Pharma, acquired Ranbaxy. Nonetheless, at least from Daiichi Sankyo’s narrative, its areas of core competencies, appear closer to any R&D-based drug company.

The second example is US-based Abbott Laboratories acquisition of domestic formulations business of Primal Heath care in India in May 2010. Like Daiichi Sankyo, this acquisition was also a part of Abbott’s strategy to enter into ‘generic drug business’ -dominated emerging markets. Abbott, at that time, apparently decided to expand its strategic focus beyond its core competencies in business, primarily of patented products. However, by the end of 2012, the company separated into two leading healthcare companies. Abbott became a diversified medical products company. The other one – a totally separate company was formed, with the name – AbbVie, as a new researched-based global biopharmaceutical organization. AbbVie now operates in India, as well – with erstwhile Abbott’s innovative brands. In this case, by an innovative restructuring of the parent organization, Abbott brought back its sharp focus on core competencies of both the companies with both doing well in India.

The third example is a recent move of reverting to the original focus of core competencies, when moving beyond these did not yield results. In that sense, this example is different from the second one. On November 16, 2020, Pfizer also announced the creation of ‘the new Pfizer’, as it reverted to its original core competencies of “developing breakthrough treatments and delivering innovative, life-changing medicines to patients around the world.” On that day, Pfizer completed transaction to spin off its Upjohn generic drug business and combined it with Mylan to create a new entity – Viatris Inc. Earlier, the company had sold its veterinary business, a baby formula unit and its consumer products division as part of a deal with GSK – for similar reasons. Earlier, the company’s moving beyond its core competencies to pluck low hanging fruits of generic drug business, did not yield dividend, as Pfizer’s profit in the generic drug sector, reportedly, had gone South.

Conclusion:

According to Pharma Intelligence, several large players, such as, Novartis, Sanofi, AstraZeneca are now focusing on core competencies, as they start recovering from their unsettling patent cliff and other headwinds. Meanwhile, one may expect to witness more of Spin-offs, Carving-out, Splitting-off or further strengthening of core-competencies of organizations – for a sustainable long-term business excellence in the years ahead.

Spin-off and acquisition of Cephalosporin generic business by GSK and Sandoz Division of Novartis, respectively, is a part of the same ball game. Thus, maintaining or reverting focus on core competencies – regardless of generic or innovative drug business, I reckon, are the new imperatives of commercial success, even in the new normal.

By: Tapan J. Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

Still Evolving: Pharma’s New Pathway For Digital And F2F Customer Engagement

Posted on February 15, 2021 by Tapan Ray

Last year – probably left with no better choice – the pharma industry, in general, had to take an unprecedented interest in digitalization of business processes. It happened faster than ever, especially in the marketing domain, along with a few others. Large research studies, across the world have vindicated this point. However, such digital transformation initiatives of last one year, is far from getting over. These are still like a work in progress. Primarily because, the extent of sudden changes in healthcare customer behavior, overall business environment and market dynamics, are still unfolding – slowly and gradually, though.

Consequently, the future drug marketing roadmap for the ongoing journey isn’t clear, just yet, especially in the area of striking a critical balance between virtual F2F (Face to Face) and in-person F2F customer engagements. Which is why, ascertaining the extent of personalization of customer contacts, customer-centric content development and their preference-based channel selection, may take more time. Accordingly, the framework of a strategic blueprint will need to be continuously updated during 2021, based on robust data.

Charting and analyzing the trend for each critical interface related to customer contacts – based on credible data, has already been initiated by renowned professional agencies. The findings of the same are also started trickling in. Some of which are on the expected line thinking, whereas a few others aren’t so expected, by many.

In this article, I shall dwell on some of these critical trends related to striking a right balance between virtual F2F and in-person F2F customer engagements for commercial excellence in 2021 and beyond. The purpose is to encourage marketers for keeping eyes on the ball, always. This is critical while formulating robust digital marketing strategies – charting a new pathway for reps’ digital empowerment – from here on. Let me start by quoting an important research study.

Digital initiatives helped staying relevant in uncertain times:

Several other research studies, including the Veeva study on ‘Industry-wide digital acceleration’, published on September 23, 2020, highlighted pharma’s digital efforts to stay relevant during a year-long uncertain times, like the last year. Even today, the industry’s digital channels, mostly related to customer engagement, like doctors and patients, are drawing similar importance of the top management.

The research underscored, healthcare sectors in emerging countries, such as India, Vietnam, Indonesia and China are increasingly relying on digital return in a post-pandemic world. Interestingly, digital engagement has now unlocked access even to those healthcare professionals who were declining F2F access to many pharma companies.

‘Slow return of in-person interactions’ – what does it mean?

While the increasing use of digital channels in customer engagement was true during last year, the recent APAC Veeva Pulse Data also shows signs of a slow return of in-person interactions. The top 5 therapeutic areas that have started to reopen include:

Respiratory,
Cancer,
Infection,
Diabetes and
Cardiovascular.

The study shows that F2F interactions dropped dramatically between February and April 2020 but increased back to pre-COVID numbers by July 2020. Curiously, at the same time, virtual engagements and meetings also continued to increase significantly. Thus, the question to ponder and address properly is – If in-person F2F interaction is increasing alongside digital, what would it mean for healthcare engagement while moving forward?’

Is it a signal for the hybrid customer engagement model in the future?

While doctors are realizing the benefits and ease of user-friendly digital engagement, this may not mean that virtual visits, meeting and engagements are replacing F2F in-person interactions, lock-stock and barrel.

Thus, it now needs to be established by more and larger studies, whether a customer engagement model with an optimal mix of digital and F2F in-person engagements can be more effective for better commercial outcomes, now and in the days ahead. The point that needs to be ascertained first is – what will this optimal mix be – between digital and F2F, which I reckon, will differ from company to company – mostly based on therapy areas they represent.

F2F engagements may increase from the past year, but not as old normal:

Except initial turbulence, with incredible resilience the pharma industry navigated through the choppy environment during the pandemic, with the skillful application of digital technology. The most recent Veeva article, published on January 07, 2021 captures this point.

It articulated, with companies continue expanding digitalization to accelerate cost-efficient commercial operations and yielding greater productivity, the new operating models will reshape the industry and drive powerful transformation for years to come. It is, therefore, unlikely that the traditional ways of in-person F2F engagement with doctors, patients and other stakeholders will come back soon in its old avatar, if at all.

Increasing scope for a two-way digital engagement with pharma customers:

Veeva Pulse data also observed the initiation of pharma’s two-way digital engagement with health care customers last year and an expanded potential of the same in the current year and thereafter.

Although, virtual meetings increased more than eightfold and rep-sent digital communication by sevenfold since January 2020, these channels have primarily been used for outbound customer engagement.

This leaves some untapped opportunities to explore, by creating new inbound digital customer-engagement channels. The aim is to make it easier for doctors and patients have greater access to companies, its reps or designated individuals, for information and services that they may want. Most importantly, this has to be – as they need it – when they need it – and the way they would prefer having it. Inbound digital engagement channels will also demonstrate a greater company focus on ‘customer-centricity’.

Expanding towards inbound digital engagement for customers has started:

This shift prompts a change in the traditional mindset of pharma marketing leadership. The process will be gradual, ongoing and having a bias on contemporary customer needs. The steps to follow should preferably be initiate – evaluate – expand, while taking every significant step.

For example, as reported by Fierce Pharma on February 08, 2021, global pharma major Novartis is aiming to personalize its interactions with healthcare professionals and deliver “what they need in real time” to support their decision-making process. Novartis, reportedly, is also setting out to change the way that they are “interacting with not only physicians, but healthcare systems, and how they think about the patient journey.”

F2F shifts from ‘in-person interaction for all’ to ‘as per customer preference’:

Be that as it may, pharma’s digital strategy requires to be craftily woven with the company’s field-strategy. Thus, the reps must be digitally well trained in delivering brand values consistently, across digital channels and platforms, as recent studies indicate.

Far from traditional F2F field sales models of in-person meetings for all doctors, the hybrid F2F model requires personalized engagement, based on customer preferences. Some customers may prefer reps to engage only through digital channels, whereas many others may like a mix of virtual and in-person engagements. With the expanding reach of digital technology for all, these preferences will keep changing with time.

Conclusion:

In 2021 and thereafter, accelerating digitization of critical pharma domains, such as marketing, is expected to reduce operational costs and boost operational efficiencies. In tandem, it will help gain deeper insight into customer behavior and market dynamics, fueled by newly acquired digital capabilities. These include, faster generation of customized data or collation of relevant and credible information collected from multiple sources, and their error-free prompt analysis. In addition, prudent application of digital technology in all selected areas by astute pharma professionals, will help reduce, if not totally eliminate, currently practiced and human error-prone, mostly repetitive manual processes.

The pan industry shift toward digital channels is here to stay and is expected to accelerate further for other strategic reasons too, such as, to add more flexibility in attaining greater efficiency and effectiveness for customer engagement. It goes without saying that factoring-in all such key success factors, companies will draw their respective current and future digital marketing strategies. That said, recent data indicate, customer engagement may call for a mix of virtual and in-person F2F engagements. The same report highlights that going back to the old normal of in-person F2F engagements for all doctors could probably be a far cry. Similarly, the initial success of e-customer engagement is unlikely to replace in-person and in-clinic F2F engagements of sales reps completely.

However, the point to note is that the industry scenario in this area is still evolving. Currently published trends indicate, different customers, like doctors, patients and hospitals, will have different preferences of engagement with drug companies, in different communication platforms. Thus, pharma’s new marketing pathway, as discussed above, will entail striking an optimal balance between digital and F2F customer engagement, which will vary from company to company based on several critical factors.

By: Tapan J. Ray

More Challenges For Brand Launch Success In The New Normal

Posted on February 8, 2021 by Tapan Ray

The drug manufacturers’ life blood to drive business growth has always been successful new product launch. However, this task has always remained a tough challenge to crack, since last so many years for various reasons. According to McKinsey & Company: “About two-thirds of drug launches don’t meet expectations. Improving that record requires pharmaceutical companies to recognize the world has changed and adjust their marketing accordingly.” Several research studies have been carried out by now to gain actionable insight on this issue.

Existing challenges for successful drug launch got further amplified, as Covid-19 pandemic added a novel dimension in this space. It involves disruptive changes in many facets of customers’ new product-value expectations. Similar changes are witnessed in the product value delivery process, doctor-patient engagement, content development and delivery platforms, among others. This article will explore this area from successful new product launch perspective, in the days ahead.

Dismal outcome of many new drug launches – more for primary care:

According to a recent study, published by L.E.K Consulting on December 18, 2020: ‘About half of all products launched over the past 15 years have underperformed pre-launch consensus forecasts by more than 20%.’ This is quite in line with what McKinsey & Company found in 2014, as quoted in the beginning of this article.

However, in a relative yardstick, the primary care market has been the most vulnerable, which continues even during the ongoing pandemic. For example, according to an April 2020 Evaluate Vantage analysis, ‘Covid-19 adds a new danger to drug launches.’ The study emphasized, new drug launches, especially those targeting the primary care market, are particularly vulnerable as the pandemic continues. The key reason being, besides widespread disruptions in the health care system, sales teams will be physically unable to reach frontline physicians, as much as, and also the way they could do the same in the old normal. The studies underscore that a strong launch is critical to achieving maximum commercial potential, despite odds.

Some pivotal factors demand a greater focus than ever before:

After in-depth analysis of various studies in this area, some pivotal marketing factors appeared critical to me, in order to reduce success uncertainty while launching new products.

Alongside, unbreachable and agile supply chain alternatives also assumed a never before-frontline-importance in the new normal, unlike pre-Covid days. Another recent study, titled ‘Competitiveness During Covid-19 Pandemic: New Product Development and Supply Chain Agility’, published by ResearchGate in October 2020, vindicated the point.

As the title indicates, the above study examined the effect of new product development and supply chain agility to gain competitiveness during the Covid-19 pandemic and probably beyond. Thus, while developing and launching new products in the new normal, some pivotal factors, such as the following, appeared critical to me, in order to reduce success-uncertainty while launching new products:

Early planning for launch with a robust market access strategy, better sales forecasting with stretch goals – supported by state-of-the art forecasting tools and relevant learnings from the past.

Gaining actionable insight on changing customer needs, market dynamics and competitive threats in the new normal – by generating credible and contemporary data and leveraging the power of analytics – to offer differentiated stakeholder value.

Driving home patient-centric coeval product values that will delight customers – through flawless execution of stakeholder engagement strategies.

Working out virtual, innovative, personalized and impactful alternatives to some critical launch related physical events, such as, conferences, seminars, webinars and the likes, for doctors and other customers.

Developing creative and contemporary content and other marketing assets for significant online or omnichannel presence of new brands – supported by video clips and other tools, aiming at the target audience.

Differentiating the launch product clearly from those of the nearest competitors, where a focus on price-value relationship of the brand – from the patients’ perspective, could play a game changing role. As McKinsey & Company also highlighted, launching an undifferentiated product in an unestablished disease area carries a greater risk of failure.

Creating a robust and agile supply chain to navigate through unexpected market changes – as all experienced recently.

Delivering ‘patient-centric’ real value of the brand together, is critical:

Interestingly, L.E.K Consulting has also emphasized in its recent study that to drive and effectively deliver ‘patient-centric’ real value of new products, it is imperative for drug companies to execute the launch process flawlessly.

To make it happen on the ground – at the moment of truth, careful selection of a team of self-motivated people is necessary. This needs to be followed by intense training in all aspects of the specific launch, including effective use of modern digital tools and platforms – and above all – by creating a ‘can do’ team spirit to deliver the deliverables.

This requirement has been epitomized in the recent article, titled ‘Beyond the Storm: Launch excellence in the new normal,’ published by McKinsey & Company. Therein, the authors articulated, ‘Intangible though it may sound, great launches have a different feel from normal launches. There is a real sense that – we’re all in this together.’

Pharma’s current way of using digital platforms doesn’t satisfy many doctors:

Over the last one year, as the pandemic brought all human activities virtually to a grinding halt, there has been a significant shift towards digital tools and online platforms, including in the way medical practitioners interact with drug companies. As recent surveys indicate, pharma customers don’t seem to be quite satisfied with the way many pharma players are currently making use of this technology.

This is happening even with those doctors who are open to virtual engagement and in favor of remote patient consultations. The issue needs to be resolved soon, particularly for new product launch successfully – using digital platforms, as reported in recent surveys.

The survey reports retraining of ‘sales reps to become digital orchestrators’:

One such recent survey, conducted by Indegene, which was also reported by Fierce Pharma on February 01, 2021, digital dissatisfaction of doctors with pharma companies, has jumped during the pandemic. The rates of dissatisfaction with pharma digital interactions, across media channels, ranged from 23% to almost 50% of physicians. Some of the key findings of the study include:

49% of physicians are not happy with pharma’s social media engagements – perceived as less sophisticated when compared to expectations set by consumer companies.

Pharma is far from providing a satisfactory digital experience, as compared to other industries. The current dissatisfaction level where a higher percentage of doctors were dissatisfied, include marketing emails – 46%, telephone sales calls with sales reps – 42% and both webinars and websites – each at 39%.

In-person meetings dropped from 78% to 15% during the pandemic, but even now only 48% of doctors surveyed expect in-person engagements to continue in the post-COVID world.

Attendance at medical conferences also dropped from 66% to only 16% during the shutdowns and travel restrictions, but only 50% of HCPs now expect to resume in-person congresses after it’s safe to hold them.

The number of physicians engaged in remote sales visits increased from 11% to 47% during the pandemic, probably because there weren’t other alternatives available. Interestingly, one-third of physicians still plan to continue with virtual sales meetings even after the pandemic.

Most stakeholders are realizing, this is going to be the new normal, with senior pharma leadership also saying, ‘it’s never going to be the same as before.’

About 5 of the top 15 global pharma players are retraining their sales reps to become “digital orchestrators” and working to help them create clear and comprehensive digital communications for doctors.

Speedy resolution of these issues is likely making a substantial difference in improving pharma-to-physician interactions, particularly during new drug launches, in the days ahead.

Conclusion:

Success uncertainties in new product launches have always been a cause of concern for the drug industry, especially after having invested a substantial resource towards innovation and clinical developments. Interestingly, pharma players were mostly following ‘stick to the knitting’ dogma, as it were, in their launch planning. Despite the availability of sophisticated digital tools and analytics over the last several years, particularly in generating and accurate analysis of contemporary and credible data to gain insights, not much had changed radically. Suddenly Covid pandemic disrupted most market traditions, business processes, and the general belief on decision makers’ ‘gut feelings’ on customer behavior, market dynamics. Besides, the mindset of ‘doing better that what you have been always doing’, prevailed in many cases. In India, market research for most companies remained within the ambit of syndicated retail and prescription audit, despite frequent grumbling of many marketers on some critical findings of these reports.

The last one year has created more challenges in this area, although with a silver lining. A large number of drug companies have now stepped into the area of digital marketing – in varying degree, scale and resource deployment. This shift is expected to help reduce launch success uncertainties of new drugs. It will again, depend on how effectively the technology is leveraged by the cerebral power of astute markers.

Another article on pharma product launch, published by McKinsey & Company on December 15, 2020, also vindicated this point. It underlined: ‘As pharmaceutical companies reshape their commercial model to prepare for the uncertainties ahead, personalization and digital enablement will be crucial to launch success in the new environment.’

Amid these, as some surveys highlight, many doctors are not satisfied with the way digital technology is being currently used by pharma companies – to interact with them and cater to their information needs. With these ‘teething troubles’ being properly and promptly addressed, many drug companies, I reckon, will be able to remarkably reduce success uncertainties of new drug launches in the new normal.

By: Tapan J. Ray

Create Purpose-Driven-Brands To Win Marketing Warfare In The New Reality

Posted on October 5, 2020 by Tapan Ray

As we navigate through the Covid days, the hope of somehow getting back to the pre-pandemic normal still lingers – notwithstanding a host of uncertainties in its way. The longing is driven by the hype of availability of scientifically proven, safe and effective drugs and vaccines – unrealistically soon, despite top experts still keeping their fingers crossed. Some are even more forthright in their expression, as reflected in a September 30, 2020 report. It flashed a headline - “There is no getting ‘back to normal. The sooner we accept that, the better.”

Alongside, COVID-19 crisis has also triggered some disruptive changes in the business processes around the world. Amid this global health crisis, interestingly, several global pharma CEOs are sensing a number of game-changing opportunities – having business implications, even much beyond the pandemic.

One such example, as Bloomberg reported on September 29, 2020, the CEO of GlaxoSmithKline Plc feels: The Covid Pandemic is ‘a Shot at Redemption in Pharma Industry.’ Elaborating the point, she said: ‘the sector’s push to find vaccines and drugs to end the crisis, if successful, could change the perception of pharmaceutical companies in the future.’ Coincidentally, the researchers from The Harris Poll found:

As of May, 40 percent of the American public said pharma’s reputation had improved since the beginning of the COVID-19 outbreak
And 81percent recalled seeing or hearing something about the industry during that time.
This is a continuation of the former trend that The Harris Poll first noted on March 2020.

There shouldn’t much doubt, either, that similar general impression on the pharma industry, with a varying degree, may now be felt in most countries, across the globe.

Curiously, flowing from this ‘redemption of pharma reputation’ angle – with new drugs and vaccines, the scope for leveraging another opportunity is also surfacing. This is from pharma ‘branding’ perspective and pertains to creating ‘purpose-driven brands’ for success in the new reality – during the pandemic and much beyond. In this article, I shall focus on the second area, and would start with its relevance to increasingly more informed health care consumers of date.

‘Purpose driven brands’ – attained greater relevance in Covid time:

The concept of creating ‘purpose driven brands,’ is profound – it goes much beyond product features, benefits and intrinsic values. It is motivated by – why the brands exist not just for providing a solution to manage or cure a disease, but also to meet a crucial need in society.

Studies have unfolded, with better stakeholder connection – and greater share of their mind, ‘purpose driven brands’ help improve brand loyalty, resulting into increased revenue and profit. We will see below, why in Covid time, this trend has started gathering wind on its sail, and deserves to find its place at the very core of any pharma branding strategy.

The consulting arm of The Beautiful Truth, also echoed the same sentiment in the article – ‘How Pharma Can Navigate Change With Purpose.’ It reconfirmed, at times of external crisis, like the global pandemic, creation of ‘purpose-driven brands’ is vital. Not just ‘for saving and maintaining business, but also for boosting internal team morale, and reconciling public trust.’

The pandemic has redefined the core purpose of a brand:

Another recent article –‘Through COVID-19, Leading Brands Have Found Their Purpose,’ published in CMO by Adobe, among many others, vindicated this point. Acknowledging that the COVID-19 pandemic has redefined the meaning of brand purpose, the paper explained the reason for the same.

In pre-Covid days, many organizations used to build brands following traditional norms – curing or effectively managing a disease is the purpose of a brand. But, since last few years, a growing number of new generation health care customers expect a brand’s ‘purpose’ to expand beyond the product and the company. It has to be inclusive in nature – benefiting the macro-environment, including governments, health care professionals, and the public. With this expectation gathering momentum during Covid time, pharma players would also need to redefine the core ‘purpose’ of a brand. Incidentally, many pharma CEOs also believe, if this trend continues, the image of the industry would probably undergo a metamorphosis.

Surveys vindicate the rationale for redefinition:

Several top consulting organizations have published excellent articles covering a number of critical points in this area. One such paper - ‘Purpose is everything,’ was published in Deloitte Insights, on October 15, 2019. It wrote on how brands that authentically lead with ‘purpose’ are changing the nature of business today.

The rationale for redefinition of brand purpose, also gets reflected in a contemporary Deloitte survey, as quoted in the above article. It revealed the following top three issues that stakeholders identify with, while making decisions about brands:

Top Issues	% of respondents
How the company treats its own people/employees	28
How the company treats the environment	20
How the company supports the community in which it operates	19

Aligning purpose to create deeper connections with stakeholders:

Especially at the Covid time, if companies try to align their purpose in doing good – for the society, they can build deeper connections with their stakeholders. And, in turn, amplify the company’s relevance in their stakeholders’ lives. From this perspective, it’s good to note in the above Bloomberg article, that one of the top pharma CEOs articulating the same in public. I reckon, increasingly, pharma businesses would endeavor harnessing the power and opportunity of aligning the ‘core purpose of brands’ with societal good, as came out in the above Deloitte article.

Mostly millennial generation favor ‘purpose-driven’ brands:

The initiation of this trend dates back to pre-Covid time with wider usage of internet. However, with the increasing democratization of health care - social media based instant information sharing, the ability to communicate with others as needed, have increased manifold. Consequently, stakeholders, particularly, the millennial generation with a different mindset, aspirations and expectations are expecting pharma players to act more on the pressing societal issues. This makes them lean towards a purpose driven brands and companies. The unprecedented Covid health crisis is acting as a force multiplier in this area.

Another study – ‘Why Customers Are Supporting ‘Purpose-Driven’ Brands,’ published in Link fluence epitomized this evolving customer preference succinctly. It reiterated, ‘It’s no longer enough for brands to deliver great products and experiences. Instead, consumers are demanding for brands to be more proactive and conscious in delivering value to society as a whole.’

‘Purpose-driven brands’ – the latest ‘marketing buzzword’?

This question was conclusively answered about two years ago - from the 2018 Cone/Porter Novelli Purpose Study. Although, this survey was conducted in the United States, it has a global relevance amid Covid pandemic. Some of the key findings include:

78 percent believe companies must do more than just make money; they must positively impact society as well.
77 percent feel a stronger emotional connection to Purpose-driven companies over traditional companies.
66 percent would switch from a product they typically buy, for a new product from a purpose-driven company.
68 percent is more willing to share content with their social networks over that of traditional companies.

Examples of ‘purpose-driven’ pharma brands/companies:

Let me give just two examples each – from pre-Covid and Covid times. The article – ‘Mission-Drive Pharma Brands,’ published by Wonder on January 15, 2018, cited several examples of ‘purpose-driven’ pharma brands. This was based on a research of individual drug campaigns for top-selling drugs around that time. These include promotional campaigns on:

Humira: Highlighted the participation in a community food drive, and volunteering in a playground construction project.

Lyrica: Highlighted the engagement in a multi-generational interaction and helping others.

Encouragingly, while combating COVID-19, several pharma companies have also displayed a sense of ‘purpose’ to save the humanity from the pandemic, mainly through collaborative approaches. Let me quote below two such examples:

On April 14, 2020 GlaxoSmithKline and Sanofi announced a very unusual collaboration to develop a COVID-19 vaccine, expeditiously. This was done for a greater purpose, responding to the critical need of the society – saving millions of lives.

Roche called on and campaigned for the governments for focusing on testing and prevention, to maintain adequate medical supplies for health care professionals around the world. It also urged the health authorities to work closely with the life sciences industry to tackle the Covid-19 pandemic through international collaboration to tackle Covid-19 pandemic.

Conclusion:

Meanwhile, as on October 04, 2020 morning, India recorded a staggering figure of 6,549,373 of Coronavirus cases with 101,812 deaths. Still there is no respite from Covid-19’s unprecedented onslaught on the country. Be that as it may, coming back to the creation of ‘purpose-driven brands’ in the Covid time, let me quote again from the above CMO by Adobe article, where it underscored:“Never before have brands been asked to show their true purpose and leadership as they are today. It’s inspiring to see companies across industries and throughout the world come together to address some of the most pressing needs brought about by this crisis.”

As Accenture had articulated: ‘In an era of radical visibility, technology and media have given individuals the power to stand up for their opinions and beliefs on a grand scale.’ Keeping this in view, with gradually changing stakeholder mindset and expectations, the ‘purpose of a brand’ deserves to be a critical centerpiece in the pharma ‘branding’ process. Various studies have established – since pre-Covid time, and more during this pandemic – brands, reflecting a robust sense of ‘purpose’ on societal values, people and the environment, connect better with customers.

Consequently, as the stakeholders find these companies walk the talk, they develop a strong and sustainable brand preference, and reward the manufacturers commensurately, both directly and also through word of mouth. Alternatively, if the stated ‘brand purpose’ is not genuine – which customers can quickly find out through digital transparency, they shift their preferences to the deserving ones. Going by this growing trend, I reckon, creating ‘Purpose-Driven-Brands’ assumes a critical importance to win marketing warfare, in the new reality.

By: Tapan J. Ray

Aptness Of Pharma Marketing Audit In Covid Days And Beyond

Posted on September 21, 2020 by Tapan Ray

That, Covid-19 pandemic has changed the operational dynamics of many areas of the pharma industry, as compared to the old normal, is being felt by many. These changes generally fall into two categories. Some are broad industry specific changes, giving rise to a new normal. Whereas, a lot more could often be specific changes required by individual companies in the changing times – depending on how these companies were operating in pre-Covid days. The good news is, the industry specific ones are being well deliberated by many domain experts, almost on an ongoing basis.

Most experts are suggesting digital solutions, for a number of problem areas in the pharma industry as a whole. But, the reality is, for rapid adaptation of the new normal, there is also a crucial need to dovetail the Company specific solutions, with the industry specific generic ones. This effort will call for effective use of robust, well-structured and time-tested systems. However, not as many discussions seem to be taking place in this area, as on date.

As I see around, one such comprehensive and well proven approach is ‘Marketing Audit’. This can be effectively used to ascertain Company specific changes, required for successful pharma business operation during the Coronavirus triggered paradigm shift. It may not sound as zesty as a ‘digital approach,’ but remains fundamentally important for pharma marketers, nonetheless.

In this article, I shall discuss the relevance and the key importance of a comprehensive pharma Marketing Audit, in this trying time for business. Its key purpose is to give shape to a cutting-edge strategy in today’s unfamiliar order. Let me begin with a brief background of the same, for better understanding of all.

Marketing Audit demonstrated its perennial importance over decades:

To put it in perspective, let me refer to a landmark article by Philip Kotler, titled ‘‘The Marketing Audit Comes of Age.’ It was published by the MIT Sloan Management Review, on January 15, 1989. In his review of the need for Marketing Audit, one can get a sense of perennial importance of Marketing Audit, proven over decades.

In Kotler’s own words: ‘The marketing audit as an idea, dates back to the early 1950s.’ An executive at Booz Allen & Hamilton, conducted marketing audits as early as 1952. Its importance of improving business results, was captured by an excellent set of papers under the title ‘Analyzing and Improving Marketing Performance,’ published by the American Management Association, in 1959.

Covid-19 Surveys highlight general trends, not any Company specific:

We all are witnessing these days, how the Coronavirus pandemic is changing the pharma consumers. In my June 22, 2020 article in this blog on ‘Enhancing Pharma Brand Experience in The New Normal,’ I highlighted some of the basic changes required in the traditional pharma sales and marketing practices.’ These were the generic changes in the marketplace involving the stakeholders. To illustrate this point better, let me cite some recent examples.

The pandemic has suddenly accelerated certain trends:

The lockdowns have brought to the fore certain shortcomings of the pharma industry, more than ever before. Consequently, its serious fallout compelled almost all players ‘to evaluate and adapt its roles and responsibilities almost overnight.’ This point was captured in the ‘Survey results: Accelerating digital transformation during COVID-19,’ published by Reuters Events– Pharma on September 04, 2020. Some of the survey findings included the following:

Although, adoption of digital engagement has accelerated, pharma’s ability to deliver exceptional virtual engagement and content is being put to test.
Customer Relationship Management (CRM), Content Management Systems (CMS) and customer engagement platforms were found wanting and not fully exploited.
There will be a greater emphasis on the Connected healthcare customer journey.
Providing a unique customer experience will emerge as a competitive edge.
The industry must re-direct resources accordingly, and re-tool to make the most of them.

Let’s now examine some India specific findings from another survey in this space.

Some India specific survey findings:

To explore the impact of COVID-19 on the Indian pharmaceutical industry, another survey, conducted by C Com Digital of India, came out with some interesting findings, some of which are as follows:

The new normal warrants a strategic shift in the business operation, besides engagement with doctors and patients.

Increasingly, drug companies are moving into online business operations from mostly offline operations of pre-Covid days.

Many companies are considering dedicating about 5 percent to 10 percent of their marketing budget towards creating webinars and online communications.

Teleconsultations and online consultations are steadily increasing and around 42 percent patients are getting their prescriptions in this way.

Doctor visits dropped by 5 percent only during March-April 2020 period.

Companies are expanding in online patient education, and online field staff training through custom made e-Learning modules.

As we find above, the emerging new trends are all generic in nature – not enough to prepare any comprehensive company specific strategy for success in the prevailing situation. This brings us to the question: What exactly is Marketing Audit and its relevance during pandemic days?

Relevance of Marketing Audit during pandemic days and beyond:

Thus, the extent of changes required on all sales and marketing related areas, during the pandemic period and beyond, has to be carefully and productively evaluated by each Company, separately. No wonder, why a comprehensive ‘Marketing Audit,’ is also considered “a marketing mirror” - so appropriately.

Without going into the theoretical details, let me first try to explain this terminology in simple terms. It has clearly been established that a Marketing Audit helps understanding, both internal and external marketing environments of an organization, in a comprehensive way. Mainly because, it involves an in-depth and data analysis of the concerned company’s business domain, not just to accurately diagnose the new areas of problems, but also to work out a contemporary – cutting edge marketing strategy.

Thus, I reckon, this tool should be effectively used by pharma marketers, as a high potential mechanism in the marketing warfare, especially during the global pandemic and beyond. Still, some can raise the question, what exactly pharma industry surveys will tell you and what those won’t, – and what gaps company specific surveys will help bridge.

The gaps that Marketing Audit will help bridge:

Industry specific surveys on Covid-19 pandemic would tell the Companies where they should aim to reach. However, each Company would still need to figure out where they currently are in those areas, and most importantly how to reach the target point. An effective Marketing Audit will help the Companies get exact information on where they currently are, and how to reach where they want to reach.

As the new normal is changing, it needs to be done periodically:

The information obtained through a robust Marketing Audit will help address both customer and market needs – on the one hand and honing or reorganizing the company’s internal value delivery systems commensurately, on the other. However, when an unprecedented or a disruptive change, such as the Covid-19 pandemic keeps striking all conceivable entities, very hard, ‘the new normal’ keeps changing. In this situation, most of the past success ingredients will no longer yield results. Thus, to realign the business with changing market demand, pre-Covid strategic blueprint needs to be redrawn, alongside the necessary wherewithal required for the same.

Marketing Audit, therefore, becomes a periodic requirement for all organizations, assuming the importance of a key business success imperative, if not for survival in the new normal. Any delay in this area may lead to significant loss of Company business.

Conclusion:

According to Covid-19 update of Evaluate Pharma, ‘seemingly uncontrollable advance of Covid-19 in India,’ is perturbing. As on September 20 morning, the country had recorded a staggering figure of 5,400,619 of Coronavirus cases with 86,774 deaths, overtaking Brazil the week before.

The above report points out the potential danger of ‘the country’s health care system to buckle under the weight of hospital admissions for the virus.’ However disturbing this trend may be, from the pharma industry perspective, it sends, at least, four clear signals:

It’s a long-haul struggle for the business, as Covid-19 is not going to vanish any time soon.
The barriers to in-person interaction will continue for an indefinite period.
The market dynamics will keep changing, mostly based on Government’s new guidelines.
A robust, flexible, contemporary and comprehensive marketing strategy needs to be supported by stronger and time-tested marketing systems for all times.

From the above perspective, one such time-tested mechanism still remains – ‘the Marketing Audit.’ For business excellence during Covid times, it carries a game changing potential, by dovetailing the industry specific generic problems with company specific strategic solutions.

The criticality of ‘Marketing Audit’ does not remain limited just to bright pharma marketers. It also provides an equally critical top management decision support tool, especially for risk-benefit analysis of the corporate business. Thus, relevance and importance of ‘Marketing Audit’, would remain undiluted, not just during the Covid pandemic – but much beyond.

By: Tapan J. Ray

Neutralize Covid-19 Impact on Drug Prices And Market Access For Faster Recovery

Posted on September 14, 2020 by Tapan Ray

Covid-19 pandemic that has not spared any facet of human lives and livelihoods, has also reignited several ongoing debates related to the drug industry. The need to urgently resolve these issues grows manifold, as the real magnitude of this health crisis doesn’t seem to be clear even to the key Government decision makers.

This is vindicated by the research paper, written by government scientists and other experts, published on September 10, 2020 in the Indian Journal of Medical Research. It reveals, India had nearly 6.5 million cases as early as May 2020. Whereas, according to the health ministry, the total number cases stood at around 180,000 in late May. This happened because, ‘large numbers of cases could have gone under the radar earlier this year, because testing was limited to symptomatic patients or states had varying testing rates,’ the paper highlighted.

From the pharma industry perspective, a pandemic of such magnitude is also causing indefinite delay in pre-planned market access of several important drugs and vaccines. Some are due to technical reasons. However, many others are related to their value-based cost-effectiveness in the new normal, when the pandemic has put enormous strain on health expenditure, across the world.

In this situation, past mechanisms of new drug pricing, are required to undergo significant changes. The new yardsticks, I reckon, will be based on two critical factors. The first – the disease treatment priorities, as will be decided jointly by both doctors and patients. And the second – the paying capacity of both payers and individual patients, based on the value that each treatment will offer – again, as perceived by patients.

As it appears, the impact of Covid-19 on the pharma industry will continue till the medium term, if not beyond. Consequently, the concept of new drug pricing – based on well-documented, differential value offerings of treatments, would need to be revisited and recalibrated. This has to be realigned with evolving patient needs. Considering the emerging scenario, this article will focus on the exigency to neutralize Covid-19 impact on new drug prices and pre-planned ‘market access’ – for faster business recovery.

Covid-19 has increased the drug price sensitivity:

The challenge of increasing drug price sensitivity – triggered by the new Coronavirus pandemic, has now assumed a global dimension. A June 18, 2020 study, flags: ‘Nine in 10 Concerned About Rising Drug Costs Due to COVID-19.’ Although, this particular study (Gallup Poll) was conducted in the United States, general public apprehension is no different in other parts of the world, including India, for various reasons.

Even in America, which is considered Eldorado for pharma business, primarily for unregulated drug pricing, is also changing with the impact of Covid-19. The reason being, reported instances of drug prices are rapidly rising, amid the pandemic. As the above Gallup Poll highlights, today ‘a large majority of Americans support direct negotiations by the federal government with the drug manufacturer on the price of a treatment for the disease itself.” Interestingly, ‘significant support exists across all major demographic groups.’

Other specialists on pharmaceutical pricing and market access, also envisage that pharmaceutical companies will be faced with increased price sensitivity, and are quite concerned with the long-term impact of the pandemic on health care systems.

Covid-19 pandemic would seriously impact pharma spending:

As quoted above, several other specialists for pharmaceutical pricing and market access have also pointed out some critical Covid-19 impact areas, including:

Tremendous increase in pandemic related public expenditure, could prompt further austerity measures in already strained health care budgets, besides job losses or pay cuts of scores of people for different reasons.

The pandemic is likely to result in a redistribution of health care funding towards infectious diseases (e.g. prioritization of antivirals and vaccines) and chronic diseases associated with worsening COVID-19 outcomes.

This may result in more drug pricing pressure in other disease areas, besides push for increasing use of similar cheaper generics and biosimilars, unless absolutely necessary.

Stricter monitoring of usage of medicines, especially in private hospitals, to ensure their use within the regulatory label and/or within the reimbursed population.

Possibility of mandatory price cuts either across the board or for drugs which have been on the market for a specific duration.

The report also envisages, pharmaceutical companies will be faced with increased price sensitivity and decrease in willingness to pay by authorities. Consequently, the key question in this area becomes: What impact will COVID-19 have on the future of pricing and market access? And how to address this issue, effectively?

Need for an appropriate drug pricing models in the new normal:

Overall scenario for drug pricing model has not changed much, till Convid-19 pandemic overwhelmed the world. The age-old concept of drug pricing, being treated as almost given, is changing fast. As I wrote earlier, it started in the developed world, with newer concepts, such as, Health Technology Assessment (HTA), besides a few others. However, to illustrate the point, I shall focus only on the HTA model. It includes a multi-faceted assessment of the clinical, economic, ethical, legal, and societal perspectives that may be impacted by a new technology, procedure, drug, or process.

Application of HTA in Medicine Pricing:

The ‘Working Paper 6’ of June 2013, on ‘The Role of Health Technology Assessment in Medicine Pricing and Reimbursement,’ published jointly by the World Health Organization (WHO) and the Health Action International (HAI), is worth referring to.

The paper aims to identify and describe the role of HTA in price-setting and reimbursement of pharmaceuticals, with a focus on its use in low and middle-income countries (LMICs). However, as Covid-19 is now fueling the drug price sensitivity across the globe, and not just in the LMIC, this reference will help drive home the point, as one faces today.

While combating health care resource crunch in the face of the Coronavirus quagmire, many countries are contemplating a variety of approaches to maintain affordable access to healthcare for patients. The concept of HTA is one such common approach. It includes pharmaceuticals, vaccines, medical devices, medical and surgical procedures, besides the systems within which health is protected and maintained.

Relevance of a recalibrated HTA in the new normal:

For a new drug, as the Institute For Clinical And Economic Review (ICER) puts it, a final HTA report would attempt to answer the following questions, besides a few others:

Is it safe and effective?
Which patients benefit the most?
Is there a meaningful improvement in health status?
Can all people afford to pay who might need it?
Will it offer a good value in the long run?
What other considerations make it important?

These points need to be looked at keeping in view that Covid-19 pandemic has seriously impacted the health care spending. Thus, the process needs to be recalibrated in the new normal. In any case, HTA has the potential to play a critical role in new drug pricing, by assessing the intrinsic value of medicines that can significantly expand patient-access to care. In tandem, it could maximize the value for money in health expenditure with most efficient allocation of scarce health resources, that most countries are facing today. Nevertheless, there could well be a few company or country specific barriers to capture the value of a drug or treatment, as well. A robust plan for their mitigation needs to be well-thought through, to ensure effective implementation and achieve desirable outcomes.

HTA in India:

At least, on paper HTA exists even in India. The Government of India had created an institutional arrangement called “Health Technology Assessment in India (HTAIn)”, under the Department of Health Research (DHR). It was entrusted with collation and the generation of evidences on cost effectiveness and safety of health care interventions, including medicines and devices.

The key goals are, to reduce the cost of patient care, overall cost of medical treatment, reduction in out of pocket expenditure of patients, besides streamlining the medical reimbursement procedures. Nevertheless, it remains a million dollar question whether India would leverage this system to ensure fair pricing of new drugs in India.

Some pre-requisites to implement HTA – afresh:

In those countries, where HTA for drug pricing and reimbursement doesn’t already exist, there could be several pre-requisites. These may include, as the above paper indicates, establishing a medicines regulatory system, developing and enforcing legislation, employing the appropriate technical expertise, and the allocation of sector-wide financial resources in accordance with the decisions of the organization using the HTA.

That said, the bottom-line is, the quest to arrive at fair pricing for a new drug, could also help ‘market access’, especially in a difficult time, like today’s health care crisis. In that endeavor, let me briefly dwell on the concept of ‘fair pricing a drug’.

The concept of ‘fair pricing a drug’:

This issue has been well deliberated by many experts around the world. However, let me quote a recent article – ‘Defining the concept of fair pricing for medicines,’ published by The BMJ on January 13, 2020.

The paper articulates, ‘a fair price for a medicine is affordable to the buyer while covering the seller’s costs and providing a reasonable profit margin. Within a fair pricing zone, a specific price may be higher or lower, possibly reflecting differential value.

Interestingly, the authors also noted: ‘Applying the framework to decision making would require access to data on R&D, manufacturing, and distribution costs, which is generally not publicly disclosed. This lack of transparency about costs undermines efforts to assess the fairness of medicines prices.’

The article underscored, lack of transparency in these areas, ‘also exacerbates information asymmetry to the sellers’ advantage.’ It suggested, disclosure can be enforced through legislation, regulation, and judicial action. Or as a condition of receiving public research funds, tax benefits, regulatory approval. Or listing in a formulary for reimbursement. ‘In the absence of disclosure, decision makers may rely on reasonable estimates based on publicly available information,’ the paper concluded.

Conclusion:

As recorded in the morning of September 13, 2020, total Coronavirus cases in India have reached a staggering figure of 4,754,356 with 78,614 deaths, overtaking Brazil. This trend continues going North, as days pass by.

All-pervasive Covid-19 pandemic is fueling severe resource constraints, especially for health care. Amid this complexity, to combat this deadly virus – alongside other non-Covid related illnesses – value added drugs and treatments could help overcome many hurdles in this area. They could help improve cost-effectiveness of treatments to price-sensitive patients, besides other stakeholders.

Recalibrated HTA mechanism, which I have used in this article as an example to effectively overcome prevailing drug price sensitivity, is one among a few others. Importantly, HTA mechanism exists even in India. It can be appropriately used for new drugs and vaccines pricing, if the Government wishes to.

On the other hand, it’s up to individual companies to choose any other price-value model’ that they will deem appropriate, to arrive at a ‘fair value for new drugs’. However, the goal remains common for all - Neutralizing Covid-19 impact on drug prices and market access, to ensure faster recovery of the business.

By: Tapan J. Ray

PILMAN

A Tapan Ray Website

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