Tag Archives: operations

Deliver Patient-Perceived Value – Not Incrementally But In Quantum Measure

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Many critical functional areas of most drug companies, such as, marketing, manufacturing, supply chain, medical affairs, human resource, R&D, quality assurance, information technology – traditionally work in silos. It doesn’t mean, though, that there isn’t any interaction between them. Nevertheless, a large majority of them don’t work as a team with a purpose or to achieve a shared goal of delighting customers with value delivered. Such a silo-mindset could often be detrimental to smooth and sustainable business operations. This was also vindicated during the recent pandemic.

Having gone through the harrowing experience of recent disruptions in the lifesaving pharma business operations, a fresh realization has dawned on many leaders’ mind. This point also came to the fore in many studies. One such is the article on ‘Overcoming industry obstacles with a cross-functional strategy’, published by the strategy&, which is a part of PwC network.

The paper came out with some thought-provoking findings. It said, while in the pre-Covid days, mostly competing business pressures used to drive the operational strategies, today the drivers are quite different. ‘Factors such as the COVID-19 pandemic, inflation, geopolitics, new therapeutic modalities, and new ways of working make it vital’ for pharma players to make such transformational operational overhaul for long term excellence.

The spotlight needs to shift from continuous incremental improvement, such as, cost savings, quality assurance, and readiness to deliver—to long-term external challenges. ‘These include high inflation and an increase in complexity and risk, as well as the compounding effects these forces have on each other.”

Several studies have underscored that this approach can ‘make sure operations can protect enterprise continuity while still delivering to patients.’ this article will venture to simplify this complex, yet critical issue. The aim is to achieve a quantum increase in value offering to customers that this strategic approach can potentially deliver to accelerate growth momentum the pharma business.

Some see pharma business as usual, astute leaders see a unique opportunity for change:

An interesting point to note. As the disruptions caused by the Covid pandemic are fading away, some critical health safety norms are also being eased by the authorities. Apparently, the overall daily working-life seems to be limping back to normal. Many pharma leaders are, therefore, considering that the industry operations are going back to pre-pandemic normal, and the business operations will soon revert to the old normal mode soon.

On the other hand, we find some astute leadership who could derive a long-term lesson from the above disruptions and are already in the process of executing those operational changes. This leadership mindset gets reflected in two recent media reports related to two pharma majors – Sanofi and GSK.

On November 28, 2022, it was reported, ‘Sanofi moves into swanky new Paris HQ designed around hybrid work and sustainability.’ Again, on December 12, 2022, another media headline flashed as ‘GSK embraces hybrid work for the long haul at new London HQ.’

To me these are interesting examples to convert problems into opportunities for long-term business success and sustainability, in the new normal. These tasks entail the transformation of business infrastructure alongside its operational strategies.

The need for re-strategizing reverberates across several recent studies:

The need for such an action, as captured by researchers, is prompted by more waves of innovation coming in various operations and functions of pharma business, mostly triggered by the pandemic. The spectrum of innovation, as reports reveal, ranges ‘from new treatment modalities, to smart machines, advanced analytics, and digital connectivity.’

Hence, the future of pharma operations strategy needs to be different now from the past. This finding was also published by the McKinsey & Company on October 10, 2022. It reiterated, as pharma companies are emerging from two years of intense firefighting, now is exactly the right time for their renewed emphasis on a new operations strategy. It emphasized: ‘Succeeding in pharma under these new and challenging conditions will require succeeding in operations.’

This point was further vindicated by the results of the latest McKinsey Global Survey, which states:‘Less than one-third of the surveyed respondents, all of whom had been part of a transformation in the past five years, said their companies’ transformations had achieved a sustained performance improvement.’

Another study very specific to India:

Another survey on ‘Indian consumer sentiment during the coronavirus crisis,’ published by theMcKinsey & Company on October 13, 2022, also reconfirms the subtle changing trend in Indian consumer behavior. Its findings include some of the following areas:

  • More than 70 percent consumers are engaging in modified out-of-home behavior, even as social gathering returning to almost normalcy.
  • Digital continues to hold sway with more than 75 percent consumers using either digital or omnichannel while purchasing across categories.
  • Social media continues to be an important influence while shopping.
  • Gen Z and millennial are leading in new shopping behavior, with value being the top reason and sustainability as an emerging factor.

Hence, to engage with such healthcare consumers and deliver the value as they perceive, pharma operational strategies may call for a rejig – for longer term success and sustainability. That said, a key point to remember is that the marketing function is central while redrawing new operational strategy.

The marketing function is central while redrawing new operational strategy:

The need for the above was well articulated in another study published by ResearchGate in May 2020. It pointed out that many drug companies invest lots of funds to be more productive in various key operational areas, like R&D, manufacturing, or supply chain. However, if marketing strategies are not in sync with contemporary market dynamics and customer behavioral trends, despite game changing improvements in those areas, achieving business growth objectives will be challenging.

Based on the study, the researchers concluded, “an effective marketing in the organization has significant impact in achieving Organizational goals and Operational Excellence in Pharmaceuticals.” The study further emphasized, ‘Operational Excellence and marketing are always interlinked. Therefore, marketing plays a vital role in achieving Operational Excellence in Pharmaceuticals or any other industry.”

Conclusion:

As we know, market dynamics keep changing with time. Generally, some strong trigger factors, such as, Covid related disruptions of lives and livelihoods, may hasten the process of this crucial change. Such changes necessitate long-term transformation of pharma operational strategies, as initiated, for example, by GSK and Sanofi.

As McKinsey & Company articles have articulated, the transformation process and scale may differ from company to company with common long-term challenges remaining the same. Such operating model transformations – involving digital tools, data science with analytics capabilities across the company, often ‘help companies interact with healthcare professionals and other stakeholders more effectively’.

Consequently, the company garners greater capabilities to deliver new patient-perceived value – not just for incremental, but quantum business growth. This, I reckon, could be a game changer for long-term success and sustainability in the pharma business.

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.

 

Shape of Future Pharma Operations – Emerging A Pragmatic Outlook?

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Just as newer reports come almost every day on safety, efficacy, dosage interval or span of immunity of Covid vaccines, similar reports are also reaching us about the possible future shape of pharma sales and marketing operations. Some hardcore optimists, apparently more from India, still believe that current changes in pharma customer behavior are mostly transient. All business processes will eventually fall in their traditional grooves, as the Covid menace disappears from our lives soon.

No doubt, several studies are also bringing out a number of respondent doctors’ preferences on reverting to F2F engagements, programs and events. Nonetheless, most other experts, including several large global pharma majors, believe that the future shape of business operations won’t be quite the same as the past. There are better ways to be more effective, leveraging the changing environment. Accordingly, they have initiated actions, reimagining the pathway of new operational frontiers. In this article, I shall explore the evolving pragmatic outlook in just two of these action areas:

  • The new and unique role of medical representatives
  • Digital health care solutions as a new growth opportunity

New role of medical representatives:

A recent survey published by Reuters Events Pharma on December 18, 2020, revealed that 30% of the respondents still expect that Medical Reps’ (MR) face-to-face access to HCPs would return to the status quo ante of Covid pandemic restrictions. However, a majority of 70% felt that the old normal is unlikely return as such. The study also brought out that the size and disposition of sales teams are under review by many of pharma players and smaller field forces look likely, as the industry moves on.

My personal experience with the Indian Pharma Industry sources suggests, when a Covid pandemic wave starts finding its peak, the feeling of the above 70% prevails. However, when the same wave climbs down from its peak to a transient trough, a large number of Indian companies and experts tend to feel somewhat akin to what the above 30% expressed in the Reuters Events Pharma survey. The process gets repeated with the emergence of the next wave.

Alongside, as the above survey also finds out, most physicians are no longer expecting – brand-driven high sales pitches, during any MR-Doctor interaction or the engagement process. Instead, they are increasingly looking for insights – in an integrated, personalized and value-driven interactions with the Reps.

Considering this as a trend of over last one year or so, it is likely that MR-doctor interactions will now need to be on digital and omnichannel platforms to deliver a personalized and value driven an experience to the customers. In this environment, the field force may be smaller in size than what it used to be in early 2020 but will have a unique new role to play. This process will come with a new challenge, especially to those inbred companies, who are still undecided about the road ahead for business excellence, in the new normal.

Three new pharma leadership challenges:

Apparently, a large number of domestic drug companies, irrespective of size and scale of operations still feel comfortable to be in the old comfort zone that had propelled the business in a growth trajectory. Most pharma sales and marketing staff members, at several levels, have grown within the industry, consistently delivering high performance.

This situation by itself, as the above research paper revealed, poses three fresh challenges for many companies to make their field-staff ready to play a unique and fresh role in e-marketing. Thus, the three new knots to untie in the virtual world, are the following:

  • Currently, most MRs are not proficient in selling in virtually,
  • They are being led by people who have also never sold virtually,
  • They are being trained by people who also have never sold virtually.

MRs will continue to have a role to play even in the digital world:

To overcome the above challenges, today’s reality prompts new L&D needs of pharma’s new e-environment. And from this perspective, I think, they would need professional domain experts’ hand-holding, at least, in the transition phase of digital marketing. Some companies have initiated this process for greater sales force effectiveness, since 2019. A recent example in this area may be quoted from a report on October 01, 2019.

The article highlights, ‘AstraZeneca sales reps have some new help in the coaching department, resulting improved interactions and better development of sales reps’ strengths. While leaders still manage reps, artificial intelligence—in the form of data generated from thousands of field-coaching forms—now adds machine-learned analysis and advice.’

Thus, it is worth noting that MRs will continue to play an important role, alongside remote digital marketing using omnichannel or multi-channel engagement platforms. The same also came out clearly in the latest study from healthcare consultancy ZoomRx, reported on April 08, 2021, where its findings raised an important question - ‘Did pharma overshoot digital sales rep calls?’ This dilemma was prompted by the study charts reflecting a decline in its effectiveness, during this specific survey period.

Thus, in my opinion, a hybrid business model for better performance will be more effective in the new normal. However, ascertaining the right mix of digital and MR’s in-person interactions, may pose a challenge for many pharma marketers.

Entry into digital health solutions – an opportunity for growth: 

Before Covid pandemic, digital therapeutics or digital health solutions were not an unknown area for several pharma companies, as a growth booster in the modern world. But, it wasn’t explored so intensively as it is being discussed today, for the same. A recent paper titled, ‘Digital health during COVID-19: lessons from operationalizing new models of care in ophthalmology,’ published in The Lancet on February 01, 2021, vindicates this point.

The paper emphasized, due to Covid pandemic ‘the traditional face-to-face patient–physician care model has had to be re-examined in many countries, with digital technology and new models of care being rapidly deployed to meet the various challenges of the pandemic.’ It further highlighted, these new models incorporate digital health solutions such as telehealth, AI based decision support for triaging, besides clinical care, and home monitoring.

Global pharma majors, such as Novartis, have publicly acknowledged on January 21, 202 that ‘digital innovation looks set to dominate the 2021 healthcare agenda.’ The statement said, COVID-19 was a catalyst for change in healthcare during 2020 and an accelerator for digital health. Similarly, 2021 looks set to continue the revolution – exploiting ‘an explosion of interest, traction and scale’ in the potential for digital solutions. These would not only support remote working, but also keep the very fabric of business, healthcare, education, and essential services in operation.

Other important and recent examples of digital health care solutions: 

Witnessing the COVID-19 pandemic pushing more people toward virtual doctor visits over the last one year, AstraZeneca, as reported on April 06, 2021, is preparing for it in the new normal, through a novel project with Massachusetts General Hospital. The Company is now in the process of establishing and validating its ‘recently launched digital health platform, designed to help patients with chronic illnesses manage their conditions without stepping foot into the academic medical center’s clinic.’

Similarly, several other companies, are also investing to be early entrants with user friendly state of the art technology in this space. Interestingly, many of these ventures were reported during March and April 2021.

Conclusion:

Arthur Miller’s play ‘Death of a Salesman,’ broadly addressed the loss of identity and a man’s inability to accept change within himself and society. Although, the book depicts a larger philosophical perspective of life – many pointed out similar issues in the drug industry perspective, as well.

Nonetheless, many studies have established, pharma MRs have been effectively delivering, since long, the endpoint deliverables, as expected of them – sales. However, the question that still haunts many – can this core process be re-imagined for greater efficiency and effectiveness at a lesser cost, harnessing modern technology. An article, published in the Pharmaphorum on March 11, 2011, has also suggested – ‘in the wake of the COVID-19 pandemic, there is an even greater need to re-examine the rep’s role. How can a field force evolve to deal with current challenges and be future-fit for the way we will be working in the post-pandemic world?’ 

There is no confusion today that MRs’ will have a key role to play in pharma’s digital endeavor. However, the key purpose of having them has evolved during the pandemic. Such as, from being an efficient way to achieve personal communication objectives – to be an orchestrator for physicians to navigate the difficult landscape, providing them a differentiated service. For this purpose, I reckon, a hybrid business model for better performance, will be more effective in the new normal, while quickly adapting to digital transformation. However, arriving at the right mix of digital and MR’s in-person interactions, may pose a challenge for many pharma marketers, as it will be a company-specific need.

Similarly, the criticality of leveraging opportunities to provide remote delivery of digital health care solutions to patients, has also come onto the radar of many pharma players, during this difficult time. Several players have already added this area as a lucrative business expansion platform – many more are expected to follow. Thus, in my view, the fast-evolving data-based trends are now giving a pragmatic shape to future pharma operations – especially on the new and unique role of medical representatives and the relevance of digital health care solutions, as a growth opportunity.

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.

Uniting Pharma With Business Ethics: A Bridge Too Far?

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Operating ethically not only is the right thing to do but also is fundamental to success in business. Poor governance and poor ethical business practices can lead to fines, public scrutiny and distrust – overshadowing good performance, destroying reputation, and undermining the morale and engagement of employees. …We must act in ways that build and maintain the trust of patients, healthcare professionals, governments and society. This was articulated in the Novartis Corporate Responsibility Report 2017, highlighting how important it is to unite pharma operations with business ethics for each company. But is it happening in reality?

The same question haunts yet again with the announcement of a new Code of Marketing Practice by the International Federation of Pharmaceutical Manufacturers and Associations’ (IFPMA),effective January 2019. The pronouncement prescribes ‘a global ban on gifts and promotional aids for prescription drugs wherever the association’s member companies operate.’

However, the overall scenario gets more complex to comprehend, when on January 03, 2019  Bloomberg Law reported: ‘The change is causing concern among both U.S.-based and multinational companies like Astra Zeneca, Bristol-Myers Squib, Johnson & Johnson, and Pfizer Inc. about how to balance appropriate business behavior with respect for cultural norms in other countries.’ Interestingly, the IFPMA membership virtually covers all MNC drug companies, operating across the world. Thus, any concern on its implementation, especiallyamong some of the bigger names, raises more questions than answers about its effectiveness. What exactly has been the outcome of all such actions being taken, especially by the multinational pharma industry associations, from time to time. Have the patients been benefited – at all?

Keeping this recent development as the backdrop, I shall try to gauge in this article, is the bridge still too far to mitigate the widening gap between overall pharma operations and the standard of business ethics -voluntary code of practices of pharma associations notwithstanding?

Why pharma ‘business-practices’ and ‘business-ethics’ are so important?

Before charting onto the sensitive areas of ‘business practices’ and ‘business ethics’, let me recapitulate the meaning of these two terminologies to fathom why these are so important in pharma to protect patient health interest.

  • Business practice is defined as a method, procedure, process, or rule employed or followed by a company in pursuit of achieving its objectives. Itmay also refer to these collectively.
  • Similarly, Business ethics is defined as a form of professional ethics that examines the ethical and moral principles and problems that arise in a business environment. It applies to all aspects of business conduct on behalf of both individuals and the entire company.

Thus, ethical business policies and practices for pharma industry, when worked out both by an industry association or an individual company, aims at addressing potentially controversial issues, such as corporate governance, insider trading, bribery, discrimination, corporate responsibility and fiduciary responsibilities.

Ironically, despite well-hyped announcements of voluntary codes of practices from time to time, no commensurate changes in patients’ health interest are visible in real life. Thus, the very relevance of such edicts is now being seriously questioned by many.

What do reports reflect on ongoing pharma business practices?

To get an idea in this area, let me quote below from three reports, out of which one is specifically on the Indian scenario, which has not changed much even today:

“The interaction between physicians and medical representatives (MRs) through gift offering is a common cause for conflicts of interest for physicians that negatively influence pre- scribing behaviors of physicians throughout the world.” This was articulated in an article titled, “Gift Acceptance and Its Effect on Prescribing Behavior among Iraqi Specialist Physicians”, published by Scientific Research Publishing (SCIRP) in June 2014.

A couple of years before that, on September 07, 2012, Reuters also published an article with the headline: “In India, gift-giving drives drug makers’ marketing.” Thereafter, many similar articles were published in various newspapers and magazines, possibly to trigger remedial action by the regulators in the country.

Very recently, on January 18, 2019, The New York Times (NYT) came out with a mind boggling headline – “Study Links Drug Maker Gifts for Doctors to More Overdose Deaths.” Elaborating on this JAMA study, the NYT wrote: “Counties where the doctors got more meals, trips and consulting fees from opioid makers had higher overdose deaths involving prescription opioids.”

The point I want to drive home here is that freebies in the form of gifts, travel to exotic places with free meals and stay, fees of various types clubbed under a mysterious nomenclature ‘consulting fees’, purported to influence doctor’s prescribing behavior, are now rampant. These are adversely impacting patients, as they are often compelled to buy high-priced drugs, unnecessary drugs, including antibiotics, sedatives and opioids, to name a few.

Are big pharma companies following the codes – both in letter and spirit?

The doubt that surfaces, are these changes just for displaying to the stakeholders how well and with stringent measures, drug companies are self-regulating themselves, on an ongoing basis? Before jumping to any conclusion, let us try to make out whether, at least the big pharma players are following these codes in both letter and spirit.

To establish the point, instead of providing a long list of large pharma settlements with governments for various malpractices, I shall cite just the following two relatively recent ‘novel’ examples related two top global pharma companies, for you to have your own inferences.

  • The first one is related to reports that flashed across the world in May 2018 related to Novartis. One such article described, “Congress demands info from Novartis about its USD 1.2m in outflows to Michael Cohen, just as it was negotiating payments for its cancer drug.” The report further elaborated, Novartis’ USD 1.2 million payment was made in the shell company of Michael Cohen, President Donald Trump’s personal lawyer and so-called ‘fixer’.
  • The second one is the September 13, 2018 report of The New York Times. It revealed: ‘Dr. José Baselga, the chief medical officer of Memorial Sloan Kettering Cancer Center, resigned on Thursday amid reports that he had failed to disclose millions of dollars in payments from health care companies in dozens of research articles.”

The report also stated: “Dr. Baselga, a prominent figure in the world of cancer research, omitted his financial ties to companies like the Swiss drugmaker Roche and several small biotech startups in prestigious medical publications like The New England Journal of Medicine and The Lancet. He also failed to disclose any company affiliations in articles he published in the journal Cancer Discovery, for which he serves as one of two editors in chief.”

Indian companies aren’t trailing far behind, either:

Many Indian companies are, apparently, sailing on the same boat. Let me illustrate this point by citing an example related to India’s top ranked domestic pharma player.

What it said: Way back on November 13, 2010, Sun Pharmain a communication expressed its concern by saying: ‘Over four decades since Independence, the government nurtured a largely self-sufficient pharma industry. But the entry of MNCs is putting most drugs beyond the reach of millions.’

The communique further added: ‘Even as the domestic industry begins to feel the heat of an unprotected market, public health experts are examining why drug prices in India are higher than in Sri Lanka, which imports most of its drugs. The MNC takeover raises the specter of an MNC-dominated pharma sector selling drugs at un-affordable prices, a throw ‘back to the scenario just after Independence, which the government painstakingly changed over four decades. Are we setting the clock back on the country’s health security?’

The reality thereafter: It’s a different story that today, the same Sun Pharma, despite alleged ‘high price drugs of MNCs’, occupies the top ranking in the Indian pharmaceutical market. Be that as it may, the point to note that the same company is now facing similar charges from other countries, almost a decade after. On March 2017, a media report came with a headline: ‘Sun Pharma, Mylan face price fixing probe in US.’

Incidentally,the company is mired with allegation on governance related issues, as well. A media report dated November 20, 2018 carried a headline: ‘Governance cloud over Sun Pharma, stock at 6-month low.’ This example is quite relevant to this discussion, as well, for its link with ethical business practices, as discussed earlier.

Additionally, class-action lawsuits in the United States for alleged business malpractices, including ‘pay for delay conspiracies’, against Indian pharma companies are also on the rise – Sun Pharma and Dr. Reddy’s top the list in terms of those who face most class-action litigation, reported a leading Indian business daily on September 02, 2017.

Pharma malpractices continue, DOP is still to make UCPMP mandatory: 

In this quagmire, where self-regulation doesn’t work, the government usually steps in, as happened in the United States and Europe. Whereas, in India, no decisive government action is yet visible to curb this menace, especially for protection of patients’ health interest. Let me try to illustrate this point with the following chronology of four key events:

  • On May 08, 2012, the Parliamentary Standing in its 58th Report, strongly indicted the DoP for not taking any tangible action in this regard to contain ‘huge promotional costs and the resultant add-on impact on medicine prices’.
  • Ultimately, effective January 01, 2015, the Department of Pharmaceuticals (DOP) put in place the Uniform Code of Pharmaceutical Marketing Practices (UCPMP) for voluntary implementation, despite knowing it has not worked anywhere in that format.
  • When voluntary UCPMP did not work, on September 20, 2016, the then secretary of the DoP reportedly said, the mandatory “UCPMP is in the last leg of clearance with the government. The draft guidance has incorporated suggestions of the pharma industry and other stakeholders.”
  • After another year passed by, on April 16, 2018, a news report reconfirmed: ‘4 years on, code to punish pharma firms for bribing doctors still in works.’ Its status remains unchanged till date.

Conclusion:

Even after Prime Minister Modi’s comment on April 2018 regarding the alleged nexus between doctors and pharmaceutical firms and doctors attending conferences abroad to promote these companies, decision paralysis of DOP continues on this important issue.

Pharma companies continue practicing what they deem necessary to further their business interest, alongside, of course, announcing their new and newer voluntary codes of practices. But, patients keep suffering, apparently for the apathy of the DOP to curb such malpractices forthwith.

Coming back to where I started from, when the malice is so deeply rooted, would any global ban ‘brand-reminders’, such as gifts, even if implemented religiously, work? Thus, the doubt lingers, for uniting pharma operations with corporate business ethics is the bridge still too far?

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.