Life Cycle Management: Value of CI for Asset Maximization Sabih Bekhouche:

Life Cycle Management: Value of
CI for Asset Maximization
Sabih Bekhouche: Director Integrated Insights, Novartis AG
Baljit Singh: Director Integrated Insights, Novartis AG
Pharma CI Conference 2014
Sabih Bekhouche
Director Integrated Insights – Novartis AG
“My competitive mindset and passion for understanding how different players
operate inspires me to work with teams towards creating winning strategies”
 Sabih Bekhouche has over 10 years of experience in the field of competitive
intelligence leading and building the Global CI function and capabilities in
different organizations.
 Education
 BA Biochemistry, Psychology
 Masters in Business of Bioscience
 Harvard Executive Education: Strategy & competition
 Contact
 Linkedin profile: http://www.linkedin.com/pub/sabih-bekhouche/0/615/a15
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Baljit Singh
Director Integrated Insights – Novartis AG
Baljit Singh is the Director, Integrated Insights Diabetes, and based in Basel at
Novartis Global Headquarters in Switzerland. His key responsibility is to cocreate brand strategies and facilitate decision-making across top Global/regions/
CPOs
 Baljit is of Indian origin, born in Denmark and educated in both in Denmark &
England. Baljit has 8 years of experience in the global pharmaceutical, biotech
and generics markets optimizing brand, lifecycle and competitive strategies
 Education
 Ph.D in Pharmaceutics from London School of Pharmacy
 Masters in Pharmacy, Royal Danish School of Pharmacy in Copenhagen
 Contact
 Linkedin profile: http://ch.linkedin.com/pub/baljit-singh/1/611/181
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Objectives
Value and role of CI for asset maximization
1. Pharma overview and issues
2. Life cycle management and asset maximization
3. Differences in value chain between originator and
generic’s companies - strategies and timing
4. Key intelligence gathering opportunities
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1. Pharma Overview and Issues
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Global Pharma
Pressure on profit margins; focus on maximizing asset value
 Pharma market is expected to reach $ 1 trillion this year
and continues to grow at single digit numbers
 NME approval average remains at 28 per year
 Increasing pricing pressures and rising costs impacting
margins
Price
Profit
Cost
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Components of change in total spending
Branded sales growth offset by LOE loss of >$100Bn
 Pharmerging driving the growth; double digit growth forecasted
 Brand growth is balanced by Loss of Exclusivity (LOE)
 >$100Bn at risk due to LOE mostly from established markets
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Key issues in Pharma
Originator companies continue facing pressure on profit margins
 Reputation management & public opinion
 Managing regulatory compliance
 Pricing pressures
 R&D productivity and costs
 Low cost generics
Differentiation
Price
Profit
Cost
Cost leader
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Response To Pressures on Sales and Margins
How to drive profitability?
R&D costs
and
Productivity
Price
Pressure
Patent Cliff
New Business Models
Refocus pipeline &
priorities
Innovation
Productivity savings
Asset maximization
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2. Life cycle management and asset
maximization
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Originator product life cycle
Pressures on sales and profitability -> optimizing area under the curve
2.
Sales
Growth phase
slowed due to
payer pressure
4.
More intense
competition
Time
Launch
1. Shorter product
life-cycle due to
longer studies
LOE/Gx Launch
3.
Mid term decline
via therapeutic
substitution
General Life Cycle Management Strategies
LCM strategies to maximize the asset’s value
1
Developmental lifecycle
management strategies
2
Commercial lifecycle
management strategies
3
LOE lifecycle
management strategies
These strategies should
focus on maximizing
patient potential and
maximizing patient uptake
These strategies can
boost patient population
but are primarily effective
at maximizing the
commercial value
These strategies can be
used to ensure the patents
and exclusivity data are
respected
•
•
•
•
• Geographical
expansion
• Compliance programs
• Rx-to-OTC switches
• Authorized generics
• Brand loyalty
programs
• Packaging innovation
• Exclusivity (data and
marketing)
• Patent term extension
• Pediatric extensions
• Patent litigation
New indications
New dosage forms
New formulations
New routes of
administration
• Fixed dose
combinations
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3. Differences in value chain between
originator and generic’s companies
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Profitability Cycle (Originators vs Gx)
Product Lifecycle - end of lifecycle at risk losing most of the profits
+ Profitability
Generic’s
Originator
Gx
Approval
(EU & US)
Gx
Launch
(IN + EM)
In Market
- Investment
Pre-clinical & Clinical
Approval
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15Y
SPC
Expiry
Key differences in value chain
3 important differences vital for CI purposes
Originator Company Generics Company
1
High investment
Few companies involved
in development and
2
commercialization
3
Long development
timeline
Relative low investment
High # of players in
development and
commercialization
Short development
timeline
Key differences in value chain
3 important differences vital for CI purposes
1
2
Generics Company
Implications
Relative low investment
More (smaller) players
who profit through trade
at each step of the value
chain
High # of players in
development and
commercialization
CI
opportunities
Highly competitive =
Complex strategies
CI challenges
3
Short development
timeline
Narrow window of
opportunity
2. Key Intelligence Gathering
Opportunities
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CI Focus – CI Opportunity
CI on Gx differs significantly due to business model and strategies
+ Profitability
Generic’s
Originator
- Profitability
Gx
(IN + EM)
Initiation of
Timing and Strategy
investigation
Initiation of
regulatory
investigation
Gx
(EU & US)
Initiation of value
chain investigation
Approval
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SPC
Expiry
Clopidogrel Example
Value loss $150m in Germany - CI imperative to avoid being blindsided
CLOPIDOGREL
BACKGROUND
- 2008 WW sales ~6bn, Germany ~ 300mn
- Plavix® launched July 1998 in EU
- Data Exclusivity expiry July 2008
- Patent expired in 2013
IMPACT
- Gx launched in Germany May 2008
- Launched 3 months prior to Data exclusivity &
5 years prior to patent expiry
Patent Expiry 2013
Plavix Sales Erosion in Germany
350
Sales fell by 19%
in 1 year
300
250
MAT Peak Sales
321Mn USD in Q2
2008
200
Sales fell by 75%
in 3 years
150
100
50
0
2006
Source: IMS
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2007
2008
Data exclusivity expiry
2009
2011
Benefits of CI
Importance of CI is increasing - start early
1. Avoid surprises
2. Maximize profitability
3. Impact is directly measurable
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