New Bain & Company research finds nearly half of all drug launches over the past eight years under-perform analyst expectations

NEW BAIN & COMPANY RESEARCH FINDS NEARLY HALF OF ALL DRUG LAUNCHES OVER THE PAST EIGHT YEARS UNDER-PERFORM ANALYST EXPECTATIONS

Out-performers do three things differently: differentiate their drug beyond the clinical trial, create broad customer advocacy and organize the launch as a micro-battle

New York – Sept. 7, 2017 – The pain of new drug launches has become all too acute for many pharma executives. Newly released Bain & Company research, Why Some Drug Launches Outperform and Others Disappoint, finds that nearly half of all launches over the past eight years have under-performed compared with analyst expectations—and 25 percent failed to reach even 50 percent of external revenue forecasts. That’s a serious concern for the pharma industry, which is expected to derive 25-80 percent of its revenues from new launches by 2021, but a new approach could improve chances for success.

Bain analyzed work it has done with clients and surveyed 100 senior launch executives from the top 20 pharmaceutical companies to understand how success factors that are within the control of a launch team are changing by examining the performance of each launch across 20 launch activities. The findings show that companies with successful launches do three things right: 1) they differentiate their drug through unique messaging, post-launch data and services; 2) they create broad customer advocacy via a superior customer experience; and 3) they organize their launch as a micro-battle and ensure continuous frontline feedback.

“While comprehensive market data and adequate funding are essential to a successful launch, they alone are not sufficient and too many companies stumble at the finish line,” said Rafael Natanek, a partner in Bain’s Healthcare Practice and lead author of the report. “Our analysis shows that many senior launch executives underestimate the importance of broad advocacy and organizing the launch as a micro battle – two of the three success factors that are vital in today’s market.”

Communicate beyond clinical trial outcomes. New drug launches face more intense competition today than a decade ago. Between 2000 and 2004, the average window of time in which a drug remained on the market before competing products arrived fell from eight years to four years. This onslaught of new products makes it much harder to use Phase III clinical trial data alone to differentiate a drug in the eyes of doctors, regulators and health insurers.

Most senior executives understand that effective marketing messaging is critical to launch success. But getting it right is not easy. The Bain survey and its client experience reveal a very large gap between winners and losers in this area.

The research finds that companies with launches that repeatedly outperform expectations are adept at communicating key clinical and nonclinical benefits of a new product to physicians and other decision-makers. They also excel at transforming market data into actionable insights to make their product stand out. These messages are grounded in clinical data and build on product efficacy and safety but also address emotional concerns, such as reducing worry. Finally, out-performers use post-launch data and services to further differentiate their product from the competition.

Create customer advocacy. Bain’s research shows that at least 40 percent of physicians’ brand preference is attributable to customer experience factors beyond the product, including for example how well pharma companies support physicians by providing answers to medical questions, identifying patients, and connecting physicians with peers.

Leading companies look beyond the key opinion leaders and turn day-to-day prescribers into advocates by providing them with a superior customer experience.

Launch a micro-battle. New drug launches today require greater coordination across the entire organization, including market access, patient services, medical affairs, regulatory, marketing and sales.

Companies that outperform market expectations organize drug launches into micro-battles. They create a “company within the company,” giving launch teams the authority and agility to make decisions that are best for the patient or the brand. Importantly, a micro-battles approach allows launch teams to focus on strategic issues for the success of the launch, not checklists.

“Bain’s work and research show that improving drug launch performance is largely within the commercial organisations’ control,” said Natanek. “What executives need to do is to ensure that they focus their teams on the issues that truly drive out-performance and structure their launch teams for success.”

Editor's Note: To arrange an interview, contact Aliza Medina at aliza.medina@bain.com or +44 207 969 6480

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