Life Science Leader Link: https://www.lifescienceleader.com/doc/facing-the-drug-launch-challenge-as-a-new-ceo-0001
As a CEO of a pharma or biotech company, getting your products to market is one of, if not the, most important parts of your job. But when you’re also juggling dozens of other critically important job functions at the same time, how can you keep your focus on this vital revenue-generating operation while still maintaining your other responsibilities — keeping your employees and shareholders happy and your management team on the top of their game?
The process of introducing new products into a market in any region, especially international markets, has its own set of unique challenges that any CEO may find daunting, regardless of experience or age. Economic instability, geopolitical struggles, market access, pricing, and regulatory differences — among many other issues — can present themselves at any time before, during, or after the launch. What is important is how a CEO manages the steps (and hurdles) in the process and what traits (both inherent and learned) can help the company efficiently and successfully bring vital healthcare products to market to best serve customers and patients.
CEO SOFT SKILLS Most, if not all, CEOs have the same on-the-job training experiences at some point in their C-suite career, but the pharmaceutical industry provides some unique obstacles that need to be faced by executives in all markets. But before discussing the process of new drug products or device launches (particularly in international markets), let’s address some important traits, or “soft skills,” that can help a CEO navigate this complex process.
Patience — The process of introducing products into new markets can be a long one. Regulatory, legislative, clinical, marketing, and funding hurdles can pop up at any time. Different countries regulate medical devices and drug products in vastly different ways. An idea for a new drug could take years of clinical trials before one even thinks about introducing it into a country. One thing to be extremely careful about is the fear of missing out on doing something that’s trending at the moment. For example, just because a competitor is succeeding with a product or idea today, it may not always make sense to attempt to duplicate it. In this fast-paced and constantly changing industry, that successful company may have made the right call many years ago but is only now reaping the rewards. If you try to duplicate its approach now — in different market conditions — it may backfire, so stick to your strategy and be patient.
Experience — Obviously, experience takes time. I was young when I joined the C-suite of our company, and I feel strongly that youth is a valuable asset in bringing fresh ideas to the table. Successfully managing the unexpected, however, is something that really becomes easier as one gains experience. Dealing with tough problems without experience can be a painful process, and definitely emotionally taxing, but overcoming difficult regulatory hurdles or failed clinical trials for example, all adds to the experience a new CEO can lean on for subsequent launches. Of course, it is key to recognize when you may need to rely on the experience of subject matter experts to complement your vision.
Problem-solving skills — New CEOs will learn, as I did, that their role is not solely dealing with day-to-day problems, but establishing the long-term strategic vision — not to mention the success — of the company. This is achieved by trusting your C-suite team, midlevel managers, and, most importantly, your employees to handle issues as they arise. As a younger CEO, I learned early on that it’s important to balance short-term problem solving with longterm vision, so one doesn’t get consumed with the problems at the expense of the vision.
Taking risks — Serving as CEO of a company comes with risks, as does introducing new drugs or devices into international markets. Obtaining and acting on the best industry information help manage that risk (which will never be zero), and being keenly aware of underlying trends will help when betting on therapy areas, technologies, and new markets. International markets can offer some unique risks that need to be factored in as well, including anti-bribery compliance, unregistered medicines, and pricing and reimbursement structures.
3… 2… 1… LAUNCH In addition to those soft skills, there are some critical due diligence factors to address. When launching in international markets, a lot of factors deviate from what is the conventional wisdom in Western markets. This creates many opportunities as well as risks. Of course, there needs to be complete support and buy-in from the executive team and board of directors to ensure a launch has the best chance of success. So, as a new CEO, there are some key steps to consider to help your company leverage those opportunities and mitigate the risks:
KNOW YOUR MARKET In some international markets, public health is lagging severely, yet overall, they are catching up with the capacity and capability to deliver treatments. At the same time, it is important to know the demographics of a specific region. For example, it can be surprising to realize how young the population is in some of these areas. When introducing a treatment targeting the elderly in these markets, regardless of price levels (and there are multiple markets with fairly high prices), the market opportunity may be smaller than you may think.
UNDERSTAND LOCAL HEALTH DIFFERENTIATORS Most rare diseases occur more frequently in international markets due to relatively higher levels of consanguinity. Coupled with high unmet needs and the emphasis on child welfare in some state budgets, international markets could be the biggest revenue driver for some rare disease products. The incidences of antimicrobial resistance (AMR) infections, diabetes, and chronic kidney disease could also be higher in some international markets as opposed to the West. But the business models built for these products in Western markets may not necessarily be compatible with international markets. This is aptly illustrated by AMR infections, where a bespoke strategy built for international markets could potentially increase the value of the asset.
LOOK FOR GEOGRAPHIC DIVERSITY International markets are extremely cyclical. There are periods of significant improvement in pricing and market access often followed by an extremely restricted environment, mostly driven by economic crises and the previous over-investment cycles. This means that what is a great market today may not be so tomorrow. And, unlike in the U.S. or the EU, the changes are often not driven by the legislation but by the variance of the application of the legislation — making geographic diversification extremely important.
BE FLEXIBLE WITH YOUR LAUNCH STRATEGY There are three ways to be flexible with a launch strategy:
Portfolio-Driven Approach: Don’t bet on a single market but try to diversify through regions to ensure you can capture the upside of growing markets and diminish the risk of markets in decline.
Efficiency & Phased Investment: It’s important to be highly efficient given the risks are higher in international markets. Phase in the investment as the launch progresses. If possible, centralize where certain resources are shared across markets (this is possible in the EU, Gulf Cooperation Council, etc.).
Diverse Teams: Hire a local team with a diverse set of experiences. In addition to hiring from other multinational corporations, look to partner with local distributors and generics companies.
A new CEO should be prepared for multiple levels of adversity, and much of that preparation comes through the experience of successful launches and understanding that change is often constant.
CEM ZORLULAR is CEO of Er-Kim Pharmaceuticals.