Are small market drugs endangered ?
Pharma has been doing everything it can to increase revenue in a down economy. First expenses were cut and then payrolls trimmed not could we possibly see some small market drugs be pulled? It's a possibility that a number of drugs, that have low sales volume, could be pulled from the market as resources are concentrated on bigger money makers. Maybe someone within the industry should read The Long Tail to understand that the days of blockbuster products maybe coming to a very swift end.
It costs a LOT of money to market new drugs today and there is no guarantee that ANY product is going to be a success. Forecasts that were made a year ago are not relevant today as this economy heads south and people forgo medical care in order to save money. Most of the drugs on the chopping block have potential but with resources today are scarce so the question becomes "do we continue to market the product or terminate it now and cut our losses". It's a business decision but a decision that could effect a lot of patients.
Like I have written so many times before here on this site pharma seems addicted to the blockbuster even though blockbuster status of new drugs is becoming increasingly harder to achieve. Their whole business model seems to be supported by huge expenses in sales forces and marketing materials and when drugs come off patent or sales are down because of environmental reasons, like a severe recession, the hatchet comes out and cuts are made. Reactive marketing is all to common for a lot of industries but for some reason pharma has a hard time changing with the times.
When new drugs are developed a business case is prepared to determine the long range forecast and ROI of the product. Since these forecasts are made sometimes years before the drugs actually come to market they need to be flexible. Some companies use a good, better & best scenario for forecasts while other companies allow corporate poltics to cloud forecasts to get funding. The problem with that of course is that as soon as the product fails to make numbers the finger pointing starts and rather than talk about ways to make the product a success there seems to be an effort to "cut our losses" and move on. This maybe especially true in organizations that need money to launch a potential new product that Wall Street feels could impact earnings significantly.
Once again lost in all this are the patients who might come to depend on these new drugs for their health. How does someone tell them that their drug may not be available anymore because it failed to live up to its sales potential? How do patients who are suffering from conditions that they believe is untreatable learn about drugs that may not have marketing support of bigger brands?
You would think that once a drug comes to market that pharma and biotech companies would find a way to make them a success. I am not saying that a huge amount of money should be thrown towards a negative ROI but pharma has to find a way to market drugs more efficiently than relying on outdated expensive sales models. The challenge most marketers are facing now is to do more with less; a lot less ! Can pharma learn to do this as well?