Guest Feature - Guidelines for Optimizing Your Time-to-Market

Pharmaceutical companies have invested heavily in speeding the technical aspects of new drug development.

By Editor on Apr 16, 2007

Pharmaceutical companies have invested heavily in speeding the technical aspects of new drug development. R&D resources have been upgraded, clinical trials are planned and conducted with an increased focus on maximizing throughput, and many companies have even taken steps to streamline their dealings with regulators on a global basis. All of these changes have allowed them to bring products to market more quickly.

More can be done. In our work, we see several frequently overlooked areas in which improvement can significantly reduce time-to-market. These are the non-technical aspects of the product development process; cultures that weight risk avoidance too heavily against speed of decision making, a tendency to allow low-priority projects to languish unnecessarily, suboptimal implementation of new R&D resources, and organizational infrastructure that changes more slowly than the demands placed on it. All of these things increase the time it takes to move products along the pipeline; an appropriate focus on fixing them will increase your competitiveness.

Give speed of decision-making its due

The tendency towards organizational cold feet, the desire to get one more piece of information before deciding to take the next step in the produce development process, is perfectly understandable given the enormous risks involved. The resource commitment and opportunity costs involved in moving to Phase III trials are enormous.

The thing is, you already know what variables most strongly impact the risks and expected payoff of continued development they were the first to be quantified and the first for which estimates were refined. At some point the expected return to collecting more decision-relevant information turns negative, and having a good grasp on where, exactly, that point lies is vital. Every one month's delay once your competitors catch wind of your new drug probably lops off the single most profitable month your product will ever have if it makes it to market.

We recommend a systematic approach to decision-making that a) specifies the most critical information for the decision, b) estimates the time and resources required to collect that information, c) quantifies the expected impact of those expenditures on profitability, d) measures the time it actually takes to perform these tasks, and e) incorporates feedback from the decision-makers into the process, so that the process continually improves the value of information it provides. This ensures that reason, rather than fear, drives the timing of decisions.

Keep low-priority projects moving through the pipeline

Yes, of course these projects are low priorities for a reason their value is relatively low or they aren'st a good fit for your product portfolio. But something is better than nothing, which is what you get if they languish too long.

Many of these low priority products can be salvaged by seeking out alliances with other parties either through out-licensing or co-development agreements. These agreements can be structured so that the risk-reward profile becomes favorable for both parties. The keys are finding the right licensee or partner, and entering negotiations with a clear idea of the range of agreements that would constitute favorable terms for you.

This approach is widely practiced for aging elements of the product portfolio, but for some reason there is tremendous reluctance to divest rights to compounds in the early stages of development. Application of this discipline to products in the R&D stage may result in some regrettable losses, but if done intelligently will ensure that these products make progress toward market and have an overall net benefit to profitability.

Make efficient innovation in the R&D platform a priority
Of necessity, pharmaceutical companies constantly move to new R&D technologies. High-throughput screening and others have proven to be absolutely vital to continued competitiveness, and the next platform is always just around the corner.

But adopting innovative technology frequently is not the same as adopting it efficiently. The identification, evaluation, selection, and integration of new technologies force your R&D people to take time from R&D, and that cost needs to be weighed against the potential benefits. On the other hand, once a powerful new technology is in place, rapid adoption by researchers is hugely beneficial.

Adopting a structured approach to R&D platform innovation can pay big dividends. By incorporating a process for ensuring rapid adoption, it ensures that you get the biggest bang for your investment buck when a new technology is introduced. More to the point, it ensures that new technologies are identified and evaluated routinely, at the appropriate skill level, and frees your researchers to do research except when their input is really needed.

Create powerful, flexible, organizational infrastructure

Time-to-market relies heavily on resources outside of R&D. Marketing, business development, reimbursement, and clinical and regulatory affairs all need to work seamlessly together to move products forward quickly. Ensuring that they work well together requires having the infrastructure to support seamlessness. Roles must be clearly defined the required competencies must be defined and accountabilities must be made clear. Processes must be in place to guide the work that people do in cross-functional situations, and these processes need to be integrated into the processes internal to each functional unit.

The infrastructure needs to be flexible, too. Things change over time; this changes the optimal organizational infrastructure. Infrastructure review should be embedded within the larger organizational structure as something that is done on an ongoing basis not after the current infrastructure fails catastrophically. By ensuring that the right people with the right competencies work together in the right ways, a solid infrastructure ensures that time-to-market is optimized.

Competing to win means always being on the lookout for a potential advantage, and grabbing it before your competition. An expanded focus on time-to-market considerations that includes the non-technical aspects of product development we'sve outlined above is one opportunity to gain the upper hand or lose it.

Rita E. Numerof, Ph.D. is President, and Mark Morgan, M.S (R). is a Senior Business Analyst of Numerof & Associates, Inc. (NAI), a strategic management consulting firm located in St. Louis, Missouri.

NAI works with clients to increase revenues, reduce costs, enhance service delivery, and sharpen strategic focus, providing consultation in three broad areas: strategy development and execution, operational excellence, and organizational infrastructure. For more information, contact NAI at 314.997.1587, info@nai-consulting.com, or visit http://nai-consulting.com/.