|150+ Charts and Diagrams|
Fresh off of 2012’s pharmaceutical patent cliff, the life sciences industry is bracing for a second cliff in 2015 — with sales losses that may total some $33.5 billion. For any company looking toward the later stages of brand life, now is the time to plan a counter-generics strategy.
To prolong brand sales and mitigate revenue erosion, key initiatives — including exclusivity extensions, line extensions and competitive tactics — require ample time to yield lucrative results.
This report examines counter-generics and biosimilar strategies for Top 10, Top 50 and small pharmas. Data show counter-generics strategy, team structures and staffing, and 39 new case studies explore companies’ experiences deploying 13 different counter-generics tactics. At the deepest level of detail, profiles depict 10 counter-generics team structures, strategy mixes and planning timelines.
Plan for and implement a diverse and robust set of strategies: Compare your team’s action plan against the ideal timeline for counter-generics strategy development to learn when to use the right tactic at the right time. Then combine strategies to maximize a brand’s revenue potential.
Build a strong counter-generics task force Determine whether generics defense efforts require a dedicated structure or an ad hoc team, and position key functions — including product and brand management and business development — to drive strategy planning.
Prepare for coming biosimilar competition and changing approval pathways The biologics landscape is changing as more biosimilar products seek approval. Compare biosimilar pathways in the US and EU markets, and ready counter-biosimilar tactics to supplement the inherent barriers to developing and manufacturing biosimilar products.
52 charts detail the prevalence of dedicated counter-generics teams, group structures, team staffing and number of generic manufacturer partnerships.
14 charts detail the prevalence of exclusivity extension tactics within surveyed companies’ overall counter-generics strategies — as well as real-world brands’ experiences using these tactics.
19 charts show the prevalence of competitive extension tactics among both surveyed companies’ counter-generics strategies and real-world brand implementations.
18 charts show the prevalence of line extension tactics within surveyed companies’ counter-generics strategies and real-world brands using these tactics.
20 charts detailing the prevalence of each of 13 counter-generics strategies among surveyed companies — and insight into the emerging threat of biosimilar drugs.
10 profiles detailing real-world counter-generics teams:
The following excerpt is taken from Chapter 1, "Decision-Making Groups and Counter-Generics Strategies." The full report explores which functions comprise counter-generics task forces and when these groups are created. Metrics on timing, FTE count and task force make up are divided into four company sizes.
As discussed in the previous sections, many teams make up counter-generics task forces. This leads to a variety of these teams taking the leadership role. Figure 1.6 [seen in full report] shows the teams who head up pharmaceutical generics and counter-generics task forces. The graphic also provides some depth by breaking responses down by company size.
As seen, 35% of companies place brand management in charge of their task forces. This is not surprising, as brand managers are the most familiar with the market for their products. However, in cases in which a task force handles more than one product or therapeutic area, assigning brand management to the leadership role may no longer make the most sense.
Lifecycle management and legal teams are the second most common groups to head up pharmaceutical generics task forces. Twelve percent of surveyed companies employ lifecycle management in their leadership positions. Certainly, lifecycle management teams bring the ability to work across numerous products, as well as the expertise of managing products at every stage of their lives. Placing this group in charge also allows for the continued growth of the group as the team will not dissolve in the way a brand team might once a product goes generic. In other words, the lifecycle management team will use the information gathered in one generic defense to use in the next occurrence and so on.
This following sample is excerpted from Chapter 2: "Marketing and Exclusivity Tactics: A Short-Term Solution." The full chapter contains timing, investment and ROI/results data for five tactics, including defensive pricing.
Defensive pricing is a widespread undertaking — 57% of companies employed some form of pricing defense in the years 2008 to 2010, as shown in Figure 1.23 (available in the full report). Similarly, 49% plan to use defensive pricing between 2011 and 2013 (seen in Figure 1.29 (available in the full report)). The cost of this counter-generics option may help to explain its frequent use; in most cases, it is not expensive.
For brand teams, defensive pricing provides the flexibility of immediate implementation. That is, teams who choose to employ a defensive pricing plan can expect to apply that plan within weeks. Figure 2.2 shows that 77% of responding companies begin planning a defensive pricing strategy within two years before patent expiration. The other 23% begin planning between two and four years prior to patent expiration.
Planning can begin so late in the product's lifecycle because a defensive pricing strategy can be implemented quickly. As shown in Figure 2.3, defensive pricing plans require an average of only 10.9 months to execute — Company 29 and Company 9 needed as little as three and four months, respectively, for pricing changes to come to fruition. This expediency, coupled with the imminent appearance of generic competitors, spurs brand teams to facilitate pricing strategies at the tail end of a product's patent life.
The following excerpt is a key finding from the full report’s Executive Summary.
Biologic Companies Use Counter-Promotion Tactics To Combat Biosimilars
The popularity of specific counter-generics and counter-biosimilar tactics differs across biologic and small-molecule companies. Figure E.8 [shown in full report] shows the prevalence of examined tactics among these two types of drug companies. Counter-promotion is the most popular counter-biosimilar tactic used by surveyed biologic lifecycle management teams. More than half (56%) of surveyed biologic teams currently use this tactic. Among those teams, 80% report increasing advertising near and after patent expiration. A large difference in biologic and small-molecule tactic lies in the authorized generic deals. No surveyed biologic teams currently use this tactic, while a fifth of small-molecule teams do. This tactic is not likely to become popular for biologic teams — finding a company with the technology and infrastructure needed to create biosimilars will remain difficult in the near future.
Counter-promotion is particularly suited to biologic drugs facing biosimilar competition. Executives discussed the dangers of switching to a drug that may not be structurally identical, as is the case with small-molecule generics. The size and complexity of biologics make biosimilar introduction inherently more difficult. For payers’ and physicians’ benefit, biologic lifecycle management teams should highlight the risk of switching to a drug that is not generic, only similar.