The pandemic didn’t hinder drug launches, but it has altered sales tactics

By Brian Corvino, managing director, and Candy Lurken, principal, Deloitte Consulting, LLP

In 2020, as the Food and Drug Administration (FDA) reviewed vaccines and therapies to prevent and treat COVID-19, it also approved a near-record 53 novel drugs—up from 48 the prior year.¹ These innovative therapies, many of which were in the pipeline when the pandemic emerged, offer new treatment options for patients who suffer from a wide range of illnesses including cancer, spinal muscular atrophy, and hereditary angioedema.

Consider this:

• Nearly 60% of the drugs approved last year were orphan-designated products—up from 44% in 2019.
• More than half (56%) of the new drugs received a Priority Review because they demonstrated potential to substantially advance medical care.
• 21 of the 53 novel drugs were identified as first-in-class, which is one indicator of a drug’s potential to have a positive impact.
• 17 of the newly approved drugs were fast-tracked because of their potential to address unmet medical needs.²

While successfully launching and promoting new drugs is always challenging, the pandemic added new layers of complexity by limiting in-person meetings and altering traditional sales channels.

Drug launches often fail to meet expectations

Despite a steady flow of innovations from biopharmaceutical companies, and the number of promising new products, few drugs meet or exceed market forecast expectations in their first year, according to our 2020 paper, Key factors to improve drug launches. The paper, which is based on research conducted before COVID-19 was declared a pandemic, identifies limited market access, inadequate understanding of marketing needs, and poor product differentiation as the top reasons new drugs don’t live up to initial expectations. The pandemic appears to have created new challenges.

Last fall, the Deloitte Center for Health Solutions conducted 14 interviews with R&D and commercial leaders at large and small biopharma companies, as well as contract resource organizations (CROs). Among other things, we wanted to know how the pandemic has impacted sales and marketing. For the most part, interviewees told us that their companies are financially healthy and that sales have been mostly steady. While some new drug launches might have struggled to meet expectations, interviewees said revenue forecast revisions have not been necessary in the short-term. However, interviewees also told us that they have seen a decline in sales for some drugs that require a hospital or clinic visit for administration, including some for oncology and rare diseases.

Most of the marketing leaders we interviewed said their companies had either revised or scaled back their launch strategies as a result of the pandemic. Some of them are shifting their marketing mix and models to improve customer engagement. They also said the market response to some new drugs has been lackluster and promoting new products has been more challenging than in the past.

As convenings of medical professionals—from large-scale congresses to small-scale dinners and events—were cancelled and moved to virtual formats, biopharma companies sometimes struggled to get the word out about new products. At the same time, many physicians stopped allowing in-person visits from sales representative. That further limited the channels through which companies could communicate new drug information with prescribers.

The pandemic limited face-to-face customer engagement

Pharmaceutical sales reps have historically built relationships with clients during face-to-face encounters—from formal office meetings to informal chats in the hallways of conferences. The pandemic required reps to navigate a new virtual world as health systems and clinicians dramatically reduced or eliminated traditional face-to-face meetings with reps. Rather than allowing multiple reps from a company, health systems might now limit it to just one, or none at all. Sales reps are also having fewer face-to-face meetings with health plan representatives, medical science liaisons, and other stakeholders.

Building rapport can be far more difficult during a video or phone call. Some of our biopharma clients have told us that their sales teams are still learning how to promote new products through virtual channels. Here are four factors that can impact the launch of new products:

• Clinicians are seeing fewer patients and writing fewer prescriptions: Some people might have lost health benefits tied to a job and opted not to visit a clinician. The fear of being exposed to the novel coronavirus might have kept others away. While the pandemic led to more virtual health visits, primary care visits in the second quarter of 2020 were more than 20% lower than average visit volumes during the same period in 2019 and 2018.³ This means fewer patients were being screened and tested for diseases. For example, blood pressure evaluations during primary care consultations were down more than 50% in 2020 compared to prior years, and cholesterol evaluations were down about 37%.⁴ With fewer diagnoses, physicians were writing fewer prescriptions. Moreover, as patient volumes fell, nearly half of independent medical practices said they had to furlough or lay off staff, according to a survey from the Medical Group Management Association.⁵ A reduction in administrative staff could have negatively impacted the prior-authorization requests required by health plans for new prescriptions.
• Reps and clinicians have gotten used to virtual meetings: There is an expectation that sales reps will return to hospitals at some point and meet with clinicians in person. But some physicians might be unwilling to return to that model. However, virtual meetings have some advantages for clinicians as well as for sales reps. For example, more people can attend virtual meetings, and reps don’t have to sit in a waiting room waiting for a clinician who is running late. However, many of our interviewees noted that clinicians are more likely to be distracted or less engaged during virtual meetings. Over the past year, sales reps have learned to make video calls more effective. They get to the point of their pitch more quickly, and they try to ensure the content is compelling and differentiated from other content. One interviewee told that he’s seen a renewed interest in print content, likely because people are growing tired of looking at screens all day long.
• Information is being delivered through new channels: The pandemic changed the way clinicians consume information about new drugs. While far more information is now distributed through digital channels, some clinicians still want at least some level of in-person interaction. That has created a need for more nuanced, customized consumer interactions. The dissemination of scientific information has also changed as major conferences were either canceled or moved to a virtual platform. Even though we are digitally producing more information, it remains to be seen how well that information is consumed by the people who need it. 
• The pandemic has not reduced demand for drugs that address unmet needs: Specialty drugs, orphan drugs, and products that receive priority review by the FDA tend to meet or beat market expectations, according to our pre-pandemic research. The pandemic doesn’t appear to have reduced the demand for those products, which typically address unmet needs in the market. Prior to the pandemic, 73% of orphan drugs, and 72% of specialty drugs, met or beat first-year expectations. That compares to just 48% of non-specialty drugs that met or beat forecasts, according to our research.

We are more than a year into the COVID-19 pandemic, and we have seen significant changes in the biopharma business model—from clinical trials to sales to on-going product support. While we expect face-to-face meetings between sales reps and clinicians will begin to return at some point, the virtual channels that emerged over the past year are likely here to stay and will become an integrated part of commercialization.   

Of the 53 novel drugs that were approved last year, 40% were first-in-class, according to FDA. Despite the pandemic, the pharmaceutical sector is an era of tremendous innovation, and the importance of getting a drug launch right has never been greater.

Endnotes:

^{1. Novel drug approvals for 2020, FDA, January 2021}

^{2. FDA approved 53 novel drugs in 2020, The Pharma Letter, January 6, 2021}

^{3. Preventive care dropped during COVID-19 pandemic despite rise in telehealth visits, Fierce Healthcare, October 8, 2020}

^{4. Despite surge in telehealth, primary care visits drop 21% amid COVID-19, Healio News, October 2, 2020}

^{5. Nearly half of physician’s practices have had to lay off, furlough workers, MGMA survey finds, Fierce Healthcare, April 14, 2020}

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