The pandemic didn’t hinder drug launches, but it has altered sales tactics | Deloitte US has been saved
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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.
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:
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.
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