This ebook from IHS examines the changing role of integrated information and insight for pharmaceutical companies within the cardiovascular therapeutic market.

1. How Can Insight-Driven Commercial
Models Deliver Value in Cardiovascular
Therapeutic Markets?
The Source for Critical Information and Insight TM
1 | How Can Insight-Driven Commercial Models Deliver Value in Cardiovascular Therapeutic Markets? Copyright © 2011 IHS.

2. Contents
The fast-changing dynamics of the pharma industry Function: Market Access .......................................... 6 New commercial models integrating insight-
require re-evaluation of analytical models and development processes will be the cornerstones
streamlining of insight-development processes to Function: Competitive Intelligence / of success ................................................................ 9
ensure sustainability .................................................. 3 Strategic Planning ..................................................... 7
Meet the Author ...................................................... 11
Stakeholder value expectations are the highest in Function: Research & Development .......................... 8
the cardiovascular therapeutic area, where insight The IHS Global Insight Healthcare
will play a vital role in future growth models ............... 4 and Pharmaceuticals Practice ................................. 11
Growth Model 2.0: Analytical processes that How can IHS help you? .......................................... 11
integrate portfolio management, competitive
intelligence, and stakeholder engagement will be
central to future sustainability. ................................... 5
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2 | How Can Insight-Driven Commercial Models Deliver Value in Cardiovascular Therapeutic Markets? Copyright © 2011 IHS.

3. The fast-changing dynamics of the pharma industry require re-evaluation of analytical
models and streamlining of insight-development processes to ensure sustainability.
The pharmaceutical industry is going through a So What’s Changed?
period of significant change driven by the rise of Over the last 50 years, intrinsic innovation was the
generic drug markets, payer-centric commercial main driver of industry growth. During this time,
“Evolving analytical
models, the growth of pharmerging markets, and pharmaceutical companies typically invested models need to
outcomes-based decision making. around 15% of their net revenues in Research and
In 2009, the industry grew at a rate of 7% to $837 Development (R&D), relying heavily on the success harness consolidated
of single blockbuster products.
billion1, largely because of both horizontal and vertical information sources
consolidation. Key growth factors included the Escalating R&D costs, declines in productivity, and
increasing demand for major therapies in emerging failures of many late-stage pipeline assets have raised in order to allow
markets and the rise of specialist-driven markets. doubts about the traditional blockbuster-dependent
approach. Many industry experts foresee a payer- efficient, intelligent
The pharmaceutical industry typically consists of many
independent, highly concentrated sub-markets aligned centric growth model driven by coordinated insight- decision making.”
to therapeutic categories. Companies compete aggres- development processes as the next frontier of success.
sively in each category, often using a dual strategy: Although industry growth is expected to continue, the
ƒ Market dominance in one particular disease class nature and structure of growth is evolving rapidly. On one
hand, there are tremendous opportunities in the emerging
ƒ Risk-benefit-based portfolio diversification for
the remaining disease classes markets, and on the other hand, there is a tightening com-
petitive and regulatory landscape in developed markets. A robust insight-development process relies on
Market leadership in each category is largely effective information compilation and ensures a
governed by a company’s depth of technological What Does It Mean? coordinated flow of information from one business
capability and the market penetration of its In order for pharmaceutical companies to successfully function to another. It will help pharmaceutical
existing portfolios. navigate the opportunities and challenges of this evolv- companies increase commercialization efficiency
ing landscape, it has become ever more important for by engaging proactively with various stakeholders
1 Source: IMS them to optimize their insight-development processes. (payers, regulators, patients, and physicians).
3 | How Can Insight-Driven Commercial Models Deliver Value in Cardiovascular Therapeutic Markets? Copyright © 2011 IHS.

4. Stakeholder value expectations are the highest in the cardiovascular
therapeutic area, where insight will play a vital role in future growth models.
The cardiovascular therapeutic segment and its What has driven the rise in stakeholder Growth of the Generic Drugs Market
subsequent disease markets are the leading areas of value expectations? A recent study indicated a higher level of generic
growth in the pharmaceutical industry. They command availability in cardiovascular markets than branded
the largest market for prescription drugs and in 2009 Demographic Shifts
products due to cost-containment strategies in
generated $110 billion in sales, accounting for about According to the World Health Organization (WHO), healthcare systems worldwide. This has led to a
13.5% 2 of the total market. the high prevalence of cardiovascular disorders is significant pressure on margins for existing players
attributed to aging populations, coupled with advances in the category.
Over the last 30 years, pharmaceutical companies
in diagnostic technologies. The aging population is
have invested heavily in the cardiovascular arena to
driving the heightened emphasis on social care in Specialty-focused R&D
develop and commercialize molecules for various
healthcare systems worldwide.
indications. Competition within the field has intensified There is an ongoing trend in cardiovascular towards
as a result of: more specialized therapies, as this approach
Payer-centric Solutions
ƒ Rise in the level of investment offers greater competitive advantage and ensures
There has been a considerable shift in the balance sustainability. This carries significant upward risk
ƒ Stakeholder commitment towards deployment
of power between payers and pharmaceutical and a higher cost base, but has the potential to
of resources
companies. Patient solutions have evolved towards deliver far greater value for all stakeholders.
ƒ High unmet clinical needs payer-centric approaches that rely on outcome-
ƒ Expected greater returns on employed capital and evidence-based decisions. The quality of
ƒ Technological advances care, improved patient outcomes, and cost of
ƒ Greater disease understanding affordability are the principal areas of controversy
The increased competition has not only led to significant between stakeholders.
developments in the treatment landscape, but has also
altered the dynamics of the therapeutic category by
placing greater emphasis on the value of cardiac care.
2 Source: Adpated from Cowan Report 2009
4 | How Can Insight-Driven Commercial Models Deliver Value in Cardiovascular Therapeutic Markets? Copyright © 2011 IHS.

5. Growth Model 2.0: Analytical processes that integrate portfolio management, competitive
intelligence, and stakeholder engagement will be central to future sustainability.
Cardiovascular therapeutic markets need a strategic Prioritized Stakeholder Engagement
re-focus because of stakeholders’ high value The evolving market dynamics place greater emphasis
expectations. Key future success factors will centre on: on the need for much broader engagement between “The development and
various stakeholders.
Portfolio Diversity and Optimization commercialization
Diversification ensures optimized allocation of finite An effective engagement strategy depends on
resources towards projects with greater return on information sharing and processing in order to landscape has shifted
capital at an acceptable level of risk. The level of make value-driven conclusions.
diversification depends on a company’s core strategy
to a more value-
Opportunities Ahead
and its relative position in the market. Successful
There are tremendous opportunities for growth within driven framework.”
diversification strategies rely on up-to-date market
the segment, but the development and commercial-
information and agile analytical models.
ization landscape has shifted to a more value-driven
Dynamic Competitive Intelligence framework. To gain market access, newer therapies
Integrated intelligence processes act as principal and solutions must exceed existing value expectations
levers of success in a highly competitive environment and increase the total level of cardiac care.
by ensuring faster movement of information between In order to achieve future growth, pharmaceutical
markets and decision makers. companies will need to effectively monitor information
across many verticals and integrate those information
Evidence- and Outcome-based Decision Models paradigms into insight-development processes.
Success in the new pharmaceutical landscape will
largely depend on how fast companies implement In the following case studies, we examine the
outcome-driven strategies. Quality and consistency significance of information and insight-development
of information are core foundations of outcome- practises for three functions within the pharmaceutical
based models. industry: market access, strategic planning, and R&D.
5 | How Can Insight-Driven Commercial Models Deliver Value in Cardiovascular Therapeutic Markets? Copyright © 2011 IHS.

6. Function: Market Access
Market access is one of the most important Deciphering the value drivers Conclusion
functions in the pharmaceutical industry and is ƒ Identify the value drivers for different stakeholders For companies to mitigate all the key challenges and
directly responsible for late-stage commercialization and potential strategies to overcome reimbursement develop a strategic road map, information processes
of a company’s drug pipeline. hurdles play a central role. Timely, consistent, and analytically
ƒ Understand the role of clinical variables from a rich information serves as a fundamental building block
Market access is typically a three-stage process
payer’s perspective for an integrated market-access strategy. An integrated
commencing with regulatory approval, reimbursement
data source that incorporates different verticals of
or pricing approval, and formulary inclusion.
Creating value propositions to fully capitalize information will effectively minimize the time-to-market
To gain market access for different assets, a pharma- existing Pricing and Reimbursement (P&R) challenges by providing greater insight.
ceutical company must develop an evidence-based opportunities
approach focused on three fundamental principles: ƒ Identify market-access barriers and model payer
ƒ Demonstration of clinical and economic value perception towards different scenarios
ƒ Number of competitors
ƒ Price evolution according to market conditions ƒ Genetics growth rate
ƒ Early timetable integrating clinical and economic ƒ Market size
Current Market ƒ Positioning of current assets
endpoints Scenario ƒ Prive evolution of each asset
ƒ Competitor pipeline
The key challenges faced by market access assets
professionals: ƒ Clinical trial results
ƒ Pipleine monitoring Pipeline Clinical
and analysis Dynamics Landscape
Understanding the pricing and access landscape ƒ Endpoint data
ƒ Interpret and forecast payer behavior for new ƒ Adverse events assessment
ƒ Post-marketing trial information
products given the current barriers to market entry
ƒ Evolution of clinical guidelines
ƒ Analyze the impact of current trends on the Regulatory
clinical landscape Environment
ƒ Country risk assessment
ƒ Optimise potential value propositions to gain ƒ Regulatory guidelines
ƒ Engagement scenarios
faster market access
Figure showing the information
dimensions of Market Access and
the critical information needs.
6 | How Can Insight-Driven Commercial Models Deliver Value in Cardiovascular Therapeutic Markets? Copyright © 2011 IHS.

7. Function: Competitive Intelligence / Strategic Planning
Sustainable performance in today’s complex industry Market Landscape Variables ƒ Forecasted market positioning
environment relies on how quickly companies process ƒ P&R environment in different countries ƒ KOL opinion analysis
market information and develop strategic processes to ƒ Clinical and regulatory policies
gain competitive advantage.
Conclusion
ƒ Orphan drug designations In order to achieve the efficient level of optimization
Competitive Intelligence (CI) is one such information- ƒ Post-marketing trial information for intelligence models, insight-development processes
harnessing function. High-quality data is the play a central role.
foundation of an efficient intelligence function and
Pipeline Monitoring
ƒ Endpoints of various trials An integrated data source, together with an
ensures faster development of insight-driven
ƒ Potential new entrants in same sub-therapeutic advanced analytical platform, will help pharmaceutical
solutions at both the tactical and strategic levels.
category companies gain competitive advantage and ensure
Intelligence-rich data enable companies to interpret a future sustainability.
given situation, e.g., a recent trend or future forecast,
and base strategies for future developments on the
current situation and knowledge. Awareness and Culture
A key challenge for any CI function in the pharmaceuti- I N FO R M AT I O N L A N DSCA PE
A successful intelligence
cal industry is the optimization of insight-development
framework depends on
processes and implementation methodologies. Communication
the three fundamental
To develop an optimized CI process, companies building blocks of
structure and process,
need timely data focusing on:
awareness and culture,
Interpretation Collection and planning and
Current Competitor Activity implementation. This
ƒ Price cuts structure is constantly
ƒ Product-labelling updates reinforced through
Analysis effective compilation
ƒ Major licensing and agreement developments Structure Planning
and and and utilization of
ƒ Patent expiration information.
Process Implementation
7 | How Can Insight-Driven Commercial Models Deliver Value in Cardiovascular Therapeutic Markets? Copyright © 2011 IHS.

8. Function: Research & Development
R&D is one of the most important functions in the Competitor pipeline variables
pharmaceutical industry, as it ensures future growth ƒ Indications of various trials
and sustainability. Nevertheless, over the last couple of ƒ Detailed primary and secondary endpoints
years, this function has come under intense pressure Regulatory
ƒ Results of completed trials
because of declining productivity and rising costs
ƒ Number of enrolments in major trials
of introducing new compounds. This situation is
ƒ Safety and efficacy information
heightened in the cardiovascular market with its high
stakeholder value expectations. Regulatory landscape
Many pharmaceutical companies have started to ƒ Detailed information about registration trials
reorganize their R&D programs by incorporating ƒ Response of regulatory agencies to clinical R&D
market variables into the development structure. There results data
has been a growing debate that R&D functions must ƒ Payer behavior towards clinical outcomes
not be isolated from the pricing or reimbursement
Conclusion
environment. A clinical development program must
The effectiveness of the R&D function largely depends
take into account the payer’s perspective on the
on integrating three main levers of information: Clinical Market
design, implementation, and interpretation of Environment Access
regulatory landscape, clinical environment, and
clinical variables.
market-access scenarios.
A fully integrated approach needs continuous
A fully comprehensive data source will help
monitoring and analysis of competitive, regulatory,
pharmaceutical companies develop a cost-effective
and payer activity, including: Figure: Stakeholder engagement map
and market-responsive R&D strategy by providing for R&D function
greater insight on stakeholder perspectives.
8 | How Can Insight-Driven Commercial Models Deliver Value in Cardiovascular Therapeutic Markets? Copyright © 2011 IHS.

9. New commercial models integrating insight-development processes
will be the cornerstones of success
The pharmaceutical industry is in a state of flux, A Rapid Evolution The role of information has changed dramatically in
and many forces are re-shaping its core structure. With the rise of the information age, the fundamental such a competitive environment. The need to compile
Historically, pharmaceutical companies have elements of success are evolving rapidly. Pharmaceutical information sources is exacerbated with the rise of the
succeeded by discovering, developing, manufacturing, companies are challenged on several fronts, and their payer-centric model and the requirement for economic
and then marketing their products, often allocating major areas of concern are centred on: endpoints in decision making.
resources in the prioritized manner.
ƒ R&D technologies For future growth and success, new commercial
The sequential approach (tunnel innovation) of ƒ Regulatory emphasis and market access models must integrate insight-development processes
resource allocation has fuelled the growth of the ƒ Stakeholder engagement in order to actively engage the various cross-functional
blockbuster-dependent commercial model. One disciplines within a company.
ƒ E-business and supply chain management
of the principal drawbacks of this approach is the
ƒ Marketing and consumer demands Pharmaceutical companies should work towards
peripheral position of information and how it is
resolving all the roadblocks in information sharing
used in decision-making models. Information was
and compilation.
disseminated from one discipline to the next, but
not within disciplines, often creating information An integrated information source will help ease
silos and masking. many concerns for different stakeholders in the
pharmaceutical industry. It should give timely,
accurate, and mission-critical information on
competitors, regulators, payers, and consumers,
thereby providing pharma companies with effective
stakeholder engagement points and helping them
achieve a sustainable growth strategy.
9 | How Can Insight-Driven Commercial Models Deliver Value in Cardiovascular Therapeutic Markets? Copyright © 2011 IHS.

10. Pharmaceutical
Companies
Pharmaceutical Figure highlights the evolving
Companies
Physicians/ commercial models in the
Clinical Community pharmaceutical industry and the
changing role of information in
Patient
the decision-making process.
Regulatory The blockbuster-dependent
Payer Agencies
Groups approach relies on information
sharing as a collateral function,
Information Regulatory depending on communication of
Agencies results, whereas the new payer-
centric approach requires an
integrated and cross-functional
utilization of information.
Payer
Physicians/ Groups
Patient
Clinical
Community
The blockbuster-dependent model relies on The payer-centric model works on fundamental principles
cyclical flow of information but lacks focus to of information dissemination across disciplines and between
disseminate information across disciplines, often stakeholders. It links decision-making process through
creating information silos. uniform distribution of information.
10 | How Can Insight-Driven Commercial Models Deliver Value in Cardiovascular Therapeutic Markets? Copyright © 2011 IHS.

11. More Information
Meet the Author The IHS Global Insight Healthcare How can IHS help you develop effective
and Pharmaceuticals Practice portfolio strategies for Cardiovascular
Praful Mehta The IHS Global Insight Healthcare and and Metabolic therapeutic areas?
Senior Healthcare Analyst, IHS Pharmaceuticals practice provides a portfolio of
Praful.Mehta@ihs.com intelligence solutions to optimize the performance The World Markets Cardiovascular and Metabolic
of companies and organizations across the Service is a single integrated source of data and
Praful Mehta is a Senior analysis providing a clear, comprehensive view of
pharmaceutical, biotech, and generics sectors.
Healthcare Analyst at IHS. He the cardiovascular and metabolic prescription drug
joined the company in 2010 and Our key focus is to provide actionable insights to markets worldwide.
is a practice leader within its support strategic decision making, particularly in the With coverage of over 30 disease areas, the service
therapeutic area services. Praful has been a long-time fields of market access, pricing and reimbursement provides the critical information and insight that
advisor to senior teams within the pharmaceutical (P&R), emerging markets, generics strategies, pharmaceutical companies need to:
industry on issues of market competitiveness, busi- therapeutic development pathways, and general ƒ More effectively manage pipelines and optimize new
ness integration and commercialization strategies. competitive intelligence. product launches
Prior to working at IHS, Praful was a Vice President » Find out more about our healthcare and ƒ Develop life-cycle management (LCM) strategies to
pharmaceuticals practice maximize profits from existing portfolios
at StrataPro Analytics and Consulting, where he
developed the company’s core consulting capability The service helps multiple business functions to
develop a unified strategy by bringing together multiple
for developed markets. He also led various project
dimensions of data into a single source.
teams at GlaxoSmithKline Pharmaceuticals and
Johnson & Johnson Pharmaceuticals. Access this unique database, together with same-
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Praful holds an MS degree in International and countries, and quarterly special reports. Data
Management and Corporate Strategy from North coverage includes:
Eastern University / Dublin City University. He has Share this eBook: ƒ Corporate Information
a BS with honors in Genetic Engineering and ƒ Drug Disease Landscape
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