Role of Business Development in Pharmaceuticals (Generic Product Business)

Phr_ali91@hotmail.com
Role of Business Development in Pharmaceuticals
Muhammad Ali
email: phr_ali91@hotmail.com

Content
 Pharmaceutical Company Department
 Why Business Development Department
 Business Development types in Pakistani Pharmaceutical Market
 New Product
 New Product Development Process or Cycle
 Challenges
 Summary
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Pharmaceutical Company Departments
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Pharmaceutical Company Departments
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Production Quality Control
Quality Assurance
Technical
Services/Validation Dept
Regulatory Affairs
Medical Affairs
Training & Development
Research and
Development/
New Product Development
Administration Human Resources
1-Marketing & Sales
2-International
Marketing/Export
Business Development
Supply Chain
1-Material Purchase/Import
2- Ware House
3-Distribution/Commercial
Dept
4-Production planning
Engineering

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Why Business Development?
• To shape the company’s future.
• To maintain or build sales.
• Customers want new products, which competitors will do their best to
provide them.
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Role of Business Development Department
Purpose
To Maintain a ROBUST products pipeline and ENSURE the launch of the RIGHT
PRODUCT at RIGHT TIME.
Responsibilities
The department is responsible to overcome the
challenges (external & internal) of bringing new products
to market in time in the focused therapeutic areas.
Nature & Scope
• BD serves as liaison between external partners & internal groups within company including Product
development, Creative, Medical, Regulatory, Production, Material Management ,Import and Marketing.
• It strategize to identify, prioritize and pursue new opportunities / molecules in the focused therapeutic
areas as defined by Organization.
• The future business opportunities and direction of business is being driven by the department which
means that the efficiency of in time product launch, is the key critical success factor.
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Core Functions
• Seize Timely Opportunity
• Strategic Business Alliance (Licensing)
• Strategic Sourcing
• Portfolio Management
• Pipeline Development
• Revitalization (Including Cost Saving)
• Process Improvement
• Corporate Image
• Competitor Analysis
• Liaison With Department In Order To Achieve Company Goals
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BD Intelligence
• Ministry & Medical Publications
• International & National weekly, monthly, quarterly subscriptions of Magazines,
Newspapers & etc.
• Internal developed BD intelligence system
• Suppliers & Indenters resources
• Specific Internet sites (SRA websites)
• Market forces
• Competitors activities
To keep Organization in top
ranking, BD up to date and relevant
with next 3 years perspectives,
following sources are in practice:
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BD Intelligence Stage 1
Stage 1
Search and technical evaluation of
opportunities for new products/ R&D
molecules/
Technologies
Step 1
BD
Continuously develop an
opportunity list by search &
initial scoping
Step 2
Medical
Medical need?
Epidemiology
Impact of drug?
Medical profile /clinical data
presentation for KOLs?
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BD Intelligence Stage 2
Stage 2
commercial evaluation
Step 1
Market Research
Market size?
Competition profile ?
Market growth rate?
Trade Prices of similar drugs?
Step 2
Marketing
Maximum sales potential?
Five years annual sales fore cast
TP/DP/MRP
Step 3
Finance
Financial evaluation
NPV, ROI, IRR
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 Rectify the
dossier & Technical
discrepancies in
coordination with
R&D.
 BD assist Regulatory Manager &
consultant (external & internal) to
overcome the issues raised
during & after registration
process.
 Other regulatory matters like:
getting files from MOH, MOM,
summaries of MOM and any
special assigned regulatory tasks
& jobs.
Regulatory Affairs
Receive
the Reg.
Letter
Provide assistance
wherever &
whenever needed
during registration
at MOH
Follow-up with Regulatory
Manager / outsourced
consultant for getting the
registration Letter
Dossier submission for registration of the
Product
Pack Size
/Form
Issues
Brand Name
Assistance
Price
committee
issues
Other
issues
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Market Placement
1)Identify target markets
– Size and growth potential
– Ability and ease of reaching segment
– Good fit with organizational objectives
– Greatest revenue generation with least investment
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Market Placement
2)Determine opportunity
Segment size
Annual usage potential
Anticipated annual growth rate
Margin
Value in use
3)Evaluate competition
Strengths/Limitations
Implications
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Business Development Types
in Pakistani Pharmaceutical Market
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National Generics - 1
Identification
Screening (Patent)
Capacity Constraints
Market Potential (IMS
etc)
Owner
of the Company
Sources of Supply
Documentation
& Samples
Registration
Marketing
to launch
Intuitive behavior followed by
many national companies
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National Generics - 2
Identification
Screening (Patent)
Capacity Constraints
Market Potential (IMS etc)
Product Potential
Long-term success
New Product
Committee
(Top-Line &
Project Leader)
Sources of Supply
Documentation
& Samples
Registration &
Launch Planning
Marketing
to launch
Intuitive behavior followed by
many national companies
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Multinational Generic
•Sources of supply: Gradation & selection
•Formulation & product development
•Dossier & registration
•Batch production & validation
•Launch planning
•Launching
DROP
Identification &
Screening on
country basis
Gap analysis &
financial evaluation
Country Head Office
Screening on
global/regional basis
Assessment of
financial evaluation
Corporate/Regional Head Office
GO-AHEAD
Process is followed by multinational
but limited to generic products
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New Product
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Why New Products?
• New product development is essential to any business that must keep up
with market trends and changes.
• Approximately one-third of the revenue a business generates is coming
from products they did not sell five years ago
• Changing environment creates new demands and needs
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Why develop New Product ?
• To create stars and cash cows for the future
• To replace declining product
• To take advantage of new technology
• To defeat rivals
• To maintain/increase market share
• To keep up with rivals
• To maintain competitive advantage
• To fill gap in the market
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Product Development
• Must be alert to quickly develop opportunities
• Focus on markets or product categories consistent with organization’s
objectives, resources, capabilities and strengths
• Securing a competitive advantage
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What is a new product ?
• A product that opens an entirely new market
• A product that adopts or replaces an existing product
• A product that significantly broadens the market for an existing product
• An old product introduced in a new market
• An old product packaged in a different way
• An old product marketed in a different way
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New Products necessity
• A way of getting new and keeping old customers
• Effective way of obtaining a competitive advantage
• Source of growth and excitement
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Categories of New Products
• New product
• entirely new market
• New line
• new product in established market
• Addition to existing line
• new product in established line
• Improvement of existing product
• value addition to existing product
• Re-positioning
• existing product in new market
• Cost reduction
• similar performance at lower cost
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New product can be used to
• Increase/defend market share by offering more choice or updating older
products
• Appeal to new segments
• Diversify into new markets
• Improve relationship with distributors
• Maintain the firm’s reputation a leading edge company
• Even out peaks and troughs in demand
• Make better use of the organization's resources
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NEW PRODUCT DEVELOPMENT PROCESS / CYCLE
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New product planning
• This is the strategic stage
• The firm assesses
• It current product portfolio
• Opportunities and threats
• The firm then determines the type of product which would best fit in with
the corporate strategy
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New product development
• New product development is a process which is designed to develop, test
and consider the viability of products which are new to the market in order
to ensure the Growth or survival of the organization.
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Stages in New product development
• Idea Generation
• Idea Screening
• Concept development and testing
• Market strategy development
• Business Analysis
• Commercialization
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Idea Generation
• Idea generation is continuous, systematic search for new product opportunities. It
involves delineating sources of new ideas and methods for generating them.
• Ideas for new products can be obtained from basic research using a SWOT analysis
(OPPORTUNITY ANALYSIS), Market and consumer trends, company's R&D department,
competitors, focus groups, employees, salespeople, corporate spies.
• Stage 1: Idea Generation
– Internal idea sources:
• R & D
– External idea sources:
• Customers, competitors, distributors, suppliers
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Idea Screening
– The object is to eliminate unsound concepts prior to devoting resources to them.
– The screeners must ask these questions:
• Will the customer in the target market benefit from the product?
• What is the size and growth forecasts of the market segment/target market?
• What is the current or expected competitive pressure for the product idea?
• What are the industry sales and market trends the product idea is based on?
• Is it technically feasible to manufacture the product?
• Will the product be profitable when manufactured and delivered to the customer
at the target price?
• Stage 2: Idea Screening
– Product development costs increase substantially in later stages so poor ideas must
be dropped
– Ideas are evaluated against criteria; most are eliminated
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Concept testing
• Concept testing present the consumer with a proposed product and measure attitudes
and intention at this early stage of development.
• Concept testing of prototypes can help avoid costly mistakes.
• Stage 3: Concept Development and Testing
– Concept development creates a detailed version of the idea stated in meaningful
consumer terms.
– Concept testing asks target consumers to evaluate product concepts.
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Market Strategy Development
• Includes development of three part strategy plan
• Stage 4: Marketing Strategy Development
• The target market’s size, structure, behavior, product positioning, and sales, share,
and profit goals for the first few years.
• Product price, distribution, and marketing budget for the first year.
• Long-run sales and profit goals and the marketing mix strategy.
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Business & financial Analysis
• Estimate likely selling price based upon competition and customer feedback
• Estimate sales volume based upon size of market
• Estimate profitability and breakeven point
• Stage 5: Business Analysis
– Sales, cost, and profit projections
• Stage 6: Product Development
– Prototype development and testing
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Commercialization
Stage 7: Commercialization
Commercialization involves implementing a total marketing plan and full production
– Launch the product
– Produce and place advertisements and other promotions
– Fill the distribution pipeline with product
– Critical path analysis is most useful at this stage
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BD (Process Flow - NPD)
Exploration of New Product from Local or
International market through Market Intelligence
sources based on R&D Breakthrough, Platform &
derivative projects product mix
After getting the feasibility approvals from
GPAPE working, Filling of Product Identification
form except marketing part.
BD will Forward the filled forms file to Marketing
for business analysis & their ownership with
specific time frame to return the filled & signed
forms
The marketing part comprises of market analysis, sales forecast,
projected volume, Proposed price (MRP, TP, DP), Market share,
Growth and analysis of Local & International market.
BD summarizes the
forms and submit for
Director approval.
BD Integrate the HOC & HOM approved products in the Company product
pipeline by submitting all the approved dossier request forms with related
docs. to Outsourced consultant or R&D and initiate them for registration
process.
Listing of major new found products
Circulation of list to:
• Marketing for Commercial feasibility
• Sourcing of API
• R&D for Production feasibility
• Medical for therapeutic fit
• COGS for Financial feasibility
After Approval, BD prepares Dossier request forms with Market
survey, Leaf insert, Artwork, 3 years forecast and Medical
justification.
Marketing
ownership
required
Director
approval
required
YES
NOdropped
NO YES
dropped
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BD (Process Flow) ….cont.d
Follow-up of submitted files for
registration from MOH fulfills the
queries if any raised by MOH.
(Brand name, SKUs, Pricing,
technical with support of Regulatory
& R&D & any other)
After registration, list down the whole new
products ready to be launch & circulate for
Marketing choice for next 2 quarters with
tentative launching date, forecast & approvals
of Marketing & Director
After getting ownership & tentative launching dates from
Marketing, discuss & finalize the production, product to be FG
dates, quantities, forecasts with R&D.
Follow-up and coordinate with
• Creative for artwork
• R&D, Planning (Production & QA) for updated status
• Import & MM for Raw Material & Packaging Material
to be available on time.
Product transfer to FG
LAUNCH
Marketing &
Director
approval
required
YES
NODropped
Cont,d from
previous
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Challenges in New Product
Development
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Challenges
• New products can be obtained via acquisition or development.
• New products suffer from high failure rates.
• Several reasons account for failure.
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Challenges
• Shortage of ideas
• Ways to improve products
• Fragmented markets
• Keen competition
• New products in smaller segments
• Lower sales & profits
• Social & governmental constraints
• Consumer safety & environmental concerns
• Slow down in innovation of drugs
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Challenges
• Cost of development process
• Ideas to find just one worthy of development
• High R&D, manufacture & marketing cost
• Capital shortage
• Good ideas
• Funds needed to research & launch
• Short product life cycles
• Rivals are quick to copy
• Recoup the investments
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Challenges
• Development time
• Compress development time by
– Computer aided design
– Manufacturing techniques
– Strategic partners
– Early concept test
– Advanced marketing planning
– New product development is most effective when there is teamwork among R&D,
engineering, manufacturing, purchasing, marketing & finance. The products idea
must be researched from a marketing point of view, and a specific cross-functional
team must guide the project throughout its development.
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SUMMARY
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Description of Activities:
Idea Generation
•Request
•Customer Need
•Market Studies
•Legislation
•Competitors
Key Deliverables:
Product Concept Doc
Assess Market
•Segment And Size
•Growth Potentials
•Customer Need
•Legal Issues
•Competition
Key Deliverables:
Market Research Report
Market Req Document
Product Definition
Statement
Product Development
•Technical Specs
•Prototyping
•Trail Production
•Testing &QA
Key Deliverables:
Product Dev. Schedule
Product Testing Report
Business Analysis
•Cost /Benefit
•Resources Required
•Capital
•Profitability/Margin
•Anticipated Sales
Key Deliverables:
Business Case
Profitability Analysis
Product Req Doc
Go to Market
•Marketing plan
•Sales Training
•Distribution plan
•Collateral Design
•Set launch date
Key Deliverables:
Product Launch Plan
Product launch Budget
Product ROI forecast
Target Launch date set
Check point # 1 Check point # 2 Check point # 3 Check point # 4 Check point # 5
•Review Deliverables
Decision:
•Go/No Go to Research
•Incubate idea or Kill
Decision:
•Go/No Go to Analysis
Decision:
•Go/No Go to Develop
Decision:
•Go/No Go to Launch
Decision:
•Go/No Go to Market
Concept Research Analysis Develop Launch
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Summary
• New product development drives growth.
• Market research is critical to the success of a new product launch.
• Market research is a continuous process as customer needs, your
business and the environment changes.
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Summary
• In general, seven stages are involved in new-product development process;
idea generation, screening, concept development & testing, marketing
strategy development, business analysis, product development, and
commercialization. The purpose of each stage is to determine whether the
idea should be dropped or moved to the next stage.
• Consumer-adoption process is influenced by many factors beyond the
marketers’ control, including the customers’ & organizations’ willingness to
try new products, personal influences, and the characteristics of new
product or innovation.
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“Don’t find customers for your products, find the products for
your customers”
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Role of Business Development in Pharmaceuticals (Generic Product Business)

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