This week marks the release of our first annual survey of pharmaceutical R&D leaders: Innovating to survive, collaborating to thrive. The report is written against a background of rapid changes in the way the pharmaceutical industry operates; with regulatory, health system and political environments all exerting unprecedented pressures on the returns that pharmaceutical companies are achieving from research and development (R&D). This week’s blog explores some of the key findings from the report.
Drivers influencing R&D priorities
Priorities within R&D companies are being influenced primarily by:
- rapid shifts in regulatory and payer environments (particularly recent changes in the US)
- the generation of new insight derived from Real World Evidence (RWE)
- pressures to reduce time to market
- ongoing re-evaluation of the portfolio composition in light of competitor activities and therapeutic advances.
Headwinds affecting peak sales
The R&D leaders we interviewed spoke of a variety of headwinds changing the payer and pricing environment. Favoured tactics to address the challenges facing their organisations included: re-balancing their portfolios to ensure that high price products are not over-represented, and that broad access to markets is maintained; developing partnerships with regulators including providing the right evidence to enable new products to progress efficiently through the product pipeline; accelerating time to filing; and focussing on areas of unmet medical need.
Top three initiatives transforming the operating model
In response to the question about the top three initiatives transforming the current operating model in their companies, the most frequently mentioned initiatives were those related to developing internal technical and data capabilities, with companies looking to develop their ability to harness the growing volumes of R&D-generated data more efficiently and upgrading internal systems to utilise existing data more effectively. The second most frequently mentioned were those aimed at boosting operational efficiency through the modification or overhaul of existing systems and processes. Changing governance models to improve the speed and accuracy of decision making, and utilising RWE were both seen as equal priorities in third place.
Game changing moves
R&D leaders considered that the two leading game changing moves within their R&D organisations were being able to:
- exploit big data using data mining, robotics, and analytics (including machine learning) to help improve the speed and outcomes of clinical development
- reduce time to market, with faster approvals from key regulators becoming possible based on the provision of new forms of evidence.
Better predictors for new treatments is the third highest scoring game changer, perhaps unsurprisingly given the sizeable costs of late-stage assets failing to obtain approval.
Culture and talent challenges
R&D leaders are increasingly looking to create a collaborative, rather than competitive culture in their organisations. Companies are attempting to break down silos between functions by forming cross-functional groups - changing the perspective from individuals acting as representatives of their respective function, to becoming members of a high performing team. In terms of talent, the agenda is being driven by a growing demand for technological knowledge and skills, changes to product development strategies, and the gradual move to an outsourced model.
Transforming collaborative working
A strong therapeutic area (TA) focus can result in higher returns than pursuing a broad commercialisation strategy. Ensuring a stronger TA focus is enabled by leveraging established relationships with stakeholders along the development process; including establishing cross-functional steering committees to promote more effective decision making between the R&D and Commercial functions.
Partnerships and alliances
Pharma companies continue to seek scientific partnerships, including with academia, to gain access to talent and cutting edge technologies, in addition to partnerships with other pharmaceutical and biotechnology companies to achieve TA consolidation, reduce attrition costs and increase risk sharing. They are also seeking digital, IT and data analysis partnerships in a bid to develop devices or applications to collect patient data and enable data management and analysis. Clinical partnerships for designing and conducting clinical trials also remain a high priority.
In embracing the concept of patient centricity, companies are seeing the patient as less of a passive recipient of treatment and more as a central part of the R&D process for new therapies. Pharma companies are looking to engage patients earlier to better understand unmet needs. This will impact trial design, patient recruitment and resilience, recognising that products and services that better meet patient needs and improve treatment regimens will receive higher acceptance by payers, providers and regulators.
Digital and technology transformation
Managing data effectively, with regard to accessibility, security and costs, is becoming increasingly critical to companies as the data landscape within R&D becomes more complex. Scientific data (from genomics and imaging), patient data (from clinical trials, RWE and medical devices), and legacy data sources all need to be efficiently managed in order to support improved hypothesis generation, informed decision making and reductions in clinical trial times, with the end goal of cost reduction.
At the time of the interviews, the UK had voted to leave the EU but had not yet triggered Article 50, and other political changes such as the US election were imminent. Their responses indicate that the effect of Brexit on their R&D operations depended to an extent on the detailed terms and conditions of the Brexit negotiations, the scale of the companies’ presence in the UK and the extent of their collaborations with UK academia and external partners. R&D leaders’ main concerns were about the uncertainty around workforce flexibility, potential regulatory and market access changes, and the future of academic collaborations. Article 50 was triggered on 29 March, however, the decision to hold a snap election on the 8th of June means this uncertainty remains.