Four Signs of Market Disruption in Biopharma—and How Brand Teams Can Stay Ahead

As competitive intensity and speed of innovation increase across disease states, the ability to systematically identify and act on market signals quickly is becoming a critical source of competitive advantage in the biopharma and biotech industries.

However, in our work with clients, we have found that brand teams can often miss, ignore, or downplay common signals that their market is being disrupted and their competitive position weakened. The good news is that brand teams can learn to identify—and address—the warning signs.

Today’s Crowded Therapeutic Market

Executives are under enormous pressure to deliver sustained sales and market share growth for their products. In parallel, virtually every therapeutic area is becoming more crowded with multiple branded products delivering similar levels of therapeutic benefit and new mechanisms of action being introduced. Psoriasis, psoriatic arthritis, Crohn’s Disease, and depression are among a subset of disease states where up to a dozen branded products are competing for health care practitioner and consumer mind share. With so many highly resourced players seeking to identify and exploit sources of competitive advantage, market dynamics are in a constant state of flux and disruption.

Four Signs of Market Disruption

Over the past few years, we’ve worked with more than a dozen biopharma brand teams that initially saw a slow decline in brand performance, only for it to rapidly spiral into a crisis within a matter of months.

Our first step in developing turnaround plans with these client teams was to conduct a comprehensive 360-degree market and brand review.

• This work focused on surfacing trend breaks in performance metrics that explain new-to-brand performance trends across competing products.
• As part of our assessment, we conducted a systematic KPI analysis based on patient claims and Rxing data, in-field execution metrics and competitive activities, and patient access and affordability dynamics.

In the course of completing these brand reviews, a clear pattern emerged: brand teams often missed, ignored, or—most commonly—downplayed a common set of signals that their market was being disrupted and their competitive position was weakening.

The four most common signals we observed were:

Deteriorating Brand Health Metrics. Changing brand perceptions are a precursor to market share gains—and losses. In our experience, brand teams need to focus on the small number of attributes that are most critical drivers of prescribing, which are typically clinically related. For example, if efficacy perceptions relative to competitors are deteriorating, rapid intervention is required because market share losses will inevitably follow.

Market Share Losses Among Critical Customer Segments. Competitive intensity is greatest with the highest-volume customers, so if performance starts declining here, it is an early warning sign that competitors are disrupting your business. In our experience, many brand teams initially deflected data on deteriorating performance with the most important customers by celebrating continued success with lower volume ones. Unfortunately, loss of volume in the former group of customers always far exceeded volume gains in the latter.

Lower Quality Engagement Scores from Customers. When we have assessed the performance of brands in decline, we consistently found that customer perceptions about the quality of field engagement and the frequency of engagement have also declined. Changing perceptions may relate to some combination of customer experiences with field sales, field medical, and field reimbursement teams.

Patient Initiation Challenges Compared to Competitors. Our market research across therapeutic areas has shown that ease of patient initiation is frequently the most important factor when a health care provider is choosing among therapies that they believe have similar clinical profiles. So, any brand that is perceived to be harder to prescribe or get a patient started relative to competitors will lose market share.

Seven Questions to Ask

As a commercial leader, the challenge is identifying when something is amiss. If you answer yes to any of the following questions, you should consider initiating a more detailed brand review:

• Is a brand losing market share for reasons that the marketing or sales team cannot explain?
• Is a brand losing market share to a competitor that you believe is clinically inferior?
• Has your sales growth slowed with a specific customer type of segment?
• Are your top customers telling you that your field teams are less responsive or that competitors are showing up better?
• Are there changes to three-month sales trend lines that can’t be easily accounted for?
• Are you seeing a slowdown in new patient starts that can’t be readily explained?
• Does your gut tell you market dynamics are changing, but you don’t know why or how?

The Right Response ... and the Wrong Response

When we have been called in to help turn around an underperforming brand, some members of the brand teams acknowledge they had noticed deterioration in brand fundamentals, but they were afraid to raise the alarm. That is, of course, the wrong response. Watching and waiting will only result in an acceleration of market share losses.

The right response is to embrace what the market is telling you and to understand what is driving the change in competitive dynamics.

Consider having a team—independent of the existing brand team if needed—to conduct a rapid review of the market and brand performance. This is a no-regret move. The market signal may be a false alarm, but the potential cost of being overconfident could be hundreds of millions of dollars in lost sales.