Know-How Exchange : Strategy

Hi

Sorry if this sounds facile, but in a genuine pharmaceutical company, the ideal frequency with which you release a truly new product is as frequently as possible. And that isn’t very often.

That’s after you’ve spent 7 or 8 years and $700,000,000 developing it, getting it through pre-clinical trials, phase 1, 2 and 3 clinical trials, working out how to scale up production, protecting your patent internationally, clearing the FDA and other regulatory hurdles, agreeing pricing with potential governmental purchasing agencies, establishing international distribution, creating the packaging for different markets and coming up with a brand name for the compound that, these days, preferably begins with a Z or an X for some weird reason.

You don’t get very many of those a year.

If on the other hand you’re talking about a pill with a new brand name for an old over-the-counter drug, the frequency of release is dictated by your marketing budget and the strength of your belief in how long consumers can be persuaded to part with their money for an expensively advertised and packaged version of something they could purchase for a fraction of the cost if they knew the generic name of the active ingredients!

If you are in the latter business, then the only other restraint is the knock-on effect that a “New” product will have on your existing brands which have the same chemical ingredients or claim the same effects.

Brand extension into other areas of therapeutic treatment also has its risks. If your company has made a name for itself in headaches then a new pain relief product will cannibalise your existing brands sales so the solution has been to sell, essentially the same ingredients for a different ache or pain. Consumer groups rightly feel this to be a bit of a con, but it earns big bucks for the OTC drug manufacturers.

Moving to another area of ailments and cures for a new product allows for more scope to release “New” treatments but there is the risk that the consumer will ask “What does this headache company know about stomach ache” so you will have to spend extensively to build credibility through marketing.

The fact of the matter is that the company knows little about headaches or stomach aches, just a lot about marketing and value added brand positioning.

Steve Alker
Unimax Solutions

One of the limitations to profiting from your products in pharma/biotech is your patent protection. The patents would have been set well before launch, so your clock is already ticking so you would want to get products out as fast as possible to make the most use of the protection.

If you have multiple products ready at one time, the launch should be based on what you have the resources to launch effectively. If you have the resources to launch them all, by all means do it. If not, launch the one that looks to give the best ROI first and work your way down to the others as resources become available.