Commercially-Oriented R&D

Aligning R&D activities with commercial realities is an old issue.

The importance of a commercial perspective in R&D is increasing more and more, due to the downward pressure on drug prices and limitations on market access.

Pharmaceutical organizations are becoming more complex and this makes increasingly difficult to ensure integrated and holistic commercially-oriented behavior in R&D. This causes significant frustration in both R&D and Commercial functions.

It is surprising that every year, the pharmaceutical industry spends an average of $140 billion in the pursuit of innovation, and meanwhile, the productivity has fallen over the last 60 years.

Most will agree that opportunities for improvement exist within any R&D organization, and internal effectiveness is paramount to preventing the already-high cost from soaring out of control.

In this article, we will speak about how pharmaceutical companies can ensure that the increasingly expensive costs of drug development will result in assets that get patients and physicians.

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The Culture and Ethos

The delivery from R&D of value enhancing products that are commercially successful remains inconsistent, although the investment has increased and experimentation with different R&D models has been implemented.

Probably, the reason for that is that these approaches often fail to address the underlying problem: the culture and ethos of the organization. How do the people who make up the company interact with one another, seek input from colleagues, and approach decision-making?

In our experience, critical decisions are often addressed when a development checkpoint is reached.

Although these milestones are necessary, they should exist an on-going series of conversations between the people with the relevant expertise and perspectives (commercial and scientific), that create an organizational understanding of the end-to-end process of R&D and commercialization, bringing an understanding to day-to-day decision-making.

Speaking the Same Language

To create a better commercial instinct, R&D organization should bring clear commercial thinking into the process starting in the very early stages, where the dialogue flows in both directions, for commercial functions to understand the R&D process and future assets.

The R&D organization should insight into the commercialization process and should have deep corporate knowledge of payers, regulators, clinicians, and patients, to capture future value.

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The Commercial Oriented R&D

In our experience, commercially oriented R&D requires three core enablers. These enablers are deliberately focused on people, process and capabilities, as we have found these are the ultimate keys to success.

Companies must systematically incorporate the explicit and implicit knowledge into the thinking and decision-making processes of the organization. This way, they can generate outcomes that are relevant and value for the market place.

In this sense, R&D will generate more products of value, while commercial functions can be afforded the time necessary for optimal launch planning.

Conclusion

We believe that improvements can be made by creating better relationships between the right Commercial and the right R&D colleagues. But as everything, this requires persistence and patience. To create this solid connection, it is as much a people issue as it is a technical issue that requires appropriate effort and a long-term perspective.

By making the effort to understand one another (commercial and scientific) and work together, they can carry great benefits to the organization and the world.

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