How can companies determine where to focus as they develop their pipelines and determine new growth opportunities? Kx Advisors’ 2020 Hot Indications List can help. In our 6th annual analysis of global R&D investment, our experts identified the top indications for industry focus.
The Journey from Patient to Healthcare Thought Leader
Some people find their interest in healthcare and science by reading books or watching documentaries. Dr. Jenna Riffell, Kx Vice President, had a hands-on experience that sparked her passion. At fourteen, doctors discovered that she had a detached retina—a medical condition that is rare in young people and can lead to blindness. She was immediately attracted to the complexities of healthcare and the impact it can have on patients’ lives.
She studied Chemistry and Biochemistry at the University of British Columbia, graduating with combined honors. Jenna continued on to earn a PhD in Biochemistry and Molecular Biology, with a focus on cancer drug development. In Jenna’s postdoctoral fellowship, she partnered with a pharma company at the Institute of Cancer Research and the Royal Marsden Hospital. There, Jenna developed an interest in translating research innovation into patient care.
Transitioning to Healthcare Growth Strategy with Kx
As a natural problem-solver with a knack for strategy, consulting was a strong fit for Jenna. When asked why she joined Kx, Jenna says, “working at a boutique consulting firm allows me to see the impact I make, both for my clients and internally. Contributing to my clients’ successes is what makes me most excited to come to work each day.” Additionally, Kx utilizes her project management skills and scientific background, especially her expertise in experimental data and drug development. Jenna brings her expertise to both client work and thought leadership, including Kx’s annual Hot Indications paper focused on pharma R&D trends. Jenna’s creativity, analytical rigor, and communication skills make her an enormously valued employee and partner for our clients.
As a leader of the transatlantic team, Jenna emphasizes the impact of Kx’s culture, both in London and virtually. She mentions that one of the best things about Kx is that “working with such a close-knit team that challenges me and encourages me to deliver my best.” She currently enjoys seeing more of her international colleagues’ faces on video in 2020 and spending more of her downtime practicing classical piano.
Interested In Healthcare Consulting?
Jenna encourages fellow academics interested in consulting to be prepared for a learning curve. As she transitioned into the field, Kx’s value on individual contributions empowered Jenna to share her innovative ideas. Jenna enjoys the entrepreneurial spirit fostered by Kx and the ability to make a difference in our clients’ healthcare projects. Have questions about our work? Get in touch with us at email@example.com.
Why Your Orphan Drug Needs A Global Market Access Strategy
An effective global market access strategy for rare diseases requires a higher degree of regional customization compared to other launch prep activities
While regulatory approval in first-tier US and EU markets can often translate on a global scale, as many local regulatory bodies look to FDA or EMA approval as the gold standard, local market access requirements vary significantly
Companies must be ready to develop individual market strategies to address these country-specific challenges
Why You Need A Global Market Access Strategy
Each country poses unique challenges in developing a rare disease market access strategy. While some areas face a scattered patient population, others may face challenges such as immature physician and patient advocacy networks. Additionally, the high cost of certain drugs, like gene therapies, are handled differently by different countries. These nuances in market behaviors and structure underlie the importance of looking across the global landscape when developing a market access strategy. For US-based pharma companies, developing a comprehensive market access plan, rather than simply pivoting off a US-focused market access strategy, will ensure the long-term launch plan meets global needs and is positioned for success.
Rare disease companies need to answer complex key questions:
Which markets will be targeted for launch?
How much compromise in pricing is possible to gain access in global markets, particularly given reference pricing?
What evidence is available or will be developed to support global market access?
The first step in entering a market is to identify which markets offer a path to reimbursement with sufficient pricing potential. The next step is assessing your pricing flexibility, as offering a lower price than in the US or even the EU5 can increase the likelihood of reimbursement in key OUS markets. When making these assessments, identifying patient access schemes, such as named patient supply (NPS), can validate and drive demand. Once an orphan drug gains regulatory approval, companies must be prepared to work with stakeholders, such as patient advocacy groups and KOLs, to demonstrate need for the orphan drug, clinical and cost effectiveness, and drive favorable reimbursement decisions. These stakeholders are pivotal in some markets, ensuring that patients can get treatments at affordable costs throughout the duration of their treatment. As an example, in Brazil, patient advocacy groups work closely with patients to navigate court systems that enable patients to make a legislative case for drug access and coverage before national approval, including for orphan drugs (see more below).
External reference pricing adds significant complexity to global market access strategy as the application of referencing varies greatly among countries, including:
Product Applicability: categories of products for which referencing is applied, including referencing only for drugs in a specific care setting (e.g., inpatient hospital), innovative medicines for which there is no alternative available on the market, or high-cost medicines
Basket Composition: both the total number and specific countries selected to include in the reference basket (typically selected based on comparable GDP per capita)
Calculation Method: use of either an average price or selection of the lowest price of basket countries
Decision Process: whether used as the main systematic criterion (most common) or as supportive information only when setting a drug price
Re-evaluation: pricing must be re-evaluated frequently after initial price is set
In Europe, the vast majority of countries use some form of reference pricing. With reference pricing, there is increased pricing interdependence between countries. Given the high prices of orphan drugs, it is critical for rare disease companies to develop a launch sequencing strategy that factors in price referencing. This could include strategically launching first in high-priced countries without reference pricing, then focusing on lower-priced countries.
RWE is gaining momentum globally as real-world data (RWD) sources become available—specifically electronic health records and claims data that provide a basis for evaluating outcomes. New treatment costs remain high for rare diseases, putting pressure on pharma and biotech companies to demonstrate results for premium pricing with payers. Gene therapies are especially costly due to their complexity, making RWE an ideal tool. A prime example is the AveXis-Novartis approach to payer contracting with Zolgensma, a one-time gene therapy treatment that replaces lifetime chronic therapy for patients with spinal muscular atrophy Type 1, and which launched in the US in June 2019. Gene therapies are breaking pricing norms since manufacturers are only able to generate revenue from “one-shot” treatment for each patient, and Zolgensma made waves with a US price point of $2.1M per patient—the most expensive treatment on the market as of this writing. Novartis worked with payers to establish efficacy-based reimbursement and a 5-year installment payment option to spread payment for treatment over time. With these arrangements, risk is lower for payers, who can pay $425K annually for five years and better justify a patient switch from Biogen’s Spinraza, a chronic treatment estimated to cost $4M+ over a 10-year period. Zolgensma won coverage for 90% of US commercial patients within its first full quarter on the market, with all payers taking advantage of value-based contracting; however, initial uptake of the installment-based payment system was limited.
Similarly, in May of this year, Zolgensma received conditional approval in Europe with the “Day One” access program, which ensures the cost of patients treated before national pricing and reimbursement agreements are in place aligns with the value-based prices negotiated following clinical and economic assessments. Working within the existing pricing and local reimbursement frameworks, the “Day One” access program for EU governments and reimbursement agencies allows the company to tackle entry into markets faster and with more flexibility. This system sets up a win for each stakeholder: the patient, the health and reimbursement bodies, and AveXis-Novartis. With the Temporary Authorization for Use (ATU) program, it became immediately accessible in France and should be available in Germany shortly.
Coverage for therapies like Zolgensma remains dependent on demonstrating values, so companies must leverage proof of value when looking to capture new patient markets. RWE and patient-reported outcomes (PROs) provide stakeholders with concrete data to inform formulary addition and clinical trial outcome endpoints.
An effective global market access strategy for orphan drugs must be adaptable to different regions and their unique challenges to be effective. As companies work through the key questions outlined above to create a successful global market access strategy, tools like RWE and external reference pricing can support tackling a large range of location-specific issues.
Elective Procedures After COVID-19: How To Support Rebounding Demand
Due to COVID-19, pharmaceutical and medical device organizations face unprecedented obstacles, impacting product forecasting, pipelines, and overall corporate strategy. One major business challenge created by this pandemic is the policy-driven limitation on elective procedures, resulting in restricted healthcare provider (HCP) accessibility for patients. Approximately 27% of patients experienced an elective procedure delay or cancelation due to COVID-19, according to an April 13th poll of over 2,500 US adults.
Defining Elective and Essential Procedures
There is no single definition of elective procedure, and the meaning of the term varies across the globe and from person to person, given how HCPs and patients view the urgency of medical situations. Generally, an elective procedure is recognized as a non-urgent procedure that can be scheduled in advance. The term elective procedure may be associated with non-immediately life-saving procedures; however, examples of necessary elective procedures include cancer surgeries, kidney stone removal, mental health services, and joint replacements.
The Impact of Pandemic Restrictions
The impact on individual hospitals and the procedures they perform is dependent on their location, the severity of the pandemic there, and how different regions are managing the epidemic. While some hospitals are fully operational, others have been prioritizing COVID-19 patients and chose, or were legislated, to scale back on elective procedures.
We are beginning to see a rebound in hospital visits and elective procedures performed in COVID-impacted areas. There is evidence that hospital visit declines in the US may have bottomed out, with a 4% increase in outpatient hospital visits in the second week of April marking the first increase in visit volume since early March. As lockdown measures are relaxed, the re-introduction of elective procedures may take some time. The pandemic has increased anxiety about seeking treatment, keeping patients from going to hospitals. Emergency room visits are down by about 50% across New York City Health and Hospital locations. This fear could take time to subside and impact patient behavior for longer than policy measures restrict procedures.
The evolution of elective procedures will be region-dependent, as strategies to lift lockdown measures and priorities are decided at a national or regional level. As the pandemic continues and cases decrease, nations are facing the challenging decision of whether to prioritize certain elective procedures, and if so, which elective procedures to bring back first. In the United Kingdom, mental health and cancer surgeries are being prioritized amongst elective procedures. However, as we see demand rise again for specific products or procedures, this resurgence will likely result in a backlog of procedures. This backlog will have a direct impact on other procedures. For example, we may see a surge of cancer surgeries that were delayed by pandemic mitigation measures, resulting in less available operating room space and limited opportunities for other operations.
Preparing For Procedures Now And Post-COVID-19
With the rollback of lockdown measures and changes on the horizon for elective procedures, healthcare organizations can support HCPs and patients in new ways. There are several factors procedure-focused companies must consider as they face the pandemic’s challenges now and throughout the global recovery:
Map demand and prepare for the backlog: Companies must monitor changes in government regulations, medical association guidance, and access to personal protective equipment (PPE), as well as analyze the continuing evolution of COVID-19 to determine which products can meet demand in identified places at the correct time. Part of this calculation must include a backlog in regions that begin to allow elective procedures. With this expected backlog of elective procedures, companies must ensure they are ready to support HCPs and patients to ensure a smooth ramp up.
Explore new ways to aid HCPs performing procedures: Crafting specialized product protocols, creating guidance for performing specific procedures more safely, and providing PPE where appropriate can support HCPs as they adapt. HCP accessibility and increased demand could also have implications for field team deployment. While it may now be more appropriate for field teams to actively reach out to HCPs, COVID-19 safety concerns may intensify scrutiny on sales rep involvement in surgeries. Understanding the changing landscape will be key for healthcare companies during this rebound phase.
Devise additional ways to help patients: With the looming fear of exposure to COVID-19 while in care settings for procedures, pharmaceutical and medical device companies can support HCPs’ new protocols to keep patients safe during procedures. From reinforcing safety of minimally invasive procedures in outpatient clinics rather than hospitals, to crafting additional guidelines for keeping medical devices uncontaminated, companies can provide value in new ways.
How Kx Advisors Can Help
Kx Advisors is continuing to evaluate business models, deliver top-notch expertise, and make profitable recommendations to our healthcare clients. Our team of experts can help your organization assess demand during and after COVID-19 and adapt your corporate strategy to position you for long-term success.
Adapting In COVID-19: A Product Forecasting Framework
Kx’s Key Takeaways For Product and Finance Teams
Separate The Trough And Rebound: Modeling both the duration of the trough and the slope of the rebound, from peak COVID-19 infections to recovery, is critical to developing an accurate product forecast
Layer In Regional Segmentation: Accurate forecasting requires more regional segmentation than most models demand due to the local variation in COVID-19 cases and varied government restrictions responding to the virus
Expand Data Sources: Although COVID-19 is unprecedented in many respects, historical data can be used to model its impact. Utilizing a variety of data sources—analog regions that roll back restrictions earlier, patient and provider research, and prior economic downturns —can provide a valuable frame of reference to develop a more informed forecast
Make It ALiving, Breathing Model: With new restrictions and the medical community’s fast-paced response, it’s critical for companies to regularly monitor and update forecasting assumptions as the pandemic evolves
COVID-19 Impacts Product Forecasting For Pharmaceutical and Medical Device Companies
Dealing with significant evolving obstacles associated with COVID-19, businesses worldwide are adjusting their 2020 strategic plans. Pharmaceutical and medical device companies face particularly complicated hurdles, including procedure delays, office closures, and more that prevent patient access to their products. In this time of uncertainty, it’s critical to develop an informed view of future sales to establish a strategic plan and mitigate future risks to the business.
Your Adaptable Product Forecasting Framework
Kx Advisors created this framework to assist organizations in accurately forecasting sales during a time of high uncertainty with COVID-19. We recommend approaching the problem in two stages: the trough and the rebound. While organizations around the globe are currently in midst of the trough, understanding both stages is crucial for full-scale recovery. The questions we’ve identified for this framework can be split into three categories of barriers that COVID-19 presents: policy barriers, behavioral barriers, and economic barriers. Policy barriers are directly related to the pandemic management decisions of governments and medical associations, while behavioral barriers are driven by changes in industry competitor, physician, and patient behavior, and economic barriers are those created by changing economic conditions affecting willingness to pay.
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Planning During COVID-19
While no one can predict the future, this framework should help you gain critical insights to better project and respond to these challenges. Leveraging this tool to strategize is only step one; your product team must continually monitor the quickly evolving factors impacting the framework’s components and adjust your strategy as needed to stay ahead of the economic effect of this pandemic.
Kx Is Here To Help
Struggling with product forecasting during this crisis? With extensive forecasting experience, we’re experts at quantifying what is hard to quantify. Our healthcare experts will rapidly analyze the changing field and build strategies with your team around the opportunities we identify.
Understanding The Changing Healthcare Landscape Is Key For Commercial Strategy
Treating Patients During A Crisis
The spread of COVID-19 has disrupted the healthcare industry. With hospitals scrambling to prepare for an influx of patients and government officials enacting large-scale safety measures, the overall volume of medical procedures is decreasing dramatically. The Centers for Medicare & Medicaid Services, the Centers for Disease Control and Prevention, and other healthcare thought leaders are recommending that providers limit non-essential and elective scheduled surgeries and procedures. However, not all procedures are equally impacted.
While COVID-19 is reducing treatment volume, the degree of impact varies depending on the urgency of the condition and the treatment setting. Procedure-focused companies must understand this evolving environment to forecast accurately and make crucial business decisions, such as resource deployment, commercial spending, and launch planning. Due to the fast pace of this pandemic and the corresponding response of the healthcare community, it can be difficult to predict the risks and disruptions organizations face. Without clear insight into the near-daily changes that medical professionals encounter, many companies’ strategic plans are no longer actionable.
How COVID-19 Impacts Orthopedics
The Kx team analyzed the consequences of COVID-19 for the orthopedic field, exploring trends that could inform expectations for the coming weeks and months. Our survey of orthopedic specialists across the US highlights that in most areas of the country, urgent and emergent procedures are still being performed, but elective procedures are being canceled.
The only orthopedic procedures that are being performed treat truly urgent conditions: cases of infection and trauma. However, even critical treatments like these are being performed at a lower volume than before COVID-19 emerged in the US.
Lessons Learned For Other Specialties
Our case study in orthopedics serves as an opportunity for companies focused on other specialties to apply insights to their fields. With ~97% of orthopedic specialists only performing urgent procedures (if at all), healthcare professionals and companies can expect to see similar trends throughout the industry. As ~38% of orthopedic specialists are not rescheduling at this time, organizations throughout the healthcare industry must adjust their expectations and expect the repercussions of COVID-19 for an extended period.
Kx Advisors, Experts In Resilience
Is your organization impacted by the sharp decline in procedures due to COVID-19? Kx Advisors can help. Our experts offer tailored guidance in forecasting, commercial strategy, and launch planning, projecting future trends and empowering your organization to adapt during a global pandemic or another unpredictable event. Our team will continue to monitor trends over time to help predict which procedures are resuming and when, giving your organization current data to inform your key business decisions.
The Role of Stakeholder Education in Rare Diseases
Despite the growing pipeline of orphan drugs, ~95% of rare diseases do not yet have an FDA-approved treatment. This increasing momentum in rare disease R&D has further highlighted the ever-present need for stakeholder education and engagement, which is critical to begin well before drug commercialization. Patients, key opinion leader (KOL) physicians, and other physician specialists supporting treatment are primary players in the rare disease space that influence treatment selection and access to novel therapies. Rare disease stakeholder education plays a critical role at every stage in drug development and commercialization and should be top of mind for rare disease companies regardless of whether they are designing clinical trials or preparing for product launch.
Caption: KOLs play an important role in the patient journey. From diagnosis to treatment access, KOLs support rare disease patients in making important decisions about managing their condition and obtaining the best possible care.
How to Implement Rare Disease Stakeholder Education
Rare disease companies need to engage with different stakeholders to address various pain points along the patient journey and maximize the opportunity for their orphan drug. KOL communities will be especially valuable throughout the drug development process. As a part of tight-knit medical communities, KOLs collectively influence treatment standards and typically have a deep understanding of how access to care and treatment varies across global markets. KOLs will be play important roles in:
Diagnosis: Timely diagnosis remains a major challenge for rare diseases; on average, patients wait close to 5 years and visit over 7 physicians before an accurate diagnosis is made. Delayed diagnosis can further complicate the patient pathway, often increasing the number of interventions required after the disease has progressed. Dedicated education efforts targeting physicians and patients, as well as improved testing access, can ensure accurate and earlier diagnoses.Companies should look at this as an opportunity to educate stakeholders and develop genetic tests to increase diagnosis rates and maximize patient adoption. While there are currently no genetic tests available for many rare conditions, competition to develop effective diagnostic tests will increase after a disease modifying treatment is introduced to the market. KOLs can also support development of innovative screening techniques, including using artificial intelligence or predictive analytics with electronic health record data to identify patients at high risk of an undiagnosed rare disease.
Drug development: KOLs play an integral role in drug development, ranging from supporting animal model design, clinical trial design, and designing clinical endpoints (e.g., novel disease severity / quality of life scales). As disease experts, KOLs understand needs, market access challenges, and adoption drivers and should be considered an asset to pre-commercialization efforts for rare disease companies. KOL in-depth expertise and knowledge should be leveraged for refining target product profiles (in particular via advisory boards), understanding treatment barriers across markets, estimating the size of local patient populations, selecting sites and recruiting patients for clinical trials, and supporting market access and reimbursement decisions for regulatory bodies and payers. Companies will greatly benefit from early and global KOL engagement throughout the drug development process – whether as consultants or scientific investigators.
Launch planning: KOLs are very familiar with the gaps in the existing patient pathway, and, post drug launch, can provide insights on ideal future-state diagnosis and referral patient pathways. Rare disease companies should continue to collaborate with KOLs to streamline the access pathway and demonstrate their long-term commitment to a given patient population. Post-launch trials also offer an opportunity for KOLs to disseminate information and develop stakeholder education deliverables about achieved health outcomes and / or pivotal trial results with physicians and patient advocacy groups (PAGs). Over time, KOLs become strong advocates for drugs, especially those that they have supported through development, and can be important allies as companies move towards commercialization.
Caption: Companies looking to launch a new drug should focus on how they can work with KOLs and other stakeholders to best understand local market opportunities, including disease prevalence/incidence, frequency of diagnosis, and likelihood of treatment adoption.
Centers of Excellence (COEs)are another critical component of rare disease stakeholder education. COEs, in conjunction with KOLs and their reference networks, offer rare disease patients specialized care and expertise. COEs combine clinical research, knowledge, and treatment services to become a regional or global “hub” for undiagnosed or recently diagnosed patients. The multidisciplinary approach they take is not only valuable to patients, but also biopharma companies as they enter commercialization stages. COEs are a reliable source of support for companies, referring patients from their centers and supporting commercial activities later down the road. A strong relationship with COEs and their KOLs can mean success for rare disease companies looking to work closely with patient populations and demonstrate long term commitment.
Caption: Centers of Excellence are a critical component of the rare disease patient pathway. Patients seek diagnosis support, treatment advice, and care coordination from experts at COEs across the globe.
KOLs and COEs are key stakeholders in the rare disease space and should be top of mind for companies looking to enter the space. As competition within the market increases, how companies work with KOLs to leverage their expertise and best understand the treatment landscape will become a key differentiator. KOLs, though critical to the market, are not the only stakeholders that companies should keep an eye on. In the next part of these series, we will share why patient advocacy groups are an important ally for both patients and rare disease companies, and how they can successfully work together to introduce new treatments to the market.