October / November 2016 by Healthcare Sales and Marketing Magazine

™ OCTOBER/NOVEMBER 2016

the publication for healthcare sales & marketing leaders™

WHO MADE THE TOP 100 PHARMA, DEVICE & BIOTECH CLUB? IN THIS ISSUE

HEALTHCARE COMPANIES

The Risk that GSK Took Roundtable: Devices and Diagnostics How HCPs See Us Shh! The Benefits of Social Listening A Global Leader on Culture Change Keeping Biopharma Innovative And more!

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TABLE OF CONTENTS Publisher’s Letter..............................................................................................................................................4 Editor’s Letter.....................................................................................................................................................5 Editorial Board....................................................................................................................................................7

ARTICLES Executive Spotlight: GSK’s Deborah Waterhouse.................................................................................9 Roundtable: Devices and Diagnostics...................................................................................................... 13 The Top 100 Healthcare Companies........................................................................................................ 23 The Doctor Will See You Now.................................................................................................................... 29 Great Minds: Keith Ferrazzi on Culture Change................................................................................... 35 Case Studies in Social Media Listening................................................................................................... 39 By The Numbers.............................................................................................................................................. 47 Motivideos........................................................................................................................................................ 53 Keeping Biopharma Innovative.................................................................................................................. 57

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Publisher’s Letter

What Just Happened? Healthcare Sales & Marketing has been dedicated to providing you with the best in industry information, studies, marketing and sales case histories, and advice from the leaders in our industry.

CARI KRAFT

One other thing we’ve done—which hasn’t been as obvious—is feature late-breaking news about what just happened. If you look at the tabs to the left, you’ll see three for People, Products and Progress, which will take you to the hot stories of the moment. This is updated continuously throughout the day.

Now, to bridge the gap between these two services, HS&M is publishing a twice-monthly newsletter. It will provide you with headlines and details about the most important developments from our news feed. All you have to do to access this is click the link here. Who just got appointed CEO of a major company? What merger happened that will change things in your sector? Which bio company got acquired? What new product is coming out in competition with yours? What regulations will make things different this year? We’ll be sifting through the avalanche of stories to bring you the ones likely to have the most telling effect on what we do. And we welcome your feedback—because HS&M has always been focused on responding to reader input and requests. So let us know what you think—of the magazine, of the newsletter, and about what you want to see us cover. As you know, our content is primarily from your peers, so we’re always looking for a few good contributors to share their expertise and in-depth knowledge. HS&M is your source, now with even more coming your way. And always, please keep the feedback coming. It all goes to making the magazine better for all of us.

Cari Kraft, Publisher

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HS&M OCTOBER/NOVEMBER 2016 | 4

Letter from the Editor

Upturn? Downturn? The Usual? We keep talking about the good times coming to an end, what with the cost of drug development reaching untold heights, the patent cliff on the horizon, the regulatory climate getting tougher, HCPs being more difficult to reach, patients becoming more demanding, our image sinking by the day, and… Hold on there a second. Let’s flip the script a little and look at the other side. The health of this country, and in fact the global population, is steadily getting better. True, lifestyle-related diseases like obesity and diabetes are on the increase, but other conditions have come under control or been eradicated. And every time we hear of an impending disaster – swine flu, avian flu, Zika virus – it turns out that the hardworking scientists, governments and organizations mobilized against it manage to head off the worst and keep it contained. NEIL GREENBERG

And while everything from Brexit to the U.S. presidential race has investors tied up in knots, our industry is growing in revenues and leading all others in profits (see By the Numbers). Let’s look at the long-term boom happening amidst all the short-term doom. Evaluate Pharma’s World Preview indicates that Roche’s first-in-class treatment for bladder cancer, Tecentriq, could be one of the best-selling drugs in the next few years; biotech advancements at Celgene and Shire (which recently acquired Baxalta) are promising; R&D productivity gains have resulted in more treatments getting fast-tracked recently, with 56 products approved in 2015; the oncology sector is expected to roll up a CAGR of almost 13% over the next several years; and there is no therapy area forecast to see a decline in sales. The health industry is a healthy industry. It’s the one people depend on the most. We’ll know what these times are like only in hindsight. In the meantime, let’s keep doing our best to serve our patients, and let the numbers take care of themselves. As always, we continue to look for the value of your contributions. Let us know if you have an idea for an article—the people we write for are the people who write for us.

Neil Greenberg, Editor To become an HS&M contributing author or provide feedback, please email me at ngreenberg@hsandm.com.

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Editorial Board

the publication for healthcare sales & marketing leaders™

Publisher Cari Kraft Editor Neil Greenberg Creative Director Hedy Sirico Digital News Rick Cataldo Digital News Chris Manning Sales Director Andrew McSherry EDITORIAL BOARD: Kristen Sharron-Albright Head of Marketing at Noven Pharmaceuticals Chris Bergstrom Associate Director, Digital Health Expert at Boston Consulting Group Sebastian “Sebby” Borriello Vice President, Chief Commercial Officer SK Life Science Lewis Chapman Vice President, Global Commercial Operations AllCells, LLC Maria Finlay, MBA Associate Director of Oncology Marketing, Teva Oncology Nick Gurreri Vice President New Products at Alexion Pharmaceuticals, Inc. Bob Roda VP and General Manager at BD © 2016 CL Media Inc., Philadelphia, PA CL Media is not responsible for any unsolicited contributions of any type. Unless otherwise agreed in writing, CL Media retains all rights on material published in HS&M for a period of one year after publication and reprint rights after that period expires. Email ckraft@hsandm.com.

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Chris Bergstrom Associate Director, Digital Health Expert at Boston Consulting Group Chris Bergstrom brings executive experience across biopharma, medical device, diagnostics, and digital health. Currently he serves as the Associate Director, Digital Health Expert at The Boston Consulting Group (BCG). Prior to that Chris was the former Chief Commercial Officer at WellDoc, a digital health pioneer and maker of the world’s first Mobile Prescription Therapy. He also held progressive positions at P&G, Roche, and BD and serves as an advisor to the CEOs of several digital health companies and a $5B charitable trust. Chris holds a Bachelor of Science degree from the Kelley School of Business at Indiana University and earned his MBA from Columbia University.

Sebastian “Sebby” Borriello Vice President, Chief Commercial Officer SK Life Science Sebby is currently service as the Vice President, Chief Commercial Officer at SK Life Science. Sebby’s career has included executive sales and marketing positions at Cempra, Mentor Worldwide LLC, Johnson & Johnson Healthcare Systems Inc., Ethicon, Inc. and OrthoMcNeil Pharmaceuticals, Inc. Sebby received his B.A. in Public Administration from St. John’s University in ‘81, and received his M.S. in Organizational Dynamics from the University of Pennsylvania in 2001.

Maria Finlay, MBA Associate Director of Oncology Marketing, Teva Oncology Maria has over 20 years of commercial marketing, sales leadership and operations experience. She has led multiple sales, women’s leadership, and cross-functional teams at Johnson and Johnson, AstraZeneca, and Teva Oncology. Maria has experience collaborating to launch and grow small and large molecule products across seven different specialty therapeutic areas.

Bob Roda

Editorial Board

VP and General Manager at BD Bob Roda is a Senior Commercial executive with extensive experience in delivering business growth and profit in the Medical Tech and Diagnostics Industries. He currently serves as VP and General Manager at Becton Dickinson where he is responsible for the global infusion therapy business. Prior to his role at BD, Bob held a variety of roles of increasing commercial responsibility within the MD&D sector at Johnson & Johnson. His diverse background included positions in Sales and Marketing at Johnson & Johnson Medical, Inc, Ethicon, Inc and Ortho-Clinical Diagnostics. While at J&J, Bob also served as the Executive Sponsor of the Commercial Leadership Development Program as well as the Chair of the VP Marketing Council for all of MD&D. He has a proven track record of delivering results and leading teams in competitive and diverse business environments. Bob is a highly respected and successful global leader. Bob holds a Bachelor of Arts degree in Economics from the University of Rhode Island.

Lewis Chapman Vice President, Global Commercial Operations, AllCells, LLC Lewis Chapman is currently the Vice President, Global Operations at AllCells, LLC.Â He has spent over thirty years in health care management. He served as VP of Global Strategic Marketing at BioMarin Pharmaceutical from 2007 to 2012, where he was responsible for strategic marketing and product portfolio analyses, and implemented medical education, brand enhancement and sales support programs on a worldwide basis. He oversaw the global launch of Kuvan, which in the U.S. was 112% to budget in 2008, the first year on the market.Â Previously, he worked with Alpha Inntech Corporation as Vice President Global Sales and Marketing, where global sales grew 26% in 2004 and 22% in 2005 under his leadership. Lewis started his career with Eli Lilly & Company, with roles at Syntex and Genentech, where he was responsible for the global commercial launch of Activase (t-PA), the largest biopharm product launch in the history of the industry up to that time (first year sales $187 million).

Nick Gurreri Vice President New Products, Alexion Pharmaceuticals, Inc. Nick Gurreri is a business leader and General Manager with over 25 years of consistently achievinghigh performance and profitability through strong leadership and cohesive team building in the biopharmaceutical and medical device industries. Nick has held executive positions at Medgenics, Insmed, Pfizer, Pharmacia and Bristol-Myers Squibb. Nick received a BS in Mechanical Engineeringfrom the University of Delaware, and also acquired a Master of Science in Information Assurance at Carnegie Mellon University.

Kristen Sharron-Albright Head of Marketing, Noven Pharmaceuticals Kristen Sharron-Albright, the current Head of Marketing at Noven Pharmaceuticals, was until recently VP Sales and Marketing, Anti-Infective Marketing and Institutional Sales Specialty Care Business Unit at Pfizer. She is an experienced business leader with 20 years of experience in the pharmaceutical and biotechnology industries. She has a strong track record of delivering results in highly competitive and complex markets. Starting her career in sales at Eli Lilly, she then held positions of increasing responsibility at Lilly, Neurogen, and Pfizer, where she was responsible for sales and marketing in a franchise business model. In her spare time she volunteers, serves on the leadership committee for her church, and enjoys hiking.

HS&M OCTOBER/NOVEMBER 2016 | 8

EXECUTIVE LEADERS

GSK Takes an Important—and Successful—Risk Changing your sales and marketing approach can pay off By Deborah Waterhouse, SVP and Business Unit Head Primary Care, US, GSK

Change, although a constant, is still a difficult and anxious process for a company to go through, all the moreso if you’re a major pharmaceutical enterprise. It takes effort, detail orientation, wisdom and more than a little luck to turn around a ship the size of GSK. Yet we did that, and the results bore out our strategy. GSK decided to change how we approach trust within the industry. The removal of sales force incentives based on sales in an individual’s territory and HCP payments, along with data transparency, are all part of a new operational model focused on putting the patient of the heart of everything we do. In general, this is a concept nearly everyone can sign onto. But what does that look like on a daily basis, and how do you ensure that your culture backs up your promise? I am in charge of the respiratory and diabetes business units for

GSK US. I also run strategy planning and operations for the whole GSK US pharma operation. On my way to this position, I made sure to gain experience in all the major areas of the business, so I knew what the hurdles and goals looked like. I worked in HR, R&D, sales and marketing. It gave me an ideal background for bringing together all these elements for my current position. To put the act behind the words about patient dedication, we had to be willing to take some radical steps to demonstrate that this is absolutely what we meant and is reflected in what we did. Part of

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this is a determination to listen and correct. Alter how we operate commercially and clinically. Be transparent about what clinical studies tell us. The question hanging in the air, of course, is can you do good and do well at the same time? Serve aspirational goals and the bottom line? We wanted to be sure we were building a strong, trust-based relationship with patients and physicians, and we didn’t want the physician/patient relationship to be inappropriately influenced by anything we do. Creating real change in any organization requires two key elements:

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HOW ARE YOU DOING $ALARY-WISE? We know this is a question most people ask themselves all the time, and we’re happy to provide you an answer by participating in our 2016 Compensation and Hiring Survey. PARTICIPATE IN OUR 2016 COMPENSATION AND HIRING SURVEY HERE We are pleased to open our yearly survey where we poll key people in the medical device, pharmaceutical, and biotech sectors of the industry to determine compensation trends. The survey is completed in conjunction with Jacobs Management Group, Inc., a leader in executive search for the healthcare industry and all participants receive a survey summary so that you can see how you compare. Please click here to be taken directly to the five-minute survey. The 2016 Compensation and Hiring Survey builds on the feedback from 2015 Survey, highlights of which were published in the JANUARY/FEBRUARY 2016

issue of HS&M. Companies ranged in size from over $100B to over $10M, and over 80% of the respondents had titles of manager or above. “We continue to receive accolades for this targeted industry report” says Jacobs Management Group, Inc. President, Cari Kraft. “Our results have become one of the key inputs into compensation benchmarks.” All specific survey information and your contact information will be held in strictest confidence. We will email you with the results as soon as they are published.

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EXECUTIVE LEADERS thoughtful and thorough planning, and buy-in from your people.  When we set about reimagining our incentive program, we were creative and detailed in our approach. We created a complex program with several items: scientific knowledge, selling skills, various empirical assessments. But, despite the best of intentions, we missed the mark.  The program was too complex.  How did we know this?  Our sales professionals let us know!  They did not understand what they needed to do to be successful, and they told us so. Some felt it took away their competitive edge. So we sought feedback to course correct. In this case, our planning was careful and disciplined, but the real key to our eventual success was listening to our employees.  In other words, creating and protect-

ing that open feedback loop is part of the disciplined process that brings about results.  Instead of digging our heels in and enforcing a policy that was not well understood, we developed a simpler system that is directly connected to the quality and effectiveness of conversations. How could we make it as simple and engaging and patient-centric as it needed to be, and still motivate the sales force? The basic job of a sales professional is to educate physicians on your medicines. So we decided to pay a bonus to differentiate those who are the top performers in that area. In other words, they were paid on scientific knowledge and the quality of calls that they deliver. The calls are judged on whether a physician is able to to understand the benefits and risks of the GSK medicine for

the right patient. Managers ride along with the sales people and observe and coach and give feedback. The basic measure is the quality of dialogue. The results speak for themselves, and I believe that our ability to demonstrate openness and commitment to our sales force encouraged them to stick with us and trust the new program.  In a 2015 employee survey, 75% of respondents agreed that our US pharma organization is making the changes necessary to compete and 81% said they were proud to work for GSK. We attribute this success to have an active feedback loop where employees know that they will be heard. The other initiative was to stop paying HCPs to speak for us. As a patient, you want to know that your doctor has all the informa-

Deborah Waterhouse talks about change at eyeforpharma Philadelphia 2016

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tion needed to decide what the right medicine is for you. But you might not be so comfortable if you knew that the HCP had spoken for financial reimbursement in support of that medication. The solution was to have physicians employed within GSK talk to healthcare professionals. We have global and local medical experts, professionals involved in academic research. There’s a multi-layered medical organization inside GSK. The volume of interactions at faceto-face meetings has remained the same, but the nature of the speakers has changed. They’re now all GSK employees. Again, we have to look at the results to judge success. Our market research shows that the quality and impact of these interactions are similar to the external speakers we used to use. We are also invested heavily in multi-channel interaction. We don’t always want to push information out, but create a tailored menu of opportunities that allow our customers to interact with us when they want to: webinars, video and educational materials, click-to-chat with medical staff. For all of the interactions we have internally, we ask one vital question: if the patient were in the room with us now, what would they think? Now to the metrics. In our 1Q 2016 report, we saw an 8% increase in revenue and earnings per share. There was also a large increase in the trajectory of launch brands. A larger proportion of revenue is now coming from new products than at any other pharma company. That trend continued in Q2 2016. It won’t be a surprise to you that this has been very

positively received by both analysts and shareholders. At the heart of the commercial model change, we wanted to make sure that GSK was building a strong, trust-based relationship between the company, patients and physicians. We looked at our way of operating through this lens and realized that—despite the risks involved in pursuing unprecedented changes—the long-term risks to our business were even greater if we did not take urgent steps to protect this relationship. Reshaping a company is excruciatingly hard work, and there are

many challenges and learnings along the way. The need for simple processes and a means for internal feedback are best practices we applied when implementing how we incentivize our sales people and interact with healthcare professionals. I’m pleased to report that this was well executed and well accepted. When you make a major change, you will naturally face resistance and skepticism from people who were used to “the way it was.” But if you follow the process with deliberation and a strong feedback process, your odds of success are enormous. •

Deborah Waterhouse SVP and Business Unit Head Primary Care, US, GSK Deborah is a business leader who has managed P&Ls across multiple geographies (both developed and developing) with extensive Government Relations experience. Her positions at GSK have included SVP and Business Unit Head US Vaccines, SVP and Regional Head Central and Eastern Europe, and VP and Country Manager Australia and New Zealand. She has been a strong leader, working across many cultures, with a track record of developing clear strategies, strong alignment and excellent execution driving shareholder and customer value. Her extensive M&A experience includes a key role in acquiring and integrating Novartis Vaccines. Deborah is passionate about working in healthcare and motivated every day by the opportunity to serve customers and make a difference to patients. GSK is a science-led global healthcare company that does research and develops a broad range of innovative products in three primary areas of Pharmaceuticals, Vaccines and Consumer Healthcare. It has a significant global presence, with commercial operations in more than 150 countries, a network of 89 manufacturing sites, and large R&D centers in the UK, USA, Belgium and China.

COMMENT HS&M OCTOBER/NOVEMBER 2016 | 12

ROUNDTABLE

THE CHALLENGES OF DEVICES AND DIAGNOSTICS With moderator NEIL GREENBERG, Editor, Healthcare Sales & Marketing

Our panel of experts: CHRISTIE BLAKELY

We see a lot of coverage in the press about the “pharma” industry and its challenges and image. What this typically means is pharmaceutical and biopharm companies. But the hurdles faced by both the devices and diagnostics sectors are equally daunting. In our very first issue, we convened a panel on devices. Here we invite back a few of the participants in that roundtable— Messrs. Shapiro and Halvorson—and a few others to discuss what’s happening in both devices and diagnostics. What we find is that there are issues similar to what the rest of the industry faces (regulation, new marketing channels) and others unique to these sectors. Our gratitude to all our experts for their detailed and enlightening contributions. Read on! Where are you now, and why did you make a move from your previous position? Eric Shapiro: When Given Imaging was bought by Covidien and Covidien was bought by Medtronic, I had an opportunity to look for something else. I was supportive of medical devices, but biotech fascinated me as the next frontier of medicine. 13 | HS&M OCTOBER/NOVEMBER 2016

Vice President of Marketing, Sports Medicine and Surgical Specialties RTI Surgical

ERIC HALVORSON President of the Americas Comeg Medical Technologies

WALLY HADDICK V.P. of Sales, Canada and Latin America DeVilbiss Healthcare LLC

DAVE SAUNDERS Senior VP, Product Development Galen Robotics

ERIC SHAPIRO Vice President, Global Marketing Luminex Corporation

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ROUNDTABLE Luminex helps decode data at the cellular level, and we partner with other companies in the industry to make a difference in healthcare. The transition was not easy. Biotech is a fairly exclusive club that wants to attract people who can hit the ground running. Wally Haddick: After spending almost 14 years at Covidien in various sales and marketing leadership roles, I completed my MBA at the Columbia Business School executive program. That milestone sparked me to follow a dream to work for a private equity (PE) portfolio, medical device company. High risk; high reward. After joining the DeVilbiss Healthcare leadership team in May 2010, Drive Medical acquired the company in July 2015 from Vestar Capital Partners. The acquisition completed a PE portfolio exit and created an opportunity to lead the Latin American Division for one of the fastest growing durable medical equipment businesses that markets and distributes its products globally. Eric Halvorson: Comeg is a leading endoscopy company in Europe, and we are expanding into the US. The endoscopy market is a growth area in healthcare. Procedures are transitioning from hospitals to ASCs to offices due to technology improvements and reimbursement challenges for the patients. How does what you are doing now compare to what you were doing then? Wally Haddick: Previously, I have been operating in more mature

or developed markets. In Latin America, covering two continents and more than thirty countries, you have numerous unique emerging markets with varying currencies, economic and political environments, and various states of payer influence. What is the same is the expectation of the end customers seeking maximum value from their partners. Eric Halvorson: As President of the Americas, I am building a quality brand and first class team. We are establishing our base of KOLs, and offering the customer a unique value proposition which takes into account the ever expanding financial challenges of our healthcare system. Eric Shapiro: I was leading regional marketing at Given Imaging. Now at Luminex I’m leading global marketing. In some ways they are very similar. I began my career carrying a bag in pharmaceutical sales, and I’m still focused on keeping the customer first and foremost in my mind. The customers have changed a bit. As a regional marketing leader I had two groups of customers, the sales force, and healthcare practitioners and their patients. As a global leader I still have all of these, but I also work further upstream, in strategy, from product ideation through commercialization, and have to make sure that my regional marketing teams are well prepared to help their customers. What challenges is your company facing at the moment? Christie Blakely: Currently my company is facing challenges similar to most companies in the medical device space. These include navigating the ever changing

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product reimbursement landscape, understanding changes in how procedures are being paid, and expanding our messaging to include a highly varied external stakeholder group that extends beyond the surgeon as the traditional sole decision maker. Eric Halvorson: As a newer company in a competitive space, we are building a base of COE and KOLS. Our technology is developed in Germany and France, and building our brand is the first goal. We’re up against a few very large companies who have much more visibility. Our technology has been wellproven over time but not used in the U.S. So we have to work hard and fast to build a brand name, get our products in front of surgeons, and highlight our advantages. Dave Saunders: A sizable challenge is continually advancing our core technology as a surgical robotics platform while keeping pace with increasing demands for supporting features. A few examples of such capabilities: integration with the hospital’s electronic health record system, remote monitoring and service, the ability to review surgical plans on a computer or tablet prior to the procedure and even interoperability with other medical devices. These capabilities affect how our core technology functions (although not directly), how our customers can interact with our core technology, and the ease of integration into hospitals expanding their own use of information technology to provide better patient care. Eric Shapiro: One of our challenges is that the space is evolving so rapidly. Information emerges every day that highlights something new, including major breakthroughs

that are happening at the cellular level. Consolidation is occurring because the cost of development is so high. It’s impossible to develop tests internally for every target that is identified, so we have to maintain an understanding of priorities in the marketplace, and how to execute and commercialize products. To be competitive you need to have multiple assays, yet it’s prohibitively expensive for small companies to develop and bring more than one assay to the market at a time. Smaller companies that are doing innovative work in focused areas are being acquired by larger companies that are looking to grow in these targeted areas. Wally Haddick: The biggest challenge for us is the same since the beginning of time for any sales or marketing executive, “How do you add value beyond price?” Value is the quotient of “perceived benefits received” in the numerator and “price paid” in the denominator. It is always easier to “see” the price paid and thus making it smaller is always the focus in most markets. Our role is to make sure that the benefits received are as clear and impactful as possible. I’ve seen that done well and poorly in operating room surgical markets and I see it the same way in emerging markets seeking respiratory and durable medical equipment. How are you applying what you have learned from the device world to these challenges? Wally Haddick: Insights still rule the day. Do you know what your key product and customer insights are? And how effectively do we communicate about both daily? Matthew Dixon and Brent Adamson call it “commercial teaching”

REIMBURSEMENT VISIBILITY ADVANCING TECHNOLOGY

DEVELOPMENT COSTS

in their book The Challenger Sale. They define it as “reframing the way the customer assigns value to the areas where you outperform your competitors.” Again, the easiest conversation you can have with any partner is on price. It is easy to measure.

with KOLs is the foundation that is most often needed. This is what we are doing. We have brought on great people, experienced, with the same values and a successful track record. We also have KOLs from multiple specialties. Surgeons rely on colleagues.

Dixon and Adamson note four important things that your (sales) teaching must do: 1) Lead to Your Unique Strengths; 2) Challenge Customers’ Assumptions; 3) Catalyze Action; and 4) Scale Across Customers. Most organizations have infrastructure and awareness in place to do most of the four. In my experience, “challenging the customers’ assumptions” takes the most preparation with great insights from across the organization and it takes the most skill to move away from price and engage the customer in a meaningful dialogue.

How will the challenges affect your mission?

Eric Halvorson: I have had the opportunity to build medical device businesses in the past. Establishing a great team and aligning

Eric Shapiro: Our job is to empower the healthcare practitioners who are treating, managing and/ or curing patients. This is what marketing is concerned with— helping the physician, lab tech, or lab director solve problems in a cost-effective manner. Eric Halvorson: As a smaller company, we are fast, nimble and flexible. We are able to service our customers with little red tape, and adapt to the changing market demands very quickly. Speed, from product development to marketplace: speed in responding to customers’ needs, speed in decision making. Speed is our weapon.

HS&M OCTOBER/NOVEMBER 2016 | 16

ROUNDTABLE Dave Saunders: Keeping abreast of these changes requires dedicated monitoring of the ever-changing ecosystem of modern hospital IT infrastructure. Generally speaking, these include hospital security for the patient; analytics to measure doctor performance, training, and simulation; claims analysis; and development of best practices. Christie Blakely: I don’t think these challenges affect our mission: RTI Surgical promotes a higher standard of patient care and creates value by leveraging employee talents to develop the highest quality surgical solutions. No matter what environment we operate within, our company will stand true to this mission as we all firmly believe in the value of excellent patient care and encouraging employees to understand and utilize their talents for growth. What new strategies have you needed to employ to move forward? Eric Halvorson: Focusing the team and then being prepared to pivot when new opportunities present themselves. We’re able to adapt to customer needs quickly. Having a flatter organization allows us to make decisions quickly. This requires hiring experienced people and giving them a lot of flexibility. We also have unique features that were developed to make it easier for surgeons, nurses and technicians. This is perfectly suited to the needs of the customers, in terms of usability and affordability. We’ve very deliberately not over-engineered it with lots of capabilities that will rarely if ever be used. The software is intuitive: each surgeon can swipe a

card before the operation and the equipment automatically re-sets to that physician’s needs and the operation being performed. It’s a breakthrough. So the strategy is basically getting it in front of right people. Eric Shapiro: We highly leverage a stage gate process as we take our products from ideation through evaluation to feasibility, and development. Getting the information needed to make the best-informed decisions at each gate is critical. Every gate increases the cost by factors. We delve into the questions. Is there really an unmet need? How big is it? If we came up with a solution could we make a difference in a customer’s life? By the time we launch it 2-3 years later, will it still be relevant? The stage gate process applies to both devices and diagnostics. Diagnostics, however, requires expertise about a wider swath of diseases, so our team has to have a wider breadth and greater depth. Christie Blakely: Going forward I think companies really need to figure out a way to be heard given all the “noise” of social media and the internet. Technology is such that companies know every item we’ve browsed on Amazon yet the personal connection, human to human, is lost. Medical device is moving toward a more nonpersonal connection but I truly believe the company that maintains solid personal relationships with our customers (while leveraging the benefits of technology) will realize sustainable growth in their space. So while we’re all more connected than we’ve ever been, we also are losing one of the most important connections of all, and that is the human relationship. Wally Haddick: The strategies are

17 | HS&M OCTOBER/NOVEMBER 2016

not new as much as process refinement. Drive DeVilbiss is one of the fastest growing durable medical equipment businesses that markets and distributes its products globally. We have been busy with organic growth, acquisitions and integration. To move forward, we have needed to understand the unique benefits on our broad portfolio where we “win” versus the competition. Further, it takes a lot of work and focus to enrich the story when “challenging the customers” assumptions during prospecting and negotiations. Dave Saunders: In a heavily regulated industry, technology often moves faster than the code of federal regulations it adheres to. This affects IT integration, cybersecurity issues, and the application of new artificial intelligence and neural net technologies. Collectively, these may greatly impact medical device usage and application as well as research on new medical treatments and disease causes. We will continue to seek innovative ways of applying new technologies to our platform while at the same time managing the risk of having to push too hard for regulatory approval. What does your company have to do to address these in terms of adjusting sales techniques? Christie Blakely: Our company is constantly adjusting sales techniques to best fit the need of the individual customer. For some customers, that means a highly individualized relationship and approach. For others, that means participating in a purchasing agreement as part of a national GPO. What we do know for sure is that techniques are not a one size fits all. Understanding customer needs

and priorities and then delivering a product or service in a highly engaging way that builds trust and connection will ensure loyalty. Eric Shapiro: We train the sales force on some very specific scientific information, which is very challenging. A diagnostic rep may have a biology undergraduate or graduate background yet still have to present in a way that resonates with the customer, while telling a compelling story. One other thing that remains critical is understanding what makes our offering unique from the customer’s perspective. How do we communicate why the customer should want to work with us and our technology? Eric Halvorson: Creativity is very important to our organization. We will not follow the same path as the other players, we are looking for differentiated people, products, Services, and process to better serve our customers. Dave Saunders: Our company is still in the preclearance stage for our surgical robotics platform, which gives us the advantage of not needing to make changes to our existing sales force when we are ready to go to market. When we are ready to go to market, we will equip our sales team with an updated playbook. Wally Haddick: When we did our work years ago improving our product launch process at a prior company, we saw one of the biggest issues was a linear process from customer requirements to the eventual commercial launch. There were hand-offs from one stage to the next and one department to the next. The institutional learning about the customer experience was lost in these transitions. The most important organizational need is

to ensure “swim lanes” vs. “silos” within key departments during product and market reviews. Insights are not exclusive to marketing. When researching, developing, and putting the message into practice, all shareholders need to talk and at all stages of the product lifecycle. What do you have to do to address the challenges in terms of marketing? Christie Blakely: From a marketing perspective it is becoming more and more about delivering value and enhanced patient outcomes than anything else. Surgeons and facilities are being assessed more critically than ever, and if a company cannot provide savings AND a product that performs consistently, then they will not be successful. So for marketing, we have to define and articulate a solid value proposition backed with clinical data. Period. Eric Halvorson: Guerilla marketing. You will not see us advertising in the major journals. You will see and hear about us through social media, KOLs, and MD to MD.

Eric Shapiro: I went to a course a few weeks ago on biotech for managers, and the things that are being learned at the cellular level can give you incredible information that was unimaginable just a few years ago. In the past the industry was much more focused on addressing a specific targeted disease. Now we have multiple tests that span a wide variety of syndromes. The pace of innovation we have to work with in the diagnostic space feels much more rapid than when I was in devices. But marketing is still marketing. It’s about identifying the unmet need, and prioritizing that versus other unmet needs, then building a compelling business case with an understanding of the opportunity relative to the total available market. Wally Haddick: Dixon and Adamson note that 80% of marketing collateral winds up in the trash and 30% of sales time is spent reproducing the collateral! I remember one call to a doctor as an inexperienced pharmaceutical sales person. I was giving my pitch and handing the collateral over

Moving Forward R&D INVESTMENT

EDUCATION

PARTNERING

NOVEL CONTRACTS

HS&M OCTOBER/NOVEMBER 2016 | 18

ROUNDTABLE for each product I was detailing. As I was doing this, the physician was multi-tasking. As I handed him the sales brochures, he would grab them without looking and without missing a beat put them right behind him into the garbage can. Now, that’s not a marketing problem, but it does underscore how important it is to “grab mind share” and “catalyze action.” Listening and collaboration are important. One former president I worked under would say that interdepartmental meetings are like a sideline offensive meeting in football on third and long. The Head Coach, QB, Offensive Coordinator and others will provide their insights, input, and recommendations, but when the timeout is over, the QB runs to the huddle, calls the play, and everyone is on board supporting getting the first down. No dissension. Great teams debate vigorously then unite indefatigably. What are the impediments to growth? Eric Halvorson: How fast can we run? The market is looking for our solution. Dave Saunders: When developing software capabilities for a medical device, acquiring regulatory clearance sometime comes one piece at a time, slowing our ability to bring cutting-edge capabilities to market. With good project management, accounting for those individual steps in advance, the regulatory impact on time-tomarket should be manageable.

Eric Shapiro: The R&D costs are significant. Our clinical studies are extremely robust and very expensive, because you may have to run a panel of twenty targets, and for every target you have to validate that your test is detecting what it’s supposed to detect. Luminex is well respected and has been an innovator for a long time, but with technology evolving, we will need to continue to invest to stay on the cutting edge in our industry. Christie Blakely: I would summarize impediments to growth in five key areas: 1) regulatory requirements globally; 2) decreasing pricing due to new bundled payment models enacted by CMS and private payers; 3) timely execution of and financial funding for clinical studies; 4) navigating MACRA and adjusting strategies to truly meet the needs of the customer; and 5) the extensive timeline for value analysis committee review for new products/technologies to be approved within a certain facility or health system. Wally Haddick: With more than thirty countries in emerging markets, the biggest impediment is regulatory and compliance planning. Drive DeVilbiss has been busy with acquisitions and integration recently and operates in more than 80 countries globally. It is important to have the discipline and focus to sit without partners and plan strategically beyond the current fiscal year. What is your competitive situation? Eric Halvorson: We are in a very competitive space with large multinational companies. Without

19 | HS&M OCTOBER/NOVEMBER 2016

risking telling them what we are doing, I will say we offer the customer what they need, when they need it. Christie Blakely: Many of the large orthopedic companies are developing entirely new business units to address the CCJR bundled payments initiative. Other companies are expanding their education footprint in order to continue to deliver more personal customer/ company interactions. All companies are funneling more and more dollars into supporting clinical studies, as this is a requirement of value analysis committees as they determine whether or not to allow a new product or technology to come into their facility. Lastly, companies are investing more time and energy on GPO and IDN agreements as participation in these define a company’s ability to access surgeon customers within a single facility. Dave Saunders: Now, with a general acceptance and customer demand for surgical robots, the industry is moving towards adapting more capabilities of the computer systems to do things a surgeon on their own cannot do, or that only the very top practitioners are capable of. We see a lot of interest in greater simulation and training, augmented reality, and even the incorporation of neural net technologies into our own surgical robotic platform. Merging a surgical robotics platform with a simulation and training platform improves education capabilities, extends the physical capabilities of some surgeons in the field, and has the potential to greatly advance the level of patient care possible throughout the entire hospital system. These technologies could also

improve patient care in developing countries and battlefield situations. Where do you see the industry a year from now? Five years? Wally Haddick: In the next four years, the World Bank expects the population of people over 65 years of age in Latin America and the Caribbean to grow by 18% (more than double the European Union at 7%). By 2024, the total number of people over 65 years old in Latin America (68.4MM) will surpass the total in the United States! We see partners in emerging markets winning because they are disrupting the payer side focusing on outcomes rather than resources and processes of old fee for service patient care as Clayton M. Christen detailed in The Innovator’s Prescription. The medical device market is deep into connectivity, patient data transparency, and providing value to decision makers as a unique benefit. Those healthcare companies who can continue to leverage their scale, broad product offerings, and innovative thinking will outpace market growth in the next five years. Eric Shapiro: Molecular diagnostics are growing rapidly. The overall market is expanding significantly. As our knowledge continues to grow, companies are continually figuring out how to detect more diseases. At the same time, we still don’t have accurate tests for many diseases, nor do we have the tools to knock them out. These have to be evolved. But we are doing more and more research to better identify at the molecular level what may be the source of many diseases. For example, look at Zika. The African strain was around for many years, but the South American strain evolved dif-

ferently, and had consequences not commonly seen with the African version, like microcephaly. Eric Halvorson: The surgeons are very interested in both the traditional outcomes of surgery and the patients’ satisfaction of their services. Cost to the patient is part of the changing dynamics, as the patient is being asked to pay higher deductibles. This drives new behaviors from the patients, who are now the consumers. I see this trend continuing, and the consumer becoming more savvy and educated in their choice of care. Dave Saunders: As a heavily regulated industry, technological availability will lag until someone has an incentive to push that technology into a device. The most promising of those technologies are providing AI assistance to the surgeon through 1) more autonomous movement of the robot (e.g. a recent animal study where a robot autonomously sutured two ends of a colon) or 2) by providing greater imaging capabilities and augmented reality. I see the potential for incorporating augmented reality and integrated heads-up displays into medical imaging systems (e.g., endoscope displays and microscopes) to improve the speed and efficacy of patient care. Neural net and artificial intelligence-based image recognition technologies enable medical professionals to identify relevant displayed information faster than on their own, allowing them to focus on delivering a high level of patient care. Right now hospital networks are busy coming to terms with advances in the IT infrastructure required to handle large patient loads, reduce readmissions and

errors, and still make a profit. The more ubiquitous these highly integrated hospital networks become, the more we should also see a demand for the Internet of Medical Things (comprising medical devices that can be monitored, data collected from, and automatically acted upon). No hospital will tolerate, in the long term, every medical device having its own app and obscure set-up overhead. Consequently, the Internet of Medical Things needs to be well-designed by every medical device company participating in it. Functionality must be more or less seamless and security, while no one should ever claim to be hacker-proof, should be top-of-mind for all companies and vulnerabilities should be constantly sought out, identified and mitigated as quickly as possible. Christie Blakely: I have been in medical device for 29 years and I have seen tremendous change throughout this period. Having said that, I do think we will see change within the next five years unlike anything we’ve seen in the last 20. Rapidly changing technology will lead this change. Patients will be connected to their providers, physicians will receive real time data on their patients through wearable or implantable technology, companies will continue to acquire and merge in order to deliver broader portfolios and savings to health systems, and patient outcomes will continue to be at the center of all we do. Having said that, and going back to a point I made earlier, it will be more important than ever to maintain personal relationships with our customers. There is nothing that will ever replace the importance of buying from someone you know and trust. •

HS&M OCTOBER/NOVEMBER 2016 | 20

ROUNDTABLE

MEET OUR PANEL OF EXPERTS

CHRISTIE BLAKELY

WALLY HADDICK

Vice President of Marketing, Sports Medicine and Surgical Specialties RTI Surgical

V.P. of Sales, Canada and Latin America DeVilbiss Healthcare LLC

Christie oversees all aspects of RTI’s marketing for the orthopedic, sports medicine, plastic and general surgery areas of the business. This includes developing strategic plans for the franchise and directing the priorities of product development. Prior to joining RTI, she spent more than five years at Zimmer Inc., including serving as director of relationship management and surgeon communications, director of U.S. regional marketing for hips, and director of global marketing for hips. Her experience also includes overseeing the hip portfolio at Exactech Inc., and sales and product management at Smith & Nephew. Christie received her BBA and MBA from the University of Memphis.

Wally is responsible for commercial operations and P&L for Canada and Latin America. Previously, he spent more than fourteen years at Covidien where served as product manager, sales vice president, and marketing vice president. He began his career in 1992 as a sales representative for Pfizer, Inc.

cblakely@rtix.com

RTI Surgical® is a leading global surgical implant company providing surgeons with safe biologic, metal and synthetic implants. Committed to delivering a higher standard, RTI’s implants are used in sports medicine, general surgery, spine, orthopedic, trauma and cardiothoracic procedures and are distributed in nearly 50 countries. RTI is headquartered in Alachua, Fla., and has four manufacturing facilities throughout the U.S. and Europe. RTI is accredited in the U.S. by the American Association of Tissue Banks and is a member of AdvaMed. 21 | HS&M OCTOBER/NOVEMBER 2016

Wally.haddick@gmail.com DeVilbiss Healthcare is a leader in the design, manufacture and marketing of respiratory medical products which are distributed in more than 100 countries around the world. DeVilbiss Healthcare is a privately held Limited Liability Company owned by Vestar Capital Partners. Vestar is a leading private equity firm specializing in middle-market growth capital investments.

ERIC HALVORSON President of the Americas Comeg Medical Technologies,

Eric leads Comeg’s novel visualization and surgical technologies expansion in the Americas. He has also served as VP and General Manager for Coloplast, as well as VP Interventional Respiratory and VP Chief Marketing Officer at Olympus. Eric held previous executive positions at Smith & Nephew and Boston Scientific. He is an experienced medical device leader with private and publicly traded companies, leading cross-functional teams with P&L responsi-

bilities, and a proven turnaround and growth expert, improving EBIT through reorganization, leadership, and developing a focused strategy. Eric has delivered strategically important acquisitions and managed integration of newly acquired companies. He is a past Board Member of Spiration and ASGE. Eric.W.Halvorson@gmail.com Comeg of the Americas is part of Sopro-Comeg, which was formed from the merger of Sopro, a wellknown company specializing in medical imaging, and Comeg, which since 1977 has been innovating in the world of endoscopy. The company has commercial offices on five continents. Its technologies are focused on improving procedural efficiency and patient outcomes in ENT, GYN, URO, and laparoscopic surgery.

DAVE SAUNDERS Senior VP of Product Development Galen Robotics

With nearly 30 years of professional experience with Internet technology and medical devices, Dave has brought over 40 innovative products from early development to market. Heâ&#x20AC;&#x2122;s the professional nerd on the executive team for Galen Robotics, which focuses on bringing new innovations to market from the top research groups and hospitals in the US. Dave assesses company assets, resources and intellectual property, and strategizes on the best approach in taking to market products that are meaningful to practitioners and patients. This includes rapid learning and assimilation of new technologies and techniques, development of business plans, system design and continued management of the IP portfolio. Prior to his position at Galen Robotics, Dave was VP of Product Development for Trak Surgical, VP Engineering, and was part of the R&D management team at Lucent Bell Labs.

ERIC SHAPIRO Vice President, Global Marketing Luminex Corporation

Eric provides leadership, best practices and execution guidance to the Global Marketing team responsible for the companyâ&#x20AC;&#x2122;s longterm strategy and all upstream marketing, along with support of regional downstream marketing efforts. Heâ&#x20AC;&#x2122;s also responsible for guiding and focusing efforts of Scientific Affairs, Creative Services, Digital User Experience, Trade Shows and Events, and Corporate Branding teams for this ~$250M biotech company. Previously, he was principal of ESS Strategic Consulting, VP Marketing for Given Imaging and held several positions at KCI Medical, including VP Marketing, VP Field Patient Coordination and Director, Corporate Development. eshapiro@luminexcorp.com Luminex is committed to creating innovative, breakthrough solutions to help its customers improve health and advance science worldwide. It serves the needs of customers in diverse markets, including clinical diagnostics, pharmaceutical drug discovery, biomedical research, including genomic and proteomic research, personalized medicine, biodefense research, and food safety. Its goal is to transform global healthcare and life science research through the development, manufacturing, and marketing of proprietary instruments and assays that deliver costeffective, rapid results to clinicians and researchers.

COMMENT

dave.saunders@galenrobotics.com Galen Robotics identifies optimal convergences of advanced technology and medical device concepts by bringing software-based navigation, imaging and data collection to existing, dumb medical devices. The company brings a fresh, Silicon Valley-based, entrepreneurial approach to creating medical device market opportunities, and applies its software expertise to making medical devices intelligent and more effective.

HS&M OCTOBER/NOVEMBER 2016 | 22

HEALTHCARE

CLICK HERE TO RECEIVE YOUR COPY OF THE TOP 100 HEALTHCARE COMPANIES

HEALTHCARE COMPANIES PHARMACEUTICAL, MEDICAL DEVICE, BIOTECHNOLOGY Itâ&#x20AC;&#x2122;s always a challenge, creating a single top 100 healthcare list from the Top 50 Pharmaceutical, Medical Device and Biotechnology companies, especially with some companies represented in more than one product category. But weâ&#x20AC;&#x2122;ve crunched the details, and here are the tallies. Pharmaceutical companies in the Top 100 continue to dominate in terms of revenue, representing 68% for a total $738B. And the good news is revenues are trending up, with 62% of their revenues increasing as compared with last year, when more than 50% of the revenue of their ranks declined year over year. All 16 of the biotechnology companies that made the top 100 list saw revenue growth, and more than 70% of the medical device companies saw a revenue increase.

23 | HS&M OCTOBER/NOVEMBER 2016

The Top 100 include 40 pharmaceutical companies, 44 medical device (medtech) companies, and 16 biotech companies. $76B in revenue came from 13 new companies to make the list, which included: Medipal Holdings, Alfresa Holdings, Baxalta, Zoetis, Perrigo, Sumitomo Dainippon Pharma, The Dental Solutions Company, Illumina, Novozymes, Teleflex, Bruker, and William Demant Group. Of the 13 new companies on the list, six moved in from pharma, five from medical device and two from biotech.

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HEALTHCARE COMPANIES

Companies are ranked by their 2015 revenue as furnished by their annual reports and publicly available sources, Edgar and Morningstar stock information websites (figures of non-U.S. companies were converted to U.S. dollars from various currencies using end of the year exchange rates for 2015 and 2014). CLICK HERE TO RECEIVE YOUR COPY OF THE TOP 100 HEALTHCARE COMPANIES

RANK COMPANY LOCATION

2015 REVENUE IN US$B

1 JOHNSON & JOHNSON

New Brunswick, NJ

$70.10

2 BAYER

Leverkusen, Germany

$50.31

3 NOVARTIS

Basel, Switzerland

$49.41

4 ROCHE HOLDING

Basel, Switzerland

$49.30

5 PFIZER

New York, NY

$48.90

6 SANOFI

Paris, France

$40.27

7 MERCK AND CO

Kenilworth, NJ

$39.50

8 GLAXOSMITHKLINE

Brentford, UK

$35.26

9 GILEAD SCIENCES

Foster City, CA

$32.64

10 ASTRA ZENECA

London, UK

$24.71

11 MEDIPAL HOLDINGS

Tokyo, Japan

$23.88

12 ABBVIE

North Chicago, IL

$22.86

13 AMGEN

Thousand Oaks, CA

$21.62

14 ABBOTT LABORATORIES

Chicago, IL

$20.40

15 MEDTRONIC

Dublin, Ireland

$20.26

16 ALFRESA HOLDINGS

Tokyo, Japan

$20.12

17 ELI LILLY

Indianapolis, IN

$19.96

18 TEVA PHARMACEUTICALS

Basel St.Petach Tikva, Israel

$19.65

19 GENERAL ELECTRIC

Fairfield, CT

$17.60

20 FRESENIUS MEDICAL CARE

Bad Homburg, Germany

$16.74

21 BRISTOL-MYERS SQUIBB

New York, NY

$16.56

22 NOVO NORDISK

BagsvÃ¦rd, Denmark

$16.40

23 BOEHRINGER INGELHEIM

Ingelheim, Germany

$16.08

24 ACTAVIS

Dublin, Ireland

$15.07

25 TAKEDA PHARMACEUTICALS

Osaka, Japan

$14.78

25 | HS&M OCTOBER/NOVEMBER 2016

NEW

HEALTHCARE COMPANIES

RANK COMPANY LOCATION

2015 REVENUE IN US$B

26 SIEMENS

Munich, Germany

$14.05

27 MERCK KGAA

Darmstadt, Germany

$13.96

28 RECKITT BENCKISER

Slough, United Kingdom

$13.08

29 OTSUKA PHARMACEUTICAL

Tokyo, Japan

$12.01

30 PHILIPS HEALTHCARE

Amsterdam, Netherlands

$11.84

31 ASTELLAS

Tokyo, Japan

$11.41

32 CARDINAL HEALTH

Dublin, OH

$11.40

33 BIOGEN

Cambridge, MAÂ

$10.76

34 VALEANT PHARMACEUTICALS

Laval, Canada

$10.45

35 BECTON DICKINSON

Franklin Lakes, NJ

$10.23

36 BAXTER

Deerfield, IL

$9.97

37 STRYKER

Kalamazoo, MI

$9.95

38 MYLAN

Canonsburg, PA

$9.43

39 CELGENE

Summit, NJ

$9.26

40 BOSTON SCIENTIFIC

Marlborough, MA

$8.07

41 ESSILOR

Charenton-le-Pont, France

$7.30

42 TEIJIN

Osaka, Japan

$6.57

43 SHIRE

Basingstoke, United Kingdom

$6.42

44 BAXALTA

Bannockburn, IL

$6.15

45 ZIMMER BIOMET

Warsaw, IN

$5.99

46 ST. JUDE MEDICAL

Saint Paul, MN

$5.54

47 CSL BEHRING

King of Prussia, PA

$5.46

48 3M

Saint Paul, MN

$5.42

49 CARL ZEISS

Oberkochen, Germany

$4.90

50 ZOETIS

Florham Park, NJ

$4.77

NEW

HS&M OCTOBER/NOVEMBER 2016 | 26

HEALTHCARE COMPANIES

RANK COMPANY LOCATION

2015 REVENUE IN US$B

51 OLYMPUS

Tokyo, Japan

$4.64

52 SMITH & NEPHEW

London, United Kingdom

$4.63

53 PERRIGO COMPANY

Dublin, Ireland

$4.60

54 EISAI

Tokyo, Japan

$4.55

55 GRIFOLS

Barcelona, Spain

$4.28

56 UCB

Brussels, Belgium

$4.21

57 SUN PHARMACEUTICAL

Mumbai, India

$4.14

58 CHUGAI PHARMACEUTICAL

Tokyo, Japan

$4.12

59 REGENERON PHARMACEUTICALS

Tarrytown, NY

$4.10

60 TERUMO MEDICAL

Tokyo, Japan

$4.07

61 GETINGE GROUP

Goteborg, Sweden

$3.58

62 MITSUBISHI TANABE PHARMA

Osaka, Japan

$3.45

63 TOSHIBA MEDICAL SYSTEMS

Tokyo, Japan

$3.43

64 C. R. BARD

Murray Hill, NJ

$3.41

65 SUMITOMO DAINIPPON PHARMA

Osaka, Japan

$3.35

66 ENDO INTERNATIONAL

Dublin, Ireland

$3.27

67 VARIAN MEDICAL SYSTEMS

Palo Alto, CA

$3.10

68 KYOWA HAKKO KIRIN

Tokyo, Japan

$3.02

69 DRAGER

Lubeck, Germany

$2.83

70 DANAHER

Washington, DC

$2.74

71 HOLOGIC

Bedford, MA

$2.71

72 NIPRO MEDICAL CORPORATION

Osaka, Japan

$2.70

73 THE DENTAL SOLUTIONS COMPANY York, PA

$2.67

74 ALEXION PHARMACEUTICALS

Cheshire, CT

$2.60

75 EDWARDS LIFESCIENCES

Irvine, CA

$2.50

27 | HS&M OCTOBER/NOVEMBER 2016

NEW

HEALTHCARE COMPANIES

RANK COMPANY LOCATION

2015 REVENUE IN US$B

76 INTUITIVE SURGICAL

Sunnyvale, CA

$2.38

77 ASPEN PHARMACARE

Durban, South Africa

$2.34

78 STADA ARZNEIMITTEL

BadVilbel, Germany

$2.30

79 SHIP HEALTHCARE HOLDINGS

Suita-Shi, Japan

$2.27

80 ILLUMINA

San Diego, CA

$2.22

81 HARTMANN

Frankfurt, Germany

$2.11

82 SONOVA

Staefa, Switzerland

$2.07

83 ACTELION PHARMACEUTICALS

Allschwil, Switzerland

$2.04

84 NOVOZYMES

Bagsvaerd, Denmark

$2.04

85 COLOPLAST

Humblebaek, Denmark

$2.02

86 HILL-ROM

Chicago, IL

$2.00

87 ACELITY

San Antonio, TX

$1.87

88 STERIS CORPORATION

Mentor, OH

$1.85

89 TELEFLEX

Wayne, NJ

$1.81

90 THE COOPER COMPANIES

Pleasanton, CA

$1.80

91 MIRACAHOLDINGS

Tokyo, Japan

$1.76

92 RESMED

San Diego, CA

$1.68

93 CONVATEC

Skillman, NJ

$1.65

94 BRUKER CORPORATION

Billerica, MA

$1.62

NEW

95 WILLIAM DEMANT GROUP

Smørum, Denmark

$1.55

NEW

96 IPSEN

LesUlis, France

$1.55

97 UNITED THERAPEUTICS

Silver Spring, MD

$1.47

98 NIHON KOHDEN

Tokyo, Japan

$1.34

99 JAZZ PHARMACEUTICALS

Dublin, Ireland

$1.32

100 ELEKTA

Stockholm, Sweden

$1.28

NEW

HS&M OCTOBER/NOVEMBER 2016 | 28

SALES

The Doctor Will See You Now Adapted from Healthcasts: Physician Voices 2016

How to get through? Ask doctors from Harvard Medical School, Mass General, Brigham and Women’s, and other major institutions. HOW DO PHYSICIANS PERCEIVE THE HEALTHCARE INDUSTRY?

Highlights from the video interviews

Healthcasts set out to learn what the industry can do to help physicians advance patient care. The Physician Voices 2016 survey collected insights from 342 physicians across a range of specialties that included oncology, cardiology, neurology, endocrinology, and primary care. Despite the recent turmoil over drug pricing practices, physicians have a more positive view of “Big Pharma” than the general public. They still see the industry as their true partners in patient care, and they want to enhance their relationships with pharma. In fact, 30% of Healthcasts member physicians said that the information they receive from industry to inform their treatment decisions is more useful than it was five years ago. Some commented that today’s increasingly data-driven environment necessitates more 29 | HS&M OCTOBER/NOVEMBER 2016

of an informational approach, and that the growing number of treatment options – particularly for rare conditions – calls for an expanding body of evidencebased information, especially as mechanisms of action and dosing schedules become more complex.

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Matt Lasmanis CIO and Vice President GLAXOSMITHKLINE

Craig Hashi Client Partner FACEBOOK

A SNAPSHOT OF OUR LARGEST EXPERT SPEAKING FACULTY YET: 2016 CONFERENCE CHAIRS:

SOCIAL/INNOVATION DAY LEADER:

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Pete Dannenfelser Social and Digital Communications Leader JOHNSON & JOHNSON MEDICAL DEVICES COMPANIES

Shwen Gwee Director, Digital Customer Insights, Digital Health Technologies and Data Sciences BIOGEN

Maria Goutsou Vice President, Ecosystem Engagement UCB PHARMA

Joe Shields Senior Director, Global Strategy and Program Management ASTRAZENECA

Elena Alikhachkina Worldwide Head Analytics Technology, Strategic Insights and Data Solutions JOHNSON & JOHNSON

Fred Bennett Executive Director, Multichannel Customer Marketing ALLERGAN

Dustin Haines Senior Director, U.S. Launch Lead VIIV HEALTHCARE

Catherine Wilson Digital Lead AMGEN

John Gallo Executive Director, Customer Strategy and Shared Services SUNOVION PHARMACEUTICALS

David Goren Vice President, Digital Health ASTRAZENECA

John Lineen Global Digital Director, Global Commercial Strategies and Platforms GLAXOSMITHKLINE

Marcello Damiani Senior Vice President and Chief Digital Officer MODERNA THERAPEUTICS

Al Altomari President and CEO AGILE THERAPEUTICS

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SALES “We need [the industry] to really address the issues that are pressing with regard to some of the epidemics such as heart disease, diabetes, hypertension, and increased [incidence of] disease in young individuals.” One oncologist appreciated “receiving more detail on the clinical trials related to the chemo agents now, compared to past years.” Other physicians noted that improvements in web-based technologies have increased the volume and frequency of more advanced and specific clinical trial data. Another oncologist said “The clinical trial data is now available online, whereas you used to have to wait for the meeting or the mail to get the information.” In many cases, physicians are clamoring for more interaction with pharma. “When I was training 25 years ago, we had a great relationship [with industry]. We often learned a great deal from the reps because they would bring in data that was fresh and new,” recalled Malissa Wood, MD, codirector of the Corrigan Women’s Heart Health Program at Massachusetts General Hospital and assistant professor of medicine at Harvard Medical School. “Because of a few bad apples, there was a heightened concern for conflicts of interest with the pharmaceutical

industry, leading to a very restrictive relationship with physicians and nurses. The pendulum needs to swing in the other direction because [pharma] needs us to give them guidance by thinking about new devices, new drugs, and new patient populations, and we need them to really address the issues that are pressing with regard to some of the epidemics such as heart disease, diabetes, hypertension, and increased [incidence of] disease in young individuals.”

“It’s very difficult to have any interaction with pharma anymore. There isn’t enough of it.” All of the KOLs interviewed hold high-level teaching positions at academic medical centers that have largely banned detailing by pharma sales reps. Some KOLs lament the loss of those relationships. “We miss that role in our academic centers of having the pharmaceutical team partners,” commented Matthew Powell, MD, director of the Division of Gynecologic Oncology at Washington University School of Medicine. “It’s very difficult to have any interaction with pharma anymore. There isn’t enough of it,” echoed Barbara Goff, MD, professor and director of the Gynecologic Oncology Division at the University of Washington. “We, to some extent, limit our ability to learn from pharma, but pharma has a lot to teach us.

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CONSTRAINTS ON PHYSICIANS’ DECISIONMAKING Many physicians feel their decision-making power has been constrained by payors and regulators. Thirty-nine percent of respondents indicated that it has become more difficult to make an independent, individualized treatment decision for their patients, compared to five years ago. When asked to specify the factors that impact their treatment decisions, 35% of respondents (including 42% of PCPs and 33% of specialists) said insurance companies exert the greatest influence because their reimbursement policies mandate use of certain therapies. “Managed care dictates what we use regardless of the message,” commented one PCP in the survey. The FDA emerged as the secondmost cited factor, due to the agency’s approval of drugs for narrow indications or specific lines of therapy. Such restrictions “make it impossible to get any more info than what is already on the package insert,” commented one oncologist. Additionally, physicians expressed frustration with communication barriers thrown up by FDA regulations. “Drug reps can only tell us what the FDA allows them to tell,” noted an endocrinologist. “Every word is vetted through the FDA,” echoed a PCP respondent, who mused that physicians “used to have some crosstalk between providers via the reps.” Compared to insurers and the FDA, pharma received less blame

Figure 1 for physicians’ feelings of marginalization. Only 10% of interviewed physicians cited pharma companies as a constraint for not releasing all of the clinical trial information they need to make good treatment decisions. Somewhat surprisingly, a similar percentage of physicians (10% of all respondents) mentioned direct-to-consumer (DTC) advertising for its impact on treatment decision-making.

Only 10% of the physicians cited pharma companies as a constraint for not releasing all of the clinical trial information they need to make good treatment decisions. The constraints on physicians’ treatment decision-making make it especially important for pharma to forge and maintain mutually beneficial relationships with doctors. If pharma companies position themselves as physicians’ allies in their struggles with payors and the FDA, physicians may feel more empowered to make independent decisions on behalf of their patients. WHAT PHYSICIANS NEED BEYOND THE REP VISIT The tightly regulated landscape for pharma/physician interaction does not appear to give doctors the type, volume, and depth of infor¬mation that they want and need. Even when pharma reps are allowed access to medical practices and treatment facilities, physicians are

often left with unanswered questions. This is more apparent among specialists, such as oncologists, for whom the stakes are higher when making treatment decisions. • One oncologist requested information on drug prices, particularly on “how to obtain drugs when patients can’t afford [them].” • Another asked for “early clinical trial data presented at meetings NOT part of FDA guidelines.” • An endocrinologist expressed interest in “educational material about disease state that fosters improving patients’ knowledge and improved decision-making as team participant.” • “It is helpful to know how the product is being used by other providers who are in similar practices,” commented a PCP. • One oncologist suggested, “Ad boards moderated by key opinion leaders are always the best.” WHAT DOES THIS TELL US? Pharma companies should re-think how best to provide the kind of

information physicians find most useful, and how to continue the “conversation” beyond the rep visit. For some physicians, impatience with detailing may stem from pharma companies’ focus on promoting newly approved drugs. Many physicians are interested in older therapies, which often lack field force support. See figure 1. SUPPORTING IN-PERSON HCP INTERACTION The research clearly demonstrates the need for both in-person and digital interaction for different types of education: • In-person interaction “enables a didactic dialogue and questions can be answered immediately. While other sources are easily accessible online, in-person discussions allow for interactive infor¬mation sharing.” • Dinner speaker programs provide the opportunity to “network with colleagues and discuss their opinions, as well as those of the speaker.” • Email “is more efficient and can be read as time allows. I can read

HS&M OCTOBER/NOVEMBER 2016 | 32

SALES those during non-clinical hours and not be interrupted during time devoted to patients.” • Online information can be accessed “at my convenience – not in the middle of a busy office day.” The survey results also revealed some interesting findings in terms of preferences for non-digital access to information, as illustrated in Figure 1. Specialists were more likely than PCPs to say they look

for more in-depth information as provided through medical journals and KOLs. On the other hand, PCPs, especially those under 44 years of age, tend to seek input from colleagues within their practice/local area for information, whereas older PCPs and specialists (i.e., over 45) rely more on sales reps and MSLs than their younger colleagues. See figure 2. There appears to be no substitute for live presentations by KOLs on

Figure 2

specific topics as a trusted source of information. Two-thirds (67%) of the physicians cited live KOL speaking engagements as the most useful vehicle for learning about new treatment approaches. However, live events have their drawbacks, foremost of which are time and money. Many physicians are unable to attend live events, and thus may represent missed educational oppor¬tunities for pharma. Indeed, “A lot of physicians now are relying on media and the internet to obtain information from remote sources because a lot of them can’t afford to come to meetings,” noted Dr. Toth. Jeffrey Gudin, MD, director of Pain and Palliative Care at Englewood Hospital and Medical Center in Englewood, NJ., said “Physicians [today] are able to educate themselves on their own time at home. To have a three- to four-minute snippet to see what is going on in the world of medicine is just remarkable.” For many physicians, on-demand access to web-based technologies complements their need for interpersonal contact. The emergence of new technologies has actually made it easier for physicians to get the information they need. In fact, 50% said it is easier or much easier to obtain information to inform treatment decisions today, compared to five years ago. When asked how they like to get information to make treatment decisions, on average, both PCPs and specialists expressed a preference for digital means of communication. “The world is changing,” observed Sekar Kathiresan, MD, director of

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preventive cardiology at Massachusetts General Hospital and Associate Member of the Broad Institute’s Program in Medical and Population Genetics at Harvard Medical School. “There are really important creative ways [pharma] can communicate with the physician audience using the current technology.” When asked about specific ways to learn about treatment approaches through innovative digital means, physicians cited their top 5 preferred vehicles: 1 Short online surveys to test their knowledge of different therapies, clinical data or patient cases 2 Short online presentations or outlines of clinical data that can be accessed at any time 3 An online platform to look up specific information on drugs 4 Online topical videos of KOLs that can be watched any time 5 Printed Q&A materials from a KOL AN OPEN, TRANSPARENT, AND CONSTRUCTIVE DIALOGUE “The best interactions are open, they’re transparent, they’re driven by what patients need, actually brokered through doctors’ knowledge, and [there is] no harm if industry is willing to support that,” stated Peter Goadsby, MD, PhD, DSc, professor of neurology at Kings College, London, and director of the Headache Center at the University of California, San Francisco. In his video interview, Dr. Goadsby emphasized the importance of including patients in these discussions: “Bring everyone together and you can use everyone’s

expertise and resources to make things bigger. [When] everyone is at the table, everyone benefits.”

“Companies need to figure out a way to say ‘the patient is living longer,’ and remind us that’s our core issue.” “Physicians are asking questions about mechanism and how and why. Maybe we should be asking, ‘what’s better for my patient?’ and rethinking the prescriptive process,” commented Paul Ridker, MD, senior physician at Brigham and Women’s Hospital and Eugene Braunwald Professor of Medicine and Director of the Center for Cardiovascular Disease Prevention at Harvard Medical School. “Companies need to figure out a way to say, ‘but the patient is living longer,’ and remind us that’s our core issue.” Finally, the importance of a constructive dialogue cannot be overemphasized. Indeed, public health and patient well-being depend upon a free flow of incisive information between physicians and pharma. In her video interview, Dr. Wood summed up this vital issue quite succinctly: “It needs to be a two-way street, with better communication from us to the industry and from industry back,” concluded Dr. Wood. “If we can create that bidirectional flow of information in a non-conflicted way, we’ll really be able to move medicine forward.” •

About Healthcasts Healthcasts is the leading educational resource for physicians with an exclusive, verified network of practicing members that spans over 30 clinical specialty areas. Since its inception in 2001, Healthcasts has been leveraging research and member feedback to provide relevant, personalized educational content from more than 50 medical conferences, insights from Key Opinion Leaders and CME programming through partnerships with leading educational institutions. Healthcasts programming is available digitally, ondemand on all devices for an optimized, crosschannel experience. Healthcasts.com/ digitalpromotions 866-275-7861 ext 2028

COMMENT

HS&M OCTOBER/NOVEMBER 2016 | 34

PHARMACEUTICAL

Great Advice from Great Minds With Jill Donahue

Keith Ferrazzi, global leader of tomorrow, on changing behavior and culture Keith Ferrazzi is considered to be a “Global Leader of Tomorrow” by the World Economic Forum, one of the “Top 40 Under 40” business leaders by Crain’s Business, and one of the most creative Americans in “Who’s Really Who.” He has been published in The Wall Street Journal, Harvard Business Review, Fortune, Forbes, Inc., and Fast Company.

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PHARMACEUTICAL His #1 New York times best-selling books Never Eat Alone and Who’s Got Your Back propelled him into the spotlight by redefining relationship growth. He is now considered the world’s foremost expert in professional relationship development. At 32, he became the youngest CMO in any Fortune 500 company. Today, as CEO of Ferrazzi Greenlight, he advises companies everywhere on how and why to change, and the importance of positive relationships to that process. Given our problems in the industry with our ability to engage and influence HCPs, Keith’s experience on changing both behavior and culture can be very valuable to us. True to his teachings in Never Eat Alone Keith really never does eat alone! At our breakfast together I was immediately put at ease with his open, generous approach. He really is dedicated to helping whomever is in front of him. One of Keith’s key messages is that in order to change culture, you have to change behavior first – then the culture changes naturally. But how do you change behavior? Here are some of the things he pointed out that help effect that. 1 People get into the industry because they want to help. This is important: recognizing that most people in this business believe in the causes it serves, not just the money it offers. What is needed is a way of getting back to their original intent, what he calls “engineering to gravity.”

2 Shareholder value comes from customer value. In every business he’s studied, he assures us that if you focus on the customer, the economics catches up. “The greatest aspiration we should have is to be as generous as possible to our targeted customer base.” 3 Employees are as important as customers. A conduit to focusing on customers has to be focusing on employees. “If they’re being squeezed,” he says, “they don’t have the opportunity to serve.” 4 Start internally. Keith says that high-return sales strategies depend on elevating and collaborating, internally and externally. And you have to focus on the internal elevation and collaboration first. Whoever is managing the key strategic accounts has to know how to effectively create solutions internally in order to deliver the robust solutions externally. 5 Practice, practice, practice. The old level behavior was to push a script. The new level behavior is to come up with patient-based solutions for efficacy, for instance. What are the specific practices that will allow that to occur? One of the things you have to do is process that dialogue and process the solution internally. That behavior has to be practiced and processed until it becomes a ritual -- and then it becomes a culture. 6 Changing the crisis of trust. The recent bad publicity and image of the industry is what he calls a negative relationship. In order to create a positive relationship, you

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have to pass through some form of candor or transparency. Keith advises being frank and vulnerable, doubling down on authenticity. Saying things like “I would imagine you’re going to think someone in my position is just concerned about how many scripts you’re going to write. But let me explain to you why that’s not even a good business model. It’s more important to us for a long-term relationship that you trust us.” 7 How relationships happen. “You’ve got to bond to the [customer] on an emotional, an empathetic level. The art of selling is the art of empathy. Your job is to build a relationship and to be of service. That’s what it means to be a trusted advisor, which is what we teach. 8 Change the behavior to change the culture: Keith says you have to ask which constituencies need to change which behaviors, and that the first constituency is you. What do you need to do to show the organization you’re willing to change your behaviors? He advises leaders to tell their stories about how they humbly need to make a change in themselves. This gives permission for the organization to make their changes. •

Share your authentic focus on the patient to build trust. interview with Keith Ferrazzi

Jill Donahue, HBa, MAdEd is on a mission to lift our industry, building purpose-driven, influential people. Through her keynote talks, workshops and award-winning mobile-learning program, she is helping teams build trust, open doors and make a bigger impact.

COMMENT

HS&M OCTOBER/NOVEMBER 2016 | 38

MARKETING

Case Studies in Social Media Listening Major companies are improving performance through what they hear By Greg Cohen, Associate Director, Global Marketing, UCB and Siva Nadarajah, GM Social Media, IMS Health

The rapid spread of social media has created rich opportunities for pharmaceutical companies to access unfiltered, organic insights into how patients and other stakeholders perceive and interact with brands, or experience and manage associated diseases. It also provides a new channel for engagement with the industryâ&#x20AC;&#x2122;s fast-expanding customer base. While some social media dialogue may appear to privilege a vocal minority, companies can ill afford to ignore inputs that may have rapid and far-reaching consequences for brand and corporate integrity, targeted investment, and competitive advantage.

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MARKETING Social listening is increasingly recognized as a viable research tool. It is rarely applied, though, as a continuous and fully-integrated strategic function. Typically, social listening involves seeking answers to predetermined questions by tapping into online conversation. Companies need to progress beyond project listening on an ad-hoc basis, and to engage more openly and consistently in a dynamic environment that can fill in critical business-knowledge gaps as well as uncovering potential avenues for traditional market research. In doing so, they can draw on specialized software that employs advanced-analytics techniques to track and contextualize online dialogue around diseases, brands, and companies. These findings can then be linked to anonymous, longitudinal patient-level data to ensure the statistical validity of leading indicators and trends seen in social listening. Ultimately, these findings serve as a platform for concerted action, including constructive engagement with stakeholders through the company’s own social media channels. Concerns about the burden of additional pharmacovigilance obligations through exposure to social media tend to be overstated. The benefits—both descriptive and predictive—of continuous and integrated social listening extend throughout the product lifecycle, from shaping R&D and recruiting patients for clinical trials to informing sales and marketing or communications strategies. Ongoing listening enables companies to identify and track trends over

time, while illuminating the issues that really matter to patients, healthcare professionals, the general public, and a whole online community of established and emerging key opinion leaders. WHY SOCIAL MEDIA MATTERS Listening to patients or other key stakeholders talk freely about their experiences, preferences and needs around disease management and product usage is a window into a fluid and fast-moving world. Some of that dialogue may be trivial, ill-informed or malicious. It may reflect the experiences or opinions of a vocal minority, which some may consider unrepresentative of the patient body at large. However, if that vocal minority is discussing your brand online, then someone will be listening…and opinions can be highly contagious! Rather than dismissing this dialogue as empty chatter or worrying about the implications of hearing something that might be more trouble than it is worth, industry needs to adopt practices from more consumer-oriented sectors and embrace social media intelligence on a continuous-listening basis. Doing so will bring pharmaceutical companies into alignment with a critical mass of patients, prescribers, and advocates who are already taking the conversation around diseases and treatments outside the conference hall, the doctor’s office, or the focus group, and into a space far more candid, intuitive, open-minded, and continually invested in the issue of health.

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CURRENT TRENDS IN INTELLIGENCE-GATHERING A recent study by Best Practices, LLC1 drew on interviews with 15 digital and social-marketing, and market-research leaders at 15 large global healthcare organizations, including six of the top 10 pharmaceutical companies, to determine how they were using social media listening programs.

It found that 85% of the companies participating in the study were currently engaged in some form of social media listening. All of these companies were monitoring patient forums while most of them were also keeping tabs on the major social media channels such as Facebook (91% of those listening) and Twitter (82%). All of the surveyed companies engaged in social media listening were looking to capture brandspecific market or patient insights, such as: • patient adherence to treatment; • brand awareness, reputation and loyalty, including misinformation perpetrated in online discussions; and • physician discussions around specific brands and markets.

Another 91% of the companies were gathering data on disease states, such as mapping the patient journey through a disease. About one third of those engaged in social listening were using it as a source of competitive intelligence.

entrusted with this responsibility (see Table 1).

the digital/IT group.

OWNERSHIP AND USES OF SOCIAL LISTENING

In the Best Practices study, the social media listening program was part of market research at 58% of the organizations surveyed and belonged to a digital/informationtechnology group at 42% of organizations.

While the regulatory framework for social media clearly influences the degree of social media listening geographically, the precise nature and objectives of social media listening strategy also vary according to which business function is

Large pharmaceutical companies were far more likely to entrust social media listening management to market research, while in midcap pharmaceutical, biotechnology or medical-device organizations responsibility tended to sit with

Brand managers involved in social media listening tend to be interested in factors influencing share of voice compared with rival brands, trends in patients switching from one brand or product to another, identifying key opinion leaders or online patient advocates, and tracking general sentiment around a brand asset. This is usually real-time listening, whereas market-research departments are concerned with much broader trends, and from a lon-

HS&M OCTOBER/NOVEMBER 2016 | 42

MARKETING ger term perspective. This might involve looking at unmet needs in a particular disease, typically through a six- or 12-month retrospective analysis. There are also areas of common interest overlapping brand management and market research, such as digitallandscape analysis: comparing brands to determine which sites or activities produce the best returns from online investment.

• expand significantly the available patient population for market research • provide further insights into what the general public think about diseases, treatments, brands and their corporate guardians • take the conversation beyond the restricted framework of a market-research survey • tap into conversations around brands, diseases and companies while they are still loose and organic

These signals are then used as the basis for targeted social surveys run online, sometimes with numbers of patients far beyond the capability of conventional market research. The survey results lend statistical validity to the signals picked up from social listening. The goal here is to pinpoint any correlations between what patients say about a medicine online, and how patients generally behave with a product in a real-world setting by examining anonymous patient level data. In this way, social listening can help companies to deepen their understanding of real-world trends, predict where those trends are going, and use the findings as a genuine call for action. ADVANTAGES OF SOCIAL MEDIA LISTENING Social media intelligence should not be seen as a separate entity from market research. It can • fill in critical business-knowledge gaps, whether around brand awareness, patient adherence, physician preferences, or product misinformation • suggest avenues for more conventional market-research initiatives

• bring to the surface day-to-day issues that are actually important to patients, rather than projecting potential concerns a company may have previously established as important to patients • identify and track trends over time, through continuous listening • help make predictions about how brands might perform over time NEW TOOLS FOR LISTENING There are now more sophisticated tools for the identification and quantitative analysis of trends in online conversation. This is about more than just tracking the volume of mentions for a particular brand, company or issue on leading social media sites such as Facebook or Twitter. A key starting point for listening is actually where nothing is being said at all—search engines. Search interest is a proxy for gaps in user knowledge and can highlight areas of potential conversation to look for online.

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Text and semantic analytics can then delve more deeply into the numbers of people talking about a particular disease, using a broad dictionary of disease terminology. This enables researchers to capture the maximum possible number of mentions while providing insights into different terms used by realworld patients to describe their condition—for example, “high blood sugar” as opposed to diabetes. These can then be fed back into marketing, labeling or clinical-trial materials. Too often, pharmaceutical companies rely on the disease descriptions they expect patients to use on the basis of previous research or marketing programs— or, worse, the technical or medical terms that companies use internally rather than finding out which words and phrases really mean something to patients. Text analytics also allow companies to track social media conversations purely on the basis of the words being used, and in isolation from any underlying sentiments. Those sentiments may in themselves be of interest, especially if they point to a serious misperception that will need to be addressed actively through marketing or public relations. But they can also cloud objective judgments of how conversations around a disease or a brand are evolving, in particular where sentiment is measured in basic degrees of positivity or negativity. The next stage in quantitative analytics is using the identified trends and numbers as a platform for more structured social surveys conducted online. By validating

signals from semantic and text analytics, the quantitative findings of these surveys reach the threshold for recommendations. These recommendations may involve, for example, adjusting an existing marketing campaign, launching a new campaign, stimulating further social media interest, or developing an unbranded educational program to raise disease awareness. Observations gleaned more organically from social listening might serve as a prompt for tactical adjustments, such as a brand manager launching a counter-campaign or stepping up a brand’s social media presence in response to a dwindling share of voice online.

they know about issues physicians have been raising in social media or other forums. This boosts the representative’s credibility with the client, breaks the conversational ice and can lead to longer meetings with time-pressed professionals.

AN INTEGRATED STRATEGY

Medical conferences are a prime opportunity to discover what a large cohort of physicians and specialists is talking about both onand offline. Conference organizers encourage real-time discussion of speaker presentations through allocated social media channels, while levels of interest in posters or new molecules can be gauged through the quantity and content of online dialogue among attendees.

Multiple stakeholders within pharmaceutical companies, including brand managers, clinical-research departments and real-world evidence groups, are already tapping into social media on their own initiative—albeit non-systematically—to help inform specific activities or to solidify relationships with their customer base. One advantage to a formal program is that it is website-agnostic, looking for every conversation and aggregating. If a brand manager is conducting her own search, she may spend time on a few key forums/ sites with which she is familiar or which she finds first as opposed to looking at the aggregate of data across all sites. This goes beyond listening to patients or the general public. For example, sales representatives, key account managers or medical science liaisons are better prepared for interactions with customers if

Increasing numbers of key opinion leaders now actively use Twitter. The more active KOLs are on social media, the more followers they accumulate, and the more likely they are to be recognized as a leader in their respective space. Other physicians may also have a dynamic presence online, whether through tweets, blogs or video presentations.

Ongoing social listening can get at what patients, healthcare professionals, or anyone else closely involved in taking medicines, really feel about the whole experience. It drills right down to the impact that a product’s efficacy (or lack thereof), ease of use, or side-effects have on key aspects of patients’ lives, most notably the need for stability, predictability or relief from pain and discomfort. Moreover, it illuminates what patients have to undergo or forego if those needs are not addressed by existing therapeutic options. In a marketplace dominated by concerns about drug costs and associated outcomes, listening to what patients in uninhibited dialogue through social media want from medicines is not so much a useful contribution as a basic strategic imperative. CASE STUDY 1: WHAT SOCIAL-INTELLIGENCE ANALYSIS SAYS ABOUT PRODUCT SWITCHING A multinational pharmaceutical company looked at whether social media listening might help it to identify the drivers behind variations in treatment-switching patterns for recently launched oral multiple sclerosis (MS) therapies observed in real-world claims and pharmacy databases in the US. The retrospective database analysis involved monitoring social media conversations among self-identified MS patients through publicly available channels such as Facebook, Twitter, blogs and online forums between October 1, 2013 and October 31, 2014.

HS&M OCTOBER/NOVEMBER 2016 | 44

MARKETING The study combined automated listening and processing with manual analysis of social media data by qualified analysts and physicians. Lexical entities referring to switching between oral, injectable and iv therapies for MS, identified by brand name, were captured from extracts of relevant online conversations.

In total, 25,073 data points were extracted from social media conversations around oral MS therapies in the target population, subsequently filtered to 22,887 relevant data points. Of these, 10,260 were identified as relevant to the study objectives and 1,684 data points were collected for treatment switches, which were most prevalent among patients in injectable MS therapies and least prevalent among those on iv therapies. The highest proportions of reported switches were to oral therapies from iv (98%) or injectable (83%) products, followed by switches away from oral medication to other oral drugs for MS (46%), injectable therapies (29%) or iv

therapies (25%). Side-effects, lack of efficacy and physician advice were the most common reasons given for a change of medication, while around 14.5% of the MS patients switched from injectables to oral therapies due to ease of use. The researchers concluded that social media intelligence was a powerful tool for outcomes research, providing insights into specific aspects of health-seeking behaviour that might not be available through other research channels, and in a population that appeared to be representative of patients engaged in real-world medication switching. The study demonstrated that social media analytics, based on observations from real-world healthcare utilization and claims databases, could be used to quantify treatment-switching patterns and identify factors underlying switching behaviour in a defined patient population. CASE STUDY 2: HOW ONLINE LONGITUDINAL PATIENT STUDIES CAN DRAW REALLIFE JOURNEY MAPS A multinational pharmaceutical company conducting ongoing analysis of patient conversations was looking for insights into how long patients went misdiagnosed before being accurately diagnosed with Crohn’s disease. It then wanted to see how long patients tried different treatments before finding the right medication for their needs. The analysis centered largely on blog and forum discussions.

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This highly qualitative study started with 34,133 data points then focused on the 500+ points with enough data to construct these longitudinal journey maps. Ultimately, the team built three comprehensive, archetypal maps, showing the five- to 15-year journeys undertaken by different types of patients who discussed their experiences online. The maps demonstrated that expectations of how quickly patients move through the patient journey may have been understated. Rather, it showed that patients spend much more time circling the symptoms-diagnosis-treatment paradigm before they make reasonable progress towards something the patient would consider an acceptable outcome. CASE STUDY 3: HELPING A PATIENT GET BACK ON A SUCCESSFUL REGIMEN One multinational company identified a patient through a social media forum who had been successfully managing her condition for years on one of the company’s products. They found that once the Affordable Care Act came into force, the patient’s healthcare plan insisted she switch back to a product on which she had already failed. However, thanks to social media listening, the company was made aware of the situation early and was able to intervene for the patient by alerting a market-access colleague in the state concerned (luckily, the patient had indicated in her post which state and which plan she was using). The company was able to escalate the situation

to the point where, a few days later, the patient came back onto the online forum and reported that a company rep had spoken to her physician and she was now back on her original regimen. In that way, the company managed to add value to the patient experience and enhance its own reputation by responding to an immediate customer concern. CONCLUSIONS Social media listening can no longer be sidelined as an optional supplement to mainstream market research or as a siloed activity pursued by different business units on an ad-hoc, project-by-project basis. With access to specialized software employing advanced-analytics techniques to track, grade and contextualize dialogue around diseases, brands and companies online, then find, validate and substantiate those findings through linkage to real-world data assets, pharmaceutical companies are well equipped to embrace social listening on a continuous-listening basis, integrated across internal departments and with benefits extending throughout the product lifecycle. â&#x20AC;˘ Pharma Social Media Listening: Benchmarking Innovative Practices in the Healthcare Industry. Best Practices, LLC. Available at: http:// www. slideshare.net/bestpracticesllc/ psm-303-a-report-summary-pharma-social-media-listening-benchmark (accessed February 16, 2016). 1

Greg Cohen Associate Director, Global Marketing, UCB Greg Cohen is an Associate Director for Global Marketing specializing in Multichannel Engagement working for UCB. Greg is part of a team tasked with accelerating the marketing maturity of UCB in order to build a world-class marketing organization. Greg is passionate about evolving how companies think of interacting with patients in order to provide a better paradigm for care. Prior to joining UCB, Greg worked in consulting and advertising, developing go-to-market strategies for B2B and B2C Fortune 500 companies interested in accelerating their activities through embracing digital and social. gcohen@us.imshealth.com Siva Nadarajah GM Social Media, IMS Health Siva Nadarajah is General Manager, Social Media at IMS Health and joined the organization through the acquisition of Semantelli, which he co-founded and grew to be an industry recognized leader in social analytics for pharma. Prior to founding Semantelli, Siva was responsible for global CRM and compliance solutions with Cegedim. Siva is a voting member of the Wikimedia Foundation and has spoken worldwide about adverse events management in social media and the impact of Wikipedia in healthcare. He was recognized for uncovering two major security holes in Microsoft Hotmail in the early days of the Internet, which forever changed the security design of internet based email systems. snadarajah@us.imshealth.com IMS Health is a leading global information and technology services company providing clients in the healthcare industry with endto-end solutions to measure and improve their performance. Our 7,500 services experts connect configurable SaaS applications to 10+ petabytes of complex healthcare data in the IMS Oneâ&#x201E;˘ cloud platform, delivering unique insights into diseases, treatments, costs and outcomes. The companyâ&#x20AC;&#x2122;s 15,000 employees blend global consistency and local market knowledge across 100 countries to help clients run their operations more efficiently. Customers include pharmaceutical, consumer health and medical device manufacturers and distributors, providers, payors, government agencies, policymakers, researchers and the financial community. www.imshealth.com

COMMENT HS&M OCTOBER/NOVEMBER 2016 | 46

BY THE NUMBERS Compiled by Cari Kraft, Jacobs Management Group, Inc.

19.8%

3,203 2015

2014

Medical Device Clearances Decreasing The number of medical device submissions cleared by the FDA declined significantly in 2015, to 3025 from a high of 3203 in 2014. It didn’t reach the levels of 2011 (3126), 2012 (3138) or even a relatively low figure from 2013 (3054). Source: “Emergo Analysis: Fewer 510(k) Submissions from US Medical Device Firms in 2015”, Emergo, February 2016

R&D Spending as a percentage of sales Total R&D as a percentage of total sales was 19.8% in 2015. Domestic R&D as a percentage of domestic sales was even higher at 24.8%. Source:“2016 Biopharmaceutical Research Industry Profile”, Pharmaceutical Research and Manufactures of America, April 2016

47 | HS&M OCTOBER/NOVEMBER 2016

3,025

3,054 2013

3,138 2012

Revenue from one drug Evaluate Pharma predicts the Pharmaceutical Market to be over 1.2 Trillion by 2022. They predict the biggest-selling global branded drug will be Opdivo (nivolumab) from BMS and Ono Pharma, with sales projected to go from $1.119 billion in 2015 to $14,634 billion, and overtaking the current No. 1 drug, AbbVie’s and Eisai’s Humira (adalimumab), currently at $14.359 billion and dropping slightly to $13.645 billion in 2022. Source: “World Pharma Preview 2016, Outlook to 2022”, Evaluate Pharma, September 2016

2011

$14.3B

Social media is outperforming TV Google sites are attracting monthly audiences of 247 million people, nearly 10% better than the 228 million of the #1 network’s primetime shows. Facebook, Yahoo and Microsoft sites are also doing as well or better than the other three major networks. Source: comScore Xmedia (Live TV, 8 PM-11 PM) and Media Metrix MultiPlatform, U.S., November 2015

3,126

9.2%

$1.08T

Total revenue of the top 100 healthcare companies in 2015 All sectors—pharmaceutical, bio and device—increased in revenue over 2014, bringing revenue higher than it’s ever been. Source: “Top 100 Healthcare Companies”, Healthcare Sales & Marketing Magazine, September/October 2016

HEALTHCARE COMPANIES

U.S. pharmaceutical stock returns top other industries U.S. pharmaceutical companies dominated an annual global ranking of top 10 large-cap stocks with the best five-year returns. This was skewed somewhat by some of the largest companies. Drug company Regeneron Pharmaceuticals, which had an average annual total share return of 75.3 per cent, was the top performer. Allergan and Gilead Sciences, with 43.3 per cent and 41.4 per cent average annual returns, respectively, took second and third place. Companies with over US$4 billion in market cap were considered for the list and ranked based on share gains and dividend yields between 2011 and 2015. Some 2,000 stocks were analyzed. Source: BCG Perspectives, Boston Consulting Group, May 2016

75.3%

$58.8B

Biopharma industry accounts for 21% of all U.S. R&D Members of the Pharmaceutical Research and Manufacturers of America (PhRMA) invested a combined $58.8 billion in research and development during 2015, up from $53.3 billion the previous year. The second-highest industry, software, accounted for 11% of R&D spending. Source: “2016 Biopharmaceutical Research Industry Profile”, Pharmaceutical Research and Manufactures of America, April 2016

COMMENT HS&M OCTOBER/NOVEMBER 2016 | 48

MEDICAL TECHNOLOGY

Bundle Up for the Changes Ahead Dorsata’s CMO talks about how bundled payment models will affect medtech By Scott Nelson, Group Director, WCG, Founder, Medsider

This article is edited from an interview by Scott Nelson with Dr. Dan Mazanec, Chief Medical Officer of Dorsata In the 1980s, there were no significant cost controls in the U.S. healthcare system, and there had been major cost increases over just a few years. They’ve been rising ever since, moreso than in other industrialized countries. In response, CMS (the Centers for Medicare and Medicaid Services) began to develop bundled care models that would control costs by limiting reimbursement for procedures. How has this affected the medtech sector? In our conversation with Dr. Dan

Mazanec, CMO of Dorsata, these are the key things he believes medtech companies need to consider right now: • Bundled care involves the whole continuum of providers—physicians, physical therapists, etc. • Care is being reshaped along value and quality • Having robust, smart and physician-friendly IT is critical to meeting the standards of the new bundling paradigms

Source: Kaiser Family Foundation 49 | HS&M OCTOBER/NOVEMBER 2016

THERE ARE SOME THINGS PEOPLE JUST WON’T TELL YOU BUT THEY’LL TELL US IN CONFIDENCE. AND WE’LL TELL YOU. There are a lot of opinions people never offer you about your company. What the pain is. What you could be doing better. What they think of your competition. How to talk to them effectively. Big corporations get these answers through expensive research. Small to medium-sized companies don’t have that luxury. That’s why we created the Private Process . It’s a quick, cost-effective way of compiling information that people will offer us in complete confidence. Then we assess the results and give you the insight you need to adapt your sales and marketing messages accordingly. ©

For details on how the Private Process works, and the kinds of answers you can get, contact us now at ngreenberg@hsandm.com.

MEDICAL TECHNOLOGY Below are some of the details and insights we uncovered in our interview. The history: In 1983 Medicare said they were not going to pay per item, but by diagnosis. They came up with 500+ diagnoses, and applied a fixed reimbursement amount to each. This forced hospitals to bundle charges so that they could make a profit. In the 90s Medicare started paying a set amount for surgical fees, a global fee for all the care associated with a procedure. Each episode of care was incorporated in a single figure. This took the risk away from Medicare and shifted it to the provider. The other major change was the definition of an episode of care. Now it’s not just a single period in a hospital, but begins with admission and extends into discharge and rehab, up to 90 days—the whole continuum of care. Now outpatient care is bundled as well. This forces providers to coordinate care within these bundles, while also maintaining quality of care. CCJR: We asked Dr. Mazanec for insights into the Comprehensive Care for Joint Replacement (CCJR) program and the potential ramifications for medical device companies. This act covers knee and hip replacement surgery. All the care, from admission up to 90 days—the surgeon, hospital, physical therapy, home care, rehab—is bundled together, and a targeted price is set, based on historical data. So if the hospital comes in under the target, they get the additional money. If not, they have to give money back. This controls costs and drives better coordination of care. Reducing readmissions becomes important, because that’s an expensive event.

The health organization has to make sure complications are addressed. This addresses the postacute phase of care, where much of the cost inflation happens, up to 40 - 50% (sometimes called the “area of uncoordinated care”). Hip replacement may need some home care, but rehab is more costly for knee replacement. Also, previously six different orthopedic surgeons may have preferred six different kinds of hardware at varying costs. Now hospitals are negotiating harder, using brand A rather than brands A, B, C and D. You may have PTs who don’t work at the hospital, you may have a rehab facility that isn’t part of the hospital system. This is where the information highway becomes important, with the post-acute people needing to maintain contact with the surgeon. The new parameters will hold together the various components. You have to have all the providers in the loop, so you can track and record data, and provide

clinical decision support within the hospital and afterwards. This will keep down complications, like blood clot events. And the EMR has to be able to guide the post-acute phase, rehab and home care, in maintaining continuity of care, so co-morbidities like hypertension have to be managed to avoid visits to the ER and/or potential re-hospitalization. The EMR has to have a userfriendly interface that engages the clinicians to collaborate and cooperate. There’s likely to be a significant role for telemedicine in the post-acute phase, to provide better care and to save money. For instance, when people get discharged after a heart attack, a myocardial infarction, this can have a significant effect in terms of reduced hospitalization, reduced ER visits, which could be an almost milliondollar savings according to one study, based solely on telemedicine intervention. CCJR is going to drive better com-

*A sampling from Redefining Healthcare

51 | HS&M OCTOBER/NOVEMBER 2016

munication between hospitals and surgeons and all other participants in the post-acute phase. In this era of value-based care, these things will be increasingly important. MACRA: Another influencing factor is the Medicare Access and CHIP Reauthorization Act (MACRA), which includes two different reimbursement models for physicians (MIPS vs. APMs). This is part of the trend of moving away from fee-for-service toward value-based care. The focus is shifting to performance, and starts us moving toward integrated practice. One model is MIPS, the Merit-based Incentive Payment System, which applies to 85-90% of doctors. Reimbursement is based on four categories: quality, resource use, clinical practice improvement, and meaningful use of certified EHR technology. Efficient, high-quality practices will succeed under this program, but smaller ones may struggle to meet its requirements: The other option is the Alternative Payment Model , which is more of a pilot. This reorganizes care where there are multiple touchpoints—social workers, behavioral specialists, nurses, coordinated care—for reduced costs and improved quality. CMS (the Centers for Medicare and Medicaid Services) estimates that 80% of solo practices will face negative adjustments in reimbursement. They’re going to have to acquire the technology to meet the requirements. They may stop seeing Medicare patients, and this will have major implications for these smaller practices. FINAL THOUGHTS Dan also offered that his favorite nonfiction business book is Redefining Healthcare by Michael E. Porter and Elizabeth Olmsted Teisberg*. And he left us with this advice: wherever you are in the healthcare system, bundling of care is where we’re going, and smart healthcare IT is the glue in this process that will help meet the demands for efficiency and quality. •

Dr. Dan Mazanec Chief Medical Officer Dorsata Board certified in internal medicine and rheumatology, Dan has been a leader in the development of the emerging specialty of spine medicine. A frequent lecturer at international and national meetings, he has authored more than 70 book chapters and papers and is an active member of the North American Spine Society, with a particular focus on the development of evidence-based clinical guidelines. Prior to joining Dorsata, Dan was the Associate Director of the Center for Spine Health at the Cleveland Clinic. He led the development of the Cleveland Clinic Spine CarePath, which merges evidence-informed clinical management of spine disorders with patient-entered clinical outcome data. Dorsata gives healthcare providers the tools to streamline the way they document their encounters. Clinicians can quickly build and modify encounterspecific workflows that facilitate robust, accurate documentation, guide decision-making, and automate order entry. Scott Nelson Group Director, WCG Founder, Medsider Scott is a self-described medtech enthusiast and currently serves as Group Director for WCG, a W2O company. Prior to his work with WCG, Scott held sales and marketing leadership positions for some of the largest medical device companies in the world, including Covidien, Boston Scientific, C.R. Bard, and ConMed. In addition, Scott is the Founder of Medsider, which helps ambitious doers learn from proven medtech thought leaders. His work with Medsider has been featured in publications like Forbes, Mass Device, MedCity News, and MD+DI. Scott is also an advisor to the Medical Devices Group, which includes over 300,000 members worldwide.

COMMENT HS&M OCTOBER/NOVEMBER 2016 | 52

MOTIVATION

MOTIVIDEOS By Cari Kraft, Jacobs Management Group Once again, one of our most popular features. From the sublime to the ridiculous, here are some morning-starters that can perk up a meeting, give your staff inspiration, or just begin the day with a laugh. What really leads to success?

Procrasti…nation.

Surprise—it isn’t luck or money. Here Richard St. John tells you what he’s learned from 500 successful people.

Admit it. We all do it. Even highly successful Ellen DeGeneres struggles with procrastination. Here’s her hilarious take on how to – maybe – overcome it.

Start your day right. As we all know, this makes a huge difference in how you spend the next several hours. Here the famous motivational guru Tony Robbins talks to Oprah about his morning.

It’s catching. Like most expressions of emotion, laughter can be contagious. Here’s an update of an old meme that shows it spreading around.

Submissions are welcome. If you have one you like, email a link to me at ckraft@jacobsmgt.com.

Cari Kraft leads a team of master level recruiters at Jacobs Management Group, celebrating 20+ years of executive recruiting in the healthcare (pharmaceutical, medical device, biotechnology) and high-tech industries, nationally. Prior to joining Jacobs Management Group, Ms. Kraft has held positions as a Senior Sales Executive, Director of Business Development and Director of Marketing. She also has deep knowledge of the technology/startup fields, having been in the industry through the rise of the Internet. Ms. Kraft is a University of Pennsylvania/Wharton alumnus holding a degree in economics and decision sciences. Cari can be reached at ckraft@jacobsmgt.com.

COMMENT 53 | HS&M OCTOBER/NOVEMBER 2016

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55 | HS&M OCTOBER/NOVEMBER 2016

Procrasti…nation. Ellen DeGeneres struggles to overcome her own distraction.

It’s catching. Laughter, the best medicine.

HS&M OCTOBER/NOVEMBER 2016 | 56

BIOPHARMA

Keeping Biopharma Innovative Some case studies in how to grow and still nurture a corporate culture open to new ideas By Nina Wachsman, President and Founder, Augur Health LLC and Gerald Mosely, PhD, Founder and Principal, CP&P Development Group

Biopharma companies are founded on ideas and innovative thinking—often started by a group of scientists or entrepreneurs with a common purpose and vision. As a small organization starting up with a new molecule or a new technology, there are less resources available and only the bare minimum of functional capabilities. Thinking out of the box is often a necessity to accomplish all that needs to be done in order to take the innovative ideas and make them a reality. As a company grows, products and capabilities are added, and there is a need to scale up people, processes and structure. This transition raises the risk of losing sight of the founding vision and spirit. A lack of clarity and direction, increased dysfunction and general organizational malaise are potential consequences of this bureaucratic transformation.

“Innovation has always been one of our values. It was obvious in the beginning. As you grow you may lose the sense of purpose you had in start-up mode. You have to build the company, get the drug throughFDA, face competitors,and satisfy multiple stakeholders.Things get more complicated, and you can get more mired in the day-to-day.” Bill Fairey, President, Actelion Pharmaceuticals US Many companies try to “import” innovative thinking by bringing in consultants, experts, and agencies or looking to outside companies to help them with their efforts. In 2000, Target was just another discount retailer when they approached their ad agency, Kirshenbaum & Bond, to help them build an image as an upscale, trendy retailer to a target urbane audience that was not aware of or did not even think of Target as fashionable. Target was willing to make the commitment to a totally new way of 57 | HS&M OCTOBER/NOVEMBER 2016

TOP LISTS the publication for healthcare sales & marketing leaders™ HS&M’s series of Top Company lists is increasingly one of our most awaited and valued features. The Top 50 Pharmaceutical, Medical Device and Biotech Companies are followed by the Top 100 Healthcare Companies of the year. Because of the demand, here are our previous lists.

BIOTECH COMPANIES CLICK HERE TO RECEIVE YOUR COPY OF THE TOP 50 BIOTECH COMPANIES

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BIOPHARMA doing business, and approached Kirshenbaum and Bond, which was renowned for its innovative and sometimes brash thinking that radically changed business for its clients. Jon Bond, agency leader, had a number of other clients, fashion designers like Isaac Mizrahi, who were looking for funding. Kirshenbaum and Bond put the two together, introducing high fashion names to a discount retailer, which gave Target a sustainable positioning and business that is still viable today.

“While promotion may win quarters, innovation wins decades.”

Today, Bond, now founder and leader of TomorroLLC, a virtual holding company that operates as a consultancy, gave this perspective on what often happens when companies bring in outside “innovators like his company: “Nothing-- the underlying reward structure doesn’t support innovation in most companies. So you end up being just a shiny object.”

• The market landscape has changed: your company is faced with new and increased competition, regulatory constraints or technological advances that present challenges to the core business or to the commercialization of products in development

What does this have to do with biopharma, and why should a biopharma company care about restoring the spirit of innovation? There are different reasons for a company to support efforts to restart innovative thinking and support their development into new products or services. Many companies feel that building innovative thinking is a necessity, and will help keep the company competitive, while others feel it is a part of its core values and a means to attract and retain the best talent.

former P&G CEO Bob McDonald, as quoted in Harvard Business Review, June, 2011. SOME SCENARIOS WHERE INNOVATIVE THINKING WOULD BE NEEDED:

• The company’s business changes, which would merit a reevaluation of priorities and how the organization will work. Through business development or acquisitions, a company may transition from a one-molecule or one-diseasestate company to a multi-product or multi-disease category entity. Or simply through the process of product development, a company may change from an early stage company to a company with product in phase III or ready to launch • A company’s leadership has changed (due to mergers, turnover, or retirement of founders or other key individuals), resulting in a change of the vision, direction, culture and operating principles. This can leave uncertainty about how the new organization will function and can potentially in-

59 | HS&M OCTOBER/NOVEMBER 2016

crease fear of being open with new ideas, or challenging the status quo TO WHAT EXTENT ARE LEADING BIOPHARMA COMPANIES COMMITTING TO INNOVATIVE THINKING? We conducted a small survey among 17 pharma managers, (with 13 respondents) from multiple biopharma companies in functions including marketing, regulatory, medical and clinical development. We found that despite the biopharma companies’ indication that they are interested in promoting innovative thinking, most have not made strong organizational commitments –such as resources, channels, and official rewards and recognition programs for innovative thinking. HOW CAN BIOPHARMA COMPANIES CONTINUE TO SUPPORT INNOVATIVE THINKING? They can start by asking three questions: 1. How are we thinking differently? Individuals across all functions, from the bench to product marketing, should take the time to look at their business from a different perspective or vantage point. This could encourage them to offer alternative solutions, and challenge the status quo, which can be essential to meet challenges such as a failed trial or a new competitor. An oft-cited case study of thinking differently is the development of Allegra, fexofenadine. Fexofenadine was the active metabolite of terfenadine, mar-

HS&M OCTOBER/NOVEMBER 2016 | 60

BIOPHARMA keted by Hoechst Marion Roussel as Seldane, the first non-sedating antihistamine. After facing a crisis due to the bioactivation of terfenadine, which worked quickly to form fexofenadine but caused adverse cardiovascular effects in vivo, scientists at HMR realized that fexofenadine could be marketed as a drug in its own right. The substance was brought to the market as Allegra in 1996, the year before Seldane was pulled from shelves. In order for “thinking differently” to happen, management must convey that there is opportunity for innovative thinking and new ideas to be brought to the table. Consider what happens to someone who brings new thinking or innovative ideas to the company: are they rewarded or thwarted? Is “thoughtful risk taking” encouraged and supported across the organization for key learnings brought to the organization without the fear of consequences of failure? Two important considerations for thinking differently: • What channel exists for individuals to bring to new ideas and new thinking about in the organization, or its products to the table for consideration? • Are people able to carve out time from their day-to-day responsibilities in order to think differently and be innovative? 2. How we are collaborating? How can new ideas or innovation be implemented to make a difference in the company’s productivity

if the innovation is not embraced by all the functions that would be necessary to make it happen? Even if new ideas and new thinking are encouraged, is it likely that a new idea can come to fruition if there isn’t a collaborative effort across functional teams? A company needs to consider whether there is an appreciation and an adequate understanding of the roles and contributions of one functional area to the other in order to bring a new idea to reality. What level of trust exists between functional groups? Has the organization defined or enabled the development of common goals, rewards, and consequences? If part of bringing a new idea to fruition involves external partners and alliances, has the organization established shared goals, rewards and consequences with them? At SmithKline Beecham Pharmaceuticals in the mid-90’s, a new high dose formulation of amoxicillin-clavulanic acid was developed in response to increasing global rates of Streptococcus pneumonia to beta-lactate antibiotics. A well-coordinated, collaborative effort and the crossfunctional commitment of resources from marketing, medical, R&D and regulatory functions, as well as the input of external infectious disease experts, generated an option to address a rising global concern. In addition to this contribution, the potential consequence of declining product usage was addressed.

61 | HS&M OCTOBER/NOVEMBER 2016

3. How are we operating? Executing on ideas or innovative thinking will require translating them into collaborative and rigorous operating plans. Just like any other effort in the organization, there should be a systematic way to measure and track actions as well as communicate progress. If you don’t have a plan of execution, the idea will remain an idea and never become a project or a product. A reward or recognition system that considers innovation as a measure of leadership or achievement in the organization can help to make innovative thinking and planning a priority rather than an afterthought. In an effort to make innovative thinking part of the organization, companies may recognize that they need to consider more than functional skills when hiring. In fact, the organization may want to assess whether they have the right people—people with the right values, goals and motivation to think differently, and the ability to collaborative to bring innovative ideas to fruition. Alexion, number 3 in Forbes’ ranking of 2015 of the World’s Most Innovative Companies, describes its corporate culture, and the people it is looking to hire: “We’re looking for people to join our team who challenge conventional thinking, collaborate to solve complex problems, pursue new challenges and are willing to be held accountable to the patients they serve.”

TERMS OF INNOVATION Radical innovation: An idea so different that it becomes market changing or shaping. Radical innovation creates an entirely new business, something new to the world, or a departure from existing process, status, or a disruptive technology. Incremental innovation: leverages existing capabilities and improves or reconfigures something that already exists. Incremental innovation can deliver significant, measurable results, and is often targeted to specific needs or areas of growth. —According to Harvard Business Essentials (2003) Disruptive Innovation (2006): A term coined by Clayton Christensen; describes a process by which a product or service takes root initially in simple applications at the bottom of a market and then relentlessly moves up market, eventually displacing established competitors. If a company wants to support or champion “innovation,” whether radical or incremental, there needs to be a commitment to resources, as well as a defined plan and process to channel ideas into innovative products or projects. As Actelion Pharmaceuticals found, with the commitment to and an investment in resources, there must also be an investment in time. It takes time to build the trust, the collaboration, the training and the processes that will allow s innovative thinking to flourish. •

Nina Wachsman President and Founder Augur Health LLC Prior to founding Augur Health over 10 years ago, Nina managed business units at some of the largest advertising agencies, such as Interpublic Group (IPG) and Grey Healthcare group. Nina’s experience goes across therapeutic categories from oncology to pulmonary arterial hypertension, and her expertise ranges from market research, patient marketing strategy and analytics to KOL engagement and digital marketing. Nina began her career as a creative director working on P&G’s flagship brands Pampers and Crest. Augur Health is a healthcare agency that specializes in innovative marketing solutions across a wide range of therapeutic categories and audiences—from HCPs to patients. Along with its subsidiary, Augur Digital Media , with a full staff of developers and digital designers, Augur Health brings innovative marketing strategy together with digital expertise to achieve business goals in today’s digital environment. Gerald Mosely,PhD Founder and Principal CP&P Development Group With over 20 years in the pharmaceutical industry, Gerald has held a variety of roles including sales, marketing, medical science liaison and country management across multiple therapeutic areas with GlaxoSmithkline. As a General Manager for Baxter Global Anesthesia & Critical Care, he led the commercial and technical/scientific teams as well as cross functional-matrix teams globally. Gerald has led multiple initiatives involving organizational design, involving structure, standards and strategy, as well as multiple product launches in different international markets. CP&P Development Group is a leadership development and strategy practice that assists corporate leaders and teams achieve their business objectives, with a primary focus on the people oriented leadership components impacting organizational health.

COMMENT HS&M OCTOBER/NOVEMBER 2016 | 62

October / November 2016

Articles inside

Keeping Biopharma Innovative

The Doctor Will See You Now

Motivideos

Case Studies in Social Media Listening

Great Minds: Keith Ferrazzi on Culture Change

Editor’s Letter

Editorial Board

Executive Spotlight: GSK’s Deborah Waterhouse

Publisher’s Letter