8/16/22, 12:04 PM
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`The secret of successful drug launches | McKinsey
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`By Hemant Ahlawat , Giulia Chierchia, and Paul van Arkel
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`About two-thirds of drug launches don’t meet expectations. Improving
`that record requires pharmaceutical companies to recognize the world
`has changed and adjust their marketing accordingly.
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` Article (PDF205KB)
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`P harmaceutical companies have long relied on successfully launching new drugs to
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`drive growth. This pressure is only likely to increase. Patents are expiring and product
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`pipelines are shrinking. Austerity measures in many countries are increasing local and
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`national hurdles for market access. And, at the same time, launches are becoming more
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`numerous, smaller, and more competitive. We estimate that pharmaceutical companies will
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`launch some 400 new products in the next three years, up 146 percent from 2005. Given
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`this changing external landscape, awash with more products of ever greater diversity, it’s
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`never been more important for pharmaceutical companies to crack the new-product launch
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`code.
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`https://www.mckinsey.com/industries/life-sciences/our-insights/the-secret-of-successful-drug-launches
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`The secret of successful drug launches
`The secret of successful drug launches
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`March 1 2014March 1, 2014 | Ar icle
`| Article
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`8/16/22, 12:04 PM
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`The secret of successful drug launches I McKinsey
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`Yet their recent track record is sobering at best. About two-thirds of new drugs fail to meet
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`prelaunch consensus sales expectat ions for their first year on the market,l1 I and those that
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`fall short typically continue to underdeliver for the next two years (exhibit). There's no
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`question that every launch has its own set of success factors. Yet by analyzing a sample of
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`60 launches in late-stage development along the dimensions of clinical differentiation and
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`the perceived burden of the disease area in which the drug is to be launched, we identified
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`fou r drug archetypes:
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`Exhibit
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`Two -thirds of a sample group of drug lau nches failed to meet
`prelau nch sales expectati ons for t heir f irst year on t he
`market.
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`Actual sales during first year of launch as% of forecast sales 1 year prior to launch'
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`e % of launches
`below forecasts
`• % of launches on
`or near forecasts
`e % of launches
`above forecasts
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`>200%
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`161- 200%
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`121- 160%
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`81- 120%
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`41- 80%
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`(}-40%
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`Of launches that exceeded forecasts
`in year 1, 65% continued to do so in
`year 2, and 53% of those exceeded
`forecasts in year 3.
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`Of launches that lagged forecasts in
`year 1, 78% continued to do so in year
`2, and 70% of those lagged forecasts
`in year 3.
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`'Sample comprises 210 new molecular entities launched between 2003 and 2009 for which consensus
`forecasts were available from Evaluate 1 year prior to launch.
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`Source: EvaluatePharma; McKinsey analysis
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`https://www.mckinsey.com/industries/life-sciences/our-insights/the-secret-of-successful-drug-launches
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`The secret of successful drug launches | McKinsey
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`•
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`•
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`•
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`Go for gold. Roughly one in four launches involves drugs that are strongly
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`dierentiated from competing products and treat diseases with a high perceived
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`burden. Examples include Zytiga, Johnson & Johnson’s prostate-cancer treatment,
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`and Januvia, Merck’s drug to lower blood-sugar levels in people with type 2 diabetes.
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`Such launches run a substantial risk of companies believing that the product’s high
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`quality guarantees high sales volume. Capturing their full potential still requires
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`shifting substantial resources from in-line brands to nance the launch. Companies
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`must avoid the “good data trap” by seeking out possible barriers to prescription and
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`focus on capturing the potential as quickly as possible by creating maximum early
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`exposure to the product, closely monitoring launch uptake, and correcting course if
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`necessary.
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`Stand out from the crowd. At the other extreme, more than half of upcoming
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`launches are of moderately dierentiated products in well-established disease areas,
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`and the priority is to nd a way to stand out from the crowd. These launches must nd
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`or create an edge that will allow the drug to be positioned eectively for particular
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`patient segments and create clear dierentiation from existing competitors. This
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`requires innovative approaches to unveil insights into stakeholder needs and
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`behaviors that competitors do not have. Finally, product pricing is another means for
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`creating dierentiation.
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`Category creator. For roughly 15 percent of launches, the priority will be to establish
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`unmet needs eectively to ensure access to a well-dierentiated treatment for a
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`targeted population. We call these launches “category creators.” Gardasil, launched in
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`the unestablished human papillomavirus market, is an example. Companies must
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`ensure they quickly understand the market’s unmet needs, make sure they don’t
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`underinvest, and be prepared to react and course correct.
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`https://www.mckinsey.com/industries/life-sciences/our-insights/the-secret-of-successful-drug-launches
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`8/16/22, 12:04 PM
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`The secret of successful drug launches | McKinsey
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`Market shaper. The remaining 8 percent of launches will face the substantial
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`•
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`challenge of launching an undierentiated product in an unestablished disease area.
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`Once the decision to market such a product has been made, the priority for these
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`market-shaping launches will lie in securing access for the product and eectively
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`establishing unmet needs.
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`While companies must take the fundamental step of identifying what decisions should be
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`made for a specic launch—ensuring a road map, quality standards, resource benchmarks,
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`and a readiness process is in place—they must also shape and execute those decisions
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`eectively. Each launch has its own set of success factors, and we believe companies
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`should ensure they are exceptional at a handful of them—at a minimum—rather than merely
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`good at everything. We also advocate selecting, training, and motivating the extended
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`launch team and fostering a culture and management style that delivers great launches.
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`Today’s environment requires such a systematic approach: pharma companies must
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`establish unmet needs in a disease area, develop deep customer insight as a basis for a truly
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`dierentiated positioning, land the products safely in the market, maximize launch uptake,
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`and use early experiences in the market to ne-tune ongoing launch activities. It’s not easy,
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`but the reward is worth the eort.
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`This article is drawn from Beyond the storm: Launch excellence in the new normal (PDF–
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`2.8 MB), a compendium from McKinsey’s pharmaceuticals and medical products practice
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`that provides details on how to tackle each of these tasks and further insight on how to
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`approach them eectively.
`1.We examined 210 new molecular entities launched between 2003 and 2009 for which Evaluate
`consensus forecasts were available one year prior to launch. Forecasts get increasingly accurate the
`closer they are to the actual launch date, and they become even more accurate once the drug is
`launched.
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`https://www.mckinsey.com/industries/life-sciences/our-insights/the-secret-of-successful-drug-launches
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`8/16/22, 12:04 PM
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`The secret of successful drug launches | McKinsey
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`ABOUT THE AUTHOR(S)
`
`Hemant Ahlawat is a principal in McKinsey’s Brussels oce, Giulia Chierchia is
`a principal in the Madrid oce, and Paul van Arkel is an alumnus of the Zurich
`oce.
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`https://www.mckinsey.com/industries/life-sciences/our-insights/the-secret-of-successful-drug-launches
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