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Cameron Tew explains why effective New Product Planning is the first line of defence against losses caused by product failures.
Cameron Tew of Best Practices LLC explains why effective New Product Planning is the first line of defence against losses caused by product failures.
Do pharmaceutical developers fully understand the importance of an effective New Product Planning (NPP) group?
One of the vital roles served by NPP leaders is to serve in a cross-functional development role to provide checks and balances among the represented functions. For example, commercial can point out when the initial plans for a compound have low potential market value, or research can point out that changing a product’s proposed formulation would be too costly or slow to meet project parameters.
NPP can bring in the commercial aspect, driving the financial and market considerations. Though the commercial teams provide input into development, commercial values can take a backseat in organisations focused on the R&D aspect of product development. In fact, it is not uncommon for R&D and NPP to speak different languages and have different priorities that can keep the two groups from understanding and fully valuing the each other.
In many ways, the art of new product development is being bipolar. On the one end you have to be the ultimate champion of the concept, and on the other hand you have to be able to say the baby is ugly; a harsh line when you have people wanting to see something go to market.
So, successful pharmaceutical product development demands a cross-functional approach, beginning in the earliest, pre-clinical stages. The leaders of NPP groups must be skilled negotiators and influencers who can communicate effectively across professional divides. Through their scientific acumen, NPP leaders can slowly win credibility among R&D teams. However, it is their soft-skill competencies that make them effective. These diplomatic skills help them excel in roles that have significant influence, but little authority.
How has the role of the NPP group changed over the years?
External pressures, combined with the ordinary constraints placed upon NPP by dominant structures, similar to other operational units of pharmaceutical companies, have created evolutionary challenges. As the role of NPP continues to evolve, structural adaptations tend to emphasise partnership, participation and collaboration. Major drivers of change include:
What are the primary challenges facing NPP groups?
The primary challenges facing NPP groups come both from externally and internally. They include:
But the concerns go far beyond bullet points to how the groups interact with others inside their organizations. Strong cross-functional communication and leadership skills are critical to ensure that sound decisions are made in an efficient and timely manner.
Has the economic downturn had any effect on NPP?
It would seem that the economic downturn is making people focus more on tightening their processes. The depleted pipelines and needs to make go or no go decisions in an efficient manner already had high functioning NPP groups working in concert with other parts of the early stage commercialisation organisation.
If a decision to stop work on a drug can be made at its earliest time, it can save companies hundreds of millions of dollars in R&D.
Best Practices LLC has conducted a study, Pharmaceutical New Product Planning: Structure and Activities to Drive Growth and Profitability. Can you tell us about some of the study's key findings?
Centralised and distributed structures dominate the pharmaceutical industry. In bigger companies, it helps to be independent for the following reasons:
Additionally, the report revealed the following:
Key activities and patterns
More activities are starting earlier in the process, even in pre-clinical stages, to ensure that later (costlier) development efforts are devoted to the right commercial targets; and enforce the market perspective and marketing discipline as early as possible. Some activities, such as creation of the Target Product Profile, become central to the work of NPP groups because they serve repositories of critical information and outcomes that can be updated with further studies:
NPP groups are structured in different ways in different companies. What structure is the most effective?
As companies grow, global concerns dominate operations, and conflicts inevitably develop around influence, participation, access to leadership, process, roles and responsibilities. Figure 1 shows a possible maturity curve depicting the evolution of the NPP function. Some of the attributes are merely artifacts of where they are in the development, or evolution. For example, Level 1 essentially represents early attributes, or the attributes of a smaller company. On the other hand, Level 2 is where the majority of companies can be found, and Level 3 is at this point in the evolution is largely aspirational.
Roles, responsibilities, interaction and influence
The report identified the following:
How can companies enhance the effectiveness of their NPP groups?
Many companies find that collaborative efforts between their NPP groups, R&D and early-stage commercialisation teams allow for greater success on projects. A key to this can be centralisation because it allows people who work on different projects and different customer segments to share resources, ideas and experiences. By fostering such close working relationships, companies reap the benefits of higher levels of integration and coordination, as well as the ability to streamline decisions and leverage resources and knowledge.
Diverse work groups also ensure that all viewpoints on a project are considered. By bringing all the key departments together at the earliest of stages, companies have the best chance of reaching a decision that is not myopic. This encourages buy-in from multiple stakeholder groups.If you have all the respective perspectives in the room at the same time, you should derive a better outcome that ultimately makes the most sense for the product. Having all the key players represented makes sure that some perspectives are not overlooked, which prevents you from having to revisit them later. This streamlines the amount of time needed to get better decisions.
As it relates to portfolio planning and management, centralisation helps establish and ensure common process, performance and evaluation standards for projects, programmes and product development. This tends to lead to faster, fairer and better prioritisation of projects, resources and capital requests that support corporate strategy and goals.
Finally, utilising cross-functional teams should lead to a smooth transition of responsibilities from NPP to in-line marketing. Most companies have adopted practices to maximise continuity and productivity during the transition process. For instance, key team members may stay with a compound from its inception through launch. The companies that take this approach believe that retaining key team members throughout the commercialization process provides for better insights and quick access to the history of compounds making for a more efficient and more profitable endeavour.