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Maria Whitman and Sankalp Sethi co-wrote this blog post with Malik Kaman. This blog post is part one in a two-part series.

At ZS, we’ve advised companies on more than 90% of the launches in oncology over the past five years, so manufacturers frequently ask us how they compare to others in terms of their people, their processes and their capabilities. This is a great question. With the pace of oncology investment worldwide—oncology is expected to be 21.25% of total pharma sales in 2020 globally, according to a Quintiles analysis—the level of competition in this space has risen to a whole new level. As we think about what it will take to compete and win in the new reality, it’s important to consider the commercial advantages and disadvantages of who you are as a company—your people, processes and capabilities—not just what scientific innovations you can bring.

To help manufacturers think about how to leverage their strengths, today and in the future, we decided to share our own internal oncology manufacturer “segmentation.”

Oncology Manufacturer Segmentation

Chart 1-3.jpgFor simplicity, we’ve purposefully excluded variables like centralized vs. decentralized decision-making, biotech vs. big pharma and scientific vs. financial orientation. These variables drive significantly different cultures within our manufacturers’ companies, but they cut across our segmentation rather than define it.

In our framework, we focused on prior oncology success because it speaks to the level of relationship, reputation, innovation and commitment that drives market perception as well as internal mindset and capabilities. Next, we chose commercial sophistication because it is becoming increasingly critical for future leadership as the “white space” for scientific innovation decreases and the data to drive decisions improves.

Which segment are you? Here’s a look at these four typical segments of oncology companies to help you identify your own organization:

1. Original Innovators: You helped define a path of early innovation in oncology. You’ve frequently launched transformational therapies years ahead of other manufacturers in the market. The oncology community considers you a thought leader with a strong heritage and reputation in your given tumor types. You tend to have a more science-oriented culture where a significant proportion of your teams have advanced scientific degrees. Values like collaboration and alignment define the way that you operate.

On the flip side, you consciously or unconsciously consider your success in oncology to be a birthright, a natural product of your superior scientific approach and the reputation and relationships that you’ve built. You tend to use less secondary data than your peers, relying on management intuition to make key commercial decisions. When secondary data is used, management has a tendency to get hung up on the gaps, and they find the faults and limitations of the analysis. Teams tend to defer to “what we know” about oncology through ad boards and primary market research interactions.

2. The Space Invaders: You are a relative newcomer to oncology, but not new to pharma. You may have recently launched a new therapy with an innovative mechanism of action, but prior to that it had been years before your company had a meaningful launch in oncology. You tend to have a more business-oriented culture where people with finance degrees or MBAs frequently set the tone for decision-making, and you’re used to intensely competitive markets. Regardless of whether your new launch is going well or struggling, you constantly hear how oncology is different. You find the oncology buzzwords and complicated terminology to be something that the “elitists” use to signal who’s part of the cool crowd and who is not. You also tend to operate in silos, sometimes attributable to the size of your organization, and collaboration between different functions can be hard to execute.

On the flip side, you’ve built the business around strong commercial capabilities and fought for market share where little clinical differentiation exists between products. You’ve carefully invested in secondary data and analytic capabilities, and while oncology presents challenges, you’re confident in your ability to exploit opportunities by driving commercial innovation.

3. The New Kids on the Block: You haven’t had much commercial experience yet, but you’ve got a great new technology platform. You look and feel like a startup though you’ve received enough funding to make it to your next milestone, and you have several gated development partnerships in the works. Your team has a zealous devotion to science, a super dynamic culture, wide-open roles where getting it done takes a premium over getting it exactly right. Nobody on the team has enough time, budget or resources to go as deep as they would like into key business questions, but everyone finds the pace invigorating. Comfort with ambiguity is high: You know that you’re cutting corners, but so far you’ve managed to get by. And in fact, you see that reality as a chance to be creative in some cases, and potentially create some competitive advantage.

On the flip side, some of you may be hesitant to become a commercial organization as that takes the focus away from the science and moves it toward the business of healthcare. There are multiple paths to getting your company to commercial success, and it may not be clear yet which you will take. Some core stakeholder in the organization may also resist changing the genetic makeup of the team from a scientific team to a sales and marketing organization, even though you know you need it.   

4. The Vanguard: This segment represents the ideal: companies that operate in the theoretical sweet spot at the intersection of great science and commercial decision-making. These companies have managed to retain the culture of biotech while implementing the discipline of big pharma. They still face fierce competition, but their agile approach drives high-quality decision-making more often than not. These companies have a clear vision for the customer experience they want to create, and they have a good balance of science, finance and commercial leadership. Their launch capability is best-in-class, providing visibility into global performance and allowing nimble course corrections based on real-time shifts in the market landscape.

While many companies aspire to be in this segment, and may demonstrate elements of this description or at least movement toward some of these dimensions, today this is an “aspirational” segment.

Each segment has strengths and challenges for the dynamically evolving oncology landscape. The key is finding ways to leverage your strengths to drive leadership and innovation.

Stayed tuned for our next post, in which we’ll cover what each segment can do to find success in a changing oncology landscape.


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Topics: Innovation, oncology, Pharma, cancer, segmentation, commercial excellence, Business Strategy, oncology manufacturer, commercial strategy, commercial landscape, behind the consultant curtain