Pharma's future leaders

On July 7, 2008, the Financial Times reported on a survey that identified 'difficult market access' as one of the most significant risk factors for pharmaceutical companies. The current shortfall in the amount of top UK market access talent means that, in the future, some pharmaceutical and medical device companies might find it difficult to ensure their brands attain their full commercial potential.

In recent months, we have held extensive discussions with senior clients and candidates about this issue in order to gather and analyse leading industry views on market access. Our emphasis was on the significant human capital challenges the industry now faces.

Discussions revealed that the current pharma leadership pool, with its proven record in delivering both health economic and clinical-based payer value is small, specific and unsustainable in the longer term. The 'hot spot' areas are a sound knowledge of health economics and an understanding of payer needs, a detailed understanding of lobbying and governmental affairs, a consultative versus marketing approach and the ability to manage the transition to a speciality care environment. This is not solely restricted to the UK market, but is an international issue affecting the homogeneous US market and heterogeneous European markets as well, making the complexities of market access even more challenging.

Health economics
The FT report, based on a survey of leading industry executives by management consultancy Roland Berger, highlights the increasing importance of market access for successful commercialisation in the future. The most significant risks identified by companies were difficult market access, reimbursement and price pressure, and general cost containment.

Some companies, especially small to medium-sized organisations, will be forced to look outside of the industry to find the new skill set. The most promising executives are likely to possess a PhD from a leading UK or European academic institution, such as the London School of Economics or the French Ecole Nationale de la Statistique et de l'administration économique (ENSAE). They will also have an affinity for complex statistics and epidemiological data. Equally crucial will be their ability to construct a reasoned, convincing economic argument by combining research data with clinical outcomes.

Traditionally, many senior market access managers were expert technicians, but not necessarily leaders or communicators. Top performing graduates and academics, at ease in both scientific and commercial environments and in possession of the critical ability to interpret and blend technical and commercial information, are likely to find themselves occupying senior positions within the pharmaceutical companies of the future. For any leadership position, the ability to communicate effectively is absolutely essential. The new generation of pharma leaders will need to be flexible in their approach and capable of dealing with customer-facing issues when helping to shape commercial strategies at senior levels.

Government lobbying
Commercial organisations are re-structuring around smaller sales forces with greater key account leverage. This impacts on how access to payers is gained and how decision makers are influenced. Decision-making in the NHS is becoming more centralised, with one centre being responsible for many regions. Local expertise in how the payers are thinking and who the key influencers are is crucial. Consequently, an in-depth understanding of political and governmental processes, and how these need to be integrated with lobbying at all levels is vital.

Finding the right individual with a blend of national and local experience is seen as the main source of competitive advantage by many companies. For UK executives wanting to move overseas to access developing markets, national expertise is often not transferable due to the differences in healthcare systems in each market. However, for corporate leadership in this area, the rare individuals who possess a broad range of international market access exposure will still be highly sought after. One CEO described the ideal candidate as: "Clever, articulate and able to anticipate the arguments".

Consultative approach
Another significant market access challenge lies in finding executives who can switch between a consultative approach and a message-driven marketing mindset. A consultative approach is essential when negotiating with payers and reimbursement committees. Clinicians are no longer the principal target for a pharmaceutical organisation's commercial strategy. Instead, the target market is now fragmented across a diverse range of stakeholders (eg NICE, disease awareness groups, health authorities and trusts). The main focus of the pharma industry has shifted from primary to secondary care interventions, speciality products and the fulfilling of unmet medical needs.

In the words of one senior executive: "What is truly needed are people who can lead the whole pricing and reimbursement process and integrate health economics and clinical into a robust value proposition acceptable to payers."

The current business environment is not a place to be playing 'catch up' in finding the necessary market access skills. A position for a director of global market access, recruited recently for a major pharma company, nicely encapsulates the skill sets now required for senior positions in this area:
• Primary care sales and marketing – six years' experience
• Secondary care marketing, key account management - five years' experience
• Market access national level – three years' experience
• Government affairs and public policy – five years' experience.

Managing the internal transition
The greatest challenge for companies moving into a speciality care environment with supportive market access strategies is likely to be managing the organisational transition while maintaining flexibility and performance in a reshaped environment. There is no simple answer to this challenge, however executives with a deep understanding of the payers systems can clearly add value and influence the direction and shape of commercial organisations.

Our observations are that the key elements for a successful transition are the transfer, and strategic and tactical refinement, of internal skill sets, as well as the way that timescales are managed during this critical period. It is also important to maintain the right balance between consultative and traditional marketing-led approaches. A greater economic focus should be developed at a corporate level to effectively access and leverage the leadership qualities of the internal pricing and reimbursement teams. Market access programmes will need to be started early in the commercialisation and planning process and there will be a need to communicate the rationale for the longer time period required for RoI to be given.

Leadership in this area will make a critical contribution to the reshaping of sales forces and commercial organisations shifting towards smaller, speciality, consultative commercial operations.

With increasing UK government pressures, the need for medicines to demonstrate real economic value is at an all-time high. Leadership and technical skills in the areas of health economics, outcomes research, strategic pricing and market access, combined with the associated commercial and regulatory skills, will be high demand areas for the industry.

The Authors:
Andy MacLeod is the COO and Hugues Petit is a principal consultant at Euromedica