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Interview: Georg Toufar, Mundipharma

Mundipharma’s chief marketing officer Georg Toufar on the benefits of having a smaller, more concentrated focus
Georg Toufar

If someone was to get all the major pharma companies to compile a list of the biggest challenges for the industry in Europe over the past decade, chances are health technology assessment (HTA) would be close to the top for most of them.

These HTA bodies, which assess the value of new medicines for use on national healthcare systems, have been rising in influence since their introduction in the early 2000s.

This has been spurred in recent years due to the global recession and major cutbacks in healthcare spending, forcing governments to be more selective in what often highly-priced new medicines they back when cheaper generics are already available.

Such tough decisions have led to angry outbursts against the UK's HTA body the National Institute for Health and Care Excellence (NICE) from the likes of Roche and Pfizer, while NICE's German equivalent - IQWiG - has faced similar criticism for some of its decisions from GlaxoSmithKline, Boehringer Ingelheim, Bayer and others.

Similar stories are repeated across the continent, and the industry consensus from larger companies seems to be that it's a system of market access that needs to change.

There are dissenters among the pharma industry, however, with some companies learning to adapt their business strategy to this way of providing patients with medicines, rather than placing blame on a structure that doesn't look likely to change any time soon.

One of these companies is Mundipharma, a mid-sized firm whose business model is built on creating development and commercialisation partnerships with companies who already have a product in early development. 

Treatments successfully brought to market in this way include asthma treatment Flutiform, created by Skye Pharma, and restless legs syndrome treatment Targin.

Speaking to PME, Mundipharma's chief marketing officer Georg Toufar explained that industry needs to move from a thought-process that valued the development of something that was merely 'new' to creating something 'better' that healthcare systems would value.

“The game has changed,” says Toufar. “If you go back to the 1990s, the moment you had something new it would come with a premium price. Now being 'new' doesn't get you anywhere.”

It's a change that smaller firms, such as Mundipharma, have benefited from, with Toufar noting that major pharma growth in Europe is coming from mid-sized companies with a clear focus rather than big pharma companies who are “backing too many ideas”.

“I think the bigger you go the more you lose focus,” says Toufar, who has experience at a pharma giant having spent time at Novartis as head of marketing and sales for Northern and Central Europe.

This concentrated effort has meant Mundipharma has to be “more picky” - as Toufar calls it - with regards to what treatments it chooses to commercialise, in contrast to larger companies who can fund dozens of programmes at once, although not necessarily ones that will pass the final hurdle.

“Big pharma still chases 'new',” says Toufar. “In some instances, such as in some orphan drugs this is amazing, but for 75 per cent of opportunities, it's not. It's newness for newness' sake when it has to be better. Governments don't have more money, so why should they spend what they have on a hypertension drug when the current treatments are good enough and cheaper.”

Choosing carefully
This scrutiny when it comes to what new treatments to back is supported by the company's 'fail fast' approach to potential products; Mundipharma doesn't want to spend money and time developing a drug to a regulatory or HTA stage only to told that it's not needed.

Instead, Mundipharma “frontloads the pain”, according to Toufar, only choosing to work with partners on products once they are confident healthcare payers are interested in having access to them.

“Big pharma backloads the pain,” says Toufar. “You have a scientist that comes up with something then chucks it over the fence. Then you have a commercial team who looks at it and chucks it over the fence. Then a market access team, and so on, until you get to a payer who isn't sure they should pay more for a drug when they're happy with what they've got.” For Mundipharma, it's a different approach: “The stuff we don't back doesn't make it. The stuff we back is successful, and we have reimbursement rates above 70 per cent.”

The key aspect of this approach is effective and early communications with the people that matter. “We co-create and co-develop stuff with payers. We go to them and say what idea we have and if they like it. And if not, what data we would like to see. We don't wait until the end. It makes for a difficult first few years but once you are through, you're through.”

Coming from a consumer background – Toufar has experience working at Mars – this need to listen to the ultimate customer during development is obvious, but something he says is severely lacking in the pharma industry.

“If your biggest customers are not interested then there is no point in pushing a product further, but in pharma, companies tend to just be interested in getting products over the next fence.”

Knowing your limits
Part of the reason Mundipharma has been able to cultivate this approach is its culture as a smaller, privately-held firm where decision-making is easier, access to senior figures is possible and entrepreneurial spirit is encouraged.

This is in contrast to larger public companies that need to answer to shareholders and consistently post positive quarterly results.

“Larger companies push projects through because the remuneration system is aligned, the news flow is aligned, the incentives are aligned. This is why you have big companies failing at a late stage.

“In a private company you have more freedom; you can call as spade a spade and say that cholesterol is done, hypertension is done. You could develop a drug that is 5 per cent better in these cases but you can't ask for a higher price because nobody is interested in paying for it. It's a more honest approach to business.”

Mundipharma is also open about its limitations, with Toufar fully acknowledging that it leaves the discovery side of things to the experts and instead focuses on the later stage of development and commercialisation. 

“We don't pretend to do early research,” he says. “We partner with people who are good at that. We take high risk in terms of commercialisation but we leave other risk with others.”

This is something that larger firms could learn to be more open about, he says. “The problem with the likes of AstraZeneca is that they have pretended to be good at research. And they aren't because if you are a smart scientist, you want to found your own company. All the innovation in big pharma comes from biotechs.”

Plugging into innovation
By being open in this way, the pharma industry will then begin to take shape of a more 'normal' industry, according to Toufar.

He justifies this point by comparing the current state of pharma to the oil industry in the 1980s just before it began to break down from large conglomerates into an ecosystem of different specialists working on different bits of the value chain.

“It's less of a big pharma way of working; that's more 'we know everything'. Instead, it's more collaborative. It's just following other industries, the way oil has desegregated so you now have some players who are good are finding oil, others who are good at drilling and so on.”

There is evidence that companies are moving towards this approach, with the likes of Johnson & Johnson setting up several innovation centres in key locations around the world with the specific intention of working with local academics, while the Innovative Medicines Initiative (IMI) is bringing EFPIA members together with academics and biotechs to research major public health problems.

Mundipharma is already ahead of the game though when it comes to collaboration, says Toufar, due mainly to necessity.

“If we are not able to plug into an external method of innovation, we are dead. Therefore we have to be more open and humble when talking to these people. We can add value in terms of commercialisation, but we don't pretend to be the two things.”

For Toufar, the next few years will see this desegregation continue, with big pharma companies breaking up – as per recent divestments by Pfizer, Abbott and GlaxoSmithKline – as new business models form.

As for where Mundipharma will fit, Toufar is confident it will be fine.

“We are fast and entrepreneurial. We follow the opportunity. Being private is an asset and we can continue to be independent and authentic.”

Article by
Tom Meek

group editor - PMGroup

1st April 2014

From: Research, Sales, Marketing, Regulatory, Healthcare



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