As we kickoff 2019, the pharma and biotech industry is once again on the cusp of significant change. We’re all still reeling from the ups and downs of 2018 and looking ahead to the new year brings on both anticipation and anxiety.

Will the trends that shape our year be for the better or worse? Unfortunately, only time can answer that question. Until then, it’s best to be prepared.

We polled the Archbow Consulting team to find out which trends they’re watching as we welcome 2019. A combination of internal and external forces, this list is guaranteed to include something that will impact your ability to deliver care…sometimes in a good way, sometimes not. Regardless, we hope this gives you the added insight to make the most of your opportunities this year.

2019 pharma and biotech trends to watch

Market access strategies as a driving force in gene therapy success

Gene therapy products represent the exciting frontier of commercially-available medicines today. Pioneers like Kymriah, Yescarta, and Luxturna are starting to see an uptick in demand, and countless more regenerative medicines will likely be approved in the near future. However, policymakers, payers, and manufacturers are still struggling to reconcile the economics of development costs and much-higher-than-customary-manufacturing costs with smaller than usual patient populations. There is significant marketplace tension from manufacturers needing to charge big prices to recoup their investments while other stakeholders are reluctant to pay.

All stakeholders are looking for well-designed and perfectly-executed market access strategies. Optimizing the market access plans for these unique products is of the utmost importance sooner than later because the next big wave of regenerative medicine products will “democratize” the category, bringing the products to more prevalent diseases at lower costs.

Finally, a foothold for value-based contracting

Despite perfectly suiting technology and luxury goods, the concept of value-based pricing has been welcomed so far in the pharma world with various levels of success.

But the environment for value-based pricing is ripe for adoption in the wake of ever-increasing demand. Beyond the growth in specialty, the emergence of one-off therapies to replace chronic treatments (treat to progression) is driving the need for adapted pricing models. Value-based contracting is consequently forging ahead with both challenges and opportunities that include:

• The guarantee that the payer can allocate resources optimally as costs are borne only for treatment responders. Symmetrically, manufacturers receive the highest price for responders while refunding partially or completely the cost of the treatment for non-responders or patients who cease to respond after a certain duration of time.

• The ability to capture outcomes at the patient level.

• Support for indication-based pricing.

• The necessity of a performance modeling tool and standardization of assessment.

The pressing need to descramble the alphabet soup of companion diagnostics 

The pending array of companion diagnostics in 2019 and beyond is daunting. According to the FDA, as of 12/20/2018, there are more than 50 in vitro diagnostic devices or imaging tools in use today. The number in development is even higher, and the incorporation of these into prior authorization (PA) criteria will only increase. Many pharmaceutical manufacturers have taken a neutral stance on these tools, citing fear of one certain test being mandated per the FDA in their product’s label. While this strategy may have been moderately successful in the past, a completely passive approach going forward is not advised.

EGFR, ALK, BRAH, ERBB2, KRAS...HELP!  The time is now for pharma to better understand how to get proactive using these mandated tools to the ultimate benefit, getting the right patient on therapy for the right amount of time.

Increasing importance of patient services in complex care models

Many of the trends we highlight this year surround the increasing complexity of today’s medicines. As the drugs themselves become more complicated to manufacture, prescribe, deliver, administer, and reimburse, high-quality patient support services that help navigate intricate care plans become ever more vital. It makes sense that treatments that require a ‘white-glove’ approach should come with heavy navigation, guidance, and assurance. Patient care models of the future will include a heavy mix of patient services-from care coordination to fully-digitized concierge HUBs. The good news for patients and manufacturers is that the U.S. Department of Justice has taken a patient-friendly stance on lawsuits that suggest services like prior authorizations and patient education are kickbacks for prescribers. Recently, they recognized the value patient service programs provide by dismissing several such cases and noting that federal healthcare programs have a strong interest in ensuring patients have access to support. For now, the path is clear for patients to receive the support they need to realize the best outcomes.

Quality as a brand differentiator

Building a Quality Management System (QMS) within your brand’s HUB services has the ability to differentiate you from the competition now more than ever. Providing your customer with services that exceed expectations (“signature quality touchpoints”) can and should be a defining attribute of your brand.

In 2019, every new program design should begin with a QMS in place. Often, organizations incorporate quality last in their planning, which leads to it being addressed first in remediation. But, when quality comes first, acting as a framework and foundation for a program, there is rarely a need for remediation. A QMS offers countless benefits, including the ability to drive performance to new levels of reliability, while improving key areas that minimize operating costs, and drive adherence and brand confidence.

Increasing collaboration between sales marketing and market access

For too long, pharma sales marketing and market access teams have been at a disadvantage by working in figurative silos. Often, market access teams are brought into the fold once sales marketing campaigns are too far along, meaning that their “on the ground” knowledge was never fully leveraged. The result is discordant messaging across teams when speaking to key stakeholders (i.e., providers, payers, etc.).

As the industry homes in on value-based care in 2019, we’ll see more collaboration between sales marketing and market access as manufacturers try to gain a competitive advantage in differentiating their brand by focusing on the patient. Industry leaders are already centering marketing campaigns around user experience on digital platforms that comply with regulatory requirements. Working together, these teams not only improve the patient experience but also secure more visibility into the real-time data and insights that drive critical business decisions.

Expansion of mobile apps into patient diagnosis, treatment, engagement, and adherence

When it comes to healthcare if there’s not an “app for that,” rest assured it’s coming, and this trend shows no signs of slowing down anytime soon. As consumers and patients, we have grown accustomed to having real-time access to data at our fingertips, day or night. Encompassing everything from finances to fitness, our personal data begins to shape our story, including our health. 

The mobile health market is rapidly expanding and is forecast to reach $58.8 billion by 2020. Apps invite the patient to take the driver’s seat in tandem with their physician in their healthcare journey, including but not limited to disease management, scheduling/reminders, medication adherence, virtual visits, and education and awareness. In 2019, we expect more providers to embrace the shift to a tech-oriented patient model, chasing the ability to analyze real-time data 24/7 regardless of the location of the patient, providing faster and more efficient care. Next up, apps that assist with exams relating to all functions of the eyes, hearts, and lungs.

The evolution of finding project success

Pharmaceutical project management has always been complex. But a few years ago, by following a well-honed formula of clearly defining your goals, naming key milestones, meeting vital timelines, and over-communicating at every turn, you could usually find quantifiable success. As the world and our workforce have changed, so have the keys to meeting project expectations.

Today’s evolved approach to project success includes a few new must-haves:

• Empowerment of team members to be part of the process and to raise the flag if they need assistance or if deliverables are at risk.

• Thorough day-to-day (sometimes even hour-to-hour) management of the project to identify potential pitfalls or risks early enough to mitigate them.

• Multi-streamed communication that includes not only leadership but also your frontline representatives. Often, changes directly impact frontline jobs and if those employees are not informed, they will fill in the gaps themselves, which may have a negative impact on how the project deliverables are received.

• Showing more gratitude and appreciation than ever before. Many individuals will step in to support your project in addition to their daily jobs. It is essential to say thank you and communicate success to keep morale high.

The ever-changing drug pricing landscape

Most countries today have a centralized healthcare authority fixing a national price for medicines, oftentimes monitoring what their neighbors (or even distant countries) pay for the same product. Known as International Reference Pricing (IRP), this process is well understood by pharmaceutical companies operating outside of the U.S. Indicators such as target price, floor price, price corridor, and even the questionable concept of launch sequence optimization are direct consequences of IRP.

A recent proposal from the Trump administration requesting the implementation of an International Pricing Index (IPI) for Medicare part B products, and one from Senator Bernie Sanders advocating for an IRP approach similar to Canada’s, shows that both liberal and conservative stakeholders want to increase control on the usage of taxpayers’ money. Notwithstanding the success or failure of the administration’s IPI pilot in 2019, it is in the best interest of pharma to strengthen global pricing governance processes and tools.

A spike in demand for high-quality Fair Market Value

In the wake of heightened government attention, pricing pressures have become the new normal for the pharmaceutical industry. In this environment, it makes sense that manufacturers will be under more scrutiny than ever where spending on services is reported in accordance with several state laws and federal provisions. That makes a flawless, rigorous approach to Fair Market Value (FMV) all the more vital. 

Selecting the right FMV partner is a strategic decision that can help a manufacturer position their organization for success because high-quality FMV isn’t just about compliance; it can also be a valuable tool for growth and efficiency. As long as drug pricing is in the spotlight and a poor decision could result in defending your pricing in front of the OIG, committing to finding the best FMV strategy for your organization is a no-brainer.

The resurgence of retail

You don’t have to look much further than the corner of your block to attest to the fact that the popularity of retail pharmacies has never really gone away. While previous trends had payers trying to encourage patients to receive chronic prescriptions via mail order (and specialty), successful efforts by retailers have mitigated financial dis-incentives for patients to fill at retail.

Moreover, a few new trends have emerged which will continue to stimulate retail growth in 2019:

• Specialty at retail. This is not a new feature, but it’s as popular as ever with patients. Patients get the best of both worlds-expertise of an SP and the convenience of their local store.

• Biosimilars. Could channel strategy be a differentiator that helps biosimilar products gain market traction in the U.S.?

• Institutional retailers. As parts of the healthcare ecosystem integrate into IDN/ACO models, pharmacies are a key piece of the treatment puzzle. Look for more aggressive moves from consolidated systems to gain access to traditionally limited distribution drugs or categories of drugs.

Partnerships with IDN-owned Specialty Pharmacies

IDNs are becoming increasingly important in the development of a successful commercial strategy for pharmaceutical manufacturers. We have all seen the data on how these rapidly growing entities have built Specialty Pharmacies to serve their members; but until recently, not much credence was given to the potential impact that these IDN-owned SPs may have. The idea of working proactively with IDN-owned Specialty Pharmacies brings up multiple concerns for Pharma, such as:

• Inconsistent data reporting

• Disjointed systems that sometimes have difficulty communicating with each other

• Lack of external payer acceptance, and thus, network exclusion issues

• 340B implications

That being said, get ready for some dramatic changes. It is wise to start paying close attention to these emerging disrupters. Each of the top 20 health systems generates billions of dollars (yes, each!) and each offers comprehensive services to the community at large. That’s a big fiscal and social footprint that can either work in favor of or opposition to pharma.

Douglas Bock is Partner, Archbow Consulting; Kevin Cast is Partner, Archbow Consulting; DeWayne Manning is Partner, Archbow Consulting; Sheryl Heinle is Senior Director, Archbow Consulting. Katie Rapp is Senior Director, Archbow Consulting Justine Hughes is Director, Archbow Consulting. Sarah Feldmann is Director, Archbow Consulting. Tami Stowe is Associate Director, Archbow Consulting. Bertrand Tardivel is Head, Global Pricing and Market Access, Archbow Consulting.