How to commercialize a biotech innovation
An innovative biotech product is usually the result of many years of research and development. Brilliant scientists have spent years of clinical development refining their initial ideas into a product that is now almost ready for the market. They are now facing the final step: the commercialization of the product.
Preparing the company
It is important for the success of the market launch that the company is ready for it.
The situation is often like this: In order to commercialize their product, the scientists responsible for research and development found a company. In the start-up phase, they then concentrate very much on the further development and clinical research of the product until it is ready for the market, without paying much attention to the target group or the market.
Therefore, it is crucial to prepare the company for the market launch by adding other perspectives.
This process follows three questions:
- Where are we? The description of the status quo should include all necessary perspectives, including those of the target group and the market.
- Where do we want to go? Based on the described status quo, you can set brand and marketing goals that are well-founded, achievable and promising.
- How do we get there? The last step involves action planning for all functions involved, determining the financial requirements and allocating budgets.
In detail, I would proceed as follows:
1. Form a launch team
Establishing a newly developed biotech product on the market requires focus and perseverance. Priority should therefore be given to forming a launch team that is dedicated to commercialization.
The team should include representatives from all parts of the company that are required for a product launch:
- Forschung und Entwicklung,
- Medizin,
- Qualitätsmanagement,
- Zulassung,
- Marketing (wenn schon vorhanden),
- Finance
and - with a view to recruiting - if applicable.
- HR (if available).
Filling the need for specific expertise
Companies that are still in the start-up phase often find that they still lack the necessary expertise in certain areas - or that this expertise does not even exist yet.
There are two sources of help here: Incubators for biotech start-ups usually offer coaching programs that provide support in certain tasks.
On the other hand, it is possible to work with independent interim managers, in for certain phases of commercialization or the entire project - especially if specific industry knowledge or operational expertise is lacking.
2. Analyze the competitive situation
The initial product idea is sometimes based on a rather vague idea of the needs that the product should serve.
But a new product will only be successful if these three minimum conditions are met:
1. there is actually a relevant demand.
2. the product offers an obvious advantage.
3. it is easy to use.
So have your launch team conduct a thorough analysis of the competitive situation in order to assess the degree of market adaptation, the product-market fit, in various segments.
The status quo should be described from as many perspectives as possible. But essentially, these aspects should be taken into account: the target group, potential competitors and current trends.
Target group
There are two questions to ask:
- What are the actual needs of the target group?
- And which needs are currently not being met by the solutions available on the market?
A direct answer can be obtained from people in the customer base. The "mom test" determines whether people without your background knowledge understand the product. This could be used with patients, for example. At the same time, market research should be conducted among prescribers.
Competitors
Analyzing potential competitors is very important in this context:
- How are competitors positioning themselves?
- And what does this mean for possible competitive strategies?
Trends
The biotech market is highly dynamic, and growth is correspondingly strong: turnover almost doubled according to BMWK between 2015 and 2020 to €6,490 million. This makes it all the more important to monitor current trends: which market trends could have an impact on the positioning of my product tomorrow or the day after tomorrow?
3. Formulate your marketing and brand goals
Your launch team can now formulate the goals: for example, turnover and sales per submarket or the sub-sector of a medical indication in which you want to become active, the target group (awareness and use) and specific needs that you are addressing, and so on.
The prioritization of possible markets, target groups and needs based on the competition and potential analysis is crucial here - and, if applicable, the voice of your investors.
4. Develop a strategy
When your marketing department develops a strategy that matches the objectives, it will include
- the pricing,
- the expected turnover,
- which multipliers should be contacted with information about the new product
- the communication and
- the planning horizon
.
In the case of healthtech products, there are also existing regulations. For example, the reimbursement amount that health insurance companies pay to pharmaceutical companies for original preparations also has an impact on sales planning.
5. Coordinate planning at department level
Implementation of the strategy in the individual parts of the company is a matter for the respective departments.
For example: Sales should serve the intended target market or target segment. But how should the company proceed? Should it launch the product itself? Should it look for sales partners? Or should you think about out-licensing or distributors right away?
When planning the implementation of the strategy, close coordination between the departments is essential. Because without regular exchange, different parts of the company could plan in different directions.
Conclusion: Commercial breakthrough means innovation plus marketing strategy
A strategy for the market launch of an innovative biotech product results from a description
- of the status quo,
- the objectives and
- the measures required to achieve the objectives.
Structure of the biotechnology market is crucial
The structure of the biotechnology market is a key factor in the concretization of the strategy. Both the innovativeness and the growth of the market, as well as the regulations, especially for pharmaceutical products, are decisive for the development of the strategy. And probably more so than in other sectors. Industry knowledge is indispensable!
