Companies regularly test new concepts to stimulate innovation and minimize commercial and financial risk ahead of major business decisions, such as product acquisition, development, and launch.

A framed and systematic research methodology showcases concepts with different features and benefits to potential or existing customers. This helps validate a value proposition and estimate its market potential. Results can inform product strategy and allow companies to refine the value proposition, incorporating concept features and properties that resonate the most with end users, as well as defining optimal pricing strategy.

Pharmaceutical Market Particularities

In the pharmaceutical world, especially the prescription market, there are additional challenges due to the complexity and specificity of the sector:

• Users, consumers, and payers might not be the same person (i.e., healthcare professional/prescriber vs. patients vs. public healthcare funding agency (e.g., NHS)).
• Drug prices are negotiated with governments and vary greatly from country to country, depending on the company’s strategy and the country’s funding capabilities.
• Characteristics of drugs (e.g., safety, efficacy, dosage, mode of administration) are not modifiable easily due to cost implications and the length of time required to validate changes in characteristics during clinical trial phases.
• An in-depth assessment of the benefit/risk balance for the patient is made before the usage of any new drug treatment.

So how do we test the value proposition of a drug and evaluate its commercial potential?

TPP Methodology

Testing the target product profile (TPP) of a new drug treatment with an audience of interest (e.g., prescribing healthcare professionals) provides valuable insights on understandability, credibility, and prescription potential, etc. It is used to guide strategic decisions related to the product portfolio.

A TPP outlines the key characteristics of a target “product” or drug for a particular therapeutic indication. It will include information regarding the intended use of the product, target population, and desired product attributes, including safety, efficacy, and dosing-related information.

To test the value proposition of a drug, a series of streamlined and semi-standardized questions are used to get clear and unbiased feedback on the TPP.

The first step in the process of a quantitative TPP test consists of formatting the TPP information into a short and optimised summary detailing key drug characteristics. As seen in the example below, an ideal TPP is typically a one-page document with grouped clinical elements. This facilitates respondent understanding and absorption of TPP information and maximises the quality of initial reactions and feedback from healthcare professionals (HCPs).

TPP is filled with illustrative data and not related to any products on the market or in development.
Content can be adapted and personalized depending on drug characteristics.

Audience

Once the content is finalised, you need to identify the right population who can understand the TPP content and provide useful perspectives that will address research objectives.

Healthcare professionals are usually the most relevant type of population to share feedback on TPP, but it can be challenging to identify the key HCP populations as certain treatments involve the participation of multiple HCP functions (e.g., nurses, generalists, and/or specialist physicians) across various specialties. For example, radiology treatment for prostate cancer typically involves a nuclear medicine specialist, a medical oncologist, and a urologist.

It is vital to identify and select the most relevant experts to target. It is also an option to go further and gather feedback from non-HCP populations such as payers to estimate the pricing and reimbursement potential, patient advocacy group/association members to gain insights from the patient point of view, and former industry executives to gauge the commercial potential of a drug.

Types of Projects

TPP testing can be applied at many different stages within the drug life cycle, depending on the research objectives. Three common use cases are as follows:

Market opportunity confirmation for business development and licensing (BD&L) – Corporate strategy teams regularly evaluate the market potential of external assets in development to determine best opportunities for drug acquisition or licensing and expand their portfolio. TPP testing helps size the market opportunity and fact-check the drug-selling statements claimed by the external company, either during an early BD assessment or before due diligence.

New drug development or early drug testing – Teams responsible for fostering internal innovation are always eager to test different scenarios for drugs in the early pipeline (e.g., preclinical and phase 1). They aim to inform the prioritisation strategy for new product development by evaluating the clinical and market potential of each trial-results scenario (e.g., worst-case vs. base-case vs. best-case scenarios). Typical outputs can be a prescription forecast funnel quantifying the risks and benefits for each scenario.

Launch and commercial strategy preparation – Marketing and commercial teams are responsible for preparing the launch of late-stage drugs (i.e., phase 2, phase 3, preapproval) on target markets. To do this successfully, a fine-tuned launch strategy is vital. Testing the drug TPP before the launch allows them to confirm and refine prescription/usage assumptions for key population segments and inform sales forecasts, field forces size, and marketing budgets needed to maximise revenue in the first years of launch.

Conclusion

The industry spending the most on R&D is pharmaceuticals (~15% of net sales). Each drug in pharmaceutical development requires significant financial and time investment (~$2.6 billion USD on average for a successful FDA-approved drug, and clinical trials represent ~65% of the cost³). For these reasons, it is imperative to be successful in the acquisition, development, or launch of a drug. Market research is utilized extensively throughout the entire drug life cycle.

TPP testing can effectively support these impactful business decisions by providing pharmaceutical clients with an unbiased and unaided assessment of the drug value proposition that guarantees the comparability and replicability of the research results. By increasing confidence in working hypotheses, quickly anticipating potential hurdles, and mitigating financial risks.

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GLG brings pharmaceutical clients world-class expert insights to support their key business decisions. Get in touch to learn more.