Sam worries about R&D’s drive to commercialize their invention.

Sam’s Problem

Sam, as product manager, must define and ship new specialty chemical features on a regular cadence. R&D wants their invention included in the next commercial launch. R&D’s viewpoint is typical of a firm driven by an engineering subculture¹. They know what their customers need.

Sam’s Solution

The patent for R&D’s new invention was granted last month in Europe. Sam wants an outside-in opinion to balance R&D’s inside-out opinion of the patent’s worth.

He knew of my outside-in expertise and hired me for the market research project.

Sam, his group and I met to outline the outside-in customer research project.

Project Outline

Project addresses the following issues:

1 What is market system acceptance for excipients² produced using the client’s patent.

2 Who, at customers, makes critical decisions on excipients use.

3 What influences decision-makers’ acceptance of new excipients.

Executive Summary: Enzyme-Processed Excipients … Marketplace Acceptance

All respondents heard this description of the client’s invention

“I’m on assignment now from a client that is working on an innovative enzymatic process for making excipients. On a bench scale they have demonstrated that, with this process, known excipients can be made with greater homogeneity.”

Forty respondents entered into deep interviews with me³. 

Thirty-four respondents cited the pharmaceutical industry’s roadmap for adopting a new excipient.

1. Imperative that a new excipient is incorporated in the first year of development of a new drug formulation.

• From the start of development to marketing authorization⁴ takes 6-10 years.
• Within the first year of development, developers decide on the excipient to be used in the drug formulation. They don’t change their minds during development.

“Your client’s invention needs to have some sort of useful differentiating property for us to consider evaluation.”
     Dir.. Acceptable Excipients … Pfizer

“George, if you come in with a new excipient, then it’s 10 years before commercial level sales. If modification stays within USP guidelines, and you’re not the current market leader, then no hockey stick growth until > 5 years.
     Bus. Mgr., Pharmaceutical Ingredients … Eastman Chemical

2. Formulators can change to a to a new excipient after a drug is approved. Yet, in practice, they don’t want to revisit the approval process for an approved drug.

“Everybody is on the lookout for improved excipients. But search is coupled with an extreme reluctance to rattle the regulatory cage of an already approved procedure and product.”
     Mgr., Quality Control … International Processing Corp.

We did not commercialize our excipient candidate. Our regulatory people saw we would need to pay for a full battery of tests ($2 million) before commercialization.”
     Leader, New Product Development … Colorcon

Six respondents in the nutraceutical industry saw value in the “new” of the invention

• • Expect supplier to pay for all compliance and regulatory test data.

“New means we have another item to feed to our 3 million distributors. We have a history of taking technology on the edge and beating our competitors to the market. We would like to work with your client and might do in marketing as ‘new’ .”
     Mgr., Strategic Chemical Group … Amway

Outcome

• Sam stopped all work on R&D’s invention and put it on the shelf.
  
  • His action freed up developers to speed cadence of short-term, work-in-process.
• Sam chose not to follow leads in the nutraceutical industry.
  
  • Did not meet his division’s guidelines for specialty product margins
• Sam’s division hired Tom, an R&D manager with relevant experience in pharmaceutical industry.

Twenty years on

• Tom is VP, Technology
• R&D’s enzymatic processing technology taken off the shelf
  
  • Gives the firm a lead in industry’s current move from batch processing of excipients to continuous processing.
    
    • Lowers price. Increases homogeneity.

Lesson Learned

Even very conservative customers will change their decisions. Be prepared to be first out of the block in meeting their changed mindset.

Endnotes

1. Edgar Schien

2. Excipients

3. My key skills for this outside-in, market research project

Elicitation
Recognizing Early Adopters

4. United States: FDA (including FDA’s SUPAC guidances) … European Union: Centralized Procedure and the Mutual Recognition Procedure … Japan: Ministry of Health and Welfare