Congratulations! The decision to embark on the journey of founding a biopharmaceutical company is a courageous step indeed. Remember, as Tony Wheeler put it, “All you’ve got to do is decide to go and the hardest part is over.” Yet this venture is less of a sprint and more of a marathon, demanding a harmonious blend of expertise ranging from chemistry, biology, pharmacology, statistics & data science, clinical science, and surprisingly, health economics and real-world data. Indeed, even before your inaugural product launch, these disciplines are crucial. Real-world examples explain why.
Take Company A, for example, an innovative offshoot from an academic research institution. They are buoyed by Series A VC funding and boast an exciting pipeline of vaccines aimed at combating a slew of viruses including HIV-1, Hepatitis C, Zika, Dengue, Lassa, Ebola, Marburg, Tuberculosis, and Malaria, all in pre-clinical stages. Given limited resources and time constraint, shall they distribute on all these indications simultaneously? Economic considerations can be instrumental in sculpting a robust business strategy for them. For instance, understanding the epidemiological characteristics of these diseases, prioritizing the right regions or countries for clinical trials and marketing, and identifying the most promising business and funding prospects can all be informed by the application of health economics.
Even established firms like Company B, listed on Nasdaq for over two decades, with a portfolio of launched products, can learn from this approach. Their flagship product was initially launched in a fiercely competitive disease area but was later approved as a ground-breaking treatment for an unmet medical need that affects 1% of the world population. Had the company integrated health economics and outcomes research (HEOR) early on in their development process, they might have led with the latter indication, setting a different price point and maximizing the return on their product before the patent expiration clock ran out.
So, when should biopharmaceutical start-ups begin incorporating HEOR into their strategies? Big pharma typically considers it by phase II, but my recommendation for smaller biotechs is to start as early as phase I of clinical development. In an industry where out-licensing or co-development are frequent exit strategies, an early HEOR perspective can be vital.
HEOR offers companies the ability to identify and quantify current and future unmet medical needs using economic models and identify drivers of treatment decisions for patients, payers, providers, and regulators at the beginning of their journey. This involves an array of tasks such as indication assessment and prioritization, overviewing the future competitive landscape, and analysis of pricing and reimbursement environment trends.
It might feel like adding another layer of complexity to an already daunting undertaking, but the value of embedding HEOR thinking early on is immeasurable. It helps to drive strategic decision-making, identify high-impact opportunities, and maximize the potential of your company’s offerings in an increasingly competitive and cost-conscious global healthcare landscape.
Remember, biopharmaceutical innovation is indeed a marathon, and HEOR is a powerful tool you can have in your race kit. Start your race on the right foot; start with HEOR.