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Enabling Marketing Insights and Superior Competitiveness Through Faster Market

Research Approvals

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Table of Contents

I. Executive Summary pgs. 3-7 Research Overview pg. 4

Participating Companies pg. 5

II. Key Findings & Insights pg. 8

III. Best Practices of High-Performing Companies pg. 16

IV. Managing Cycle Times & Fast Response pg. 36

V. Managing Roles & Responsibilities pg. 50

VI. Managing Honoraria Services pg. 57

VII. Managing Non-conforming Requests pg. 69

VIII. Approval Process Excellence pg. 72

IX. Best Practice Case Study: How One Company Evolved Fast & Efficient pg. 80

Approval Systems

X. Lessons Learned & Pitfalls to Avoid pg. 93

XI. Field Interviews & Executive Verbatims pg. 98

XII. Path Forward Recommendations pg. 104

XIII. Benchmark Class Demographics pg. 108

XIV. About Best Practices, LLC pg. 112

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Key Operational & Management

Factors Examined

Benchmark

Methodology

Research

Objectives

Research Overview: Objectives & Methodology

Twenty leading pharmaceutical and biotech

organizations participated in the study.

Eight companies’ executives participated in

deep-dive operational interviews.

Additional qualitative

Balancing Business & Regulatory Risks:

Use external benchmarks to evaluate how

biopharma companies participating in

specialty and rare diseases balance

competing needs: Business (go fast, go

deep) and Regulatory (Be safe and

compliant)

Evidence-Based Benchmark: This study

engaged companies focused on specialty

therapeutic areas and rare diseases;

research probed diverse factors enabling the

all-important Marketing Research and

Insights Approval Process.

Marketing Research Topics Probed:

Managing Roles & Responsibilities

Managing Cycle Times & Fast Response

Managing Honoraria Requirements

Managing Non-conforming Requests

Approval Process Excellence Drivers

Managing Vendors

Market research studies help biopharmaceutical companies gain critical insights they need to compete successfully in a

fast-changing market. Delays in launching and executing key market research projects can negatively impact or slow the

decision-making process, resulting in missed opportunities and increased costs. This report identifies practices for expediting the corporate market research approval process for faster insights.

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Benchmark Class

Universe of Learning: 21 Leading Companies Focused on Specialty & Rare Diseases Contributed to this Research This study engaged 22 executives from 21 leading pharmaceutical, biotech, and life sciences companies. Eleven

companies responded on behalf of rare disease markets. Forty percent of companies participated in deep-dive interviews

about the drivers of operational excellence. Three-fourths of respondents are directors or heads of market research.

= Company participated in deep-diving qualitative interviews

= Company contributed lessons learned & pitfall commentary

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Market Research Project Approval Speed Can Help or Hinder Competitiveness

(6) MARKET SHARE

When all is equal, speed navigating

markets drives share gains.

(7) GROWTH VS. DIVIDEND

Growth models need to grow faster & into

new adjacencies; dividend models can

grow slowly and pass cash to shareholders.

MR is most important to growth models.

(4) MARKET NICHES

Growth paths move into market niches,

making understanding the niche critical.

(5) LAUNCH CURVE

Launch curves are inflected up or down by

market understanding & positioning.

(2) NUMBER OF STUDIES

# of studies drives market understanding

& responsiveness.

(3) COMPETITIVE MARKETS Rising market competition makes MR more

important & harder to conduct in specialty /

rare disease markets.

(8) MARKET CAP Growth and profit disproportionally

drive market capitalization.

(1) MR APPROVALTIMES

Approval speed affects number of

studies & MR productivity.

Market Research

Speed to Insight

Drives

Competitiveness

in Growth

Companies

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Key Findings: Process Excellence, 1

Cycle Time Review Key Metric for Assessing MR Approval Process: Nearly three-quarters of participants use

review cycle time as a metric for determining if the market research approval process is functioning at an

acceptable level. Study cost and recruiting failure rates are metrics used by 43% of the benchmark class.

Best Practice Checklists: Employ best practices, checklists and rules for high performance. Begin with

checklists in pinch points that are most problematic. Then extend to entire process and operations. Checklists

help control processes

Process Simplification Commonly Used to Track and Manage MR Approval Process: All benchmark

respondents take at least one approach to tracking and managing the market research approval process. Process

simplification is the most common approach, always used by 75% and used “sometimes” by the remainder of

companies.

Simplification: Employ multiple management processes and designs to simplify work flows. Simplifying

“pinch points” in the process seems a high-yield first-stage improvement. Simplification can be achieved

through process design, better rules, checklists and removal of unnecessary and redundant activities.

Less Than 10% of Market Research Projects Have Exceptions at Benchmark Companies: Set exception &

niche market rules to address, document and move forward. High performers, for example, don’t require

honoraria reviews of proposals that use approved rates.

Seventy-nine percent of benchmarked companies report less than 10% exception rates for market research

requests where honoraria requests don’t comply with the standards.

Fifty percent of companies always specify what information should be included to prevent exception

reviews. Forty seven percent of companies develop forms to guide the compliant projects requests while

44% also specify the information to support a non-complying project request.

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Employ Single-Leader Decision Maker Models When Speed Is

Essential to Competitiveness

“(The company) is clear about a single

decision maker. There is a single decision

maker concept. That allows you to move pretty

quickly. . . . At (my previous company) we

had multiple decision makers. You had one

person to say Yes and 11 people who could

say no. . . . At my (current company) the

single decision-maker is the SVP from the

business unit, getting counsel from brand,

legal, compliance or pharmacovigilance.”

-- Marketing Director, Rare Disease

Yes/

No

Review /

Advise

Review /

Advise

Review /

Advise

Review /

Advise

Review /

Advise

Review /

Advise

Yes/

No

Advise

+ Veto

Advise

+ Veto

Advise

+ Veto

Advise

+ Veto

Advise

+ Veto

Advise

+ Veto

Consensus Model = Slower & Less Decisive

Single Decision Maker = Fast & Decisive

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Q. On average, how long does the Market Research project approval process take?

Many companies can move market research projects through the approval process in two weeks or less. Concerns about

adverse events does lengthen the time frame for some, but 90% have approval within a month.

On Average, Market Research Approvals Take 2 Weeks or Less

Time Market Research Approval Process Takes for Average Project

N=15-20

% Two

weeks or

Less

82%

79%

78%

80%

74%

65%

% Respondents

29%

26%

28%

27%

16%

15%

24%

21%

28%

27%

16%

25%

29%

32%

22%

27%

42%

25%

6%

5%

6%

13%

11%

25%

12%

16%

11%

7%

11%

5%

6%

5%

5%

Patients

Physicians

Payers

Specialty pharmacists

Concern about off-label messaging

Concern about adverse event reports

1-2 business days 3-5 business days 1-2 weeks 3-4 weeks

5-8 weeks 9-12 weeks More than 27 weeks

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Q. Do you differentiate the honoraria rates paid to the following respondent types to incent them to participate in market research?

N=19

Rate Differentiation: Working In Rare Disease Markets

In rare diseases, physicians and rare disease specialists are the lone group where a majority uses differentiated

honoraria rates to incent participation in market research. Pharmacists are the research respondents least often

receiving differentiated rates.

Differentiated Rates Are Less Common in Rare Disease Market

68%

42% 32% 32%

26% 21%

32%

58% 68% 68%

74% 79%

Physicians or raredisease

specialists

Payers (focusedon rare disease)

Nurses in rarediseases

Advocacy Groupsfor Rare Disease

Patients in rarediseases

Pharmacistsserving rare

diseases

NO Differentiated Rate Paid for this Respondent Type YES Differentiated Rate Paid for this Respondent Type

% R

esp

on

den

ts

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75%

59%

50%

33%

31%

25%

41%

50%

67%

69%

We regularly try to simplify the process

We track approval times

We use process improvement techniques toimprove review speeds

We set goals for approval speed

We conduct analysis to understand slowreviews

Always Sometimes

Q. What approach do you take to tracking and managing your Market Research approval process?

% Respondents N=8-19

Use of Approaches for Tracking & Managing Approval Process

All benchmark respondents take at least one approach to tracking and managing the market research approval process.

Process simplification is the most common approach, always used by 75% and sometimes by the remainder of companies.

Process Simplification & Project Approval Time Tracking Are Most

Frequent Approaches to Managing Approval Process

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Universe of Learning: Majority of Participants Are Directors

Q. What is your job title?

N=19

This research features data and insights from a wide range of leaders from the pharma industry. Fifty-five percent of

the participants hold director-level positions, 25% of the participants are managers, and 20% percent of participants

hold other positions.

Participant Job Titles

Director/ Associate

Director/ Deputy Director/ Senior

Director, 55%

Head/ Lead, 20%

Manager/ Sr. Manager, 25%

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Companies Are Involved with Specialty Care, Primary Care &

Rare Disease Patient Populations

Q. Which of the following types of patient population does your company support?

N=20

Patient Populations Supported

Specialty care patient populations are the main focus of companies participating in the benchmark study, with 70%

supporting them. More than half the companies support both primary care and rare disease patients.

70%

55% 55%

Specialty Care Primary Care Rare Disease / Orphan DrugDesignation

% R

esp

on

den

ts

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Participants Do MR in U.S., Europe & High-Growth Markets

Q. Within which of the following countries do you actively perform market research?

% Respondents N=20

Other:

Russia, Mexico,

Korea, Canada,

Australia, Brazil,

Turkey,

South Korea,

Netherlands,

All countries

worldwide within

top 20-30.

Geographic Scope

Benchmark participants actively perform market research across the globe, with 95% covering the United States and 60-

70% active in Western Europe. Half cover Japan and 45% do market research in China.

30%

15%

45%

50%

60%

60%

60%

65%

65%

70%

95%

Others

India

China

Japan

Italy

United Kingdom

Brazil

France

Spain

Germany

United States

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About Best Practices LLC About Best Practices, LLC

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Best Practices®, LLC is an internationally recognized thought leader in the field of best practice

benchmarking®. We are a research, consulting, benchmark database, publishing and advisory firm that

conducts work based on the simple yet profound principle that organizations can chart a course to superior

economic performance by leveraging the best business practices, operating tactics and winning strategies of

world-class companies.

6350 Quadrangle Drive, Suite 200

Chapel Hill, NC 27517

(Phone): 919-403-0251

www.best-in-class.com