ULE Blockbuster 2.0: Eight Ways to Follow that Leadersz Commercial Strategy ing to Thomson Reuters, there are 11 more pro: jected blockbusters launching in 2015, including Bristol-Myers Squibb’s cancer agent Opdivo and Regeneron/Sanof’s cholesterol agent Praluent. Ironically, pharmaceutical companies’ bigger ‘challenge has not been finding but following bloc busters, What ean these companies do for an encore? How can companies successfully follow their own blockbusters when threatened by rivals’ brands or generic competitors, either before or after patent Pharmaceutical companies’ bigger challenge has not been finding but following blockbusters expiry? Pfizer's well-documented struggles to replace its blockbuster Lipitor highlight the immense challenges that many companies faces they pursue “Blockbuster 2.0.” Pfizer tried numerous strategies toreplace or extend the patent life of Lipitor, includ ing combining it with the developmental HDL-rais- ing compound atorvastatin, but ultimately failed, GlaxoSmithKline with its respiratory juggernaut AdvairlSeretide and Sanofi with its gold standard insulin Lantus are among the many companies cur- rently facing this predicament. There are many reasons why companies fail to follow a blockbuster with a Blockbuster 2.0. First and foremost, product has become a blockbuster because it isso well received by market stakehold- ers, especially providers and patients, Iecan be very challenging to improve upon the gold standard, Providers and patients trustand rely on the product and often resist switching. For many doctors, pre- seribing a blockbuster becomes habitual. Payers ‘may have contractual arrangements or financial incentives such as rebates, discounts, or tenders which restriet switching from the blockbuster agent. Branded or generic competitors may offer better or lower-priced alternatives. Strategies for sequel A number of pharmaceutical companies howe have demonstrated effective approaches to reme this situation, Hexe are eight strategies for follow- ing a company’s own blockbuster: Conversion: The most commonly pursued approach is to convert providers and patients into users of the company’s next generation blockbuster. ‘Theclassic example of ths strategy is AstraZeneca's switch from its $6 billion blockbuster heartburn agent Prilosec to Nexium, a closely-related stereo: isomer, According to a 2002 Wall Street Journal report, AZ initiated the “Shark-Fin Project” seven years before the proton-pump inhibitor Prilosec was scheduled to go off-patent. The internal team iden= tified numerous ways to convert Prilosec users to Nexium believers, including conducting head-t- head studies of the ewo products demonstrating Nexium’s better results in gastro-esophageal reflux disease (GERD); legal and regulatory activities t0 protect intellectual property rights; an aggressive advertising campaign to switch “the purple pill” positioning from Prilosec to Nexium and a massive direet-to-consumer marketing campaign. As a result ‘of this highly controversial approach, AZ overcame branded rivals, prevented generic competition, and successfully established Nexium as a $6 billion suc- cessor heartburn drug, Sanofi is currently borrowing a page from AZ’s Blockbuster 2.0 playhaok as it seeks to fend off Deanded and generic rivals for its market-leading basal insulin Lantus. The company is seeking 10 switch diabetic patients to Toneo, its follow-on “next generation of basal insulin.” The company has con- «ducted several head-to-head trials demonstrating the advantages of Tonjeo, featuring a more flexible and sustained dosing profile with reduced hypoglycemic episodes and weight gain. The company is also tak- ing legal actions against potential biosimil petitors and aggressively promoting the product. Despite these steps, analysts expect Tonio to gener- ate only a small fraction of Lantus’ $8 billion in annual sales. To further offset Lantus’ expected sales losses to competitors, Sanofi has broadened its dia betes franchise with new products, including devel ‘oping Lixil.an, a combination of Lanes with itsnew GLP-1 agent Lyxumia, and adding MannKind’s inhaled insulin Af Combinations: Gilead is an expert im combining products to ensure follow-on blockbuster success ‘The company built its HIVIAIDS franchise with its two-fixed dosed combination blockbuster Tru ‘vada, Ic followed that ace with the three-dose com- bination Blockbuster 2.0 Atriplia, which replaced its predecessor as the world’s best-selling HIV ther- apy. Gilead next launched Stribild, a four-ingr cent single-tablet regimen, which has already achieved blockbuster status. The company is apply ing a similar strategy to its HCV franchise, starting with the mega-blockbuster Sovaldi followed by Harvoni, a combination of Sovaldi and the NS5ACommercial Strategy 33 \r PHARMEREC COM Securing Growth for the HER2 Franchise oS STE EE 2010-2011 2012, 2013-2014 20152016 Ii Established standard of care Ml Potential new standard of care Ml Future standard of care Buling on the blockbuster Hercentin for metastatic breast cancer tmBC}, Reche recent launched two follow-on ‘agents: Kadcyia at antbody dug conjugate combining Herceptin and the cytotoxic cemoterapy, ONT, an Perjeta, tobe used i conjunction with Herceptin or Kadcyl inhibitor ledipasvir. Harvoni’s inal blockbuster Revlintid as a launched 1 yearsago, Hui has sales have already eclipsed the first-line multiple myeloma medi- become the world's best-selling, huge quarterly sales of the origi- cine followed by its other agents drug with projected 2015 sales nal molecule Sovalat Thalomid andior Pomalyst. exceeding $13 billion. Transition: Buildingon market Although Pontalyst is a newer, Acquisition: Failing to find a entrenchment and physician more potentfollow-onagent, Cel- TNF blocker to succeed Huta, familiarity of Herceptin for meta- gene wants doctors to prescribe AbbVie was forced to go outside static breast cancer, Roche Rerlimid first since Pomalyst is the theumatology area. The com- launched two follow-on agents: unlikely 10 achieve the block- pany recently acquired Pharmacy Kadeylatrastuzumabemtansine, buster sales of ts predecessor. _clics and its oncology product or DMI), an antibody-drug Indications: AbbVic's Huemira_Inbruvica (brutinib), the frst in conjugate that combines the isthe poster child for maintaining a classof medicines called Beuton HER? inhibition of crastuzumab — thehigh sales of Blockbuster LOby tyrosine kinase (BTK) inhibitors. (the active ingredient found in leveraging eight different indica- _AbbVie has publicly committed to Herceptin),and the eytotoxicche- tions, including rheumatoid arthri- its pipeline-in-pill strategy with motherapy, DMIs and Perjeta, tis, psoriasis, and Crohn's disease. Imbruvica, which already has which can he used in conjunction In 2010, Humes US Commercial four of its own FDA-approved with Herceptin or Kadeyla. These Leader Jeffrey Stewart was quoted indications. two fllow-onagentsand a poten- as saying, “We're the only self- Acquisition of porential Block tial bundling of Roche's HER2 injectable TNF (tumor necrosis buster 2.0 produets or comple~ breast cancer drugs represent a factor) inhibitor in the category mentary agents in the same thera- critical anti-biosimilar defense that works across the bones, skin, —_peuticarea isan approach used by strategy for Roche. As shown in andthe gu.” More recently, Elaine many companies. For years, AZ. the chart above, Roche isencour- Sorg, VP, US Immunology at has marketed the $3.5 billion aging oncologists prior to the — AbbVie, said "Humira is the only respiratory blockbuster Symbi launch of Herceptin biosimilarsto biologic with such breadth ofindi- cort, an inhaled corticosteroid! transition t0 using the two new cations.” Humira’s U.S. product long-acting beta agonist (IC agents instead of Herceptin. label literally lists these eight indi- LABA). As competitors broad: Priortization: Some companies cationsasiflisting blockbuster ver- ened their inhaled respiratory sequence next-in-class agents to sions 1.1, 1.2, 1.3, etc. Humira portfolios, AZ responded by mak- follow use of the original block- essentially offers “a pipeline in a ing acquisitions co fill he gaps in Ibuster. In analysts’ meetings, Cel- product,” to paraphrase AbbVie _ its respiratory portfolio. In 2013, iene has prioritized use ofits orig- CEO Rick Gonzalez. Despite being, AZ purchased Peal Therapeutics,2s Commercial Strategy vr PHARMENEC COM Companies must initiate a Blockbuster 2.0 multi- disciplinary team as soon as they recognize their first compound's blockbuster sales potential ‘STAN BERNARD 0, ea, sPresaentot Berar Associates Luc. agobal easy competion consti, He can ‘be ached at seerorekioa eraraassociates uccom, JANET WELLS NEA, Isaserior associate at Bere Assocanes, stecante reacted ot nnet els @ eraraAssooates uccem ‘whose metered dose inhaler (MDI) development pipeline included a long-acting muscarinic amagonist (LAMA},aLAMAILABA combi- nation, and a triple combination {ICS/LABA/LAMA) for chronic obsteuctive pulmonary disease (COPD). Alongside Symbicort, this provided AZ with a fll pore folio, with ee triple being eyed a, a blockbuster on its own, Because the produets would not launch for _nfew years, AZ ako picked up the respiratory portfolio of Almirall and its US partner Actavis, giving AZ.an instant boost from LAMA aclidinium and LAMA/LABA aclidiniuin/formoterol in Europe, ‘The Almirall portolio also con- tains other products which, when paired with AZ’S novel azens in RSD, could provide future resp ratory blockbusters for AZ. Litigation: Neary all compa- nes seek to protect and/or extend the life of theie original block- buster. Vie has hen defending over 200 patents for Hira price {0 ts 2016 parent expiey and has sought an injunetion to block the European Medicines Ageney from releasing detailed clinical trial dara. Similarly, Celgene has actively sought to maintain exelu- sivty for Revlimid beyond its pat ent expiry in 2019, Given thar Revlimid represents the majority ofits sales and profs, Celgene has builea patent fort to protect this drug from generic ri Hybridization: Some compa- nies seek to use several of these strategies simultaneously. GSK ere- ated a new once-daily ICS/LABA (BreofRevar ro convercusers rom | its blockbuster Advair! Seretide (iuticasone/salmeterol) business, which represents over a quarter of the company’s total pharmaceuti- cal revenues. Recognizing the upcoming fragmentation in the ICS/LABA class and thae Breo/Rel- suar would not be able replace all oftherevenues delivered by Advi, GSK created a Blockbuster 2.0 portfolio—all produced in the Ellipea inhaler, which is an opti- nized version of its popular but ‘older Diskus inhaler. GSK acquired a large share in Theravance, part- nering with the company t0 pool R&XD assets and ro ensue rapid development success GSK has worked to develop the broadest portfolio in the respira- tory field, offered in a common device placform, chat includes the first LAMA/LABA to the market inthe US;a triple combination that could be first to marker; and a novel ICS/LAMA combination ‘targeted fora new indication called asthma COPD overlap syndrome. GSK also used litigation in Europe to challenge Sandoz as it brought its own version of salmeterol fat: ceasone in a purple Diskus-like inhaler to the marker. With its landmark studies SUMMIT and SALFORD, GSK is working t0 evolve the respiratory market, pos: sibly carving out cardiovascular mortality asa new indication, and toestablish the healthcare resousce utilization benefits of once-daily treatment withthe Ellpra inhaler, Best practices There are ar Jeast three key learn: ings from companies who have been challenged to find a Block buster 2.0: Accept the challenge: Pharma companies and professionals should not underestimate the difficulty of replacing a bil- lion- dollar agent. As these examples demonstrate, many companies have failed to find successful solution ¢o the Blockbuster 2.0 predicament. Start planning early: Branded rivals will target a potential therapeutic elass blockbuster as soon as they feel threat ened, often as early as devel: ‘opmental Phase I or II1,and may conduct counter launches in the pre-launch period. Similarly, generic companies will seek to acquire a potential block- buster’s active pharmaceuti cal ingredient in Phase 11 and no later than at launch in order to initiate their own counter-strategies. Conse- quently, companies must ini- tiate a Blockbuster 2.0 mult: disciplinary team or task force as soon as they recog- nize their first compound's blockbuster sales potential This internal team should consist of executive manage: ment, marketing, clinical dis covery and development, medical affairs, legal, regula- tory, manufacturing, com petitive intelligence, market research, business develop. ment, and other cross-func tional professionals as appro- priate. Use multiple strategies: The internal team should evaluate the potential Blockbuster 2.0 strategies listed here and oth: ers to find the right mix of options and actions. As Pfizer and other companies ‘can attest, Blockbuster 2.0 failure can be a very painful lesson. @