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Medicinal Product Line Outsourcing: an Option Worth Considering? – Part I

The Opportunity

Change creates opportunity, so they say. Well, here’s one change that might benefit – if handled right – the medicine originator, the service provider and, most importantly, the patient by just moving the responsibilities of an entire medicinal product line into different hands.

What opportunity am I talking about – as outsourcing itself is neither new nor terribly exciting?

Well, I’m sure you have been noticing a fair number of outsourcings of specific tasks such as eCTD submissions or QPPV (Qualified Person Responsible for Pharmacovigilance)activities by pharma. This might be, for example, to cover high peak demands, getting access to specialists or for exploring alternative markets. But what about outsourcing ‘end of life’ or less profitable products or entire product lines?

A single medicine or an entire product line will naturally reach a point in its lifecycle, after all, when the original investment has been recouped, the vast proportion of profit extracted as a result, and market maturity has long been reached. Further business opportunities are limited and attention is drawn to products that make more (financial) sense. And should resources be scarce, then this will certainly end the life of the product concerned. Never mind that Unexpected Adverse Drug Reactions for example have to be taken care of.

Should a decline in profit be the end of a medicinal product?

Reaching this stage in medicinal product life cycle, a fair number of companies would rather retire or withdraw the product than continue offering a medicine low on profit and high on overheads. After all, this is a business and profits have to be made. But there comes a tipping point when covering compliance with latest regulations, ‘housekeeping’ in terms of drug safety and other overheads to keep the product on the market, starts to eat away at the last bits of revenue sought.

But just withdrawing the product might not be such a smart move, as there is definite value for all parties concerned, especially the patient. Wouldn’t it be kind of foolish to deny yourself and your patients such a benefit?

So why not take this opportunity off the originator’s hands from this point forward? Doesn’t supporting mature products to extract all remaining potential make better sense for all parties concerned? Wouldn’t it be more economical to support new and/or developing markets or finding economies of scale that maybe weren’t possible before? The opportunities seem endless and rather appealing.

And that is where ‘Medicinal Information Management’ comes in. What do I mean by that? Medicinal Information Management or MIM is much more than Regulatory Information Management or RIM as we are looking at the entire life cycle of the drug, possible new undiscovered markets, maybe alternative product strength or form of administration, not only regulatory requirements and/or changes. This also extends into new areas of product marketing, whether in new regions or new target markets.

So how would ‘Medicinal Information Management’ work? Third parties would engage in dialogues with pharma companies, looking to take their mature, less profitable products off their hands, paying a royalty and looking to extract all the remaining potential of the material. That third party can look, for example, to put this into new or developing markets or find economies of scale that maybe someone else wouldn’t. This is good economics; there is no need to let something ‘die’ that still has potential to give back to investors and patients at the same time.

Part II of this blog will look at how to overcome the challenge of doing all of the above effectively.


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