Demystify Pharma. Vol1: An Introduction To A Typical Pharma Company

Demystify Pharma

Volume 1: An Introduction to a typical Pharma company

Written for the pharma professionals by a pharma professional

By

Dr. Ajay K. Pandit

Demystify Pharma Volume 1: An introduction to a typical pharma company.

Dr. Ajay K. Pandit

Copyright © 2015 Dr. Ajay K. Pandit

Published at Smashwords

About Dr. Ajay Pandit

Dr. Ajay Pandit is a trained physician, a well-published scientist and a business leader in pharma life sciences, medical devices and healthcare industry with over 2 decades of leadership experiences in various roles across US, Europe and Asia. His medical degree is from University of Bombay, India and he has 2 double graduate degrees – MS and an MBA both from Penn State University. He has held leadership roles in the past with companies such as Deloitte Consulting, WellCare Health Plans, Campbell Alliance, GlobalData Publications and Novartis. He has worked extensively with the senior business leaders and CXO-level clients across top global pharma companies in US, Europe and Asia. Dr. Pandit has led teams with 350-400+ healthcare professionals in companies such as GlobalData Publications and Novartis and is passionate about developing and training talent. Dr. Pandit is an avid reader of quantum physics, economics and loves to create hypothetical solutions to real world problems. Dr. Pandit is the author of the Demystify Pharma series of which 2 volumes have been published.

Connect with Dr. Pandit on:

Email: aj_p_72@yahoo.com OR ajpandit@gmail.com

Tel: +91 9820582922

LinkedIn profile: in.linkedin.com/in/ajaypandit1/

Table of Contents

Preface

1. Overview of Healthcare Industry

1.1. Head and Heart:

1.2. Pharma-centric view of the healthcare industry

2. Overview of Pharma Industry

2.1. Based on size

2.2. Based on type of products

2.3. Based on business models

2.4. Based on functional competence

2.5. Based on global footprint

2.6. Based on corporate structure

2.7. Multi-dimensional integrated Pharma view

2.8. Pharma companies

3. A Typical Pharma Company

3.1. Anatomy of a typical Pharma company

3.2. Departments deep dive framework

4. Commercial

4.1. Sales

4.2. Marketing

4.3. Medical Affairs

4.4. Managed Markets

4.5. Business Insights

4.6. Market Research

4.7. Pricing

4.8. Medical Access

4.9. Health economics and outcomes

4.10. Scientific or Medical Writing

4.11. Sales Force Effectiveness Research

4.12. Business Development and Licensing

4.13. How does a Mid to Small Pharma company do all of these functions listed above?

4.14. Summary:

5. Development

5.1. Drug Discovery

5.2. Drug Formulation

5.3. Pre-Clinical Development

5.4. Clinical Development

5.5. Regulatory

5.6. Medical Affairs

5.7. Quality

5.8. How does a mid-size pharma company do all of the functions listed above?

5.9. Summary

6. Manufacturing

6.1. Plant Maintenance

6.2. Sourcing

6.3. Production

6.4. Quality

6.5. Supply Chain and Logistics

6.6. Warehouse Management

6.7. Manufacturing Operations

6.8. Summary

7. Finance

7.1. Stakeholders for Finance

7.2. Stakeholder Needs for Finance

7.3. Finance Organization and Departments:

7.4. How does Finance integrate itself in to business?

7.5. How to partner with Finance at all levels?

8. HR

8.1. Stakeholders for HR:

8.2. Stakeholder Needs for HR:

8.3. HR Organization and Departments

8.4. How does HR integrate itself in to businesses?

8.5. How to partner with HR at various levels

9. IT

9.1. Stakeholders for IT

9.2. Stakeholders Needs for IT

9.3. IT Organization and Departments

9.4. How does IT integrate itself in to Business?

9.5. How to partner with IT?

10. Compliance and Enterprise Risk

11. Communications

12. What does a Pharma company actually do?

12.1. Overview

12.2. Developing products

12.3. Manufacturing products

12.4. Commercializing products

12.5. Business models for Pharma companies

12.6. Typical strategies in a Pharma company

Preface

I wish I knew what I know today 20 years ago. I have often felt this pain and heard it echo from my many industry colleagues over the years especially from those in the pharmaceutical industry. In fact many of us irrespective of the industry could benefit from our experienced peers knowing how the industry landscape is, which are the land mines to avoid, where are the pots of gold located, how to negotiate choppy waters in corporate Pharma, so on and so forth.

After I completed 2 decades in the healthcare industry as a physician, a scientist, a teacher, a patent office analyst, a management consultant, an entrepreneur, a marketing leader and a business leader – the idea for this book originated in a routine conversation with my brother. Being my philosophical sparring partner for decades he had often noticed me bringing up my current events and connecting them with past events and saying how my 20-20 hindsight could have benefitted me big time and changed some of my key decisions and avoided some big cost decisions that I ended up taking. Being a noble heart that he is, he suggested why don’t I write a book that will help bring some of those experiences to the future students of the pharma industry who are just about to start on their own career journeys and equip them with certain data facts that can be used as and when needed in initial stages of their careers. My wife who is generally more pragmatic and emotional than I am, could easily connect that the idea is both doable and connected to what I am passionate about. My mother heard about this plan and blessed it as she did with whatever decisions I have taken in life. My father offered support in his unique way by asking what could go wrong, will this make me happy and am I sure of what I am doing. And last but not the least the 3 little rock stars that I had at home – my 2 darling nephews and a tiny mischievous son both inspired me to be a role model for them as well as reminded me that I was writing this book to make our professional world a better place so that when our kids grow up they can lean on each other, share knowledge and help each other to achieve their full potential. If there is a single person who uses this book to better their professional life then my effort would totally be worth it. Armed with support from my family I started to write this book with the hope that thoughts would flow and they would find their way to those who have a need for it. It is with same love and affection that I have for my kids, that I write this book for our junior colleagues and hope that the readers benefit from it the way it is intended to.

This book is an attempt to level the playing field for all those potential students of pharmaceutical industry who are starting their careers gearing up for jobs in pharma industry. I call everyone associated with the Pharma industry (including myself) a student of pharma industry because this is one of those unique industries where you can easily spend 7 life times and still not learn everything that is to learn. My hope is that after reading this book, a student of pharma industry can prepare for a long rewarding career in an industry that has seen some of the most influential leaders and in an industry that has its heart in the right place.

The book is part of series of book that I have written and I encourage readers to read the entire series that is about pharma industry, healthcare industry and how to build careers within the pharma industry. This book focuses on:

An overview of the healthcare industry and the ecosystem within which Pharma industry operates.

A multi-dimensional classification of the companies in the pharma industry to better understand organizational strategy and positioning of pharma companies.

An anatomical dissection of a typical pharma company and the departments that form the company to better understand operations of a Pharma company.

Understanding Pharma companies’ strategy from publicly available resources.

And finally the role of people in Pharma companies.

If the reader can understand these 4 sections well, then they will enter in the Pharma industry with rock solid awareness of how the company is structured, which jobs are appealing and aligned with their own career plans and how to negotiate life in a pharma company where there are many departments co-existing simultaneously. Such an understanding of pharma companies’ strategy and operations will equip the readers to better compare career opportunities and prep for jobs amongst other things. Of course, it will help them prepare for job interviews which may be an immediate benefit of reading this book.

The book is neither meant to be a text book nor a Ph.D. thesis so most of the places there won’t be references. This does not mean all the ideas are my own – in fact far from it. This book has many ideas that are my own and has many more that are not my own. Many of these ideas are common knowledge in the pharma space and of course some are my own. Most of these ideas were discussed over endless cups of coffee, mugs of beers and barely acceptable cafeteria food with my colleagues who I loved to debate, discuss, argue and have philosophical debates with. I want to thank each and everyone of my colleagues who have burnt a few hours of their life and their grey cells in enlightening me and debating with me. They have allowed me to step in to their brilliant minds and freely examine their ideas as I would some priceless pearls. More importantly they have allowed me to make their every thought my own, which I can happily donate to the global Pharma community. Each precious minute of their life that they gave me along with their own business insights has made this book possible. There are many to mention here, but they all know who they are and they know my gratitude is real. Every colleague who has spend their evening having dinner, drinks with me, every colleague who met me over tea and coffee, every colleague who was with me on my countless hours waiting at the airport or working over the weekend – each one of them has given me something which now belongs to the Pharma community.

If you read this book and happen to be a Pharma industry veteran then it is likely that you can spot opportunities for improvement right away. Please help me help our Pharma community by contributing ideas for improvement and change. Nothing will make me happier than updating this book and issuing a following edition that is a more complete, factual and helpful than the book currently is.

1. Overview of Healthcare Industry

In order to understand pharma industry, let us start with an overview of the healthcare industry. Doing so, will help us understand many different types of organizations that seems to connect with the pharma industry at many levels and the function that they serve. The figure drawn below illustrates what a typical healthcare landscape looks like in any country. In the healthcare industry there are many stakeholders (meaning people/organizations/entities who have some interest in being partially or fully in the healthcare industry):

Patients

Providers (Physicians, hospitals, clinics, emergency rooms, casualty rooms etc) – they provide health care to patients.

Payors (Insurance companies, Medicare, Medicaid, Health insurance providers with travel, car accident etc).

Pharmacies (Chemist and medical shops that fulfil prescriptions for medicines).

PBMS – Pharmacy Benefit Managers.

Retailers – (including wholesalers, distributors etc who form the supply chain).

Policy makers – including health economists and public health experts who form public policies on how healthcare should be delivered to the affected population.

FDA and regulatory authorities.

Medical device companies provide medical devices instead of medicines to the patients. Diagnostic companies provide diagnostic kits to the patients for helping diagnose diseases. Imaging companies help diagnose medical conditions as well.

And there are many more stakeholders who are not listed here but form part of healthcare landscape.

As can be seen from the figure below, some of the stakeholders are at the center of the healthcare universe and some are more peripheral than others.

The key fact here is that for the healthcare industry as a whole, the patient is at the centre of the universe and everything is centered around the patient. If there is no patient, then there is nobody to help out and the whole industry would have no reason to exist. This is an important point to understand because it drives the purpose for almost all health care industry stakeholders. It is very difficult to find a pharma company or a payor company who has not declared their purpose in life to be patient centric.

Because we’re more interested in Pharma companies for purpose of this book, it becomes important to understand how do Pharma companies adopt the patient centric view of the healthcare universe. Pharma companies adopt patient centric view of the healthcare industry by making it their mission to help patients. This is reflected in their mission statements. For eg: Novartis states its mission as Our mission is to care and cure (http://www.novartis.com/about-novartis/our-mission/index.shtml). JNJ Credo one of the most well-known mission statements in Pharma industry states in its first sentence We believe our first responsibility is to doctors, nurses and patients…. (http://www.jnj.com/sites/default/files/pdf/jnj_ourcredo_english_us_8.5x11_cmyk.pdf ). WellCare Health Plans a leading HMO based in the US states its mission as Enhance our members’ health and quality of life (https://www.wellcare.com/aboutus/default). Aetna – one of the largest payors in US states that at the center of its core values it’s the people we serve (http://www.aetna.com/about-us/aetna-values.html). There are many more examples but the patient-centric theme is common in almost all organizations in healthcare industry. Being patient-centered is almost a pole star in an industry that is dynamic, complex and seamless which changes reg

For a developed country with high standard of healthcare almost all the stakeholders on the landscape have well developed business models and work in coordination with the rest of the industry. In a developing country, depending on the state of evolution some parts may be developed and others not