Market Analysis for Life Science Start-ups
Part One: What you need to Get Funding and Plan for the Future
Carolyn Siegal
Principal, Siegal Consulting
carolyn@siegalconsulting.com
626-798-8700
www.siegalconsulting.com
MARKET ANALYSIS: A CLEAR UNDERSTANDING OF
PRODUCT, COMPETITION AND CUSTOMERS AND HOW
TO GET FROM ONE TO THE OTHER
If you are…..
• Filing an SBIR or similar grant applications
• Raising external capital
• Building a business plan for internal purposes
and decision making
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Market Analysis Overview
Defining the target market
 Market environment
Building a winning target product
profile
 Selecting your market segment
 Product positioning
 Industry trends
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 Distribution channels
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Customer profile
Competitive activity
Pipeline activity
Opportunities and barriers to entry
Sales and marketing methods
Tool kit:
 Situational market analysis (landscape)
 Secondary market research
 SWOT analysis
 Buying process
 Gap analysis
Features and benefits
Cost and reimbursement
Buying process
Map the future
Tool kit:
 Target Product Profile
 Primary market research
 Income forecast
 Competitive Matrix
 SWOT analysis
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Market Research for SBIR Proposals
Questions from the NSF Phase II Commercialization Plan
• What customer needs will be addressed with your product or service?
• Describe who your target customer is. Providing generally-known examples may
be helpful.
• How does the target customer currently meet that need that you are addressing?
Is there is a significant problem that is not yet being addressed?
• What is the business model you plan to adopt to generate revenue from your
innovation?
• Is the target market domestic, international or both?
• What channels would you employ to reach the targeted customer?
• What is the current size of the broad market you plan to enter and the “niche”
market opportunity you are addressing?
• What are the growth trends for the market and the key trends in the industry that
you are planning to target?
• What are the barriers to enter this market?
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Defining Your Market Segment
Not too big…not too small, just right!
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Finding the Right Level
Right Level
• Market share is based on
unmet needs, competitive
attributes, displacement,
buying patterns, customers
• Ex. Neuromodulation for
Urinary Incontinence, 100
thousand patients per year,
Product X can capture the 20%
of the market that is dissatisfied
with Product B
• Unit/demand driven
High Level
• Market $ # is not informative
about competitive advantage
• Ex. Anti-cancer drug sales
were $50 billion in 2009
• Ex. Clinical laboratory analysis
for in vitro diagnostic (IVD)
testing, $39 billion mark in
2008
• Ex. Relapsed, refractory multiple
myeloma, 20 thousand patients
based on patients not responding
to current 1st line standard of care
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Need vs. Nice to Have
• Need
• Information that will inform business decisions
• That shows your market knowledge, expertise
• That dovetails and adds to the knowledge of an expert
• “No data before it’s time”
• Model is more sophisticated than the product
knowledge/stage
• Anticipate the pivot
• Most early stage companies change direction on the
way to market
• Priority vs. budget
• If you don’t have money DIY!!!
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DIY Market Research Resources
Secondary Data
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Clinical literature
Scientific literature
Trade literature
USPTO.gov
SEC.gov
http://report.nih.gov/
clinicaltrials.gov
Competitor websites
Suppliers
Medical Associations/Guidance documents
Trade associations (BIO, AdvaMed, PMC)
Patient advocacy groups (American Cancer
Society)
Government agencies (NIH, CDC, FDA,
DARPA)
Foundations (Gates, Michael J Fox)
Public health (WHO, NICE)
Google
Wikipedia
Primary Data
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Customer and expert interviews
LinkedIn groups
Analyst reports
Association lists and online
survey resources
• Personal network
• Suppliers
• Conference competitive
intelligence
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DIY Starter Kit
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Target Product Profile
Market segment landscape analysis
SWOT
Competitive matrix
Buying process
Also a great foundation for business plan
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Target Product Profile
Product Description/
Mechanism of Action
Primary Indication(s)
Target Patient
Population/
Route of Administration
Dosage and
Administration
Duration of Treatment
Success Criteria
(efficacy) for modeling
purposes only
Very successful
Successful ( for modeling
purposes only)
Minimally Successful ( for
modeling purposes only)
Expected Primary
Endpoint (for modeling
purposes only)
Single Agent Therapy
(3rd Line Relapse/refractory ALL, Mantle
Cell, Waldenström’s
macroglobulinemia,?)
A tissue targeted cytotoxic prodrug that is
bioreduced to PRODUCT (reduced
PRODUCT), a highly potent DNA
topoisomerase II inhibitor.
Phase Ib
Patients with advanced Lymphoid
neoplasms. POC in patient with Multiple
Myeloma. Phase 1b would be a short run in
trial starting on dose level below the phase
1 solid tumor study. Phase II program will
be broad based in areas other than MM if
Product is successful. These include, ALL,
Mantle Cell, Waldenström’s, AML, CLL,
DLBCL, Follicular. Most of these would
require a randomized phase 3 studies and
require at lease 600+ patients. ALL,
Mantle, Waldenström’s would require
single arm studies but these are small
prevalence diseases
Patients with DLBCL, Follicular, Mantle,
Waldenström’s who have failed front-line
and at least one second-line multi-agent
regimen with alkylating agents and/or
Rituximab. Patients with ALL who have
failed at least 1 regimen who are not
candidates for BMT.
Oral
Administered daily (or BID) for 5 days with
nine day rest in a 28 day cycle or daily for 5
days for 2 weeks with 12 days rest. Dose to
be determined from Phase 1 trial in
lymphoid and/or solid malignancy trials.
Up to 6-12 months
Observed response rate (ORR) of > 50%
with RD of > 12 months
This is dependent on the indication selected.
ORR of 40-50% with RD of 10-12 months
ORR of 30% with RD of 7-10 months
ORR 0 – 10% efficacy is not supportive of
further development as a single agent.
Phase I
Preliminary Bioavailability
Phase II
ORR and Duration of Response
(need both endpoints for 3rd line approval)
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Combination Therapy
(2nd Line in MDS, Mantle, CLL,
DLBCL, ?? )
Same
Phase Ib
MTD, DLT, PK/PD, Safety in combination
with Doxorubicin, Rituximab (?),
Fludarabine (?), lenalidomide (?) in selected
population of Lymphoid neoplam
Dependent on indication selected from
phase 1 and/or Product development
Phase 2
As above in a randomized phase II
In combination with chemotherapy or
biologic who have failed frontline therapy
or after first relapse.
Oral
Administered daily (or BID) for 5 days with
nine day rest in a 28 day cycle or daily for 5
days for 2 weeks with 12 days rest. Dose to
be determined from Phase 1b combination
trial in lymphoid neoplasm trial.
Up to 6-12 months
ORR of > 80% with a PFS of > 12 months
ORR of 50-60% with a PFS of 10-12
months
ORR of 45% with PFS of > 10 months
ORR of 0 – 10% efficacy is not supportive
of further development in combination.
Phase I
Phase II
ORR and Duration of Response
(need both endpoints for 1 st or 2nd line
approval)
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Market Segment - Landscape
Analysis
• Merges situational analysis and mapping/landscapes
• Key market attributes
• Epidemiology/demographics
• Market behaviors
• Trends
• Key competitive attributes
• Competitive matrix
• SWOT of your Target Product Profile
• Map products against market attributes
• Drivers and hurdles
• Validate assumptions from secondary and primary market
research
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Market Landscape Analysis
Tyrosine Kinase Inhibitors in Acute Myelogenous
Leukemia
Likely Impact on Standard of Care
Low
Medium
Tipifarnib
Phase III
High
Lestaurtinib
Product
Phase II
Phase I
Sorafenib
Tandutinib
Sunitinib
No combination data available for sunitinib, tipifarnib will not directly address flt3 mutant but overall benefit in
first line may impact treatment selection
FLT3
Other MTKI w/ flt3
Other targeting
10/11/2011
selective
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SWOT
• Strategic planning method
• Project/Product/Business Venture
• Factors that are helpful vs. harmful to achieving business
objective
• Internal factors
• Strengths
• Weaknesses
• External factors
• Opportunities
• Threats
• A way to summarize hurdles and opportunities in one page
• Do before market research to see what you are missing
• Do after market research to summarize what you learned
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REMICADE – SWOT Analysis
Weakness
Strengths
• Largest number of approved indications, including a pediatric label
in Crohn’s disease
• REMICADE was the only approved drug for Crohn’s disease and
ulcerative colitis for almost 9 years and has an archive of experience
across indications.
• Infusion once in 8 weeks limits office visits and improves patient
convenience.
• As it is administered at a hospital/rheumatology clinic, patients
usually do not have reimbursement concerns.
• Robust data supporting remission with full steroid withdrawal
at 1 year for CD; considered gold standard in IBD4
• Chimeric antibody vs. competitor mAbs that are
humanized
• Black box warning of risk of infections especially
tuberculosis
• Being an IV infusion drug, patients have to face
inconveniences of traveling to an infusion center.
• Duration of infusion is long (2 hours)
• Mostly reserved for second-line+ in rheumatoid arthritis,
psoriasis, and ankylosing spondylitis.
Threats
Opportunities
• REMICADE is the only IV anti-TNF and is thought to offer a
faster response than other anti-TNFs
• Strong foothold in Crohn’s disease and ulcerative colitis indications
with robust patient registry data creates an advantage over other
anti-TNFs.
• Cannibalization with SIMPONI IV formulation (Phase
III)8
• Results from HUMIRA 52-week trial in UC induction &
maintenance are pending. If data is positive, HUMIRA
could take away share from REMICADE in UC.7
• Abatacept (ORENCIA) has shorter infusion time (30
min vs. 1 hour for REMICADE) and similar efficacy to
anti-TNFs.
• Due to different MoA, ORENCIA and ACTEMRA are better
positioned to target anti-TNF refractory patients.
• Novel oral drugs in pipeline (JAK, MAPK, SYK
inhibitors)
Sources:1Drugs@FDA – REMICADE Label, 2Jeff Stoll “Is the anti-TNF Market Facing a Seismic Shift?, Scientia Advisors, May 12, 2011, 3Jeffrey G Stoll and Uma Yasothan,
Rheumatoid Arthritis Market – Nature Review – Drug Disc, Vol 8, Sep, 2008, 694, 4“Anti-TNF Treatments and IBD” University of Manitob, 5“Positioning of REMICADE relative to
SIMPONI in leading indication – RA”, PharmaShare, 6“Surveyed Gastroenterologists Indicate That Humira Has Advantages Over Remicade In Maintaining Clinical Remission Of
Crohn’s Disease, Decision Resources, Jan 26, 2009, 7Armuzzi, A. & Pugliese, D., “Adalimumab for ulcerative colitis — is the glass half empty or half full?, Nat. Rev. Gastroenterol.
Hepatol. 8, 249–251 (2011), ” New Therapies in the Management of Rheumatoid Arthritis”, 8Maya H Buch et al., “New Therapies in the Management of Rheumatoid Arthritis”, Curr
Opin Rheumatol. 2011;23(3):245-251
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Reaction
Yield
Purity
Capacity
Processing
Speed
Scale-up
Synthetron™ S3
98%
Highest
1.5 Kg/hour
Fastest
Linear
Microreactor
90%
Good
5 gram/hour
Moderate
Parallel
Batch
76%
Varies
Multi-kg/hours
Slow est
Non-Linear
Extrapolation of experimental results to commercial use
characteristics
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Additional
Requirements
No external cooling
required
Requires cooling &
maintaining 0°C
Cooling capabilities to 40°C & below
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Chemical Synthesizer Competitor Comparison
10/11/2011
Competitive Matrix
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Buying Process
Tailor to your product/your industry
6 stages
• Problem recognition
• Information search
• Evaluation of alternatives
• Purchase decision
• Purchase
• Post-purchase evaluation
Validate your assumptions with secondary
and primary market research
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Treatment Process: RA
RA Patients
1% adult pop, 2.1 million
NSAID
75%, 1.2 million
MTX
15%, 250 K
30-40% of TNF blocker
treated will progress,
annual ~40K
Non-MTX DMARD
or
MTX
2nd TNF Blocker
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MTX
+
+
Non-MTX DMARD
TNF Blocker
Other Biologic
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Under Treatment
75%, 1.6 million
Area
Target Product Profile, identification of commercial challenges
Device to provide visual cues to visually impaired
Commercialization Plan, support in- license agreement
POC rapid diagnostic test, Q Fever
KOL IDS’s to support in-licensing-in-licensing
HDAC-inhibitor, oncology, PTCL, Lung cancer
Top-line competitive clinical assessment to support venture investment
Malignant melanoma
Partnering support; non-confidential docs and exhibit prep
Antibody library generation
Strategic advisor; SBIR companies
Antibody discovery and development, Power wheel chair,
Lyme disease field inoculation, microneedle transdermal
path, Alzheimer therapeutic, cardiac monitoring device,
OCT imaging, early detection for Parkinson's, mobile
wireless ECG, Oncology research tool based on modified Blactam
Pipeline; resource allocation/prioritization
Rheumatoid arthritis
Out-licensing strategic partner assessment, identification
Oncology
Pricing analysis and recommendations for Phase 2 product to support outlicensing
Oncology
Deal comp analysis and recommendations
Cardiac output monitor
Partner identification for out-licensing
Cystic fibrosis
Acquisition opportunity vetting
Oncology, supportive care
Commercial Assessment and Sales Forecast
Pre-clinical TNF Blocker
Analysis of industry standards for SG&A and Product Marketing to support US
sales forecast
Japanese Pharma
Corporate summary for investor review
Lab equipment/process for rapid chemical reaction
processing
Commercialization plan for SBIR grant application
Liposomal formulation , chemotherapy, breast cancer
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Type
10/11/2011
Consulting Projects
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Next Session
• Working group
• Hands-on web time/mentoring
• Pick a “Tool” to focus on.
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