Market research dominates early-phase spending

By Kirsty Barnes

- Last updated on GMT

Related tags: Clinical trial

Pharmaceutical companies are spending big on market research during
the early stages of drug discovery.

Regardless of whether they are promoting a future blockbuster drug or a small, niche brand, all drug companies tend to spend heavily on market research in early drug development up until Phase II, according to a recent study published by pharmaceutical business intelligence firm Cutting Edge Information.

This is because in the early stages of a drug's development, it is difficult to assess whether the majority of marketing resources should be allocated until a drug's benefits become clearer and a clinical profile is established.

Therefore, a brand team relies heavily on market research during the early stages to identify unmet treatment needs and outline the drug's competitive environment in order to spot potential problem areas that could affect commercial development in the years ahead.

This allows any potential challenges to be tackled by the drug company as early as possible and also allows them to guide the R&D process more effectively towards desired clinical endpoints.

"The project team members we interviewed report that it's nearly impossible, especially in early phase development, to recognise and address key commercial challenges without market research,"​ said Jon Hess, project team leader at Cutting Edge Information.

Because of this, niche and mid-level brands allocate higher percentages of their total commercialisation budget to market research in comparison to blockbusters, as they tend to have fewer overall resources to play around with.

Blockbusters, while still spending as heavily on market research, will usually also spread their resources out and spend more on other categories in early development as well, such as advertising or awareness campaigns, and establishing a connection with the medical community, in order to address potential problem areas.

Between pre-clinical and phase II, niche brand teams allocated 53 per cent of their total commercialisation budget to market research, while mid level brands spent 42 per cent and blockbusters only spent 38.5 per cent, according to the report "Pharmaceutical Product Commercialization: Pre-Clinical to Phase III Resource Allocation".

Related products

show more

Laboratory Solutions for COVID-19 Clinical Trials

Laboratory Solutions for COVID-19 Clinical Trials

Q2 Solutions | 10-Jun-2020 | Clinical Study

As a leading laboratory services organization for trials across the globe, we are proud to partner with clients to support COVID-19 clinical trials. Our...

Parents as Gatekeepers for Children with Cancer

Parents as Gatekeepers for Children with Cancer

PRA Health Sciences | 08-Jun-2020 | Technical / White Paper

The RACE for Children Act will require new drugs intended for adult cancer treatment to also be studied in pediatric cancers when the molecular target...

Related suppliers

Follow us


View more