• jeffreypkiplinger

Unmet Need

Updated: Nov 21, 2018

When I joined Pfizer in 1988 as a young scientist, Pfizer was number 20 among the world's pharmaceutical firms. I loved everything about the company, especially the shared ambition to develop more first-in-class drugs and so become a top five player. I learned about how the R&D division made decisions about programs and targets and drugs to be chosen for development. One phrase that kept popping up was "unmet need", a partial measure of the scale of the market for a product.

Unmet need was then an estimate and could be somewhat vague. For example, in developing the first drug for erectile dysfunction, Viagra, the company could not estimate the market size because the condition was under-reported. Turns out that if the population believes there's nothing that can be done about a condition, or it's a natural state due to aging, they accept it. If it's accepted and there's a social taboo around it, people don't report it.

When Viagra launched, it changed the size of the market by helping people re-evaluate ED as a treatable health condition, and it made such a splash that it also removed the stigma.

In the 21st century, as everyone tries to figure out what's "wrong" or "broken" about the pharma R&D business (fewer first-in-class treatments, exhorbitant R&D costs, downsizing R&D in favor of commercial development, M&A instead of organic growth, etc), I wondered if the definition of unmet need had changed in some way that reduced the big companies' former pride in growing by discovering and developing new drugs.

It turns out it has. The classic study of unmet need, and how to measure it, revolves around family planning. Since the 1960s, economists and demographers have studied populations of women (usually in Africa and Asia) to understand the demand for fertility regulation. Yes, another first world white male (usually) perspective on what women need and want. At any rate, whether you believe the papers or discredit them as mansplaining, the methods for understanding unmet need have shifted dramatically.

Early on the studies determined the fraction of women who had indicated they had wanted to terminate or forestall pregnancy but had no access to birth control. This resulted in paternalistic demographic goals of increasing contraception rates that were decried by advocacy groups at the 1994 International Conference on Population and Development (ICPD). The measuring task shifted to defining the unmet need for information and services.

So in the mid-90s, talk of unmet need shifted from numbers of patients that could be treated for a condition to understanding the influence of available information and services on the patient-initiated adoption of a treatment. Put this together with the 1997 FDA relaxation of Direct to Consumer (DTC) advertising rules, and pharma marketing departments suddenly had a powerful tool to influence consumer decisions. Companies also increased their efforts to influence insurer's drug formularies. Today it sometimes seems that the primary care physician has little say in what is prescribed, or even in what conditions the patient needs treated.

How does this influence decision making? First-in-class drugs are going to be less profitable, unless a high profile need is available - e.g. cancer. "Me too" drugs are more profitable, if the developer can convince formularies and consumers that their new drug has at least some small advantage. Unmet need is easiest to define for new drugs within a known class.

This is not the only reason the pharma R&D industry has changed. Financial deregulation in the 80s and 90s had a big influence in multiple ways, including the large mergers. Some say it's not the R&D model that's broken, it's just not agile enough in a 100,000 person company. Too bad. Pfizer was an exciting, inspired, and fun place to work as a young scientist in 1988. Now, with hindsight, I can better appreciate that bold and creative environment.


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