The cost of bringing new pharmaceutical products to market can be astronomical. Pharma companies sometimes spend billions on R&D and multi-phase testing only to come up empty in late-stage trials. That’s a high cost of failure, but it can be mitigated or even prevented with the right tool set for pharma forecasting and planning. This is critical because predictive, accurate pharma forecasting helps organizations run better, from planning next month’s production schedule to strategizing revenue for the next two decades.
Drug developers rely on forecasts to optimize decisions about their R&D and drug development pipelines, and their current and future product portfolios. These analyses can be so complex that they are beyond the capabilities of manual spreadsheet processing. They require forecast process automation plus advanced-analytic modeling and simulation.
That may seem like a big investment, but it pales in comparison to the potential payoffs, which include lower development costs, better R&D-to-market success, and sustained revenue growth. These payoffs are a huge challenge because myriad factors drive rising R&D costs. Meanwhile patent expirations pose a constant struggle to future revenue generation.
Pharma forecasting for drug manufacturers
For drug manufacturers and distributors, forecasts are needed to plan as accurately as possible for volatility in supply and demand, which is driven by emerging market growth, a continually shifting contract manufacturing market, and the advent of new medicines and ingredients. Additional challenges include:
- Complex product and distribution requirements
- Long product-development cycles
- Limited shelf lives
- Multi-stage supply chains
- Difficult to assess new product adoption and revenue
The power of analytics
Whether for R&D or supply chain, pharma companies should be able to compare courses of action to identify ideal risk-reward opportunities. Automated, advanced-analytic software enable data-maturing companies to test ideas virtually.
Drug developers can test and tweak development pipelines and portfolio mixes for optimum profitability, sustainability, safety, and other weighted outcomes. Drug makers and distributors can refine short-term forecasts by sharing and analyzing live-stream data at various junctures in the supply chain.
In both cases, it’s clear that manual spreadsheet modeling has become an inadequate business process for these kinds of critical forecasting and planning endeavors. Maturing organizations must have a single and consolidated view of demand, supply, portfolio mix, and product pipelines. They must take into account promotions, advertising, new product introductions, seasonality, competitor actions, and all of the other drivers that shape accurate short- and long-term pharma forecasting.
Vanguard Software accomplishes these tasks with a single, cloud-based platform on which all teams in the organization see and contribute to forecasts. Teams and users model scenarios, review projections, discuss what-ifs, and align goals with expectations. Features include:
- Advanced-analytic pharma forecasting algorithms that identify patterns, seasonality, anomalies, correlations, and more
- Cognitive method-selection technology that automatically chooses optimal forecast methods and parameters, increasing accuracy and letting business users spend more time on results
- Adjustments & overrides that let Sales and other business users layer in promotions, ad campaigns, and other business activities or events to help shape or refine forecasts
- Automated new product introductions (cannibalization, supersession, comparable forecasting, new store openings, and group forecasting)