If You Build It, Will They Come? Addressing The Value Equation

Posted March 12th, 2019 by Ankit Mahadevia, in From The Trenches, Pharma industry, Pricing and Policy

This blog was written by Ankit Mahadevia, CEO and founder of Spero Therapeutics, as part of the From The Trenches feature of LifeSciVC.

Over my experience building several therapeutics companies, I’ve sometimes observed a Field of Dreams approach to therapeutics: if we build it, they (patients, health system, payors) will come.  Last month’s hearing in Congress on pharmaceutical access, and the overall debate on how to pay for new therapies drives home that adoption of a therapy doesn’t always naturally follow an approval. Articulating the value of each therapy we deliver to the health care system is a critical complement to all of the clinical data we generate to maximize the likelihood that our innovations get to patients who need them.  @LifeSciVC also drives this home in his excellent year in review.  

When’s the right time to think about value?

For those of us developing emerging therapies or picking the right applications for our platforms, it’s natural to defer seemingly downstream considerations about value. We may think it’s possible to defer to our larger colleagues if our therapeutic area is in very high demand, or we ultimately plan for a buyer to take on these complex considerations.  In 2019, however, can we afford to think this way?   Especially for areas in high demand, price vs. value is a major consideration and it’s inevitable that the need for a reasoned, therapy-specific view flows downstream to biotech; further, in a crowded field, having an understanding of value built into the data we deliver is a way to stand out from the crowd.  Also, as more independent biotechs (as we do at Spero) see commercialization as a viable alternative to partnering, the onus is on us even more to engage in the value vs. price discussion in a thoughtful way.

All of these trends suggest that an earlier, targeted investment in understanding our therapies as a solution for the health care system can go a long way; it’s important to consider how your therapy solves the unmet needs of physicians, payers and patients and whether any structural factors exist that may influence that thinking on the way to approval.  Our erstwhile partners have infrastructure dedicated to these topics; however, as the developers of our science we need to own this conversation but with far fewer resources.

At Spero, we have recognized the benefit of understanding the value equation early for each of our three therapies in clinical development.     We have been asked to account for our therapies’ value proposition at all stages of development by our investors, Pharma partners, our clinician and pharmacist partners, and our patients.   We share our lessons learned and practical suggestions as we’ve responded to these asks and advance our lead therapy into pivotal trials.

Suggestions from the Trenches:

Focus on how your therapy solves  key patient and physician problems and what needs to change to enable the solution: We invested time early in understanding three key questions in our therapeutic area of urinary tract infections:  1) what are payers and physicians doing today for patients and where are their pain points 2) how large are the patient populations that our therapy best serves, and  3) what behavioral changes within the broader system are needed, if any, to reach those different segments. This does not require a multi-year, expensive effort; targeted conversations can go a long way.   Early in our lead therapy’s development path, we used our SAB and network to set up discussions with pharmacists, hospital administrators, and plan executives. As we progressed into pivotal trials, we’ve complemented this understanding with targeted research led by an outside firm (of which several good ones exist that balance resource intensity with getting to an actionable answer).  Especially if behavior changes are required in the health system to maximize how patients access a drug, it is very helpful to know what needs to change early on.

Avoid the “good data trap” in designing clinical studies:  In our view, smart trial design is the best way to mitigate the risk that adoption does not naturally follow a drug approval.  While clinical data sufficient for regulatory approval is crucial, marrying this data to value for each stakeholder is the best way we see today to mitigate future barriers for adoption and reimbursement.  We learned early in our discussions framing value that it was important to show benefit in very specific populations of highest unmet need.  This insight helped us construct a pivotal trial for SPR994 that not only included a regulatory path for approval, but included a value message for these targeted populations.   This includes specified analysis in those patient populations of greatest unmet need, as well as secondary endpoints that speak directly to the value of the therapy as seen by payors and health institutions.   

Start conversations early with future partners:  Prior authors in this blog (and we agree) suggest it’s never too early to build a rapport with future BD partners.  Our view is that the same is true in market access: it is never too early to build awareness about your therapy, including providers, payers, patient groups, and policymakers.  Even beyond building a basic framework of value, longitudinal conversations with the physician and patient community starting from when we invested in SRP994 and building as we designed our pivotal study builds trust and has deepened our understanding of what our therapy will deliver.

Looking ahead, the onus on us to prove our therapies’ worth will only get greater. With proper planning, some proactive conversations and data analysis, and smart development decisions, we can address these questions early and hopefully smooth the path of our therapies to the patients that need them.


Many thanks to my Spero colleagues Cristina Larkin and Sharon Klahre for their advice and input into this article



Ankit Mahadevia

Serial biotech entrepreneur and executive
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