Often, managers get so involved in their day to day business that they forget to lift their heads long enough to take a breath of air. Fortunately, breathing isn’t an optional activity but developing a strategy for your business is. Failing to stop long enough to develop a strategy for your business can have the same long-term effect as holding your breath too long.
Imclone, a USA based biotech company, has developed an interesting drug called Erbitux that was proving to be an effective drug (in combination with chemotherapy) at fighting colon cancer. The drug moved quickly through some of the Federal Drug Administration (FDA) requirements but had one hurdle to clear before final approval.
Anxious to get their new drug to market and reap the rewards, the owners of Imclone rushed forward headlong into disaster. With their eye clearly on investors, Imclone placed scientists with great credentials on their board rather than pharmaceutical people with credentials with the FDA. Only two of their board members had any pharmaceutical experience at all.
To save money and to speed the FDA approval process, Imclone kept their clinical trials as small as possible. As well, in their continued rush to get FDA approval, Imclone submitted their drug approval application in a rolling format. In other words, parts of the application were still being worked on when the application was submitted.
All of these shortcuts had disastrous (if predictable) results. The sample studies were rejected as being too small and Imclone was requested to send more data. Additionally, to Imclone’s surprise, the FDA has a 45-day deadline on drug applications which Imclone’s rolling format didn’t meet, triggering immediate disqualification of their application.
It turns out that the FDA is like any other customer- they have certain needs that must be satisfied. Given that a mediocre drug sells a million dollars a day (365 million per year in sales) and a blockbuster can sell above 10 million dollars per day (4 billion per year), delays in the drug approval process are costly.
Adding insult to injury, another drug company is in the final phases of clinical trials for their drug and may indeed beat Imclone to the market. This would force Imclone to concede a ‘first in’ advantage in the drug market to a competitor’s product.
It pays to think through the consequences of your poor decisions before you rush full force into making them. Take a deep breath- feel how the oxygen rejuvenates your body. Now, do the same for your business. Take the time to feed your business some oxygen. Plan a time to meet with your management team. Do it regularly, do it offsite, and develop a strategy for your business unit, region or group. No strategy- no future – no fun! – Just Breathe!
When developing your business strategy, remember:
1. You may have several sets of customers (in the example above the FDA, the doctors, the investors and the patients must all be considered customers)
2. Map out the needs of each set of customers and identify any gaps between your offering and their needs.